/raid1/www/Hosts/bankrupt/TCR_Public/231004.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, October 4, 2023, Vol. 27, No. 276
Headlines
11824 OCEAN PARK: Case Summary & Three Unsecured Creditors
171 LONE STAG: Case Summary & Two Unsecured Creditors
201 EL CAMINO: Voluntary Chapter 11 Case Summary
255 BUTLER: Case Summary & 19 Unsecured Creditors
48 HIGHLAND SHORES: Case Summary & One Unsecured Creditor
53 EAGLES COVE: Case Summary & Three Unsecured Creditors
AHF PARENT: Moody's Rates $70MM Incremental 1st Lien Loan 'B2'
AN GLOBAL: Seeks to Hire Ordinary Course of Professionals
AT HOME GROUP: S&P Raises Subs Senior Secured Debt Rating to 'CCC'
BENTTREE CUSTOM: Hires Allen Jones & Giles as Counsel
BITNILE METAVERSE: Preferred Stockholders Lose Voting Rights
BLACK STONE: Case Summary & Three Unsecured Creditors
BPI SPORTS: Tarek Kiem of Kiem Law Named Subchapter V Trustee
CALLON PETROLEUM: Moody's Hikes CFR to B1 & Unsecured Notes to B2
CANO HEALTH: Names Eladio Gil as Interim Chief Financial Officer
CCM MERGER: Moody's Affirms 'B1' CFR & Alters Outlook to Negative
CELSIUS NETWORK: Reaches Settlement on Chapter 11 TRO Changes
CENERGY LLC: Court OKs Cash Collateral Access Thru Feb 2024
CHATHAM COMMUNICATIONS: Unsecureds to Get 100 Cents on Dollar
CLEAR BLUE: Hires Allen Hill Associates PC as Accountant
COHERENT CORP: S&P Alters Outlook to Positive, Affirms 'BB-' ICR
CP IRIS II: Moody's Cuts CFR to B3 & Secured First Lien Loans to B2
CPC ACQUISITION: BlackRock DSF Marks $569,000 Loan at 24% Off
CXOSYNC LLC: Case Summary & 11 Unsecured Creditors
CYTOSORBENTS CORP: To Present at EACTS 2023 in Austria
DERBY BUYER: Moody's Assigns First Time B2 Corporate Family Rating
DIOCESE OF ROCHESTER: Has Plan to Pay Off Abuse Claims
DRAIN SERVICES: Case Summary & 11 Unsecured Creditors
EDGEWATER GENERATION: S&P Cuts Senior Secured Debt Rating to 'B+'
EQUITABLE OF IOWA II: Fitch Affirms 'BB+' Rating on Preferred Notes
FR REFUEL: Moody's Affirms B3 CFR & Rates New $120MM Term Loan B3
FTAI AVIATION: S&P Upgrades ICR to 'B+', Outlook Stable
FTX GROUP: Stanford to Return Entire Millions of Dollars Gifts
FUTURE PRESENT: Court OKs Cash Collateral Access Thru Nov 17
GALAXY NEXT: Delays Annual Report for Year Ended June 30
GAMESTOP CORP: Names Ryan Cohen as CEO
GULFPORT ENERGY: Expands Common Stock Repurchase by 63%
HELIUS MEDICAL: Receives UPC Numbers for PoNS System and Mouthpiece
HELIX ENERGY: Adopts Mandatory Incentive Clawback Policy
HOMES AT LAWRENCE: Hires Bast Amron LLP as Bankruptcy Counsel
HRH FENCHAK: Hires Steidl and Steinberg P.C. as Counsel
IKON WEAPONS: Claims to be Paid From Available Cash
INDIEV INC: Case Summary & 20 Largest Unsecured Creditors
INNOVATION PHARMACEUTICALS: Has $3.2M Net Loss in FY Ended June 30
INTEGRATED VENTURES: Posts $25.5M Net Loss in FY Ended June 30
IPS CORP: BlackRock Debt Strategies Marks $919,000 Loan at 22% Off
IRONMAN LOGGING: Unsecureds to Get $500 per Month for 60 Months
ISOLVED INC: Moody's Assigns First Time B2 Corporate Family Rating
ISOLVED INC: S&P Assigns 'B' Issuer Credit Rating, Outlook Stable
JIREH FITNESS: Aleida Molina Named Subchapter V Trustee
JIREH FITNESS: Court OKs Interim Cash Collateral Access
JT & SON: Court OKs Interim Cash Collateral Access
KING DRIVE: Hires Cunningham Chernicoff as Legal Counsel
LD CONSTRUCTION: Christy Brandon Named Subchapter V Trustee
LEAFBUYER TECHNOLOGIES: Incurs $585K Net Loss in FY Ended June 30
LI GROUP: S&P Affirms 'B' ICR on $50MM Term Loan Prepayment
LIFEPOINT HEALTH: Moody's Rates New $1BB Sr. Secured Notes 'B2'
LONZA GROUP: BlackRock DSF Marks $939,000 Loan at 16% Off
LTL MANAGEMENT: J&J Defends Unit's Use of Texas 2-Step Strategy
MARAVAI TOPCO: S&P Downgrades ICR to 'B', Outlook Stable
MAYVILLE HOLDINGS: Case Summary & 11 Unsecured Creditors
MEDIMPACT HOLDINGS: S&P Assigns 'B+' ICR, Outlook Stable
METROPOLITAN BREWING: Case Summary & 16 Unsecured Creditors
MI OPCO: Moody's Assigns 'B2' CFR & Rates New First Lien Loans 'B2'
MTPC LLC: Court Confirms First Amended Plan
MXP OPERATING: Files Emergency Bid to Use Cash Collateral
NAKED JUICE: BlackRock Debt Strategies Marks 2L Loan at 21% Off
NEW HAVEN TRUCK: Court OKs Cash Collateral Access Thru Oct 31
NUSTAR ENERGY: Fitch Hikes LongTerm IDR to 'BB', Outlook Stable
OFF LEASE ONLY: Wins Cash Collateral Access on Final Basis
PALATIN TECHNOLOGIES: Posts $27.5M Net Loss in FY Ended June 30
PERSHARD INVESTMENTS: Court OKs Interim Cash Collateral Access
PHI GROUP: Delays Filing of Annual Report
PRIME CORE: Redaction of Customer Names in Chapter 11 Okayed
REGENCY CONVERSIONS: Case Summary & 20 Largest Unsecured Creditors
REMARK HOLDINGS: Forge New Agreement with Ionic
RENALYTIX PLC: Posts $45.6 Million Net Loss in FY Ended June 30
RESHAPE LIFESCIENCES: $8-Mil. Securities Offering Now Effective
ROY BLACKWELL: Case Summary & 20 Largest Unsecured Creditors
SA NW UPSCALE: Case Summary & Three Unsecured Creditors
SALEM MEDIA: Agrees With Lenders to Extend Forbearance Until Nov. 3
SANDY HOOK: Case Summary & Four Unsecured Creditors
SIGNAL HOLDINGS: Voluntary Chapter 11 Case Summary
STARNET LLC: Seeks to Hire Myers Jackson as Auctioneer
SUPPLY CHAIN WAREHOUSES: Court OKs Interim Cash Collateral Access
THORCO INC: US Trustee Says Disclosures Inadequate
TOPPOP LLC: Creditors to Get Proceeds From Liquidation
TRIUMPH GROUP: Moody's Ups CFR to Caa1 & Alters Outlook to Stable
TRUE NORTH CLASSICAL ACADEMY: S&P Assigns 'BB' ICR, Outlook Stable
URBAN ONE: Ernst & Young Stays as Outside Auditor
VG IMPERIAL: Court OKs Cash Collateral Access Thru Jan 2024
WCS PROPERTY: Continued Status Conference Continued Until Oct. 5
WHEEL PROS: Moody's Affirms Caa3 CFR on Debt Exchange Completion
WHITEWATER WHISTLER: Moody's Rates New $500MM Sec. Term Loan 'Ba2'
WINDOW SYSTEMS: Court OKs Cash Collateral Access Thru Oct 10
WISE HEALTH: Fitch Lowers IDR to 'B+', On Watch Negative
WOLVERINE MUTUAL: A.M. Best Cuts Fin. Strength Rating to B-(Fair)
ZYMERGEN INC: Case Summary & 30 Largest Unsecured Creditors
[*] Seyfarth Shaw Launches Servicing/Special Servicing Practice
*********
11824 OCEAN PARK: Case Summary & Three Unsecured Creditors
----------------------------------------------------------
Debtor: 11824 Ocean Park Partners LLC
11824 Ocean Park Blvd.
Los Angeles, CA 90064-2709
Business Description: 11824 Ocean Park is a Single Asset Real
Estate debtor (as defined in 11 U.S.C.
Section 101(51B)).
Chapter 11 Petition Date: October 3, 2023
Court: United States Bankruptcy Court
Central District of California
Case No.: 23-16465
Debtor's Counsel: Matthew D. Resnik, Esq.
RHM LAW, LLP
17609 Ventura Blvd.
Suite 314
Encino, CA 91316
Tel: (818) 285-0100
Fax: (818) 855-7013
Email: mat@rhmfirm.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Ronald L. Meer as president of Bear
Capital Partners, Inc., the Managing Member of Ocean Park Manager,
LLC, the Managing Member of the Debtor.
A full-text copy of the petition containing, among other items, a
list of the Debtor's three unsecured creditors is available for
free at PacerMonitor.com at:
https://www.pacermonitor.com/view/YGYFZJQ/11824_Ocean_Park_Partners_LLC__cacbke-23-16465__0001.0.pdf?mcid=tGE4TAMA
171 LONE STAG: Case Summary & Two Unsecured Creditors
-----------------------------------------------------
Debtor: 171 Lone Stag, Ltd.
340 N. Sam Houston Parkway, Suite 140
Houston TX 77060
Business Description: The Debtor is engaged in activities
related to real estate.
Chapter 11 Petition Date: October 2, 2023
Court: United States Bankruptcy Court
Southern District of Texas
Case No.: 23-33845
Judge: Hon. Eduardo V. Rodriguez
Debtor's Counsel: Leonard Simon, Esq.
PENDERGRAFT & SIMON LLP
2777 Allen Parkway Suite 800
Houston TX 77019
Phone: 713-528-8555
Email: lsimon@pendergraftsimon.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Joe Fogarty as manager and general
partner.
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/LBTCMFQ/171_Lone_Stag_Ltd__txsbke-23-33845__0001.0.pdf?mcid=tGE4TAMA
201 EL CAMINO: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: 201 El Camino Real LLC
66 Barry Lane
Atherton CA 94027
Business Description: 201 El Camino is a Single Asset Real Estate
debtor (as defined in 11 U.S.C. Section 101
(51B)).
Chapter 11 Petition Date: October 3, 2023
Court: United States Bankruptcy Court
Northern District of California
Case No.: 23-30669
Judge: Hon. Dennis Montali
Debtor's Counsel: Barzin Sabahat, Esq.
BY THE LAW, APC
940 Saratoga Ave 112
San Jose, CA 95129
Phone: 408-550-8686
Email: barry@anchorlawgroup.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Nariman Teymourian as manager.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/YACFU6Q/201_El_Camino_Real_LLC__canbke-23-30669__0001.0.pdf?mcid=tGE4TAMA
255 BUTLER: Case Summary & 19 Unsecured Creditors
-------------------------------------------------
Debtor: 255 Butler LLC
255 Butler St.
Brooklyn, NY 11217-3020
Business Description: 255 Butler owns a commercial building
located at 255 Butler Street, Brooklyn,
New York.
Chapter 11 Petition Date: October 3, 2023
Court: United States Bankruptcy Court
Eastern District of New York
Case No.: 23-43575
Debtor's Counsel: Kevin Nash, Esq.
GOLDBERG WEPRIN FINKEL GOLDSTEIN LLP
125 Park Ave
New York, NY 10017-5690
Email: knash@gwfglaw.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Margaux Levy as manager.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/6GUDNXA/255_Butler_LLC__nyebke-23-43575__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 19 Unsecured Creditors:
Entity Nature of Claim Claim Amount
1. 255 Butler Associates, LLC Judgment $36,241,836
c/o Sussam Godfrey LLP
1301 Avenue of the Americas
Fl 32
New York, NY 10019-7736
2. 46 Nelson LLC Loan $114,600
2 East 28th Street
PMB 446
New York, NY 10016
3. 80 Richards Street LLC Loan $633,000
2 East 28th Street
PMB 446
New York, NY 10016
4. BH 402M Realty LLC Loan $76,000
2 East 28th Street
PMB 446
New York, NY 10016
5. Dick Bailey Service Inc. $13,178
5202 3rd Ave Fl 2
Brooklyn, NY
11220-1707
6. Heller Horowitz & Feit PC Legal Services $229,676
260 Madison Ave Fl 17
New York, NY
10016-2410
7. HH 1636 Coney LLC Loan $47,000
2 East 28th Street
PMB 446
New York, NY 10016
8. HH West 20th LLC Loan $112,375
2 East 28th Street
PMB 446
New York, NY 10016
9. HHRE Management LLC Loan $38,000
2 East 28th Street
PMB 446
New York, NY 10016
10. HKA Global LLC $153,631
2005 Market St Ste 820
Philadelphia, PA
19103-7005
11. HR Consultants & Accounting $2,185
Advisors LLC
2701 Avenue K
Brooklyn, NY
11210-3721
12. Idea Nuova Lease Inc. Loan $130,500
2 East 28th Street
PMB 446
New York, NY 10016
13. Internal Revenue Service Taxes Unknown
Centralized Involvency Operations
PO Box 7346
Philadelphia, PA
19101-7346
14. Kalmon Dolgin Brokerage $1,232,145
Affiliates Inc.
101 Richardson st
Brooklyn, NY
11211-1344
15. Maguire Butler LLC Mortgage Loan $13,458,246
c/o Frank Dell'Amore, Esq.
Jaspan Schlessinger &
Narandran LLP
300 Garden City
Plz #5TL
Garden City, NY
11530-3302
16. Morrison Cohen LLP Legal Services $278,000
909 3rd Ave Fl 27
New York, NY
10022-4784
17. NYC Dep't of Finance Taxes $311,850
Legal Affairs
Collection Unit
375 Pearl St Apt 30
New York, NY
10038-1442
18. NYS Dep't of Taxes Unknown
Taxation Bankruptcy/
Special Procedure
PO Box 5300
Albany, NY
12205-0300
19. Seligson Rothman & Legal Services $690,000
Rothman
29 W 30th St Fl 10
New York, NY
10001-4461
48 HIGHLAND SHORES: Case Summary & One Unsecured Creditor
---------------------------------------------------------
Debtor: 48 Highland Shores, Ltd.
340 N. Sam Houston Parkway, Suite 140
Houston TX 77060
Business Description: The Debtor is engaged in activities related
to real estate.
Chapter 11 Petition Date: October 2, 2023
Court: United States Bankruptcy Court
Southern District of Texas
Case No.: 23-33843
Judge: Hon. Jeffrey P. Norman
Debtor's Counsel: Leonard Simon, Esq.
PENDERGRAFT & SIMON LLP
2777 Allen Parkway Suite 800
Houston TX 77019
Phone: 713-528-8555
Email: lsimon@pendergraftsimon.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Joe Fogarty, president and general
partner.
The Debtor listed FDR Consulting as its sole unsecured creditor
holding a claim of $415.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/KRYIP3Q/48_Highland_Shores_Ltd__txsbke-23-33843__0001.0.pdf?mcid=tGE4TAMA
53 EAGLES COVE: Case Summary & Three Unsecured Creditors
--------------------------------------------------------
Debtor: 53 Eagles Cove, Ltd.
340 N. Sam Houston Parkway, Suite 140
Houston TX 77060
Business Description: The Debtor is engaged in activities related
to real estate.
Chapter 11 Petition Date: October 2, 2023
Court: United States Bankruptcy Court
Southern District of Texas
Case No.: 23-33844
Judge: Hon. Jeffrey P. Norman
Debtor's Counsel: Leonard Simon, Esq.
PENDERGRAFT & SIMON LLP
2777 Allen Parkway Suite 800
Houston TX 77019
Phone: 713-528-8555
Email: lsimon@pendergraftsimon.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Joe Fogarty as president and general
partner.
A full-text copy of the petition containing, among other items, a
list of the Debtor's three unsecured creditors is available for
free at PacerMonitor.com at:
https://www.pacermonitor.com/view/KY6APPQ/53_Eagles_Cove_Ltd__txsbke-23-33844__0001.0.pdf?mcid=tGE4TAMA
AHF PARENT: Moody's Rates $70MM Incremental 1st Lien Loan 'B2'
--------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to AHF Parent
Holding, Inc.'s (AHF, the company) $70 million incremental senior
secured first lien term loan due 2028. All other ratings for the
company remain unchanged, including the B2 Corporate Family Rating,
the B2-PD Probability of Default Rating, and the B2 rating on the
existing $215 million original principal amount senior secured
first lien term loan due 2028. The outlook remains negative.
AHF plans to use the proceeds from the incremental $70 million
first lien term loan towards future acquisitions. AHF's "growth
through acquisition" strategy is as an aggressive use of leverage
because it utilizes debt and increases the company's financial
leverage amidst industry headwinds. AHF is also using cash from the
balance sheet to partially fund acquisitions. Persistently high
inflation, rising interest rates, and weakening macroeconomic
conditions is limiting spending on discretionary goods, including
hard flooring products. Moody's estimates AHF's financial leverage
is high with debt/EBITDA (all ratios Moody's-adjusted unless
otherwise stated) at 4.5x as of the last 12 month (LTM) period
ending June 30, 2023 and pro-forma for the incremental term loan.
In addition, the incremental debt follows the company's $22 million
dividend distribution to shareholders during 2Q-2023 that was
funded with cash on hand. The dividend is an aggressive financial
policy move at a time when the industry demand is weak and the
company remains acquisitive.
The ratings are unaffected because AHF maintains a good market
position within the hard surface flooring market. In addition,
Moody's expects that AHF's EBITDA margin will gradually expand,
benefitting from pricing actions and cost deflation, resulting in
debt/EBITDA leverage improving to around 4.0x over the next 12-18
months.
RATINGS RATIONALE
AHF's B2 CFR broadly reflects its good market position in the US
hardwood flooring market, aided by its strong market leading
position in the solid wood flooring (SWF) category, and #2 position
in engineered wood flooring (EWF). The July 2022 acquisition of AFI
meaningfully expanded the company's products into non-wood
categories, particularly into the faster growing luxury vinyl tile
(LVT). In addition, this acquisition diversified the company's end
markets with sales in the commercial segment, which now represent
just over a third of revenue. AHF's large domestic manufacturing
footprint and differentiated brand portfolio with the ability to
service distribution partners without channel conflict are
competitive advantages. AHF's good liquidity is supported by its
cash balance of $17.4 million and about $75 million available on
its ABL revolving facility as of June 30, 2023, as well as the lack
of meaningful debt maturities until the ABL revolver expiration in
2027.
AHF's credit profile also reflects its narrow product focus in the
mature and discretionary hard surface flooring industry. The
hardwood category, which represents about a third of AHF's revenue,
continues to experience gradual declines in market penetration, as
LVT products continue to gain share. AHF's financial leverage is
high with debt/EBITDA at 4.5x as of the LTM period ending June 30,
2023 and pro forma for the incremental term loan, and the company
is exposed to cyclical consumer discretionary spending. High
inflation and higher borrowing costs are negatively impacting
demand for the company's products with categories such as SWF and
EWF down in the 30% range thus far this year. Moody's projects the
company will generate modestly positive free cash flow in 2023,
pressured by anticipated elevated capital expenditures related to
planed automation projects and higher interest expense. The company
has high geographic and customer concentration with sales primarily
in North America and with its top four customers representing about
a third of annual sales.
AHF's ESG credit impact score CIS-4 indicates the company's rating
is lower than it would have been if ESG exposure did not exist. The
score is mainly driven by governance risks associated with its
concentrated control due to majority ownership by private equity
sponsors and aggressive financial strategies including operating
with high leverage, shareholder distributions, and frequent
debt-financed acquisitions. AHF is moderately negatively exposed to
environmental risk.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
The negative outlook reflects Moody's view that demand headwinds
impacting the flooring industry will persist into 2024, the
uncertainty regarding the duration of the current flooring industry
slowdown, and the risk that AHF's profitability could deteriorate
if volume declines persist because of weaker housing trends or
macroeconomic conditions.
The ratings could be downgraded if AHF's revenue or EBITDA weakens,
debt/EBITDA is sustained above 5.0x, EBITDA less capital
spending/interest falls below 1.5x, or if free cash flow is weak or
negative. The ratings could also be downgraded if liquidity
deteriorates for any reason, including reliance on revolver
borrowings, or if the company completes a debt-financed acquisition
or shareholder distribution that increases leverage.
The ratings could be upgraded if the company demonstrates a
consistent track record of organic revenue growth alongside EBITDA
margin expansion, sustains debt/EBITDA below 4.0x and free cash
flow to debt above 7.5%. The company would also need to maintain at
least good liquidity, and Moody's would need to expect balanced
financial policies that support credit metrics at those levels.
The principal methodology used in this rating was Consumer Durables
published in September 2021.
AHF Parent Holding, Inc. (AHF) manufactures and distributes hard
surface flooring in North America to both residential and
commercial end markets. The company's flooring product categories
include solid wood flooring (SWF), engineered wood flooring (EWF),
luxury vinyl tile (LVT), vinyl composite tile (VCT), and stone
polymer core (SPC) flooring products, among others. The company is
headquartered in Mountville, PA, and has 10 manufacturing plants in
the US and 1 in Cambodia. Following the 2022 leveraged buyout
transaction, AHF is majority owned by Paceline Equity Partners and
revenue for the LTM period ending June 30, 2023 is about $911
million, pro forma for acquisitions.
AN GLOBAL: Seeks to Hire Ordinary Course of Professionals
---------------------------------------------------------
AN Global LLC and its affiliates seeks approval from the U.S.
Bankruptcy Court for the District of Delaware to employ ordinary
course of professionals.
The following are the ordinary course of professionals:
Professionals Services
A.M.C.O. Abogados, S.C. Mexico Civil and Commercial
Prado Sur 274 Litigation counsel
Lomas - Virreyes
Lomas de Chapultepec
Miguel Hidalgo
1000 Ciudad de Mexico
CDMX Mexico
Allende & Brea Argentina Legal Counsel
Maipu 1300
CABA (C1006ACT)
Argentina
Alves Strabelli Advogados Brazil Labor Counsel
R. Ferreira de Araujo
202 - 7 andar - Pinheiros
Sao Paulo - SP
05428-000 Brazil
Bello, Gallardo, Bonequi y Garcia, Mexico Immigration Counsel
S.C.
Agustin Manuel Chavez 1 - 001
Santa Fe Zedec Sta Fe
Alvaro Obregon
01210 Ciudad de Mexico
CDMX Mexico
BLP Abogados S.A. Costa Rican Finance Counsel
BLP Building
Via Lindora, 4th Floor
Radial Santa Ana/Belen
Costa Rica
Creel, Garcia-Cuellar, Aiza y Counsel to Chief Executive
Officer
Enriquez, S.C.
Torre Virreyes Pedregal No. 24
Piso 24 Col. Molino del Rey
Ciudad de Mexico, 11040
Epstein Investment Trust Counsel on Certain
Contractual
5 Ledgewood Drive Matters
Dover, MA 02030
L.O. Baptista Advogados Brazil Litigation Counsel
Av. Paulista, 1294
8 andar
01310-100
Sao Paulo Brasil
Marcelo de los Santos y Cia., S.C. Mexico Corporate Counsel
Marcelo de los Santos y Cia., S.C.
San Luis Potosi
Mexico
Mattos Filho Vei a Filho Marre Jr e Brazilian Finance Counsel
Quiro a Advo ados
Alameda Joaquim Eugenio De Lima
N 447, Jardim Paulista,
Sao Paulo, SP
Zip code:01403-001
Brazil
Mauricio Bolaños Delgado Costa Rica Legal Counsel
Centro Corporativo Plaza Roble
Piso 5 Oficinas Regus
Costa Rica
Morano & Sambrizzi Argentina Corporate Counsel
and
Viamonte 377 Legal Representative
8 Piso Acceso Norte
Ramal Tigre 2779
San Isidro, Buenos Aires
Argentina
Olgletree, Deakins, Nash, Smoak & U.S. Immigration Legal
Services
Stewart, P.C.
First Base Building
2142 Boyce St., Suite 401
Columbia, SC 29201
Pacheco & Neach PC Counsel to Chief Executive
Officer
2 Park Plaza, Suite #1000
Irvine, California 92614
Ramon & Cajal Abagados Spain Legal Counsel
Caravela la Niña
12, planta 6
08017 Barcelona
Spain
Ritch Mueller Mexico Tax Counsel
Oscar A. Lopez Velarde
Av. Pedregal 24 piso 10, Molino del Rey
11040 Ciudad de Mexico
Mexico
Roel Abagados Mexico Labor Counsel
Av. P. de la Reforma 369
Cuauhtemoc
06500 Ciudad de Mexico
CDMX
Mexico
Scherianz - Yanes & Asociados Argentina Labor Counsel
Cerrito 1070
3° Piso - Oficina 71
Ciudad de Buenos Aires
Argentina
(C1010AAV)
Severgnini, Robiola, Grinberg & Argentinian Finance Counsel
Tombeur
Reconquista 336 piso 2º
C1003 ABH
Buenos Aires, Argentina
Ulhoa Canto Advogados Brazil Corporate and Tax
counsel
Av. Brigadeiro Faria Lima, 1847
Jardim Paulistano, Sao Paulo - SP
CEP 01452-001 - Brasil
+55 11 3066 3066
About AN Global LLC
AN Global, LLC and affiliates are global providers of agile-first,
end-to-end digital transformation services in the North American
market using on-shore and near-shore delivery.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Lead Case No. 23-11294) on August
28, 2023. In the petitions signed by their chief restructuring
officer, James S. Feltman, the Debtors disclosed $100 million to
$500 million in both assets and liabilities.
Judge J. Kate Stickles oversees the cases.
The Debtors tapped Potter Anderson & Corron LLP and Hughes Hubbard
& Reed LLP as bankruptcy counsels; Garrigues Mexico, S.C. as
general Mexican restructuring counsel; Teneo Capital, LLC as
financial advisor; and Guggenheim Securities, LLC as investment
banker. Kurtzman Carson Consultants, LLC is the claims, noticing
and balloting agent.
Blue Torch Finance LLC is the administrative agent and collateral
agent under the DIP Agreement and under a pre-bankruptcy first lien
facility. It is represented by Ropes & Gray, LLP and Chipman Brown
Cicero & Cole, LLP.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee to represent unsecured creditors in the Debtors' Chapter
11 cases.
AT HOME GROUP: S&P Raises Subs Senior Secured Debt Rating to 'CCC'
------------------------------------------------------------------
S&P Global Ratings corrected its issue-level rating on At Home
Group Inc.'s (At Home) subsidiary At Home Cayman's $200 million
senior secured notes (NewCo notes) by raising it to 'CCC' from
'CCC-'. This change results from the correction of an error in the
associated recovery rating, which S&P revised to '4' from '5'. The
'4' recovery rating indicates its expectation of average (30%-50%;
rounded estimate: 40%) recovery for lenders in the event of a
payment default.
The error relates to the recovery analysis underlying the ratings
S&P originally assigned to the NewCo notes on June 6, 2023. At the
time, it did not consider a structural feature of the NewCo notes
that improves their recovery prospects relative to the other senior
secured first-lien debt in At Home's capital structure.
As part of At Home's distressed exchange transaction in May 2023,
the company established At Home Cayman, a Cayman-based entity,
which it designated as a restricted, nonguarantor subsidiary. At
Home Cayman issued the NewCo notes, which benefit from the same
guarantee and collateral package as At Home Group's other
first-lien debt. As a nonguarantor, At Home Cayman does not
guarantee or pledge its assets to secure At Home's other secured
debt.
S&P said, "The structural feature that boosts recoveries for the
NewCo notes, and which we originally did not take into
consideration, involves an intercompany note. After issuing the
NewCo notes, At Home Cayman lent the proceeds to At Home via an
intercompany note. The intercompany note (an asset of At Home
Cayman and an obligation of At Home) has the same guarantee and
collateral package as, and ranks pari passu with, At Home's other
first-lien debt. Moreover, the intercompany receivable is pledged
as security for the $200 million senior secured notes. As a result,
under our updated analysis, holders of the NewCo notes benefit from
having dual independent claims: the NewCo notes have a claim
against At Home and the guarantor subsidiaries through the
guarantees and asset pledges provided directly by those entities;
and the NewCo notes also benefit from the claim that At Home Cayman
has against At Home and the guarantor subsidiaries by way of the
intercompany note, which is an asset on At Home Cayman's balance
sheet. Our previous analysis did not include the prospective
incremental recovery from the intercompany note and, therefore, did
not differentiate the recovery expectations for the NewCo notes
from the other senior secured debt in the capital structure.
"As a result, we revised our recovery rating on the NewCo notes to
'4' from '5'. In addition, we revised the rounded estimate for
recovery on the remaining senior secured instruments to 20% from
25%, reflecting the incremental claim represented by the NewCo
notes. The 'CCC-' issue-level and '5' recovery ratings are
unchanged."
ISSUE RATINGS - RECOVERY ANALYSIS
Key analytical factors:
The company's capital structure comprises:
-- $675 million asset-based lending (ABL) facility due 2026,
-- $600 million first-lien term loan due 2028,
-- $200 million senior secured notes due 2028,
-- $300 million senior secured notes due 2028,
-- $410 million exchange notes due 2028, and
-- $58 million senior unsecured notes due 2029.
At Home Group Inc. is the issuer of the $600 million first-lien
term loan, $300 million senior secured notes, and $410 million
exchange notes. At Home Group Inc. is also the issuer of a $200
million intercompany note which is held by At Home Cayman. At Home
Cayman is the issuer of the $200 million senior secured notes.
Our simulated default scenario contemplates a default occurring in
2024 stemming from revenue and EBITDA declines because of
ineffective inventory and merchandise management, the loss of its
ability to source low-price merchandise, and an economic slowdown
that reduces consumers' discretionary income. These factors all
lead to a loss of market share and require aggressive promotions
and discounting to move inventory.
S&P said, "Our recovery analysis assumes that in a hypothetical
bankruptcy scenario, the secured lenders benefit from a second lien
on the collateral securing the ABL facility (accounts receivable
and inventory) and a first lien on substantially all of the
company's other assets and stock in its subsidiaries.
"We assume At Home would emerge from a bankruptcy event and value
it on a going-concern basis using a 5x multiple, applied to our
projected emergence-level EBITDA. This is in line with the multiple
we use for other general retailers."
Simulated default assumptions:
-- Simulated year of default: 2024
-- EBITDA at emergence: $172 million
-- Implied enterprise value (EV) multiple: 5x
-- Estimated gross EV at emergence: $859 million
Simplified waterfall:
-- Net EV after 5% administrative costs: $816 million
-- Valuation split (obligors/nonobligors/unpledged): 100%/0%/0%
-- ABL facility (not rated) and other priority claims: $409
million*
-- Total first-lien debt claims:
--NewCo $200 million senior secured notes recovery
expectations: 30%-50% (rounded estimate: 40%)*
--First-lien term loan and senior secured notes recovery
expectations: 10%-30% (rounded estimate: 20%)
-- Senior unsecured debt claims and other non-debt unsecured
claims: $151 million
--Recovery expectations: 0%-10% (rounded estimate: 0%)
*The NewCo debt recovers through the secured guarantee from the
parent and domestic subsidiaries as well as the secured
intercompany note, which is pari passu with the existing senior
secured debt in sharing the existing collateral value. All debts
amounts include six months of prepetition interest.
BENTTREE CUSTOM: Hires Allen Jones & Giles as Counsel
-----------------------------------------------------
Benttree Custom Homes, LLC seeks approval from the U.S. Bankruptcy
Court for the District of Arizona to employ Allen, Jones & Giles,
PLC as its bankruptcy counsel.
The firm's services include:
a. providing the Debtor with legal advice with respect to its
Chapter 11 bankruptcy proceeding;
b. representing the Debtor in negotiations involving
creditors;
c. representing the Debtor at court hearings; and
d. preparing legal papers necessary to assist in the Debtor's
reorganization.
The firm will be paid at these rates:
Thomas H. Allen, Member $485 per hour
Michael A. Jones, Member $485 per hour
Philip J. Giles, Member $450 per hour
David B. Nelson, Associate $325 per hour
Legal Assistants and Law Clerks $175 to $215 per hour
The Debtor paid the firm a retainer of $26,738.
Thomas Allen, Esq., a partner at Allen, Jones & Giles, disclosed in
a court filing that his firm is a "disinterested person" pursuant
to Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Thomas H. Allen, Esq.
David B. Nelson, Esq.
ALLEN, JONES & GILES, PLC
1850 N. Central Ave., Suite 1150
Phoenix, AZ 85004
Tel: (602) 256-6000
Fax: (602) 252-4712
Email: tallen@bkfirmaz.com
dnelson@bkfirmaz.com
About Benttree Custom Homes, LLC
Benttree Custom Homes, LLC, filed a Chapter 11 bankruptcy petition
(Bankr. D. Ariz. Case No. 23-06350) on September 12, 2023,
disclosing under $1 million in both assets and liabilities.
The Debtor is represented by ALLEN, JONES & GILES, PLC.
BITNILE METAVERSE: Preferred Stockholders Lose Voting Rights
------------------------------------------------------------
BitNile Metaverse, Inc., formerly known as Ecoark Holdings, Inc.,
filed Certificates of Amendment on Sept. 28, 2023, to the
Certificate of Designation of Rights, Preferences, and Limitations
with the Nevada Secretary of State with respect to the Company's
Series B Convertible Preferred Stock and its Series C Convertible
Preferred Stock issued in connection with a Share Exchange
Agreement dated Feb. 8, 2023, by and among the Company, Ault
Alliance, Inc. and the other signatories.
The Amended Certificates eliminated the voting rights of the
holders of shares of the Preferred Stock.
About BitNile Metaverse
Founded in 2011, BitNile Metaverse (formerly Ecoark Holdings, Inc.)
-- is a holding company, incorporated in the State of Nevada on
November 19, 2007. Through March 31, 2023, the Company's former
wholly owned subsidiaries with the exception of Agora Digital
Holdings, Inc., a Nevada corporation, and Zest Labs, Inc., a Nevada
corporation, have been treated for accounting purposes as divested.
The Company's principal subsidiaries consisted of (a) BitNile.com,
Inc., a Nevada corporation, which includes the platform BitNile.com
and that was acquired by the Company on March 6, 2023, which
transaction has been reflected as an asset purchase, and (b)
Ecoark, Inc., a Delaware corporation that is the parent of Zest
Labs and Agora.
BitNile.com, Inc. is in the embryonic stage of development yet
represents a significant development in the online metaverse
landscape, offering immersive, interconnected digital experiences
that are engaging, and dynamic.
BitNile Metaverse reported a net loss of $87.36 million on zero
revenue for the year ended March 31, 2023, compared to a net loss
of $10.55 million on $27,182 of revenues for the year ended March
31, 2022. As of March 31, 2023, the Company had $23.77 million in
total assets, $37.72 million in total liabilities, and a total
stockholders' deficit of $13.94 million.
New York, New York-based RBSM LLP, the Company's auditor since
2019, issued a "going concern" qualification in its report dated
July 14, 2023, citing that the Company has suffered recurring
losses from operations and had an accumulated deficit that raises
substantial doubt about its ability to continue as a going concern.
BLACK STONE: Case Summary & Three Unsecured Creditors
-----------------------------------------------------
Debtor: Black Stone Investment Group, LLC
5322 Bellaire Blvd, Suite 445
Bellaire TX 77401
Chapter 11 Petition Date: October 2, 2023
Court: United States Bankruptcy Court
Southern District of Texas
Case No.: 23-33848
Judge: Hon. Marvin Isgur
Debtor's Counsel: William Haddock, Esq.
PENDERGRAFT & SIMON LLP
2777 Allen Parkway Suite 800
Houston TX 77019
Phone: 713-528-8555
Email: whaddock@pendergraftsimon.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Ann Banda as president.
A copy of the Debtor's list of three unsecured creditors is
available for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/5FMZK7A/Black_Stone_Investment_Group__txsbke-23-33848__0001.1.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/4YDEMFY/Black_Stone_Investment_Group__txsbke-23-33848__0001.0.pdf?mcid=tGE4TAMA
BPI SPORTS: Tarek Kiem of Kiem Law Named Subchapter V Trustee
-------------------------------------------------------------
The U.S. Trustee for Region 21 appointed Tarek Kiem, Esq., at Kiem
Law, PLLC as Subchapter V trustee for BPI Sports, LLC.
Mr. Kiem will be paid an hourly fee of $300 for his services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Mr. Kiem declared that he is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Tarek Kiem, Esq.
Kiem Law, PLLC
8461 Lake Worth Road, Suite 114
Lake Worth, FL 33467
Tel: (561) 600-0406
Email: tarek@kiemlaw.com
About BPI Sports
BPI Sports, LLC is a sports nutrition company in Fort Lauderdale,
Fla., which offers supplements, pre-workouts, diets, and fitness
advice.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 23-17463) on Sept. 18,
2023. In the petition signed by Derek Ettinger, authorized
representative, the Debtor disclosed up to $10 million in both
assets and liabilities.
Judge Scott M. Grossman oversees the case.
Eyal Berger, Esq., at Akerman LLP, represents the Debtor as legal
counsel.
CALLON PETROLEUM: Moody's Hikes CFR to B1 & Unsecured Notes to B2
-----------------------------------------------------------------
Moody's Investors Service upgraded Callon Petroleum Company's
Corporate Family Rating to B1 from B2, Probability of Default
Rating to B1-PD from B2-PD and senior unsecured notes rating to B2
from B3, with a stable outlook. The Speculative Grade Liquidity
(SGL) rating remains SGL-2. This rating action concludes the review
for upgrade initiated on May 4, 2023.
"Callon's upgrade reflects the company's improved operating
footprint and around $300 million net debt reduction following its
recent acquisition in the prolific Permian Basin and concurrent
divestment of assets in the Eagle Ford Shale," said Thomas Le Guay,
a Moody's Vice President and Senior Analyst. "The company's
continued focus on applying free cash flow towards debt reduction
should lead to a continued improvement in Callon's financial
profile."
RATINGS RATIONALE
Callon's B1 CFR benefits from the company's scale and focus on the
attractive Permian Basin, with its potential for competitive unit
costs, strong operating margins, and high proportion of liquids in
its production. The company's renewed commitment to reducing debt,
now targeting gross debt of $1.5 billion following the successful
reduction to just under $2.0 billion, will lead to a continued
improvement in Callon's financial profile and contribute to enhance
its resilience through the cycle.
The B1 CFR also reflects Callon's still sizable debt obligations,
significant capital requirements to develop its acreage in the
Permian Basin and maintain production levels and the volatile cash
flow profile inherent to its exposure to highly volatile oil and
natural gas prices.
Callon's SGL-2 rating reflects its good liquidity, supported by
cash flow from operations as well as significant unused capacity
under its revolving credit facility. As of June 30, 2023, Callon
had $528 million of borrowings outstanding on the revolver against
a $1.5 billion elected commitment. The revolver has two financial
covenants - a minimum current ratio of 1x and a maximum leverage
ratio of 3.5x. Moody's expect the company to remain in compliance
with the covenants through 2024. The revolver matures in October
2027. Callon's next maturity of notes will be in July 2026.
Callon's senior unsecured notes are rated B2, one notche below the
B1 CFR, as a result of being subordinated to obligations under the
senior secured revolving credit facility. Callon's debt capital
structure includes the senior secured revolving credit facility
($1.5 billion of elected commitments) and three issues of senior
unsecured notes ($1.57 billion principal amount outstanding as of
August 2023). Significantly higher revolver utilization or a
substantial increase in elected commitments could put downward
pressure on the senior unsecured notes' rating.
The outlook is stable, based on Moody's expectation that the
company will improve its production efficiency, generate positive
free cash flow and continue to reduce debt through 2024.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Callon's ratings could be upgraded if the company grows production
at competitive returns on investment while continuing to reduce
debt. To support an upgrade, the company should maintain a
leveraged full cycle ratio (LCFR) above 1.5x and Retained Cash Flow
(RCF)/debt above 40% in a mid-cycle commodity price environment.
The ratings may be downgraded if there is an increase in leverage
to fund acquisitions or shareholder returns or if the company
experiences a meaningful decline in production. A downgrade could
occur if RCF/debt declines below 25% or if the company fails to
generation positive free cash flow.
Callon Petroleum Company, headquartered in Houston, TX, is a
publicly listed oil and gas exploration and production company with
operations in the Permian Basin in Texas. Average daily production
was 107 Mboe/d in Q2 2023.
The principal methodology used in these ratings was Independent
Exploration and Production published in December 2022.
CANO HEALTH: Names Eladio Gil as Interim Chief Financial Officer
----------------------------------------------------------------
Cano Health, Inc. announced that Eladio Gil has been appointed
interim chief financial officer, effective Sept. 29, 2023.
Mr. Gil, who previously served as Cano Health's vice president of
Medicare Advantage Finance, succeeds Brian Koppy, who has stepped
down to accept an opportunity outside the organization.
Mr. Gil is a seasoned finance executive with more than 30 years of
comprehensive healthcare experience. Before joining Cano Health,
Mr. Gil served as the chief financial officer of Total Health,
where he managed the company's finance and accounting functions, as
well as Management Services Organizations Operations.
Additionally, he has held key finance and business leadership roles
with other major healthcare companies, including as chief financial
officer of CarePlus Health and as vice president of Care Delivery
with Humana. Mr. Gil has also been instrumental in building and
optimizing finance and operations departments during his tenure
with Blue Cross Blue Shield and United Health Plans.
"We are thrilled to welcome Eladio as Interim CFO," said Mark Kent,
chief executive officer of Cano Health. "In my more than 12 years
knowing Eladio, I have witnessed the combination of his extensive
industry experience and finance expertise, including developing and
executing strategies to reduce complexity and ensure balance sheet
stabilization. I look forward to greater collaboration with him as
we work to unlock embedded profitability, reduce complexity, and
create value for shareholders."
Mr. Kent added, "We are deeply grateful to Brian for his exemplary
leadership during his tenure as CFO. His expertise,
professionalism, and poise helped navigate our company through
several pivotal periods of change, including organizational
restructuring and strategic asset divestitures. While we are sad
to see him go, we appreciate his support and dedication to the
company and wish him the very best."
As Interim CFO, Mr. Gil will report directly to CEO Mark Kent. Mr.
Gil is a graduate of Florida International University's School of
Finance and received his CPA certification from the State of
Florida in 2002.
Mr. Gil will be paid a base salary at an annualized rate of
$300,000 and he will be eligible to receive target cash incentive
compensation of 35% of his annualized base salary in respect of the
Company's 2023 fiscal year, subject to the terms of the Company's
2023 Executive Incentive Compensation Program. Mr. Gil will also
be eligible to receive an annual equity award of performance-based
restricted stock units in respect of the Company's 2023 fiscal year
with a target value of $400,000, vesting in shares of the Company's
Class A common stock. In addition, Mr. Gil will be eligible to
receive a $100,000 one-time award of restricted stock units vesting
in shares of the Company's Class A common stock in full on Nov. 10,
2024, the first anniversary of his election as Interim CFO, subject
to his continued employment with the Company or one of its
subsidiaries through such time.
About Cano Health
Cano Health, Inc. (NYSE: CANO) -- canohealth.com -- is a primary
care-centric, technology-powered healthcare delivery and population
health management platform. Founded in 2009, with its headquarters
in Miami, Florida, Cano Health is transforming healthcare by
delivering primary care that measurably improves the health,
wellness, and quality of life of its patients and the communities
it serves through its primary care medical centers and supporting
affiliated providers.
Cano Health reported a net loss of $428.39 million in 2022, a net
loss of $116.74 million in 2021, a net loss of $71.06 million in
2020, and a net loss of $19.78 million in 2019.
Cano Health announced that on Sept. 5, 2023, it was notified by
NYSE Regulation Inc. that it is not in compliance with Section
802.01C of the NYSE Listed Company Manual because the average
closing stock price of a share of the Company's Class A common
stock was less than $1.00 per share over a consecutive 30
trading-day period.
* * *
As reported by the TCR on Aug. 17, 2023, S&P Global Ratings lowered
its issuer credit rating on Medicare Advantage-focused primary care
service provider Cano Health Inc. to 'CCC-' from 'B-'. S&P said,
"We based our negative outlook on our expectation for continued
weak operating performance and cash flow deficits. Given the
company's current liquidity position, we believe there is
heightened risk of a near-term default such as a bankruptcy filing,
debt restructuring, or missed interest payment."
CCM MERGER: Moody's Affirms 'B1' CFR & Alters Outlook to Negative
-----------------------------------------------------------------
Moody's Investors Service affirmed CCM Merger, Inc.'s ratings,
including its Corporate Family Rating at B1, Probability of Default
Rating at B1-PD, Senior Secured Bank Credit Facility rating at Ba2
and Senior Unsecured rating at B3. Moody's also revised the outlook
to negative from stable.
The change in outlook reflects CCM Merger's deteriorating market
position, with slow revenue growth and declining market share.
Although CCM Merger, and the Detroit gaming market in general,
continue to recover from the pandemic, revenue and EBITDA for the
LTM ending June 30, 2023 were still about 20% lower than their 2019
levels. During this period, CCM Merger lost market share to its
larger competitor. In addition, because of the poor operating
results, the company has limited cushion under the leverage
covenant of its credit facility.
RATINGS RATIONALE
CCM Merger's B1 CFR reflects its single asset concentration and
small size in a regional gaming market that is less diversified
than a destination market such as Las Vegas, which benefits from a
mix of tourism, entertainment and conferences. CCM Merger owns only
one casino in Detroit, MI, MotorCity. In addition, in the Detroit
market, CCM Merger competes with larger gaming operators such as
MGM Resorts International (operates MGM Grand Detroit) and PENN
Entertainment, Inc. (operates Greektown Casino). This is evidenced
by CCM Merger's loss of market share over the past few years,
largely to its larger competitor, MGM Grand Detroit. CCM Merger's
market share was 30% at June 30, 2023, compared to 34% in 2019.
Moreover, of the 20 commercial casinos outside of Nevada, MotorCity
experienced the steepest revenue decline year-over-year through
June 2023.
CCM Merger's challenging operating environment resulted in its need
to amend the credit facility to meet the required total leverage
step down schedule at 31 March 2023. Nonetheless, even after the
amendment, the covenant cushion remains modest.
Moody's expects that CCM Merger will continue to generate positive
free cash flow with low capital expenditures and low distributions
to its owner. This will provide the financial flexibility to reduce
debt and improve covenant cushion if needed.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade is unlikely given the negative outlook. A ratings
upgrade is also unlikely without a diversification of the asset
base. In addition, CCM Merger would need to continue to generate
consistent and positive free cash flow and achieve and maintain
debt-to-EBITDA below 3.0x.
CCM Merger's ratings could be downgraded if competition in the
Detroit gaming market increases, EBITDA declines because of volume
pressures or higher operating costs, liquidity deteriorates, or CCM
Merger is unable to maintain debt-to-EBITDA below 4.5x. Further
weakening of the covenant cushion could also lead to a downgrade.
The principal methodology used in these ratings was Gaming
published in June 2021.
CCM Merger, Inc. is privately held. It owns and operates the
MotorCity Casino Hotel in Detroit, Michigan through its subsidiary
Detroit Entertainment L.L.C. MotorCity Casino is one of only three
commercial casinos allowed to operate in the Detroit area. CCM
Merger is owned by the Ilitch family and generated approximately
$390 million of net revenue for the latest 12-month period ended
June 30, 2023.
CELSIUS NETWORK: Reaches Settlement on Chapter 11 TRO Changes
-------------------------------------------------------------
Vince Sullivan of Law360 reports that Celsius Network Ltd. entered
settlement talks with crypto staking firm Stakehound SA in an
effort to resolve proposed changes to a temporary restraining order
that bars Stakehound from transferring assets in the midst of a
$150 million dispute with the debtor.
About Celsius Network
Celsius Network LLC -- http://www.celsius.network/-- is a
financial services company that generates revenue through
cryptocurrency trading, lending, and borrowing, as well as by
engaging in proprietary trading.
Celsius helps over a million customers worldwide to find the path
towards financial independence through a compounding yield service
and instant low-cost loans accessible via a web and mobile app.
Celsius has a blockchain-based fee-free platform where membership
provides access to curated financial services that are not
available through traditional financial institutions.
The Celsius Wallet claims to be one of the only online crypto
wallets designed to allow members to use coins as collateral to
get a loan in dollars, and in the future, to lend their crypto to
earn interest on deposited coins (when they're lent out).
Crypto lenders such as Celsius boomed during the COVID-19 pandemic,
drawing depositors with high interest rates and easy access to
loans rarely offered by traditional banks. But the lenders'
business model came under scrutiny after a sharp sell-off in the
crypto market spurred by the collapse of major tokens terraUSD and
luna in May 2022.
New Jersey-based Celsius froze withdrawals in June 2022, citing
"extreme" market conditions, cutting off access to savings for
individual investors and sending tremors through the crypto
market.
The list of major crypto firms that have filed for bankruptcy
protection in 2022 now includes Celsius Network, Three Arrows
Capital and Voyager Digital.
Celsius Network, LLC and its subsidiaries sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead Case
No. 22-10964) on July 14, 2022. In the petition filed by CEO Alex
Mashinsky, the Debtors estimated assets and liabilities between $1
billion and $10 billion.
The Debtors tapped Kirkland & Ellis, LLP and Kirkland & Ellis
International, LLP as bankrupty counsels; Fischer (FBC & Co.) as
special counsel; Centerview Partners, LLC as investment banker; and
Alvarez & Marsal North America, LLC as financial advisor. Stretto
is the claims agent and administrative advisor.
On July 27, 2022, the U.S. Trustee appointed an official committee
of unsecured creditors. The committee tapped White & Case, LLP as
its bankruptcy counsel; Elementus Inc. as its blockchain forensics
advisor; M3 Advisory Partners, LP as its financial advisor; and
Perella Weinberg Partners, LP as its investment banker.
Shoba Pillay, Esq., is the examiner appointed in the Debtors'
Chapter 11 cases. Jenner & Block, LLP and Huron Consulting
Services, LLC, serve as the examiner's legal counsel and financial
advisor, respectively.
CENERGY LLC: Court OKs Cash Collateral Access Thru Feb 2024
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Wisconsin
authorized Cenergy, LLC and Consumers Cooperative Association of
Eau Claire to use cash collateral on a final basis in accordance
with the budget.
As previously reported by the Troubled Company Reporter, the Debtor
requires the use of cash collateral for reasonable and necessary
costs of operating the Debtors' business.
Oakwood Bank and the U.S. Small Business Administration assert an
interest in the Debtor's cash collateral.
Cenergy LLC is indebted to Oakwood Bank on a single note originally
dated October 11, 2016 (renewed November 29, 2021), with a balance
as of July 31, 2023 of $217,437. The annual interest rate on the
note is 4.50%, with monthly payments of $5,738.
The note is secured by a general business security agreement dated
October 11, 2016, by which Cenergy granted Oakwood Bank a security
interest in substantially all of its assets.
Oakwood Bank perfected its interest in the Oakwood Collateral
through its UCC-l financing statements filed with the Wisconsin
Department of Financial Institutions on October 12, 2016.
The value of the Oakwood Collateral is estimated for purposes of
this cash collateral motion and remains subject to final
determination. As of July 29, 2023, the Debtors combined had
approximately $1.8 Million of inventory and $104,000 of accounts
receivable.
CCA is indebted to the U.S. Small Business Administration, which
made an Economic Injury Disaster Loan to CCA on May 6, 2020, with a
balance as of July 31, 2023 of approximately $148,000. The annual
interest rate on the note is 3.75% with monthly payments of $731.
The SBA note is secured by a general business security agreement
dated May 6, 2020, by which CCA granted SBA a security interest in
substantially all of CCA's assets, including all equipment.
SBA perfected its interest in the SBA Collateral through its UCC-l
financing statements filed with the Wisconsin Department of
Financial Institutions on May 15, 2020.
As of July 29, 2023, the Debtors combined had approximately $1.8
Million of inventory and $104,000 of accounts receivable.
As adequate protection, Oakwood Bank and the SBA are granted
replacement liens, in the same priority and upon the same
classifications of collateral each had pre-petition in the Debtor's
personal property. The Post-Petition Liens are perfected as of the
Petition Date.
As set forth in the Budget, Debtors agrees to continue making
monthly payments to Oakwood Bank of $5,738 and to SBA of $731.
These events constitute an "Event of Default":
-- Any failure to comply with a term or requirement of the Order;
-- The dismissal of these pending bankruptcy cases;
-- The appointment by the Court in any of the bankruptcy cases of
a trustee to perform certain duties generally reserved to a debtor
in possession;
-- Cancellation or lapse of any of the Debtors' insurance policies
that insure the Collateral; and
-- Cessation of normal business operations by Debtors.
A copy of the order is available at https://urlcurt.com/u?l=mFcsAs
from PacerMonitor.com.
About Cenergy, LLC
Cenergy, LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Wisc. Case No. 23-11558) on September
1, 2023. In the petition signed by K. Michael Buck, authorized
individual, the Debtor disclosed up to $10 million in both assets
and liabilities.
Judge Catherine J. Furay oversees the case.
Craig E. Stevenson, Esq., at Dewitt LLP, represents the Debtor as
legal counsel.
CHATHAM COMMUNICATIONS: Unsecureds to Get 100 Cents on Dollar
-------------------------------------------------------------
Chatham Communications Corporation filed with the U.S. Bankruptcy
Court for the Western District of New York a Plan of Reorganization
for Small Business dated September 26, 2023.
The Debtor is a New York State S Corporation founded by Bruce A.
Machlica in August 1985. Chatham provides full-service marketing
communication services and other select capabilities.
The Plan Proponent's financial projections show that the Debtor
will have projected disposable income of $5,000 per month
increasing in increments to $8,000 per month.
The final Plan payment is expected to be paid on February 1, 2029.
This Plan of Reorganization proposes to pay creditors of the Debtor
from cash flow from operations and sale of assets.
Non-priority unsecured creditors holding allowed claims will
receive distributions, which the proponent of this Plan has valued
at approximately 100 cents on the dollar. The Plan also provides
for the payment of administrative and priority claims.
Class 3 consists of Non-Priority Unsecured claims of Bernie
Marquart. Bernie Marquart as holder of such Class 3 Claims,
totaling $244,420 shall be paid 100% of the principal amount of
such claims on the date such claims come due in accordance with the
original contract terms as modified and extended by agreement
between the parties.
Class 4 consists of Non-priority unsecured creditors other than
Class 4. Unsecured claims, other than Class 3 claims, totaling
$516,355, will be paid in full without interest pro-rata from
consecutive equal monthly payments due on the first day of each
month.
Equity security holders of the Debtor shall retain their interests
but shall not receive any distribution under the Plan.
Bruce A. Machlica shall continue to be employed by, own an operate
the business of the Debtor.
The monthly plan payments shall be funded from the Debtor's
continuing business operations.
The Debtor shall sell certain items of its personal property
consisting of sports and entertainment memorabilia and collectibles
sufficient to generate net proceeds of $150,000, within 14 months
of the effective date, and shall distribute the sale proceeds
pro-rata in respect of Class 4 non-priority unsecured claims. Mr.
Machlica is currently in the process of engaging an auction house
that specializes in the sale of historical sports memorabilia.
The Debtor shall sell additional personal property on or before the
payment due dates to satisfy the allowed Class 3 Claims of Bernie
Marquart.
A full-text copy of the Plan of Reorganization dated Sept. 26, 2023
is available at https://urlcurt.com/u?l=LEdF74 from
PacerMonitor.com at no charge.
Attorney for the Plan Proponent:
David H. Ealy, Esq.
Cristo Law Group LLC
Two State Street, Suite 1000
Rochester, NY 14614
Tel: (585) 454-2181
Fax: (585) 454-4026
Email: dealy@trevettcristo.com
About Chatham Communications Corporation
Chatham Communications Corporation provides full-service marketing
communication services and other select capabilities.
Chatham Communications filed a Chapter 11 bankruptcy petition
(Bankr. W.D.N.Y. Case No. 23-20308) on June 28, 2023, disclosing
under $1 million in both assets and liabilities. The Debtor is
represented by David Ealy, Esq., a partner at Trevett Cristo.
CLEAR BLUE: Hires Allen Hill Associates PC as Accountant
--------------------------------------------------------
Clear Blue Pool Supply San Antonio, LLC seeks approval from the
U.S. Bankruptcy Court for the Western District of Texas to employ
Allen Hill Associates, PC as accountant.
The firm will assist the Debtor with preparing financial
statements, monthly operating reports, proformas and account entry
adjustments, prepare quarterly tax returns, and prepare annual tax
returns.
The tax preparation services, both Federal and State, will be
billed at a flat fee of $2,475. For additional accounting services,
the firm will be paid $350 per hour.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
As 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:
Ryan Hill
Allen Hill Associates, PC
907 RR 620 South Suite 302
Austin, TX 78734
Tel: (512) 328-6800
About Clear Blue Pool Supply San Antonio, LLC
Clear Blue Pool Supply San Antonio, LLC sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. W.D. Tex. Case
No.23-51217-cag) on September 6, 2023. In the petition filed by
Aaron J. Thompson, manager, the Debtor disclosed $100,000 in total
assets and $500,000 in estimated liabilities.
Ronald Smeberg, Esq., at Smeberg Law Firm, represents the Debtor as
legal counsel.
COHERENT CORP: S&P Alters Outlook to Positive, Affirms 'BB-' ICR
----------------------------------------------------------------
S&P Global Ratings revised its outlook on Coherent Corp. to
negative from stable and affirmed its 'BB-' ICR as well as its
issue-level ratings on the company's debt instruments.
The negative outlook on Coherent Corp. reflects its S&P Global
Ratings-adjusted leverage of more than 5x and free operating cash
flow (FOCF) to debt of less than 5% as of the end of fiscal year
2023, as well as S&P's expectation for continued weakness in its
leverage and free cash flow metrics during fiscal year 2024.
Although we expect the company will improve its revenue and
profitability in the second half of 2024, the negative outlook
captures the risk that product demand and financial results will
remain volatile and lead it to sustain weaker metrics beyond fiscal
year 2024.
Coherent Corp.'s performance will be challenged over the next 12
months due to inventory digestion in the communications end market.
During fiscal year 2023, the company experienced a pullback in
customer orders because of macroeconomic headwinds in its Datacom
and Telecom segments. The headwinds it is facing from the ongoing
inventory digestion in these segments are in line with those facing
its competitors in the space. Management pointed to the cautious
macroeconomic environment, which is leading some customers to delay
shipments, as the impetus behind the slowdown. S&P said, "We now
expect that Coherent's revenue will decline about 7%-8% in fiscal
year 2024, which will cause its S&P Global Ratings-adjusted
leverage to rise to about 6x by the end of fiscal year 2024. We
note that just above 2x of Coherent's S&P Global Ratings-adjusted
leverage is related to the $2.15 billion Bain Capital investment,
which we treat as debt under our criteria." This investment will
not accrue any cash interest over the first four years as dividends
are payable solely in kind during this time. After the fourth year,
dividends are payable at the company's option in cash, in kind or a
combination of both.
The negative outlook on Coherent Corp. reflects its S&P Global
Ratings-adjusted leverage of more than 5x and free operating cash
flow (FOCF) to debt of less than 5% as of the end of fiscal year
2023, as well as our expectation for continued weakness in its
leverage and free cash flow metrics during fiscal year 2024.
Although S&P expects the company will improve its revenue and
profitability in the second half of 2024, the negative outlook
captures the risk that product demand and financial results will
remain volatile and lead it to sustain weaker metrics beyond fiscal
year 2024.
S&P said, "We could lower our rating on Coherent Corp. if its
performance in fiscal year 2024 is worse than we assume in our
base-case forecast (2024 revenue decline of about 8%, FOCF/debt of
about 4% and leverage in the low-6x area). We could also lower our
ratings if revenue growth is muted in fiscal year 2025 and we
expect it will sustain S&P Global Ratings-adjusted leverage of more
than 5x. This could occur due to a combination of weak demand for
its products or challenges with its ongoing restructuring and
synergy plans."
S&P could revise its outlook on Coherent to stable if it is able
to:
-- Successfully execute its restructuring and synergy plans;
-- Improve its S&P Global Ratings-adjusted leverage below 5x; and
-- Expand its free cash flow such that S&P adjusted FOCF to debt
approaches 10%.
CP IRIS II: Moody's Cuts CFR to B3 & Secured First Lien Loans to B2
-------------------------------------------------------------------
Moody's Investors Service downgraded CP Iris Holdco II, Inc.'s (dba
IPS Corporation) corporate family rating to B3 from B2 and
probability of default rating to B3-PD from B2-PD. At the same
time, Moody's downgraded the senior secured first lien bank credit
facility rating to B2 from B1 and the senior secured second lien
bank credit facility rating to Caa2 from Caa1. The outlook remains
stable.
"The downgrade reflects the company's elevated leverage, which has
been above Moody's expectations since the initial LBO by
Centerbridge Partners in 2021", said Nirali Patel, Analyst, "Credit
metrics are pressured with Moody's-adjusted leverage expected to
remain above 7.0x through 2024".
Governance considerations—including management credibility &
track record as well as compliance and reporting—were a key
driver of the rating action. IPS Corporation has not met its
initial guidance for earnings and leverage from its initial LBO and
has experienced delays in financial reporting and restatements of
financials.
RATINGS RATIONALE
IPS Corporation's B3 CFR reflects its high leverage, exposure to
cyclical residential end markets, and acquisitive growth strategy.
Leverage has remained elevated due to softer volumes from customer
de-stocking, driven by declines in new single-family home starts.
Operating performance is largely dependent on economic activity in
residential and commercial construction, which are inherently
volatile. The company typically uses free cash flow generation for
bolt-on acquisitions to expand operations, which are expected to
continue and will create integration and execution risk.
Providing an offset to IPS Corporation's current credit metrics is
its strong market position as a global leading manufacturer and
supplier of solvent cements, plumbing and roofing products, and
specialty adhesives in a highly fragmented industry. The rating is
further supported by the company's strong EBITDA margin profile due
to the critical nature of its products and its consistent free cash
flow generation as the business has low capital intensity.
Moody's expects IPS Corporation to maintain good liquidity over the
next 12 to 18 months. Cash flow is expected to be positive as the
business is not capital intensive, and Moody's expects excess cash
flow to be allocated to bolt-on acquisitions. Liquidity is also
supported by the $90 million revolving credit facility, which is
undrawn as of June 30, 2023.
The stable outlook reflects the expectation that IPS Corporation
will steadily grow revenue organically, maintain strong operating
performance, generate solid free cash flow, and reduce debt
leverage.
ENVIRONMENTAL, SOCIAL, GOVERNANCE CONSIDERATIONS
Governance considerations are material to IPS Corporation's rating.
Governance factors Moody's considers for IPS Corporation include
its high leverage since the LBO transaction, track record related
to expected performance, delays and restatement of financials, and
concentrated ownership by its PE sponsor Centerbridge Partners.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if the company increases its scale
and demonstrates earnings growth. Moody's could also consider
upgrading the rating if adjusted debt-to-EBITDA maintains below
6.0x, EBITA-to-interest coverage remains above 2.0x, and the
company preserves good liquidity.
The ratings could be downgraded if adjusted debt-to-EBITDA
maintained above 7.0x and adjusted EBITA-to-interest expense is
near 1.0x. A deterioration in liquidity including negative free
cash flow, an aggressive acquisition with additional debt or
significant shareholder return activity could result in downward
rating pressure.
The principal methodology used in these ratings was Manufacturing
published in September 2021.
Based in Compton, California, IPS Corporation is a leading global
manufacturer of solvent cements, plumbing and roofing products, and
specialty adhesives. IPS Corporation is owned by Centerbridge
Partners, a private equity group based in New York City. For the
twelve months that ended June 30, 2023, IPS Corporation generated
$438 million in revenue.
CPC ACQUISITION: BlackRock DSF Marks $569,000 Loan at 24% Off
-------------------------------------------------------------
BlackRock Debt Strategies Fund, Inc has marked its $569,000 loan
extended to CPC Acquisition Corp to market at $429,624,589 or 76%
of the outstanding amount, as of June 30, 2023, according to
BlackRock Debt's Form N-CSRS report for the first half of 2023,
filed with the Securities and Exchange Commission.
BlackRock DSFI is a participant in a Term Loan to CPC Acquisition
Corp. The loan accrues interest at a rate of 9.25% (3-mo. CME Term
SOFR at 0.75% Floor + 3.75%) per annum. The loan matures on
December 29, 2027.
BlackRock Debt Strategies Fund, Inc is registered under the
Investment Company Act of 1940, as amended, as closed-end
management investment companies and is referred to herein
collectively as the Fund.
CPC Acquisition Corp is in the chemicals industry.
CXOSYNC LLC: Case Summary & 11 Unsecured Creditors
--------------------------------------------------
Debtor: CXOsync, LLC
1900 E. Golf Rd.
Suite 500
Schaumburg, IL 60173
Business Description: CXOsync is a corporate event planner which
presents events and workshops. Established
in 2008, CXOsync has planned, populated and
executed thousands of CXO events globally;
events that collaborate corporate leaders
with cutting edge content & solutions in the
fields of IT, Information Security,
Marketing, Finance, Human Resources and
Customer Experience.
Chapter 11 Petition Date: October 3, 2023
Court: United States Bankruptcy Court
Northern District of Illinois
Case No.: 23-13193
Judge: Hon. A. Benjamin Goldgar
Debtor's Counsel: Ben Schneider, Esq.
THE LAW OFFICES OF SCHNEIDER AND STONE
8424 Skokie Blvd Suite 200
Skokie, IL 60077
Phone: (847) 933-0300
Email: ben@windycitylawgroup.com
Estimated Assets: $50,000 to $100,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Rupen Patel as managing member.
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/TULBSWQ/CXOsync_LLC__ilnbke-23-13193__0001.0.pdf?mcid=tGE4TAMA
CYTOSORBENTS CORP: To Present at EACTS 2023 in Austria
------------------------------------------------------
CytoSorbents Corporation will present at the 37th European
Association of Cardio-Thoracic Surgery (EACTS) Annual Meeting in
Vienna, Austria, from October 4-7, 2023, including the second
analysis from the international Safe and Timely Antithrombotic
Removal (STAR) Registry.
The International STAR Registry captures high fidelity data on
real-world clinical use and associated clinical outcomes using
CytoSorb(R) for antithrombotic drug removal (ATR) in the acute
hospital setting. The registry collects cases using CytoSorb to
purify the blood of the major modern antithrombotic agents* such as
Brilinta(R)/Brilique(R), Plavix(R), Effient(R), Pradaxa(R),
Savaysa(R)/Lixiana(R), Xarelto(R), and Eliquis(R) in a variety of
clinical scenarios, but particularly in cardiothoracic surgery,
where the blood thinners can potentially cause serious and even
fatal bleeding. The STAR Registry, not to be confused with the
completed U.S. and Canada STAR-T pivotal trial, is enrolling ahead
of internal projections with plans for ongoing presentations at
large, international conferences.
The first registry analysis entitled, "Insights from the
International Safe and Timely Antithrombotic Removal (STAR)
Registry" was presented at the EuroPCR conference in May 2023, the
largest interventional cardiology conference in the E.U.,
attracting 11,500+ participants this year. This analysis included
67 patients from 7 centers in the U.K. and Germany who underwent
coronary artery bypass graft (CABG) surgery within 2 days of
Brilinta(R) (ticagrelor) administration with a high risk of
perioperative bleeding. The analysis reported no device related
adverse events and low rates of BARC-4 bleeding (6%), reoperation
for bleeding (4%), and 24-hour chest tube drainage (537 ± 231 mL).
BARC-4 bleeding is defined as CABG-related bleeding that includes
at least one of the following: perioperative intracranial bleeding,
reoperation after closure of the chest for the purpose of
controlling bleeding, transfusion of 5 units or more of whole blood
or packed red blood cells within a 48-hour period, or chest tube
output of 2 liters or more within a 24-hour period.
These results compared favorably to the results, referred to in the
presentation, from an often cited analysis of the SWEDEHEART
registry, the national Swedish registry of all patients
hospitalized for acute coronary syndrome or undergoing percutaneous
coronary intervention or heart surgery, published in the European
Heart Journal. In this study, Hannson and colleagues reported an
average 31.4% incidence of severe BARC-4 bleeding in a cohort of
patients who similarly required CABG surgery within 48 hours of
ticagrelor (Brilinta(R)) administration but did not get CytoSorb.
In addition, patients in this cohort had 12-hour chest tube
drainage (CTD) of 813 ± 478 mL and 641 ± 337 mL following CABG
surgery within 24 and 48 hours, respectively, from last ticagrelor
administration, which was more CTD than seen in patients treated
with CytoSorb in the first STAR Registry analysis, yet in only half
the time. In the entire study, which included patients who had a
chance to wash out the drug for more than 5 days prior to surgery
which accounted for approximately 2/3rds of all patients,
reoperations due to bleeding was 6.1%.
The second analysis of the International STAR Registry being
presented at the 2023 EACTS conference, entitled "Intraoperative
hemoadsorption for antithrombotic drug removal during cardiac
surgery: the International Safe and Timely Antithrombotic Removal
(STAR) Registry," summarizes the use of CytoSorb in patients on
blood thinners undergoing a much broader range of heart surgeries
than reported previously, mixing isolated CABG patients with more
complex and invasive procedures at higher risk of perioperative
bleeding including valve replacement, CABG + valve replacement,
aortic surgery, and heart transplant. It also includes, for the
first time, data on patients being treated with CytoSorb to reduce
seven different antithrombotic medications. The analysis is divided
between two groups: 114 patients on antiplatelet drugs including
Brilinta(R) (ticagrelor), Plavix(R) (clopidogrel), and Effient(R)
(prasugrel); and 51 patients on the direct oral anticoagulants
(DOACs) including Eliquis(R) (apixaban), Xarelto(R) (rivaroxaban),
Sayvasa(R)/Lixiana(R) (edoxaban), and Pradaxa(R) (dabigatran). The
overall study population was taken from 8 centers in Germany, the
United Kingdom, Austria, and Sweden.
The antiplatelet analysis focuses on the use of intraoperative
CytoSorb on 114 patients on antiplatelet agents undergoing isolated
CABG (78%), or higher risk cardiothoracic surgeries including valve
replacement, aortic surgery, and heart transplant (22%). The rate
of BARC-4 bleeding for isolated CABG surgery alone was 4.5%, while
overall BARC-4 bleeding was 13.2%, reflecting the higher bleeding
risk of the more complex surgeries and the use of Plavix(R) (17%)
and Effient(R) (3%), historically thought to be irreversible
platelet inhibitors, in 20% of the patients. In the future, in
addition to generating more data on the clinical impact of removing
Brilinta(R)/Brilique(R), the STAR Registry is also expected to help
answer the question of whether CytoSorb can mitigate the bleeding
risk in patients on Plavix(R) and Effient(R) in ways not related to
drug binding to the platelet.
The Direct Oral Anticoagulant (DOAC) analysis reports on the use of
CytoSorb intraoperatively in patients on Eliquis(R) (47%), Xarelto
(27%), Sayvasa(R)/Lixiana(R) (24%), and Pradaxa(R) (2%) undergoing
a more evenly divided set of procedures including isolated CABG
(23.5%), CABG + valve replacement (15.7%), isolated valve
replacement (17.6%), Aortic surgery (15.7%), and other procedures
(27.5%). There was no BARC-4 bleeding in the 12 patients undergoing
isolated CABG surgery, with 15.7% BARC-4 bleeding overall,
reflecting the higher proportion of higher risk and more invasive
surgeries.
The international STAR Registry authors concluded that for this
analysis, for "patients undergoing cardiac surgery before the
recommended washout period, the use of intraoperative
antithrombotic drug removal is associated with lower incidence of
serious bleeding compared with historical rates," and "importantly,
no serious device-related adverse events were observed."
Dr. Efthymios Deliargyris, Chief Medical Officer of CytoSorbents,
stated, "We believe the STAR Registry provides a powerful platform
to systematically collect high quality, real-world outcomes data on
the ability of CytoSorb to reduce perioperative bleeding risk in
patients on a variety of antithrombotic drugs undergoing
cardiothoracic surgery on an international scale. Given that
DrugSorb-ATR uses an equivalent polymer technology as CytoSorb, we
believe the outcomes seen in the STAR registry analysis are
encouraging and provide greater insights into the clinical benefits
of antithrombotic removal that are also investigated in our U.S.
and Canada STAR-T and STAR-D programs."
Other Key Presentations at EACTS
In addition to the STAR Registry analysis, another study was
selected for presentation entitled, "Antithrombotic drug removal
during off-pump coronary artery bypass grafting using
hemoadsorption" highlighting the successful use of CytoSorb, in
conjunction with a simple hemoperfusion machine, to
prophylactically remove Brilinta(R) or Xarelto(R) during off-pump
CABG surgery. According to the study investigators, Mair et al.,
stated, "Decoupling of the hemoadsorber from the cardiopulmonary
bypass machine will open new future indications in various medical
specialties (e.g. trauma, neurosurgery) and in emergency patients
on antithrombotic medication."
Ex Vivo Organ Perfusion
On Sept. 11, Cytosorbents issued a press release highlighting the
growing momentum of ex vivo organ perfusion in organ
transplantation and the vital role CytoSorb and ECOS-300CY are
playing in the burgeoning field. These technologies may help to
improve the quality and number of usable organs while improving
transplant success rates. Importantly, data from recent
peer-reviewed publications highlight how these innovative therapies
may improve outcomes in the specific field of lung transplantation,
the Company said. A full-text copy of the Company's statement is
available at https://tinyurl.com/yueu8w6x
About CytoSorbents
Based in Monmouth Junction, N.J., CytoSorbents Corporation is
engaged in critical care immunotherapy, specializing in blood
purification. Its flagship product, CytoSorb, is approved in the
European Union with distribution in more than 75 countries around
the world as an extracorporeal cytokine adsorber designed to reduce
the "cytokine storm" or "cytokine release syndrome" seen in common
critical illnesses that may result in massive inflammation, organ
failure and patient death.
CytoSorbents reported a net loss of $32.81 million for the year
ended Dec. 31, 2022, a net loss of $24.56 million for the year
ended Dec. 31, 2021, a net loss of $7.84 million for the year ended
Dec. 31, 2020, a net loss of $19.26 million for the year ended Dec.
31, 2019, and a net loss of $17.21 million for the year ended Dec.
31, 2018. As of Sept. 30, 2022, the Company had $62.27 million in
total assets, $23.13 million in total liabilities, and $39.14
million in total stockholders' equity.
The Company has said there is substantial doubt about its ability
to continue as a going concern. The Company expects to raise
additional capital in the future.
As of June 30, 2023, CytoSorbents had $52.4 million in total assets
against $28.3 million in total liabilities.
DERBY BUYER: Moody's Assigns First Time B2 Corporate Family Rating
------------------------------------------------------------------
Moody's Investors Service assigned first-time ratings to Derby
Buyer LLC (dba Derlin), including a B2 corporate family rating and
a B2-PD probability of default rating. Concurrently, Moody's
assigned a B2 rating to the senior secured first-lien credit
facility including a $175 million senior secured first-lien
revolving credit facility and a $700 million equivalent first-lien
term loan facility which will be split into US and Euro tranches.
The outlook is stable.
The proceeds from the term loan, along with $1.2 billion cash and
rollover equity will be applied towards the purchase of Delrin by a
private equity firm, TJC, L.P. from DuPont de Nemours, Inc.
("DuPont") and pay for transaction-related fees and expenses.
DuPont will retain a 19.9% equity interest in Delrin.
ESG was a key driver for this rating action. Moody's assigned an
ESG Credit impact score (CIS) of CIS-4 which reflects the high
governance risk arising from the company's private equity ownership
and environmental and social risk associated with the company's
operations.
RATINGS RATIONALE
Delrin's B2 CFR reflects the company's limited scale, high adjusted
debt/EBITDA (leverage) and carve-out risk associated with its
separation from DuPont. The rating reflects the company's niche
focus on the Acetal Homopolymer ("HPOM") segment - a highly
engineered thermoplastic with large exposure to cyclical end
markets such as automotive and industrial businesses, in addition
to the company's exposure to medical and consumer markets. Moody's
estimates the pro forma leverage (Moody's adjusted) to be 6.2x at
the transaction close. Moody's expects the leverage will reduce
below 6.0x as auto build rates recover over the next 12-18 months.
The ratings are also constrained by the company's limited track
record as a standalone entity and the cost associated with
establishing certain business operations in HR and IT. Customer
concentration is also high with the top 10 customers accounting for
close to 45% of combined sales.
Nonetheless, the rating is supported by Delrin's entrenched market
position as the largest global supplier of HPOM. The highly
engineered and spec'd in nature of the company's products commands
premium pricing and supports a strong EBITDA margin of close to
30%. The rating benefits from its long-standing relationship with
its customers and the critical nature of its certain products,
especially in specialty and high viscosity segments, that creates
high switching costs.
Delrin's liquidity is good based on Moody's expectation of positive
free cash flow and an undrawn $175 million revolving credit
facility. The company is expected to have $5 million of cash at the
transaction close.
The stable outlook reflects Moody's expectation of near-term
recovery in automotive build rates that will enable the company to
resume revenue growth, reducing leverage below 6.0x over the next
12-18 months.
ESG risk considerations include the company's private equity
ownership and risks associated with opportunistic debt-financed
dividends and acquisitions. The environmental and social risk
includes customary items for a business of this type; including
continued investments towards safety and reliability as well as
continued in-process efforts to reduce air emissions, waste and
pollution from its energy-intensive polymer production to maintain
compliance with environmental regulations, reduce downtime and meet
customer demands.
As proposed, the new credit facilities are expected to provide
covenant flexibility that if utilized could negatively impact
creditors. Notable terms include the following: Incremental debt
capacity up to the greater of 100% of closing date EBITDA and 100%
of EBITDA for the most recent four consecution quarters plus an
additional amount subject to first lien leverage ratio that is not
greater than 4.0x. Subsidiaries are only required to provide
guarantees if they are wholly-owned domestic guarantors. This
raises the risk that a sale or disposition of partial equity
interests could trigger a guarantee release, with no explicit
protective provisions limiting such guarantee releases.
There are no express "blocker" provisions which prohibit the
transfer of specified assets to unrestricted subsidiaries; such
transfers are permitted subject to carve-out capacity and other
conditions. There are no express protective provisions prohibiting
an up-tiering transaction.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be downgraded if the company faces execution
challenges as it transitions to a standalone entity. The rating
could also be downgraded if adjusted debt/EBITDA remains above 6.0x
on a sustained basis, operational performance and liquidity
deteriorate such that annual free cash flow reduces to break-even
levels.
The ratings could be upgraded if the company's earnings continue to
grow such that adjusted debt/EBITDA is sustained below 4.5x and the
sponsor demonstrates and commits to a more conservative financial
policy. Good liquidity with consistent positive free cash flow will
also be a consideration for a rating upgrade.
Delrin is a global manufacturer of Acetal Homopolymer (HPOM) with
applications in the automotive, consumer, industrial and medical
sectors. TJC, L.P. will own the majority of the company with DuPont
retaining 19.9% ownership in the company. Revenue for the last
twelve months ended June 2023 was less than $600 million.
The principal methodology used in these ratings was Chemicals
published in June 2022.
DIOCESE OF ROCHESTER: Has Plan to Pay Off Abuse Claims
------------------------------------------------------
The Diocese of Rochester and the Official Committee of Unsecured
Creditors submitted a First Amended Chapter 11 Plan of
Reorganization.
This Plan provides for the financial restructuring of the Diocese
and the settlement of all, or substantially all, Claims against the
Diocese, including, without limitation, the settlement of all Abuse
Claims against the Diocese and the Participating Parties. As set
forth in more detail below, the Plan provides for payment in full
of all Administrative Claims, Priority Tax Claims, Non-Tax Priority
Claims, Professional Fee Claims, and U.S. Trustee Fee Claims,
leaves unimpaired any Allowed Secured Claims or Pass-Through
claims, provides for deferred payments equal to the full Allowed
amount of any General Unsecured Claims, and establishes the Abuse
Claims Settlement Fund to be held by the Trust to compensate
holders of Abuse Claims. Inbound Contribution Claims are disallowed
and extinguished pursuant to the Plan.
The Plan's treatment of Abuse Claims represents the culmination of
nearly 4 years of negotiation between the Diocese and the Committee
in its capacity as an advocate on behalf of all Abuse Claimants and
has been approved by the Committee in consultation with attorneys
who collectively represent approximately seventy percent (70%) of
all Abuse Claimants who have asserted Abuse Claims against the
Diocese ("State Court Counsel"). The Plan provides that funding for
the Trust and the Abuse Claims Settlement Fund will be provided
from, among other potential sources of recovery, a cash
contribution by the Diocese and other Participating Parties in the
aggregate amount of $55 million, and insurance settlement payments
paid pursuant to Insurance Settlement Agreements with various
Settling Insurers. As of the date of this Plan, the Diocese and the
Committee have agreed to accept a total of $71.35 million in
settlement payments from four Settling Insurers, LMI, Underwriters,
Interstate, and First State, in exchange for entering into
Insurance Settlement Agreements with respect to their respective
Insurance Policies.
To the extent the Diocese and the Committee can reach agreement on
an Insurance Settlement Agreement or other settlement terms with
any Non-Settling Insurers prior to confirmation of the Plan, the
Plan provides that such Non-Settling Insurers may become Settling
Insurers and for settlement proceeds resulting therefrom to be used
to further supplement the funds available to the Trust. To the
extent no settlement is achieved, the Plan provides for the
assignment of all Insurance Claims held by the Diocese or other
Participating Parties to the Trust, and establishes a framework for
post-confirmation litigation of Insurance Claims, Stipulated
Judgments and other Litigation Claims seeking recovery from
Non-Settling Insurers. The Committee has previously rejected a
settlement offer from Non-Settling Insurer CNA in the amount of
$63.5 million. The Committee, in consultation with State Court
Counsel representing approximately seventy percent (70%) of all
Abuse Claimants, has acknowledged and accepted the risk inherent in
pursuing post-confirmation recovery from Non-Settling Insurers in
the absence of a settlement. All holders of Claims against the
Diocese are encouraged to read this Plan and the Disclosure
Statement and other Plan Documents in their entirety before voting
to accept or reject this Plan. Among other information, the
Disclosure Statement contains discussions regarding the Diocese,
events prior to and during the Chapter 11 Case, and a summary and
analysis of the Plan. No solicitation materials, other than the
Disclosure Statement, have been authorized by the Bankruptcy Court
for use in soliciting acceptances or rejections of the Plan.
Under the Plan, Class 3 General Unsecured Claims are impaired. The
Reorganized Diocese will pay each holder of an Allowed General
Unsecured Claim, Cash in two installments each equal to 50% of the
Allowed amount of such General Unsecured Claim with the first
payment to occur on, or as soon as reasonably practicable after the
later of (a) the Effective Date, and (b) the date on which such
General Unsecured Claim becomes an Allowed General Unsecured Claim,
and the second payment to occur on, or as soon as reasonably
practicable after the date that is six months after the date of the
first payment. The foregoing payments will be in full satisfaction,
settlement, and release of, and in exchange for, such Allowed
General Unsecured Claim. Notwithstanding anything to the contrary
set forth above, no payments will be made to any Protected Party on
account of any General Unsecured Claim and all Protected Parties
shall be deemed to have withdrawn any General Unsecured Claim with
prejudice as of the Effective Date in consideration of the
Channeling Injunction and Release provided in the Plan. The Trust
will not be responsible for payment of General Unsecured Claims.
All Administrative Claims, Priority Tax Claims, Non-Tax Priority
Claims, General Unsecured Claims, and Pass-Through Claims will be
paid by the Diocese or the Reorganized Diocese. All Abuse Claims
will be paid solely from the Trust to be established for the
purpose of receiving, liquidating, and distributing Trust Assets in
accordance with this Plan and the Allocation Protocol.
Counsel to The Diocese of Rochester:
Stephen A. Donato, Esq.
Charles J. Sullivan, Esq.
Grayson T. Walter, Esq.
BOND, SCHOENECK & KING, PLLC
One Lincoln Center
Syracuse, NY 13202-1355
Telephone: (315) 218-8000
Facsimile: (315) 218-8100
E-mail: donatos@bsk.com
sullivc@bsk.com
walterg@bsk.com
- and -
James R. Murray, Esq.
James Carter, Esq.
1825 Eye Street NW
BLANK ROME LLP
Washington, DC 20006
Telephone: (202) 420-3409
E-mail: jim.murray@blankrome.com
james.carter@blankrome.com
Counsel to the Official Committee of Unsecured Creditors:
James I. Stang, Esq.
Ilan D. Scharf, Esq.
Iain A. W. Nasatir, Esq.
Brittany M. Michael, Esq.
PACHULSKI STANG ZIEHL & JONES, LLP
780 Third Avenue, 34th Floor
New York, ny 10017-2024
Telephone: (212) 561-7700
Facsimile: (212) 561-7777
E-mail: jstang@pszjlaw.com
ischarf@pszjlaw.com
inasatir@pszjlaw.com
bmichael@pszjlaw.com
- and -
Timothy W. Burns, Esq.
Jesse J. Bair, Esq.
BURNS BAIR LLP
10 E. Doty St., Suite 600
Madison, wi 53703
Telephone: 608-286-2808
E-mail: tburns@burnsbair.com
jbair@burnsbair.com
A copy of the First Amended Chapter 11 Plan of Reorganization dated
September 13, 2023, is available at https://tinyurl.ph/gbtJE from
Amazonaws, the claims agent.
About The Diocese of Rochester
The Diocese of Rochester in upstate New York provides support to 86
Roman catholic parishes across 12 counties in upstate New York. It
also operates a middle school, Siena Catholic Academy. The diocese
has 86 full-time employees and six part-time employees and provides
medical and dental benefits to an additional 68 retired priests and
two former priests.
The diocese generated $21.88 million of gross revenue for the
fiscal year ending June 30, 2019, compared with a gross revenue of
$24.25 million in fiscal year 2018.
The Diocese of Rochester filed for Chapter 11 bankruptcy protection
(Bankr. W.D.N.Y. Case No. 19-20905) on Sept. 12, 2019, amid a wave
of lawsuits over alleged sexual abuse of children. In the petition,
the diocese was estimated to have $50 million to $100 million in
assets and at least $100 million in liabilities.
Bond, Schoenec & King, PLLC and Bonadio & Co. serve as the
diocese's legal counsel and accountant, respectively. Stretto is
the claims and noticing agent.
The U.S. Trustee for Region 2 appointed an official committee of
unsecured creditors in the diocese's Chapter 11 case. Pachulski
Stang Ziehl & Jones, LLP and Berkeley Research Group, LLC serve as
the committee's legal counsel and financial advisor, respectively.
DRAIN SERVICES: Case Summary & 11 Unsecured Creditors
-----------------------------------------------------
Debtor: Drain Services Inc.
415 Main Ave E
Ste 691
West Fargo, ND 58078
Business Description: Drain Services offers residential,
commercial, industrial, and municipal pipe
laying and lining to Minnesota, North Dakota
and South Dakota customers. The Debtor
offers sewer and water repair & replacement,
sump pump & drain tile, storm sewer
management, among other services.
Chapter 11 Petition Date: October 2, 2023
Court: United States Bankruptcy Court
District of North Dakota
Case No.: 23-30352
Judge: Hon. Shon Hastings
Debtor's Counsel: Maurice Verstandig, Esq.
THE DAKOTA BANKRUPTCY FIRM
1630 1st Avenue N
Suite B PMB 24
Fargo, ND 58102
Phone: (701) 394-3215
Email: mac@dakotabankruptcy.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $500,000 to $1 million
The petition was signed by Kevin Cameron as vice 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/OPNAQTY/Drain_Services_Inc__ndbke-23-30352__0001.0.pdf?mcid=tGE4TAMA
EDGEWATER GENERATION: S&P Cuts Senior Secured Debt Rating to 'B+'
-----------------------------------------------------------------
S&P Global Ratings lowered its rating on Edgewater Generation LLC's
senior secured debt to 'B+' from 'BB-'. The '2' recovery rating,
indicating its expectation for substantial (70%-90%; rounded
estimate: 70%) recovery in the event of default, is unchanged.
The stable outlook reflects S&P's view that despite the weakness in
the capacity market and large capital spending, Edgewater will
achieve its minimum projected debt service coverage (DSCR) of about
1.27x throughout the asset life.
Lower cleared and projected Pennsylvania-New Jersey-Maryland
Interconnection (PJM) capacity prices will reduce capacity-based
cash flows for Edgewater Generation LLC (Edgewater or the
project).
Edgewater is a portfolio of four natural gas-fired assets totaling
2.7 gigawatts (GW). The 1.3 GW Fairless Power Station, the
portfolio's main asset, is in Pennsylvania within the PJM power
market. Also within PJM are the West Lorain and Garrison
facilities. West Lorain is a 545-megawatt (MW) peaking facility
near Lake Erie in Lorain, Ohio; Garrison is a 309-MW facility in
Dover, Del. The portfolio also has exposure to the independent
system operator of New England (ISO-NE) via its 510-MW Manchester
Street Power Station in Rhode Island. Lotus Infrastructure Partners
is the project sponsor.
Portfolio diversification with four independent assets.
Three of the four assets sell forward capacity to the PJM power
market, which is the largest and most liquid in the U.S. Capacity
payments provide cash flow visibility for the next two years.
The wholesale power market is highly competitive, and the portfolio
is exposed to market risks, such as power demand, commodity prices,
and capacity auction cleared prices.
Energy transition and decarbonization is a long-term risk for
thermal-based merchant generators.
The project will be exposed to refinancing risk when the term loan
B (TLB) matures in December 2025.
Lower PJM capacity prices will weaken DSCRs through asset life.
S&P said, "The PJM capacity auction prices for the 2024-2025
delivery year were materially lower than we expected. With most of
Edgewater's capacity in PJM, and capacity payments constituting a
significant portion of gross margin, at about 40%, we expect the
project will experience the effect of lower cleared and projected
capacity prices throughout its life, including during the
refinancing period. Our base-case scenario reflects the loss of
approximately 20% in capacity revenue from 2023 to 2043 compared
with our previous forecast. This reduction directly affects cash
flow available for debt service (CFADS), resulting in lower debt
service coverage ratios (DSCRs) over the remaining asset life.
Based on our revised base-case scenario, we now project a minimum
DSCR of 1.27x, which occurs during the refinancing period
(2026-2043). Under our refinancing assumptions, we assume that the
remaining TLB debt is repaid entirely by 2043 via a structure that
requires quarterly principal and interest payments.
"We anticipate lower sweeps and higher debt balance at maturity due
to significant major maintenance. Edgewater is budgeting about $120
million in major maintenance and capital spending for 2023 and
2024. A significant portion of the capital spending is budgeted for
Fairless' scheduled major inspection, which is generally required
after a combustion turbine reaches a certain number of operating
hours. Major maintenance inspection is one of the most expensive
maintenance tasks for a gas-fired power plant because of the
components involved. We do not expect the portfolio will defer some
of the major maintenance work, particularly the major inspection,
hot gas path inspection, and rewind because doing so could affect
the plants' performance.
"In terms of available liquidity, the project has about $25 million
in a major maintenance reserve to partially fund a portion of the
work, and the balance will be funded with operating cash flows set
aside at least six months in advance. We also expect the project
will extend its revolver maturity date, which is coming due in
December 2023.
"Given the magnitude of expenditures and capital outlays, combined
with weaker capacity-related cash flows during this period, we
project lower cash flow sweeps, leading to a higher debt balance at
maturity. In addition, the project had to pay $22 million in PJM
penalties earlier this year, which contributed to the higher debt
balance. Under our base-case scenario, we project a debt balance of
about $915 million at maturity in 2025."
The portfolio has hedged a large portion of its expected generation
for 2023 at attractive margins. On-peak power prices in PJM have
hovered in the mid-to-high $30 per megawatt-hour (MWh) area over
the past few months, as the combination of a mild winter and low
natural gas prices pressured prices. New England also experienced
mild temperatures, which reduced natural gas demand, and
contributed to the lower power prices. However, Edgewater
opportunistically hedged a considerable amount of its expected
generation at Fairless through spark spread hedges for 2023.
Considering the effect of lower cleared capacity prices, S&P
expects stronger energy margins will absorb some of the cash flow
loss from lower capacity revenues.
PJM penalties affected Edgewater's sweeps in fiscal 2022. The
portfolio did not perform at the required operating levels during
capacity resources events in December 2022; therefore, it was
assessed $22 million in net penalties, or $30 million in penalties
and an $8 million bonus by PJM. The event negatively affected the
project's debt repayment, as cash flow was directed toward paying
the penalty, rather than being available for sweep payment.
A sizable share of coal capacity retirement in the American
Transmission System Inc. (ATSI) region is resulting in better
economics for West Lorain. Until 2020, Edgewater's West Lorain
plant operated as a periodic-start, oil-fired asset with
substantially all gross margin generated from capacity payments and
ancillary revenues. As part of the plan to reconnect West Lorain to
gas, Edgewater constructed a lateral through which West Lorain
could be connected to the newly constructed Nexus Gas Transmission
pipeline to source low-cost gas. S&P expects the peaking units will
operate at a lower dispatch because these facilities are put into
use only when needed during periods of peak power demand. However,
the facility's advantageous location with access to low-cost
natural gas, and ongoing retirement of coal-based generators in the
Ohio region, is creating dispatch opportunities for West Lorain,
resulting in better-than-expected energy margins. In previous
years, the facility operated purely as a peaking unit and generated
almost all of its revenues from PJM capacity payments. S&P expects
West Lorain will yield approximately $15 million in additional
energy margin.
S&P said, "The stable outlook reflects our view that despite weak
capacity markets and large capital spending, Edgewater will achieve
our minimum projected DSCR of about 1.27x through the asset life.
We also forecast debt repayment of at least $50 million-$60 million
through the TLB period and about $915 million debt outstanding at
maturity in 2025.
"We would consider a negative rating action if we expect the
minimum DSCR will fall and be sustained below 1.15x during the
project's life (including the refinancing period). This could
result from lower-than-expected capacity factors, weaker energy
margins, depressed capacity prices, higher-than-projected capital
spending, and operational issues such as forced outages and lower
plant availability. We could also consider a negative rating action
if the project's cash flow sweeps were materially lower than we
expect, which would increase the residual debt outstanding at TLB
maturity, and potentially weaken the projected DSCRs in the
post-refinancing period, absent any improvement in market
conditions.
"We could also take a negative rating action if we believed the
project's liquidity had deteriorated.
"We would consider an upgrade if we envisioned the project
achieving DSCRs above 1.35x throughout debt life, including the
post-refinancing period (2026-2043). This could occur if our
long-term outlook for capacity prices improves, or if the project's
financial performance exceeds our forecast due to any other factors
(such as improved energy margins or higher dispatch), leading to
lower-than-expected debt outstanding at TLB maturity."
EQUITABLE OF IOWA II: Fitch Affirms 'BB+' Rating on Preferred Notes
-------------------------------------------------------------------
Fitch Ratings has affirmed Voya Financial, Inc.'s (Voya) life
insurance subsidiaries' Insurer Financial Strength (IFS) ratings at
'A' (Strong). Fitch has also affirmed Voya's Long-Term Issuer
Default Rating (IDR) at 'BBB+' and senior unsecured debt at 'BBB'.
The Rating Outlook was revised to Positive from Stable.
The Positive Outlook considers Fitch's improved view of Voya's
capitalization, demonstrated by a 'Very Strong' Prism score over
the past three years, along with RBC levels well above target. In
addition, the company ROE has improved in absolute terms and is
more stable following its de-risking initiatives and Voya is
expected to continue to benefit from the higher interest rate
environment.
KEY RATING DRIVERS
Improved Strong Business Profile: Voya's business profile reflects
its strong market position and operating scale in institutional
retirement and wealth management; investment management; and
employee health benefits, including group medical stop loss.
Fitch believes Voya's core business segments currently support a
stable, institutionally focused operating profile, with lower
business risk, which is less reactive to capital market volatility.
The company added distribution strength to its business profile
with the Allianz Global Investors (AGI) deal in 2H22.
Voya completed its acquisition of Benefitfocus, Inc., in 1Q23, a
benefits administration technology company that serves employers,
health plans and brokers, which will strengthen performance in the
intermediate term.
Voya has a relatively conservative investment portfolio that is 96%
investment-grade. The company has very limited exposure to the
regional banks with a majority of their investments focused on the
large banks. Additionally, their CML exposure is in line with the
industry at 14% of their portfolio; however, they are underweight
office loans at 15% of their CML portfolio compared with the
industry average of 20%. Voya's loan quality is higher than the
industry with 72% CM1 loans and an average LTV around 45%.
Strong Operating Performance: Operating earnings for 2022 were very
strong and benefited from strong alternatives investment income,
growth of in-force premiums and asset-based fee income due to
favorable equity market performance, which was a continuation of
the prior year.
Year-to-date, Voya is benefiting from the rising interest rate
environment. Fitch expects Voya's earnings profile to continue to
improve in terms of stability and sustained absolute profitability
due in part to its less market-sensitive, institutionally focused
business mix as well as to a reduction of overall expenses.
Strong Statutory Capitalization: Fitch considers Voya's statutory
capitalization strong and consistent with expectations for the
current rating. The consolidated RBC was 490% at YE 2022, which is
above the company's target of 375%, and the company's Prism capital
model score remained 'Very Strong'. Voya's operating leverage of
12x continues to compare favorably with rating expectations.
Financial Leverage Decline: Voya's financial leverage declined to
approximately 29% as of 1H23 from 30% as of YE 2022, and Fitch
expects it to further decline modestly over the near to medium
term.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Continued growth in operating profitability that leads to an
improvement in operating ROE to over 11%;
- Sustained maintenance of GAAP operating earnings-based
fixed-charge coverage of more than 8x;
- A Prism capital model score of 'Very Strong' and financial
leverage at or below 27%.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Lack of progress towards reducing financial leverage back to 32%
over the near term;
- GAAP operating earnings-based interest coverage below 5x;
- Failure to not meet financial expectation of sustained earnings
with a decline in operating ROE below 6%;
- A decline in reported RBC below 375% and a Prism capital model
score at the low end of 'Strong'.
ESG CONSIDERATIONS
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Prior
----------- ------ -----
Equitable of Iowa
Companies Capital
Trust II
Preferred LT BB+ Affirmed BB+
Voya Holdings Inc.
senior
unsecured LT A+ Affirmed A+
Peachtree Corners
Funding Trust
senior
unsecured LT BBB Affirmed BBB
Voya Financial, Inc. LT IDR BBB+ Affirmed BBB+
senior
unsecured LT BBB Affirmed BBB
junior
subordinated LT BB+ Affirmed BB+
preferred LT BB+ Affirmed BB+
ReliaStar Life
Insurance Company
of New York LT IFS A Affirmed A
Voya Retirement
Insurance and
Annuity Company LT IFS A Affirmed A
ReliaStar Life
Insurance Company LT IFS A Affirmed A
Equitable of Iowa
Companies, Inc. LT IDR BBB+ Affirmed BBB+
FR REFUEL: Moody's Affirms B3 CFR & Rates New $120MM Term Loan B3
-----------------------------------------------------------------
Moody's Investors Service affirmed FR Refuel, LLC's ("Refuel"), B3
corporate family rating, B3-PD probability of default rating, B3
senior secured first lien revolving credit facility rating, B3
senior secured first lien delayed draw term loan and B3 senior
secured first lien term loan B ratings. In addition, Moody's
assigned a B3 rating to Refuel's proposed $120 million senior
secured first lien incremental term loan B. The outlook remains
stable.
Proceeds from the proposed $120 million senior secured 1st lien
incremental term loan B will be used to repay approximately $102
million of outstanding revolver debt, partially finance the
acquisition of a five store convenience store operator and pay fees
and expenses.
The affirmation of Refuel's ratings reflect the company's small
scale, geographic concentration and relatively limited track record
of operating performance given its rapid acquisition driven growth.
The affirmation also reflects that Refuel's leverage remains high
with debt to EBITDA of around 5.6 times for the LTM period ending
June 30, 2023.
RATINGS RATIONALE
Refuel's B3 CFR is constrained by its small scale with about 217
convenience stores, geographic concentration in the southeast which
accounts for about 58% of locations and an aggressive growth
strategy that increased its number of stores from 31 at its
inception in May 2019 to 217 as of June 30, 2023, the substantial
majority of which was driven by acquisitions. The B3 CFR also
reflects that Refuel's leverage remains high with debt to EBITDA of
around 5.6 times for the LTM period ending June 30, 2023. Refuel's
credit profile benefits from its good liquidity, the fact that the
majority of its gross profit is driven by merchandise sales rather
than the more volatile fuel sale volumes and its relationship with
major fuel providers that adds additional brand recognition.
The stable outlook reflects Moody's view that Refuel will maintain
good liquidity and that any acquisitions will be leverage neutral
on a pro forma basis.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to an upgrade include an increase in scale
and greater geographic diversity that will enable it to better
weather any economic challenges or competitive threats that could
be amplified within specific regions. A higher rating would also
require debt to EBITDA sustained below 5.5 times and EBITA coverage
of interest sustained around 2.0 times while maintaining at least
good liquidity.
Factors that could lead to a downgrade include an inability to
successfully integrate acquisitions that lead to an inability to
improve credit metrics from current levels or caused a
deterioration in liquidity. A downgrade could occur if debt to
EBITDA is sustained above 6.5 times or EBITA coverage of interest
migrated towards 1.25 times on a sustained basis.
Based in South Carolina, FR Refuel, LLC, owns and operates
approximately 217 convenience stores in North and South Carolina,
Texas, Arkansas and Mississippi. Refuel is majority owned by the
private equity firm First Reserve. Annual revenue is around $1.34
billion.
The principal methodology used in these ratings was Retail
published in November 2021.
FTAI AVIATION: S&P Upgrades ICR to 'B+', Outlook Stable
-------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on FTAI Aviation
Ltd. to 'B+' from 'B' and its issue-level rating on its senior
unsecured notes to 'B+' from 'B'. S&P's '3' recovery rating on the
notes is unchanged.
The rated entity is now the new parent company FTAI Aviation Ltd.
Therefore, S&P subsequently discontinued its ratings on Fortress
Transportation and Infrastructure Investors LLC.
S&P said, "The stable outlook reflects our expectation the company
will improve its EBIT interest coverage to the low-2x area (from
1.2x in 2022) and expand its funds from operations (FFO) to debt to
the low- to mid-teens percent area through 2024 (from 1.3% in
2022)
S&P expects FTAI's performance will continue to benefit from a
favorable operating environment over the next year. The volume of
short-haul domestic leisure airline traffic has recovered over the
past two years as the effects of the COVID-19 pandemic on global
air travel have declined. Therefore, the demand and lease rates for
narrowbody aircraft and engines--the predominant aircraft type in
FTAI's fleet--have recovered more quickly than those for widebody
aircraft, which are used mostly on international routes.
In addition, the production and delivery of new aircraft and
engines have been delayed by supply chain disruptions and labor
constraints over the last few years. Additionally, the lower than
expected time-on-wing performance of the new technology engines and
extended wait periods for maintenance have led some airlines to
park aircraft while awaiting inspections and maintenance. In
addition, RTX Corp. announced that a manufacturing flaw in an
engine component could require it to remove, inspect, and repair
about 3,000 geared turbofan (GTF) engines (used on several
new-technology Airbus aircraft) over the next 2-3 years. S&P
expects these trends will support elevated demand for FTAI's fleet,
as its airline customers seek to overcome these delays by operating
older, current technology aircraft and engines for extended
periods.
S&P said, "While we expect the contribution from the company's
aerospace segment will increase gradually over the next few years,
we believe leasing will remain its largest segment in the near
term. Over the last two years, FTAI has increasingly positioned
itself as a provider of various aftermarket maintenance solutions
for CFM56 engines. The company sells engine modules through The
Module Factory (a collaboration with Lockheed Martin Corp.) and
offer used serviceable materials (USM) through its exclusive
partnership with AAR Corp. We believe current market conditions are
favorable for FTAI to expand its aftermarket operations, given that
the capacity of the larger engine maintenance, repair, and overhaul
(MRO) providers is constrained by supply chain bottlenecks and
limited labor availability. Nevertheless, we currently view the
company's aerospace segment as small (albeit growing), with
relatively niche offerings, and expect leasing will remain its
largest business over the next few years.
"We forecast FTAI's credit metrics will continue to improve
gradually through 2024. The favorable demand dynamics have also
supported the company's ability to realize sizeable gains on its
engine and aircraft asset sales in the first half of 2023, which we
expect will continue through at least the end of the year. However,
we anticipate a gradual normalization in FTAI's asset sale gains as
sale volumes and prices decline somewhat from the current high
levels. On the other hand, given the management's continued focus
on its aerospace operations, we don't expect the company will
significantly expand its leased asset base. Therefore, we assume
capital spending of $550 million-$650 million annually through
2024, which will largely be offset by annual asset sales of $500
million-$600 million.
"The stable outlook reflects our expectation that FTAI will
continue to gradually improve its credit metrics through 2024,
supported by continued strong demand conditions and an increasing
contribution from its aerospace segment. We assume the company
expands its EBIT interest coverage to the low-2x area through 2024
(from 1.2x in 2022) and its FFO to debt to the low- to mid-teens
percent area through 2024 (from 1.3% in 2022). We also expect its
debt to capital will remain above 90% through 2024 (compared to
101.9% in 2022)."
S&P could lower its ratings on FTAI over the next year if its EBIT
interest coverage approaches 1.3x or its FFO to debt falls below 9%
on a sustained basis. This could occur if:
-- The company's revenue and cash flow generation underperform our
expectations because of lower leasing demand or an inability to
continue to expands its aerospace operations; or
-- The company significantly increases its debt to finance
strategic investments or pay additional shareholder returns.
S&P could raise its ratings on FTAI over the next year if it
expects its EBIT interest coverage will remain above 2x while its
FFO to debt improves to the high-teen percent area on a sustained
basis. This could occur if:
-- The company continues to improve its operating performance
because air travel demand remains strong; or
-- It repays debt significantly beyond S&P's current
expectations.
FTX GROUP: Stanford to Return Entire Millions of Dollars Gifts
--------------------------------------------------------------
Amelia Pollard and Jonathan Randles of Bloomberg Law report that
Stanford University plans to return millions of dollars it received
from bankrupt crypto exchange FTX and related entities, a
university spokesperson said in an emailed statement.
"We have been in discussions with attorneys for the FTX debtors to
recover these gifts and we will be returning the funds in their
entirety," the spokesperson said.
About FTX Group
FTX is the world's second-largest cryptocurrency firm. FTX is a
cryptocurrency exchange built by traders, for traders. FTX offers
innovative products including industry-first derivatives, options,
volatility products and leveraged tokens.
Then CEO and co-founder Sam Bankman-Fried said Nov. 10, 2022, that
FTX paused customer withdrawals after it was hit with roughly $5
billion worth of withdrawal requests.
Faced with liquidity issues, FTX on Nov. 9 struck a deal to sell
itself to its giant rival Binance, but Binance walked away from the
deal amid reports on FTX regarding mishandled customer funds and
alleged US agency investigations.
At 4:30 a.m. on Nov. 11, Bankman-Fried ultimately agreed to step
aside, and restructuring vet John J. Ray III was quickly named new
CEO.
FTX Trading Ltd (d/b/a FTX.com), West Realm Shires Services Inc.
(d/b/a FTX US), Alameda Research Ltd. and certain affiliated
companies then commenced Chapter 11 proceedings (Bankr. D. Del.
Lead Case No. 22-11068) on an emergency basis on Nov. 11, 2022.
Additional entities sought Chapter 11 protection on Nov. 14, 2022.
FTX Trading and its affiliates each listed $10 billion to $50
million in assets and liabilities, making FTX the biggest
bankruptcy filer in the US this year.
According to Reuters, SBF shared a document with investors on Nov.
10, 2022, showing FTX had $13.86 billion in liabilities and $14.6
billion in assets. However, only $900 million of those assets were
liquid, leading to the cash crunch that ended with the company
filing for bankruptcy.
The Hon. John T. Dorsey is the case judge.
The Debtors tapped Sullivan & Cromwell, LLP as bankruptcy counsel;
Landis Rath & Cobb, LLP as local counsel; and Alvarez & Marsal
North America, LLC as financial advisor. Kroll is the claims agent,
maintaining the page
https://cases.ra.kroll.com/FTX/Home-Index
The Official Committee of Unsecured Creditors tapped Paul Hastings
as counsel, FTI Consulting, Inc., as financial advisor, and
Jefferies LLC as the investment banker. Young Conaway Stargatt &
Taylor LLP is the Committee's Delaware and conflicts counsel.
Montgomery McCracken Walker & Rhoads LLP, led by partners Gregory
T. Donilon, Edward L. Schnitzer, and David M. Banker, is
representing Sam Bankman-Fried in the Chapter 11 cases.
White-collar crime specialist Mark S. Cohen has reportedly been
hired to represent SBF in litigation. Lawyers at Paul Weiss
previously represented SBF but later renounced representing the
entrepreneur due to a conflict of interest.
FUTURE PRESENT: Court OKs Cash Collateral Access Thru Nov 17
------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of New York
authorized Future Present Productions, LLC dba GUM Studios to use
cash collateral on an interim basis in accordance with the budget,
with a 15% variance, through November 17, 2023.
The U.S. Small Business Administration, Grow America Fund, Inc.,
and Pursuit Lending are the Debtor's pre-petition secured lenders.
The Debtor requires the use of cash collateral to continue paying
its obligations and preserve the assets of the estate as a going
concern.
The Debtor's authorization to use the cash collateral will commence
as of entry of the Interim Order by the Court and terminate upon
the earliest of:
(i) November 17, 2023; and
(ii) the occurrence of a Termination Event.
As adequate protection, the Secured Lenders will receive:
(i) replacement liens pursuant to 11 U.S.C. Section 361(2) on
all property of Debtor and its estate, whether now owned or
hereafter acquired, which such Replacement Liens will be to the
same extent and validity as its pre-petition liens;
(ii) to the extent required by the pre-petition loan
documents, the Debtor will continue to make monthly adequate
protection payments, which are payments at the nondefault contract
rate to the Secured Lenders in accordance with the Loan Documents.
The Adequate Protection Liens will be subject to the following:
(i) the payment of allowed professional fees and disbursements
incurred by the Debtor's professionals retained by an Order of the
Bankruptcy Court, or the Subchapter V Trustee, and in the event of
a default that results in the termination of the Debtor's
authorization to use cash collateral, unpaid Professional Fees and
Disbursements (including any fees or expenses of the Subchapter V
Trustee) incurred prior to delivery of a carve out trigger notice
in accordance with the Budget not to exceed the sum of $75,000;
(ii) any recoveries in favor of the estate pursuant to Chapter 5
of the Bankruptcy Code; and
(iii) any amounts allowed by the Court as fees and expenses of a
trustee appointed under 11 U.S.C. Section 726(b) of the Bankruptcy
Code in an amount not to exceed $10,000.
The Replacement Liens granted to each of the Secured Lenders will
become valid, enforceable and fully perfected liens without any
action by Debtor or the Secured Party, and no filing or recordation
or other act that otherwise may be required under federal or state
law in any jurisdiction will be necessary to create or perfect such
liens and security interests.
The occurrence of any of these events, will constitute a
Termination Event:
(a) the Chapter 11 case will have been dismissed or converted
to a case under Chapter 7 of the Bankruptcy Code, or there will
have been appointed in the Chapter 11 case, a trustee (other than
the Subchapter V Trustee) or examiner with expanded powers beyond
the authority to investigate particular activities of the Debtor;
(b) the Debtor files a motion seeking to modify, vacate, stay,
supplement or amend the terms of the Interim Order without the
prior written consent of the affected Secured Party.
(c) the Interim Order is modified, vacated, stayed,
supplemented, reversed, or is for any reason not binding on the
Debtor, without the prior written consent of the affected Secured
Party.
(d) the Debtor fails to perform, in any material respect, any
of the terms, provisions, conditions, covenants, or obligation
under the Interim Order.
(e) Debtor expends more than 110% of the Budget, unless caused
by an increase in business by the Debtor.
(f) There is at any time a material inaccuracy in any
financial report or certification provided by the Debtor to the
Secured Lenders.
A hearing on the matter is set for November 15, 2023 at 10 a.m.
A copy of the order is available at https://urlcurt.com/u?l=UEScfj
from PacerMonitor.com.
About Future Present Productions, LLC
Future Present Productions, LLC d/b/a GUM Studios is a
multi-location film stage & equipment rental facility with
production capabilities in the New York Metropolitan - Tri State
area. GUM Studios caters to production companies, advertising
agencies, video-photographers, designers, and large tv/film
productions.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. N.Y. Case No. 23-42510 on July 18,
2023. In the petition signed by Carrie White, CEO, the Debtor
disclosed $6,065,879 in assets and $5,760,994 in liabilities.
Judge Jil Mazer-Marino oversees the case.
Lewis W. Siegel, Esq. represents the Debtor as legal counsel.
GALAXY NEXT: Delays Annual Report for Year Ended June 30
--------------------------------------------------------
Galaxy Next Generation, Inc. will be delayed in filing its Annual
Report on Form 10-K for the fiscal year ended June 30, 2023.
In a Form 12b-25 filed with the Securities and Exchange Commission,
the Company said it is unable to file its Annual Report on Form
10-K by the prescribed date without unreasonable effort or expense
due to a recent change in auditors. As a result, the Company was
unable to compile and review certain information required in order
to permit the Company to file a timely and accurate report on the
Company's financial condition. The Company believes that the
Annual Report will be completed and filed within the 15-day
extension period provided under Rule 12b-25 of the Securities
Exchange Act of 1934, as amended.
About Galaxy Next Generation
Headquartered in Toccoa, Georgia, Galaxy Next Generation, Inc. --
http://www.galaxynext.us-- is a manufacturer and distributor of
interactive learning technologies and enhanced audio solutions. It
develops both hardware and software that allows the presenter and
participant to engage in a fully collaborative instructional
environment.
Indianapolis, Indiana-based Somerset CPAs PC, the Company's auditor
since 2018, issued a "going concern" qualification in its report
dated Sept. 23, 2022, citing that the Company has suffered
recurring losses from operations, recurring negative operating cash
flows and has a net capital deficiency that raise substantial doubt
about its ability to continue as a going concern.
GAMESTOP CORP: Names Ryan Cohen as CEO
--------------------------------------
GameStop Corp. disclosed in a Form 8-K filed with the Securities
and Exchange Commission that its Board of Directors has elected
Ryan Cohen as president and chief executive officer, effective
immediately. Mr. Cohen will not receive compensation for serving
as the Company's president, chief executive officer and chairman.
In connection with his appointment, Mr. Cohen will assume the role
of principal executive officer from Mark H. Robinson effective
immediately and his responsibilities will include the oversight of
all other executive officers, including Mr. Robinson. Mr. Robinson
will remain the Company's general counsel and secretary, with
responsibilities including administrative matters, corporate
development, and legal affairs.
About GameStop
Grapevine, Texas-based GameStop Corp. is a specialty retailer
offering games and entertainment products through its E-Commerce
platforms and thousands of stores.
GameStop reported a net loss of $313.1 million for the fiscal year
ended Jan. 28, 2023, a net loss of $381.3 million for the fiscal
year ended Jan. 29, 2022, a net loss of $215.3 million for the
fiscal year ended Jan. 30, 2021, a net loss of $470.9 million for
the fiscal year ended Feb. 1, 2020, and a net loss of $673 million
for the year ended Feb. 2, 2019. As of April 29, 2023, the Company
had $3.07 billion in total assets, $1.79 billion in total
liabilities, and $1.27 billion in total stockholders' equity.
GULFPORT ENERGY: Expands Common Stock Repurchase by 63%
-------------------------------------------------------
Gulfport Energy Corporation said the Company's board of directors
has expanded the common stock repurchase authorization by 63% to
$650 million. The increased authorization extends the program
through December 31, 2024.
John Reinhart, President and CEO, commented, "As we close out 2023
and look ahead to an improving natural gas macro environment in
2024, we forecast accelerating free cash flow generation for our
business, highlighting our disciplined approach to capital
allocation and our focus on enhancing margins, optimizing
efficiencies and protecting the financial strength of the Company.
Given the unrecognized value we believe remains in our equity, our
board of directors has increased our common stock repurchase
authorization by 63%, allowing us to continue to opportunistically
repurchase our shares and deliver significant value for our
shareholders."
On September 15, 2023, the Company had repurchased approximately
3.9 million shares of common stock at a weighted average share
price of $85.92 since the program was initiated in March 2022,
totaling approximately $331.3 million in aggregate.
Purchases under the repurchase program may be made from time to
time in open market or privately negotiated transactions and will
be subject to available liquidity, market conditions, credit
agreement restrictions, applicable legal requirements, contractual
obligations, and other factors. The repurchase program does not
require the Company to acquire any specific number of shares. The
Company intends to purchase shares under the repurchase program
opportunistically with available funds while maintaining sufficient
liquidity to fund its capital extended or discontinued by the board
of directors at any time.
As of June 30, 2023, Gulfport had $2,555,724,000 in total assets
and $1,131,149,000 in liabilities.
About Gulfport Energy Corporation
Oklahoma City, Okla.-headquartered Gulfport Energy Corporation is
an independent natural gas-weighted exploration and production
company focused on the production of natural gas, crude oil and
NGL. The Company's principal properties are located in eastern Ohio
targeting the Utica and Marcellus and in central Oklahoma targeting
the SCOOP Woodford and Springer formations.
Gulfport and its subsidiaries sought Chapter 11 protection (Bankr.
S.D. Tex. Lead Case No. 20-35562) on Nov. 13, 2020. As of Sept. 30,
2020, Gulfport had $2,375,559,000 in assets and $2,520,336,000 in
liabilities.
The Honorable David R. Jones was the case judge.
The Debtors tapped Kirkland & Ellis LLP as their bankruptcy
counsel; Jackson Walker L.L.P. as local bankruptcy counsel; Alvarez
& Marsal North America, LLC as restructuring advisor; and Perella
Weinberg Partners L.P. and Tudor, Pickering, Holt & Co. as
financial advisor; and PricewaterhouseCoopers LLP as tax services
provider. Epiq Corporate Restructuring LLC acted as the claim's
agent.
Wachtell, Lipton, Rosen & Katz was counsel for the special
committee of Gulfport's Board of Directors, while Chilmark Partners
is the financial advisor.
Katten Muchin Rosenman LLP served as counsel for the special
committee of the governing body of each Debtor other than Gulfport,
while M III Partners, LP, was the financial advisor.
The U.S. Trustee for Region 7 formed an official committee of
unsecured creditors in the Debtors' Chapter 11 cases. The committee
was represented by Norton Rose Fulbright US LLP and Kramer Levin
Naftalis & Frankel, LLP and Jefferies LLC as its investment
banker.
Gulfport emerged from Chapter11 bankruptcy earlier in 2021. Control
of Gulfport was handed to its creditors, many of them hedge funds,
upon completion of the bankruptcy process that swapped around $1.2
billion of debt for shares in the Company.
In July 2023, Fitch Ratings affirmed Gulfport's Long-Term Issuer
Default Rating (IDR) at 'B+'. Fitch also affirmed Gulfport's
first-lien revolver at 'BB+'/'RR1′ and the senior unsecured notes
at 'BB-'/'RR3′. The Rating Outlook is stable.
HELIUS MEDICAL: Receives UPC Numbers for PoNS System and Mouthpiece
-------------------------------------------------------------------
Helius Medical Technologies, Inc. announced that its Portable
Neuromodulation Stimulator ("PoNS") system and mouthpiece have been
assigned universal product code ("UPC") numbers by Wolters Kluwer
Health - Medi-Span. Medi-Span is an automated clinical screening
solution– providing a data backbone and vital support to payers,
pharmacy benefit managers, wholesalers, and manufacturers.
The PoNS system has been assigned the Global Trade Item Number
("GTIN") of 00864288000462, with a direct price of $25,700. The
PoNS mouthpiece has been assigned the GTIN of 00864288000431, with
a direct price of $7,900. These UPC numbers are now included in
Wolters Kluwer Health's pharmacy database, which a large number of
health care companies are subscribed to including 17 out of 20 of
the top-grossing PBMs. Consequently, this will allow Helius to
pursue reimbursement through both the pharmacy and the Durable
Medical Equipment ("DME")/HCPCS pathways.
"Receiving UPC numbers for the PoNS system and mouthpiece is a
gamechanger for Helius," said Dane Andreeff, Helius' president and
chief executive officer. "We will now be able to reference these
UPC numbers as we negotiate reimbursement with third party payers,
and prescriptions can be written with these UPC numbers. We
believe that having these UPC numbers in place will facilitate and
potentially expedite negotiations with third party payers on a
faster timeline than the DME/HCPCS pathway. Additionally, once
HCPCS codes are assigned by CMS and a payment amount has been
determined for Medicare, PoNS will be one of the few products with
both pharmacy and device codes, providing dual paths for potential
reimbursement."
About Helius Medical
Helius Medical Technologies, Inc. -- http://www.heliusmedical.com
-- is a neurotech company in the medical device field focused on
neurologic deficits using orally applied technology platform that
amplifies the brain's ability to engage physiologic compensatory
mechanisms and promote neuroplasticity, improving the lives of
people dealing with neurologic diseases.
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 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.
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, thus raising substantial doubt about the Company's ability
to continue as a going concern.
HELIX ENERGY: Adopts Mandatory Incentive Clawback Policy
--------------------------------------------------------
Helix Energy Solutions Group, Inc. disclosed in a Form 8-K Report
filed with the Securities and Exchange Commission that the
Company's Board of Directors has adopted a Mandatory Recoupment
Policy, referred to as the Clawback Policy.
The policy was adopted to comply with the final clawback rules
adopted by the U.S. Securities and Exchange Commission under
Section 10D and Rule 10D-1 of the Securities Exchange Act of 1934
as amended. It also complies with the listing standards, as set
forth in the New York Stock Exchange Listed Company Manual.
The Clawback Policy provides for the mandatory recovery of
erroneously awarded incentive compensation from current and former
officers of the Company, as defined in Rule 10D-1. In the event,
the Company is required to prepare an accounting restatement as
specified in the Clawback Policy.
Under the Clawback Policy, the Board is said to recoup from the
Covered Officers erroneously awarded incentive compensation
received within a lookback period of the three completed fiscal
years. This period precedes the date on which the Company is
required to prepare an accounting restatement.
The Clawback Policy has been effective as of September 18, 2023,
and supersedes the terms and conditions of the Company's previously
disclosed Incentive Award Recoupment Policy adopted December 12,
2019.
A full-text copy of the Clawback Policy is available at
https://tinyurl.com/2rf7v8f4
About Helix Energy
Headquartered in Houston, Texas, Helix Energy Solutions Group, Inc.
is an American oil and gas services company.
Egan-Jones Ratings Company on June 23, 2023, maintained its 'CCC+'
foreign currency and local currency senior unsecured ratings on
debt issued by Helix Energy Solutions Group, Inc.
As of June 30, 2023, Helix Energy reported $2,423,845,000 in total
assets and $891,917,000 in total liabilities.
HOMES AT LAWRENCE: Hires Bast Amron LLP as Bankruptcy Counsel
-------------------------------------------------------------
Homes at Lawrence Homeowners Association, Inc. seeks approval from
the U.S. Bankruptcy Court for the Southern District of Florida to
employ Bast Amron, LLP as its bankruptcy counsel.
The firm's services will include:
a. advise the Debtor with respect to its responsibilities in
complying with the U.S. Trustee's guidelines and reporting
requirements and with the rules of the bankruptcy court;
b. prepare legal documents;
c. protect the interests of the Debtor in all matters pending
before the court; and
d. represent the Debtor in negotiations with its creditors and
in the preparation and confirmation of a Chapter 11 plan.
The firm will be paid at these rates:
Jeffrey P. Bast $675 per hour
Paralegals $275 per hour
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
The firm received a retainer of $40,000.
Jeffrey Bast, Esq., a partner at Bast Amron LLP, 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 through:
Jeffrey Bast, Esq.
BAST AMRON LLP
One Southeast Third Avenue, Suite 1400
Miami, FL 33131
Tel: (305) 379-7904
Fax: (305) 379-7905
Email: jbast@bastamron.com
hharrison@bastamron.com
About Homes at Lawrence Homeowners
Association, Inc.
Homes at Lawrence Homeowners Association, Inc., filed a Chapter 11
bankruptcy petition (Bankr. S.D. Fla. Case No. 23-17333) on
September 13, 2023, disclosing under $1 million in both assets and
liabilities.
The Debtor is represented by BAST AMRON LLP.
HRH FENCHAK: Hires Steidl and Steinberg P.C. as Counsel
-------------------------------------------------------
HRH Fenchak, LLC seeks approval from the U.S. Bankruptcy Court for
the Western District of Pennsylvania to employ Steidl and
Steinberg, P.C. to handle its Chapter 11 case.
The Debtor paid Steidl and Steinberg a retainer of $7,500 for its
services, plus the filing fee of $1,738.
Christopher Frye, Esq., an attorney at Steidl & Steinberg, will be
paid at his hourly rate of $350 and will be reimbursed for
work-related expenses incurred.
The retainer is $5,000.
Mr. Frye disclosed in a court filing that his firm is a
"disinterested person" pursuant to Section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
Christopher M. Frye, Esq.
STEIDL & STEINBERG, PC
2830 Gulf Tower
707 Grant Street
Pittsburgh, PA 15219
Tel: (412) 391-8000
Email: chris.frye@steidl-steinberg.com
About HRH Fenchak, LLC
HRH Fenchak, LLC, filed a Chapter 11 bankruptcy petition (Bankr.
W.D. Pa. Case No. 23-21923) on September 11, 2023, disclosing under
$1 million in both assets and liabilities.
The Debtor is represented by STEIDL & STEINBERG, P.C.
IKON WEAPONS: Claims to be Paid From Available Cash
---------------------------------------------------
Ikon Weapons, LLC, submitted a Third Amended Plan of Liquidation.
On June 2, 2023, the Court entered the Order Pursuant To 11 U.S.C.
Sec. 105 and Sec. 363 Authorizing The Debtor To Sell Property Free
And Clear Of All Liens, Claims, Interest Or Encumbrances And
Approving Settlement Pursuant To Bankruptcy Rule 9019 (the "Sale
Order"), approving the Debtor's Motion For Authority To Sell
Property At Private Sale Free And Clear Of All Liens, Claims,
Interests, Or Encumbrances Pursuant To Sections 105 And 363 Of The
Bankruptcy Code And Motion To Approve Settlement Pursuant To
Bankruptcy Rule 9019 (the "Sale and Settlement Motion").
This Plan is to address (i) the distribution of the proceeds of
sale derived from the sale approved on the Sale Order and the
disposition of the remaining Assets not sold pursuant to the Sale
Order, (ii) in the event the approved sale does not close, the
disposition of all the Debtor's assets not previously sold, and
(iii) in either event, the distribution of proceeds derived
therefrom.
This Plan contemplates the liquidation of the Debtor's Assets
pursuant to the Sale Order and/or other orders of the Bankruptcy
Court by the Liquidating Agent as well as the prosecution of causes
of action not assigned prior to the Effective Date. The Debtor,
through its sound business judgment, believes that the liquidation
of the assets in chapter 11 will yield the largest and best benefit
for the creditors, estate and other parties in interest.
Under the Plan, Class 5 Allowed General Unsecured Claims are
impaired. After the satisfaction of or provision for payment in
full of Allowed Administrative Expense Claims and Allowed Claims in
Classes 1-4, the holders of Allowed Class 5 General Unsecured
Claims will receive interim and final distributions, pro rata, up
to but not exceeding the Allowed Claims in Class 5. The timing and
amount of any interim and final distribution will be at the
discretion of the Liquidating Agent and subject to Articles 6 and 7
of this Plan.
Distributions after the Effective Date will be made from Available
Cash in the following order of priorities:
* The Liquidating Agent may create sufficient reserves for the
estimated post-confirmation costs of administering the Plan.
* Allowed Administrative Expense Claims, unless the holder(s)
thereof have consented to the treatment provided in Section 2.3.1
* Class 1 Allowed Priority Claims.
* Class 2 Allowed Priority Tax Claims.
* Class 3 Allowed Secured Claims.
* Allowed Administrative Expense Claims, where the holder(s)
thereof have consented to the treatment provided in Section 2.3.
* Class 4 Allowed Administrative Expense Claim of Geneva
Capital, LLC, if any.
* Class 5 Allowed General Unsecured Claims.
* Class 6 Allowed Subordinated Unsecured Claims: (a) If Asset
Sale closes, any surplus assets are distributed to PSA; (b) if
Asset Sale does not close, PSA receives treatment of its claims in
section 3.7.3, and surplus assets distributed to holders of Equity
Interests after all Allowed Claims are paid in full.
Distributions to holders of Allowed Claims will be made from
Available Cash, funded by the revenue generated through the
liquidation of Assets and from causes of action, including
Avoidance Actions.
The Debtor estimates that Available Cash as shown on the
Liquidation Analysis will consist of the following:
* Net proceeds derived from the sale of the Albemarle Property,
approximately $1,059,000 ($1,150,000 less brokers commission).
* Net proceeds derived from the sale of the Mt. Gilead Property,
estimated at approximately $100,000 less costs of sale.
* Gas masks, estimated at approximately $5,000.
* Proceeds of settlement with IZOP-K, D.O.O., approximately (i)
$135,000 if the Asset Sale to PSA closes; and (ii) approximately
$287,250 if the Asset Sale to PSA does not close.
* Net proceeds derived from the sale of the AC Unity Goods, (i)
approximately $1,130,000 if sold to PSA pursuant to the Sale Order,
or (ii) approximately $1,500,000 if sold by the Liquidating Agent.
* Approximately $91,000, held in the trust account of Debtor's
counsel pending further Orders of the Bankruptcy Court.
Counsel for debtor Ikon Weapons, LLC:
John C. Woodman, Esq.
ESSEX RICHARDS, P.A.
1701 South Boulevard
Charlotte, NC 28203
Tel: (704) 377-4300
Fax: (704) 372-1357
E-mail: jwoodman@essexrichards.com
A copy of the Third Amended Plan of Liquidation dated September 15,
2023, is available at https://tinyurl.ph/NcgcF from
PacerMonitor.com.
About Ikon Weapons
Ikon Weapons, LLC, operates as a weapons manufacturer, purchaser,
and importer. The Debtor sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. M.D.N.C. Case No. 22-10507) on Sept.
2, 2022. In the petition signed by Suliban Deaza, member and
manager, the Debtor disclosed up to $10 million in both assets and
liabilities.
Judge Benjamin A. Kahn oversees the case.
John C. Woodman, Esq., at Essex Richards, P.A., is the Debtor's
counsel.
INDIEV INC: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Indiev, Inc.
1690 Scenic Avenue
Costa Mesa, CA 92626
Chapter 11 Petition Date: October 2, 2023
Court: United States Bankruptcy Court
Central District of California
Case No.: 23-12036
Judge: Hon. Scott C. Clarkson
Debtor's Counsel: Michael Jay Berger, Esq.
LAW OFFICES OF MICHAEL JAY BERGER
9454 Wilshire Boulevard, 6th Floor
Beverly Hills, CA 90212
Tel: (310) 271-6223
Email: michael.berger@bankruptcypower.com
Total Assets: $2,830,208
Total Liabilities: $26,438,492
The petition was signed by Ying Zhou as chief financial officer.
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/6ZADF4A/INDIEV_INC__cacbke-23-12036__0001.0.pdf?mcid=tGE4TAMA
INNOVATION PHARMACEUTICALS: Has $3.2M Net Loss in FY Ended June 30
------------------------------------------------------------------
Innovation Pharmaceuticals Inc. filed with the Securities and
Exchange Commission its Annual Report on Form 10-K disclosing a net
loss of $3.17 million on $0 of revenues for the year ended June 30,
2023, compared to a net loss of $7.04 million on $18,000 of
revenues for the year ended June 30, 2022.
As of June 30, 2023, the Company had $7.52 million in total assets,
$5.48 million in total liabilities, and $2.04 million in total
stockholders' equity.
Farmington, Utah-based Pinnacle Accountancy Group of Utah, the
Company's auditor since 2018, issued a "going concern"
qualification in its report dated Sept. 28, 2023, citing that the
Company has negative working capital, has suffered losses and
negative cash flow from operations, which raise substantial doubt
about its ability to continue as a going concern.
Innovation said, "There can be no assurance that sufficient funds
required during the next year or thereafter will be generated from
operations or that funds will be available from external sources,
such as debt or equity financings or other potential sources. The
lack of additional capital resulting from the inability to generate
cash flow from operations, or to raise capital from external
sources would force us to substantially curtail or cease operations
and would, therefore, have a material adverse effect on our
business. Furthermore, there can be no assurance that any such
required funds, if available, will be available on attractive terms
or that they will not have a significant dilutive effect on our
existing stockholders."
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1355250/000147793223007158/ipix_10k.htm
About Innovation Pharmaceuticals
Innovation Pharmaceuticals Inc. (IPIX) -- http://www.IPharmInc.com
-- is a clinical stage biopharmaceutical company developing a
portfolio of innovative therapies addressing multiple areas of
unmet medical need, including inflammatory diseases, cancer,
infectious disease, and dermatologic diseases.
INTEGRATED VENTURES: Posts $25.5M Net Loss in FY Ended June 30
--------------------------------------------------------------
Integrated Ventures, Inc. filed with the Securities and Exchange
Commission its Annual Report on Form 10-K disclosing a net loss of
$25.46 million on $3.86 million of net total revenue for the year
ended June 30, 2023, compared to a net loss of $565,514 on $6.55
million of net total revenue for the year ended June 30, 2022.
As of June 30, 2023, the Company had $6.59 million in total assets,
$2.97 million in total current liabilities, $1.12 million in series
C preferred stock, $3 million in series D preferred stock, and a
total stockholders' deficit of $509,883.
Houston, TX-based M&K CPAS, PLLC, the Company's auditor since 2018,
issued a "going concern" qualification in its report dated Sept.
28, 2023, citing that the Company has suffered net losses from
operations in current and prior periods and has accumulated
deficiency, which raises substantial doubt about its ability to
continue as a going concern.
Integrated Ventures said, "The ability of the Company to reach a
successful level of operations is dependent on the execution of
management's plans, which include the raising of capital through
the debt and/or equity markets, until such time that funds provided
by operations are sufficient to fund working capital requirements.
If the Company were not to continue as a going concern, it would
likely not be able to realize its assets at values comparable to
the carrying value or the fair value estimates reflected in the
balances set out in the preparation of the financial statements.
"There can be no assurances that the Company will be successful in
attaining a profitable level of operations or in generating
additional cash from the equity/debt markets or other sources fund
its operations. The financial statements do not include any
adjustments relating to the recoverability of assets and
classification of assets and liabilities that might be necessary.
Should the Company not be successful in its business plan or in
obtaining the necessary financing to fund its operations, the
Company would need to curtail certain or all operational activities
and/or contemplate the sale of its assets, if necessary."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1520118/000147793223007190/intv_10k.htm
About Integrated Ventures Inc.
Integrated Ventures Inc. -- www.integratedventuresinc.com --
focuses on acquiring, launching, and operating companies in the
cryptocurrency sector, mainly in digital currency mining, equipment
manufacturing, and sales of branded mining rigs, as well as
blockchain software development.
IPS CORP: BlackRock Debt Strategies Marks $919,000 Loan at 22% Off
------------------------------------------------------------------
BlackRock Debt Strategies Fund, Inc has marked its $919,000 loan
extended to IPS Corp to market at $716,820 or 78% of the
outstanding amount, as of June 30, 2023, according to BlackRock
Debt's Form N-CSRS report for the first half of 2023, filed with
the Securities and Exchange Commission.
BlackRock DSFI is a participant in a 2021 Second Lien Term Loan B
to IPS Corp. The loan accrues interest at a rate of 12.20% (1-mo.
CME Term SOFR at 0.50% Floor + 7.00%) per annum. The loan matures
on October 1, 2029.
BlackRock Debt Strategies Fund, Inc is registered under the
Investment Company Act of 1940, as amended, as closed-end
management investment companies and is referred to herein
collectively as the Fund.
Headquartered in Compton, CA, IPS Corporation is a manufacturer of
a wide range of adhesive cements and plumbing products primarily
for the new residential, remodeling and commercial construction
markets.
IRONMAN LOGGING: Unsecureds to Get $500 per Month for 60 Months
---------------------------------------------------------------
Ironman Logging, L.L.C., filed with the U.S. Bankruptcy Court for
the Western District of Louisiana a Plan of Reorganization under
Subchapter V dated September 26, 2023.
Debtor is engaged in the harvesting and marketing of timber in the
Central Louisiana area. Debtor is wholly owned by Edward B. Holmes,
Jr, who is the sole member of the company.
At the time this case was filed (July 12, 2023) debtor owed 2
secured creditors which have liens on equipment used in the logging
operations.
The debt owed to one of the secured creditors was not in default,
and debtor was involved in negotiations to re-finance its debt.
However, that creditor took action to seize and apply deposits of
the debtor to its debt, without the consent of the debtor. The
Debtor was informed that the debt would be re-structured however
that never occurred which prompted the filing of this case.
The Debtor believes it is will have sufficient profits to pay based
upon recent history and it has no reason to believe that it should
not be able to pay the claims in full. Obviously, any attempt at
projecting income at this point is purely speculative as a result
of the current state of the general economy of the United States.
However, there is good reason to believe that this industry will
continued to proper and allow debtor to generate sufficient profits
to pay the debts as stated.
This Plan of Reorganization proposes to pay creditors of Ironman
Logging, L.L.C., from current operating profits over time. This
Plan provides for 4 classes of claims, as well as one class of
equity security holders. This Plan also provides for the payment of
administrative claims.
Class 4 consists of the Claim of the Unsecured Creditors. The
total amount of all unsecured claims is not known due to the
pending sale of the assets. After the payment of all administrative
claims in this case including attorney's fees and Chapter 11
Subchapter V Trustee fees, General Unsecured Claims shall be paid
$500.00 per month for 60 months. Payments will begin after all
Administrative Expenses have been paid in full.
Class 5 consists of the Equity interests in the debtor. Unless
otherwise provided herein, title to property of the estate,
subjecting to existing liens found to be valid in bankruptcy, shall
vest in the debtor upon confirmation of this Plan. Equity Security
Holders will retain their ownership interest in the debtor.
The funds necessary for the satisfaction of the creditors' claims
shall be derived from net operating profits of the debtor as well
accounts receivable collected after the filing of the case.
Upon confirmation, the Debtor will be authorized to execute any and
all property transfers contemplated hereunder. Such transfers shall
be pursuant to such documents of title as reasonably required by
parties and in accordance with normal business practices. The
provisions of the automatic stay and any stay or injunction that
becomes effective upon confirmation will be lifted on ex parte
motion to the extent necessary for good title to be transferred to
such secured creditor.
A full-text copy of the Plan of Reorganization dated September 26,
2023 is available at https://urlcurt.com/u?l=4l2Z5r from
PacerMonitor.com at no charge.
Attorney for Debtor:
Thomas R. Willson, Esq.
Law Office of Thomas R. Willson
1330 Jackson Street
Alexandria, LA 71301
Tel: (318) 442-8658
Fax: (318) 442-9637
Email: rocky@rockywillsonlaw.com
About Ironman Logging
Ironman Logging, LLC, a company in Georgetown, La., filed a
petition under Chapter 11, Subchapter V of the Bankruptcy Code
(Bankr. W.D. La. Case No. 23-80389) on July 12, 2023. In the
petition signed by its managing member, Edward B. Holmes, Jr., the
Debtor disclosed $1,255,500 in assets and $554,248 in liabilities.
Judge Stephen D. Wheelis oversees the case.
Thomas R. Willson, Esq., is the Debtor's legal counsel.
ISOLVED INC: Moody's Assigns First Time B2 Corporate Family Rating
------------------------------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family Rating and
B2-PD Probability of Default Rating to isolved, Inc. The proposed
senior secured first lien credit facilities, including a $75
million revolving credit facility and $550 million of term loans,
were assigned B2 ratings. Net proceeds from the first lien term
loans will be used primarily to refinance existing debt as well as
other general corporate purposes including adding cash to the
balance sheet. The outlook assigned is stable.
RATINGS RATIONALE
The B2 rating reflects isolved's high financial risk profile with
estimated debt to EBITDA of roughly 5.6x (including Moody's
standard adjustments) at closing and the likelihood for financial
leverage to remain elevated, consistent with the company's
acquisition strategy. Although growing, isolved is small in scale
relative to deep-pocketed rivals and faces intense competition in
the evolving human capital management (HCM) market. The company
differentiates itself by targeting SMB and midmarket customers,
providing cloud HCM systems across a range of HR functions, and
offering a centralized place to manage over the employee lifecycle.
Similar to the company's software peers, isolved benefits from
cloud-based subscription revenues and high retention rates which
provide good visibility into cash flows. isolved has a good track
of growing revenues organically supplemented by tuck-in
acquisitions, and Moody's expects isolved's top line will continue
to increase in the low double-digit percentage range over the next
couple of years supported by ongoing M&A. The company is a serial
acquiror of tuck-in businesses with excess cash being directed to
support growth investments and debt-funded M&A. As a result,
Moody's expects adjusted debt to EBITDA will remain high over the
next few years. The tuck-in acquisition strategy of isolved comes
with reduced risk given the company's focus on buying out partners
within the isolved Network who have a proven track record.
Governance considerations are a key driver of ratings given
controlled ownership and the company's track record for high
leverage reflecting a debt-financed acquisition strategy. isolved's
asset-light business model reduces the impact that environmental
and social risks have on debt ratings.
isolved has good liquidity consisting primarily of availability
under the proposed $75 million revolving credit facility which is
expected to be undrawn at closing. Moody's expects unrestricted
cash balances will be maintained around $10 million given excess
cash will likely be used to support growth investments including
M&A. Working capital needs are nominal throughout the year, and
capital spending is less than 4% of revenues annually. The B2
instrument ratings are in line with the Corporate Family Rating
reflecting the presence of only one class of debt within the
capital structure.
The stable outlook reflects Moody's expectation for continued top
line gains in the low double-digit percentage range supported by
sector growth plus ongoing tuck-in acquisitions. Moody's expects
adjusted EBITDA margins will remain above 20% with good free cash
flow conversion given minimal working capital needs and capital
spending requirements of less than 5% of revenues. The outlook does
not include dividends given isolved's strategy of re-investing
excess cash to drive organic and inorganic growth.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Given isolved's high leverage and acquisition growth strategy,
Moody's does not expect a rating upgrade in the near term. Over
time as isolved's scale approaches those of its HCM peers, ratings
could be upgraded if Moody's expects revenues will continue to grow
organically in the mid to high single digit percentage range with
adjusted leverage sustained below 4.5x and growing free cash flow.
Ratings could be downgraded if organic revenue growth decelerates
to the low single digit percentage range or adjusted debt to EBITDA
increases to more than 6x. There would also be downward rating
pressure if adjusted EBITDA margins deteriorate reflecting
competitive pressures or execution challenges, or liquidity weakens
demonstrated by cash balances plus revolver availability falling
below $60 million or adjusted free cash flow to debt remaining
below 2%.
As proposed, the new credit facilities are expected to provide
covenant flexibility that if utilized could negatively impact
creditors. The credit agreement contains incremental revolver and
Term Loan B debt capacity up to the greater of $110 million and
100% of consolidated EBITDA, plus unlimited pari passu secured
amounts so long as the first lien net leverage ratio does not
exceed 5.25x (as defined). In the case of issuing incremental debt
that is unsecured or comes with junior liens, the net leverage
ratio maximum increases to 5.75x. The credit facilities also
include provisions allowing the transfer of assets to unrestricted
subsidiaries subject to "blocker" provisions which prohibit (i)
transfer of legal title, or license, on an exclusive basis of any
intellectual property that is material to business operations; and
(ii) the designation of any restricted subsidiary that holds
exclusive licenses to, or owns, any material intellectual property
as an unrestricted subsidiary. Only wholly owned subsidiaries are
required to act as subsidiary guarantors, raising the risk that
guarantees may be released following a partial change in ownership,
subject to protective provisions to be determined. The credit
agreement provides some limitations on up-tiering transactions,
including the requirement for the consent of each adversely
affected lender for any contractual payment or lien subordination
on terms and exceptions to be determined. The above are proposed
terms and final provisions of the credit agreement may be
materially different.
isolved, Inc. is a provider of cloud-based human capital management
("HCM") software, focusing on SMB and midmarket organizations.
isolved has been controlled by financial sponsor Accel-KKR since
2011. Over the next year, 12-month revenues are expected to exceed
$400 million.
The principal methodology used in these ratings was Software
published in June 2022.
ISOLVED INC: S&P Assigns 'B' Issuer Credit Rating, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings assigned its 'B' issuer credit rating to isolved
inc., a cloud-based human capital management (HCM) software
provider. S&P also assigned its 'B' issue-level rating and '3'
recovery rating to the company's proposed first-lien term loan and
revolving credit facility.
The stable outlook reflects S&P's view that isolved will continue
to grow its scale and expand its EBITDA margins as it executes its
growth strategy.
The HCM market is highly competitive and fragmented. S&P views
isolved as a smaller provider of software-as-a-service (SaaS) human
capital management (HCM) solutions, including HR and payroll,
workforce management, and talent acquisition and management, in a
highly competitive market. While the market for HCM solutions is
segmented by business size, the company regularly competes with
larger and well-capitalized HCM providers, such as Automatic Data
Processing Inc. (ADP), UKG, Workday, Paycor, Paylocity, Paycom and
Ceridian, along with other enterprise resource planning and
point-solution providers, including Oracle, SAP S.E., and
Cornerstone OnDemand, that have more financial flexibility to
expand product offerings and capture market shares. Additionally,
S&P views its scale and focus on small and medium-sized businesses
(SMBs) could pose higher business and cash flow volatility in times
of economic downturns.
Competitive end to end product offerings provide good growth
prospects. S&P said, "We believe isolved has a compelling and
comprehensive suite of HCM solutions, all in one platform and a
single database, that are scalable and competitive with upside
potential as they compete more in the mid to enterprise end market
segments. This is important as we expect demand for cloud HCM
solutions will increase due to the trends of hybrid and remote
working and workload digitalization and as increasing
sophistication in HCM needs continues." According to IDC research,
the HCM and payroll application market within the U.S. region is
expected to grow to $35.5 billion at a CAGR of 11.1% from 2023
through 2027, where cloud-based solutions will grow at a slightly
higher rate than on-premises solutions.
The company has been successful maintaining long-standing client
relationships and a well-diversified customer base with modest
industry concentrations in health care, business services,
manufacturing, and hospitality. Additionally, isolved's high
recurring revenue base of over 90% and good retention rates above
100% provide some revenue stability and visibility to partially
offset the potential business volatility stemming from an economic
downturn and reduced IT spending.
S&P said, "The stable outlook on isolved reflects our view that the
firm will continue to grow its scale and expand its EBITDA margins
over the next 12 months. We expect the company's adequate liquidity
position, modest but improving profitability, and good retention
rates will enable it to continue to pursue its growth strategy,
increase free cash flow generation, and reduce leverage over time
even when accounting for tuck-in acquisitions."
S&P could lower its rating on isolved if:
-- Its performance is worse than expected because of economic
downturns and raising unemployment;
-- Business execution or acquisition integration missteps lead to
lower client retention and EBITDA margin erosion; or
-- It pursues significant debt-financed acquisitions or increased
shareholder returns that cause its S&P Global Ratings-adjusted
leverage to exceed 9.5x (including the preferred equity that S&P
treated as debt in its leverage calculation) or its FFO cash
interest coverage sustains below high-1x area.
S&P could raise the rating on isolved if:
-- Its leverage improves and is sustained below 7x (including the
preferred equity that S&P treated as debt in its leverage
calculation) or it sustains FFO cash interest coverage over mid-2x
area; and
-- Its financial sponsor commits to a financial policy of
maintaining the credit metrics listed above.
S&P said, "Governance factors are a moderately negative
consideration in our credit rating analysis of isolved as is the
case for most rated entities owned by private-equity sponsors. We
believe the company's highly leveraged financial risk profile
points to corporate decision-making that prioritizes the interests
of the controlling owners. This also reflects the generally finite
holding periods and a focus on maximizing shareholder returns."
JIREH FITNESS: Aleida Molina Named Subchapter V Trustee
-------------------------------------------------------
The U.S. Trustee for Region 21 appointed Aleida Martinez Molina,
Esq., as Subchapter V trustee for Jireh Fitness Solutions Corp.
doing business as Retrofitness Wellington.
Ms. Molina will be paid an hourly fee of $450 for her services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Ms. Molina declared that she is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Aleida Martinez Molina, Esq.
2121 NW 2nd Avenue, Suite 201
Miami, FL 33127
Telephone: (305) 297-1878
Email: Martinez@subv-trustee.com
About Jireh Fitness Solutions Corp
Jireh Fitness Solutions Corp. operates a Class A Gym and Fitness
facility in Wellington, Fla., and has been in operation since June
2022. In addition to the cardio and weight operations of the gym,
the Debtor has tanning, muscular rejuvenation services and massage
chairs. The facility includes full bathroom (change room, lockers
and showers) for its members.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (S.D. Fla. Case No. 23-17407) on Sept. 15, 2023,
with up to $10 million in both assets and liabilities. Eduardo P.
Jurado, president, signed the petition.
Thomas L. Abrams, Esq., at Gamberg & Abrams, represents the Debtor
as legal counsel.
JIREH FITNESS: Court OKs Interim Cash Collateral Access
-------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Florida,
West Palm Beach Division, authorized Jireh Fitness Solutions Corp.
d/b/a Retrofitness Wellington to use cash collateral on an interim
basis in accordance with the budget, with a 10% variance.
The Secured creditor, Gulf Coast Bank & Trust will have a
replacement lien on cash used by the Debtor and all other assets
which comprise of its secured claim to the same extent, validity
and priority that existed prior to the commencement of this case.
Gulf Coast Bank & Trust, does not waive its right to seek further
adequate protection at a later date, and reserves all objections,
rights and remedies as to the Motion, and otherwise.
A second interim hearing on the matter is set for October 4, 2023
at 1:30 p.m.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=go5aU8 from PacerMonitor.com.
The Debtor projects $78,000 in total income and $80,500 in total
expenses.
About Jireh Fitness Solutions Corp
Jireh Fitness Solutions Corp operates a Class A Gym and Fitness
facility in Wellington, Florida and has been in operation since
June 2022. In addition to the cardio and weight operations of the
gym, the Debtor has tanning, muscular rejuvenation services and
massage chairs. The facility includes full bathroom (change room,
lockers and showers) for its members.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (S.D. Fla. Case No. 23-17407) on September 15,
2023. In the petition signed by Eduardo P. Jurado, president, the
Debtor disclosed up to $10 million in both assets and liabilities.
Judge Erik P. Kimball oversees the case.
Thomas L. Abrams, Esq., at Gamberg & Abrams, represents the Debtor
as legal counsel.
JT & SON: Court OKs Interim Cash Collateral Access
--------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Pennsylvania
authorized J.T. and Son Construction, LLC to use cash collateral on
an interim basis in accordance with the budget.
As previously reported by the Troubled Company Reporter, the U.S.
Small Business Administration has a lien on certain property of the
Debtor by way of a business loan. The lien was perfected by the
filing of a UCC Financing Statement (Filing #: 2020060101573) with
the Pennsylvania Secretary of State on June 1, 2020. The SBA has a
valid and perfected first priority lien and security interest in
the cash collateral.
John Deere Construction & Forestry Company, has a lien on certain
property of the Debtor by way of a business loan. The lien was
perfected by the filing of a UCC Financing Statement (Filing #:
2021102000157) with the Pennsylvania Secretary of State on October
19, 2021. John Deere has a valid and perfected second priority lien
and security interest in the cash collateral.
CHTD Company, has a lien on certain property of the Debtor by way
of a business loan. The lien was perfected by the filing of a UCC
Financing Statement (Filing #: 2022010600720) with the Pennsylvania
Secretary of State on January 6, 2022. CHTD has a valid and
perfected third priority lien and security interest in the cash
collateral.
Internet Truckstop Payments, LLP, has a lien on certain property of
the Debtor by way of a business loan. The lien was perfected by the
filing of a UCC Financing Statement (Filing #: 2022013101466) with
the Pennsylvania Secretary of State on January 31, 2022. ITP has a
valid and perfected fourth priority lien and security interest in
the cash collateral.
Corporation Service Company, has a lien on certain property of the
Debtor by way of a business loan. The lien was perfected by the
filing of a UCC Financing Statement (Filing #: 2022022401141) with
the Pennsylvania Secretary of State on February 24, 2022. CSC has a
valid and perfected fifth priority lien and security interest in
the cash collateral.
John Deere Construction and Forestry Company has a lien on certain
property of the Debtor by way of a business loan. The lien was
perfected by the filing of a UCC Financing Statement (Filing #:
2022041100439) with the Pennsylvania Secretary of State on April 8,
2022.
John Deere has a valid and perfected sixth priority lien and
security interest in the cash collateral.
Channel Partners Capital, has a lien on certain property of the
Debtor by way of a business loan. The lien was perfected by the
filing of a UCC Financing Statement (Filing #: 20230209026889) with
the Pennsylvania Secretary of State on February 9, 2023. Channel
Partners Capital has a valid and perfected seventh priority lien
and security interest in the cash collateral.
National Funding, Inc., has a lien on certain property of the
Debtor by way of a business loan. The lien was perfected by the
filing of a UCC Financing Statement (Filing #: 20230317051895) with
the Pennsylvania Secretary of State on March 17, 2023. National
Funding, Inc. has a valid and perfected eighth priority lien and
security interest in the cash collateral.
Atipana Credit Opportunity Fund I, LP has a lien on certain
property of the Debtor by way of a business loan. The lien was
perfected by the filing of a UCC Financing Statement (Filing #:
20230517100839) with the Pennsylvania Secretary of State on May 17,
2023. Atipana has a valid and perfected ninth priority lien and
security interest in the cash collateral.
Corporation Service Company, has a lien on certain property of the
Debtor by way of a business loan. The lien was perfected by the
filing of a UCC Financing Statement (Filing #: 2019072900637) with
the Pennsylvania Secretary of State on July 29, 2019. CSC has a
valid and perfected fifth priority lien and security interest in
the cash collateral.
The court ruled the pre-petition liens of the Lenders will be
continued post-petition as to both pre-petition and post-petition
assets, but the value of the Lenders' lien will not be greater
post-petition than the value thereof at the time of the filing of
the Bankruptcy Petition initiating the case, plus accruals and
advances thereafter, and minus payments to the Lender thereafter.
No additional financing statements or mortgages need be filed to
perfect such post-petition liens and security interests.
The debtor is required to make monthly payments to John Deere
Construction & Forestry Company, CIT, Channel Partners Capital,
U.S. Small Business Administration, CHTD Company, Internet
Truckstop Payments LLC, National Funding, Inc., and Atipana Credit
Opportunity Fund I, LP until a plan is confirmed. The Debtor is not
required to make payments to U.S. Small Business Administration,
CHTD Company, Internet Truckstop Payments LLC, National Funding,
Inc., and Atipana Credit Opportunity Fund I, LP, as they have
already paid in full.
A copy of the order is available at https://urlcurt.com/u?l=7r0K2Z
from PacerMonitor.com.
About J.T. and Son Construction, LLC
J.T. and Son Construction, LLC sought protection under Chapter 11
of the U.S. Bankruptcy Code (Bankr. W.D. Pa. Case No. 23-21623) on
August 2, 2023. In the petition signed by John Minarik, owner and
operator, the Debtor disclosed up to $10 million in both assets and
liabilities.
Judge John C. Melaragno oversees the case.
Brian C. Thompson, Esq., at Thompson Law Group, P.C., is the
Debtor's counsel.
KING DRIVE: Hires Cunningham Chernicoff as Legal Counsel
--------------------------------------------------------
King Drive Corp. seeks approval from the U.S. Bankruptcy Court for
the Middle District of Pennsylvania to employ Cunningham,
Chernicoff & Warshawsky, P.C. as its legal counsel.
The firm's services include:
a. advising the Debtor regarding its powers and duties in the
continued operation of its business and management of its
property;
b. preparing legal papers; and
c. providing other legal services necessary to administer the
Debtor's Chapter 11 case.
The firm will be paid at these rates:
Robert E. Chernicoff $450 per hour
Partners $400 to $450 per hour
Associate Attorneys $225 to $350 per hour
Paralegals $100 to $150 per hour
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Robert Chernicoff, Esq., a partner at Cunningham, 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.
Cunningham can be reached at:
Robert E. Chernicoff, Esq.
CUNNINGHAM, CHERNICOFF & WARSHAWSKY, P.C.
P.O. Box 60457
Harrisburg, PA 17106-0457
Tel: (717) 238-6570
Fax: (717) 238-4809
About King Drive Corp.
King Drive Corp. in Harrisburg, PA, filed its voluntary petition
for Chapter 11 protection (Bankr. M.D. Pa. Case No. 23-02044) on
September 8, 2023, listing $1 million to $10 million in assets and
$500,000 to $1 million in liabilities. Richard A. Angino as
president, signed the petition.
Judge Henry W. Van Eck oversees the case.
CUNNINGHAM, CHERNICOFF & WARSHAWSKY PC serve as the Debtor's legal
counsel.
LD CONSTRUCTION: Christy Brandon Named Subchapter V Trustee
-----------------------------------------------------------
The Acting U.S. Trustee for Region 18 appointed Christy Brandon,
Esq., a practicing attorney in Bigfork, Mont., as Subchapter V
trustee for LD Construction, Inc.
Ms. Brandon will be paid an hourly fee of $250 for her services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Ms. Brandon declared that she is a disinterested person according
to Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Christy L. Brandon
PO Box 1544
Bigfork, MT 59911
Phone: (406) 837-5445
Email: christy@brandonlawfirm.com
About LD Construction
LD Construction, Inc., a company in Lewistown, Mont., filed a
petition under Chapter 11, Subchapter V of the Bankruptcy Code
(Bankr. D. Mont. Case No. 23-40063) on Sept. 15, 2023, with $1
million to $10 million in assets and liabilities. Brian L. Larson,
president, signed the petition.
Judge Benjamin P. Hursh oversees the case.
Gary S. Deschenes, Esq., at Deschenes & Associates Law Offices
represents the Debtor as bankruptcy counsel.
LEAFBUYER TECHNOLOGIES: Incurs $585K Net Loss in FY Ended June 30
-----------------------------------------------------------------
Leafbuyer Technologies, Inc. filed with the Securities and Exchange
Commission its Annual Report on Form 10-K disclosing a net loss of
$585,211 on $5.09 million of revenue for the year ended June 30,
2023, compared to net income of $955,695 on $3.81 million of
revenue for the year ended June 30, 2022.
As of June 30, 2023, the Company had $1.83 million in total assets,
$3.11 million in total liabilities, and a total deficit of $1.28
million.
Lakewood, CO-based BF Borgers CPA PC, the Company's auditor since
2017, issued a "going concern" qualification in its report dated
Sept. 28, 2023, citing that the Company has suffered recurring
losses from operations and has a significant accumulated deficit.
In addition, the Company continues to experience negative cash
flows from operations. These factors raise substantial doubt about
the Company's ability to continue as a going concern.
Leafbuyer said, "Our ability to continue as a going concern is
dependent upon our generating profitable operations in the future
and / or obtaining the necessary financing to meet our obligations
and repay our liabilities arising from normal business operations
when they come due. Management believes that actions presently
being taken to further implement our business plan of expansion of
products, geographical locations we sell our services and deeper
market penetration will generate additional revenues and eventually
positive cash flow and provide opportunity for the Company to
continue as a going concern. While we believe in the viability of
our strategy to generate additional revenues and our ability to
raise additional funds, there can be no assurances to that
effect."
A full-text copy of the Annual Report on Form 10-K as filed with
the Securities and Exchange Commission is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1643721/000147793223007194/lbuy_10k.htm
About Leafbuyer
Leafbuyer Technologies, Inc. is a marketing technology company for
the cannabis industry and is an online cannabis resource.
LI GROUP: S&P Affirms 'B' ICR on $50MM Term Loan Prepayment
-----------------------------------------------------------
S&P Global Ratings affirmed all its ratings on LI Group Holdings
Inc. (Liaison), including its 'B' issuer credit rating.
S&P said, "The stable outlook on Liaison reflects our expectation
that despite muted revenue growth and a slight decline in
profitability over the next 12 months, the reduced debt burden will
enable the company's leverage to remain under 7x in our forecast
period. We expect a gradual rebound in higher education enrollment
and macroeconomic recovery to allow free operating cash flow (FOCF)
to debt to recover to the low-teens percent area by fiscal 2025.
"We expect Liaison's S&P Global Ratings-adjusted leverage to
decline materially in fiscal 2024, primarily as a result of the
debt paydown using excess cash on balance sheet. We view this as a
positive development given that challenging business conditions
would make organic deleveraging difficult over the next year as
demand slowly recovers. The company's S&P Global Ratings-adjusted
leverage reached 7.9x in the 12 months ended June 30, above our 7x
downside trigger. Pro forma for the $50 million term loan payment,
Liaison's current leverage would be about 6.6x.
"We expect revenue growth in the low-single-digit percent area for
full-year fiscal 2024 and EBITDA margins of about 28% to keep
leverage in the mid-6x area by the fiscal year-end. In addition to
lower leverage, the prepayment also reduces the company's annual
interest burden by about $5 million, which we view as impactful
given Liaison's small scale and the current high interest rate
environment.
"We expect FOCF to debt will be about 5% in fiscal 2024 before
recovering to the low-teens percent area thereafter. We also
forecast Liaison will maintain sufficient liquidity including cash
on hand of $20 million-$30 million following the prepayment. We
view this as sufficient for business operations given its FOCF
generation of about $10 million in fiscal 2024, full access to its
undrawn $15 million revolver, and manageable debt amortization
payments.
"The stable outlook on Liaison reflects our view that the company
will grow revenues in the low-single-digit percent area as
enrollments steadily recover and maintain EBITDA margins at about
28% such that its S&P Global Ratings-adjusted leverage remains
stable in the mid-6x area in fiscal year 2024.
"We would consider a downgrade if we believe that Liaison's
leverage will exceed 7x on a sustained basis. This could result
from a slower-than-expected rebound in applications volume, a
further deterioration in profitability, or leveraged mergers and
acquisitions (M&As) with challenges in integration. We would also
consider a downgrade if Liaison cannot generate positive FOCF or
maintain adequate liquidity on a sustainable basis.
"Although unlikely over the next 12 months due to Liaison's small
scale and leverage over 6x, we could consider an upgrade if Liaison
significantly expands its scale through maintaining mid- to
high-teens percent growth and improves its EBITDA margins and free
cash flow generation over a multiyear period while sustaining S&P
Global Ratings-adjusted leverage under 5x."
LIFEPOINT HEALTH: Moody's Rates New $1BB Sr. Secured Notes 'B2'
---------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to Lifepoint Health,
Inc.'s new $1 billion senior secured notes due in 2030. There are
no changes to the existing ratings including the B3 Corporate
Family Rating, the B3-PD Probability of Default Rating, the B2
senior secured term loan, the existing B2 senior secured notes and
the Caa2 senior unsecured ratings. The outlook is unchanged at
stable.
Proceeds from the new $1 billion senior secured notes will be used
to partially repay Lifepoint Health, Inc.'s existing $3.015 billion
senior secured term loan due in 2025, and for general corporate
purposes. The offering will lengthen the Lifepoint's debt maturity
profile and will be largely leverage neutral, with the exception of
some fees paid. However, the transaction will increase interest
expense by roughly $7.5 million a year. Combined with a recent term
loan add-on also used for refinancing, LifePoint's annual interest
expense will increase by about $37.5 million.
RATINGS RATIONALE
Lifepoint's B3 CFR reflects the company's high financial leverage,
with debt to EBITDA at 7.9x pro-forma for recent transactions,
including the sale leaseback transaction that closed in September
2023.The primary drivers for the spike in financial leverage were a
surge in operating expenses including elevated labor costs and
increased spending on new facilities associated with acquisitions
completed in early 2023. Moody's believes Lifepoint's combination
of acute care, rehabilitation and behavioral health translates into
a strong organic growth profile with many opportunities for
expansion with acute care hospitals serving as referral source to
its other business lines. Moody's expects improvement in
Lifepoint's leverage and cash flow as labor pressures continue to
abate. This reflects declining use of contract labor and changing
segment mix with a higher percentage of behavioral health that
carries higher margins. Lifepoint's rating is supported by the
company's large scale and good geographic diversity.
Moody's expects Lifepoint will maintain good liquidity for the next
year. The company reported $128 million of cash as of June 30, 2023
which together with revolver availability provides a buffer against
negative free cash flow. The company's $800 million ABL revolver
(unrated, maturing in January 2028), has about $165 million used
and about $60 million of LOCs as of June 30, 2023. Lifepoint
recently completed a sale leaseback of a medical office building,
which provided $224 million in cash. Moody's anticipates that
Lifepoint will generate negative cash flow for the next 12- 18
months but that it should improve in 2024.
The company's term loan facility ($2.0 billion pro forma for the
transactions) and $2.4 billion of senior secured notes are rated
B2, one notch higher than the B3 corporate family rating. The
notching reflects the secured debt effective subordination to the
asset-based revolver which has a first lien on certain accounts
receivable. The secured debt benefits from the material level of
junior capital provided by the $1.8 billion of unsecured debt. The
Caa2 rating on the company's unsecured notes is two notches below
the B3 corporate family rating and reflects their effective
subordination to a material level of secured debt.
In the stable outlook, Moody's forecasts that margins will improve
resulting from a lower use of contract labor in 2023 and change in
service offering mix with the higher margin behavioral health and
rehabilitation segments comprising roughly 20% of revenue pro forma
for the recent acquisitions. Moody's also anticipates that capital
expenditures will decline as IT upgrades and existing facility
improvements are completed.
Lifepoint's CIS-4 indicates the rating is lower than it would have
been if ESG risk exposures did not exist. This reflects Lifepoint's
exposure to social risk considerations (S-4) and governance risk
considerations (G-4). As a healthcare services provider, Lifepoint
has exposure to responsible production risk, which considers the
company's potential liability related to patient care. In addition,
Lifepoint has exposure to human capital, as the company relies on
highly specialized labor to provide its services. The company is
also exposed to societal and demographic trends such as changes in
reimbursement rates by its payors, which include government payors,
as well as a push towards reducing overall healthcare costs.
Governance risk considerations reflect Lifepoint's exposure to
aggressive financial strategy and limited track record since its
acquisition of Kindred Healthcare, LLC and subsequent spin-off of
Scion Health in December 2021.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Moody's could upgrade the ratings if Lifepoint improves
profitability and maintains balanced financial policies and good
liquidity. Ratings could be upgraded if debt/EBITDA is sustained at
6 times.
Moody's could downgrade the ratings if the company's liquidity
weakens or if the operating environment weakens significantly
including ongoing margin pressure. Ratings could be downgraded if
financial policies become more aggressive including debt-financed
dividends or leveraging acquisitions.
Lifepoint Health, Inc., headquartered in Brentwood, Tennessee, is
an operator of general acute care hospitals, community hospitals,
regional health systems, physician practices, outpatient centers
and post-acute care facilities in non-urban markets. Inclusive of
Springstone, the company operates 62 community hospitals in 30
states, approximately 39 rehabilitation facilities and 22
behavioral health hospitals, and 200 outpatient centers under the
private ownership of funds affiliated with Apollo Global
Management, LLC. Revenues are approximately $9 billion pro forma
for acquisitions.
The principal methodology used in this rating was Business and
Consumer Services published in November 2021.
LONZA GROUP: BlackRock DSF Marks $939,000 Loan at 16% Off
---------------------------------------------------------
BlackRock Debt Strategies Fund, Inc has marked its $939,000 loan
extended to Lonza Group AG to market at $791,529 or 86% of the
outstanding amount, as of June 30, 2023, according to BlackRock
Debt's Form N-CSRS report for the first half of 2023, filed with
the Securities and Exchange Commission.
BlackRock DSFI is a participant in a USD Term Loan B to Lonza Group
AG. The loan accrues interest at a rate of 9.27% (3-mo. CME Term
SOFR + 3.93%) per annum. The loan matures on July 3, 2028.
BlackRock Debt Strategies Fund, Inc is registered under the
Investment Company Act of 1940, as amended, as closed-end
management investment companies and is referred to herein
collectively as the Fund.
Lonza is a Life Sciences driven company headquartered in
Switzerland.
LTL MANAGEMENT: J&J Defends Unit's Use of Texas 2-Step Strategy
---------------------------------------------------------------
Emily Field of Law360 reports that Johnson & Johnson's litigation
head defended the talc unit's use of the "Texas two-step" strategy
to handle thousands of talc asbestos claims, as bipartisan
lawmakers assailed the tactic as an attempt to reap "all the
benefits of bankruptcy without the cost."
About LTL Management
LTL Management, LLC, is a subsidiary of Johnson & Johnson (J&J),
which was formed to manage and defend thousands of talc-related
claims and oversee the operations of Royalty A&M. Royalty A&M owns
a portfolio of royalty revenue streams, including royalty revenue
streams based on third-party sales of LACTAID, MYLANTA/MYLICON and
ROGAINE products.
LTL Management filed a petition for Chapter 11 protection (Bankr.
W.D.N.C. Case No. 21-30589) on Oct. 14, 2021. The case was
transferred to New Jersey (Bankr. D.N.J. Case No. 21-30589) on Nov.
16, 2021. The Hon. Michael B. Kaplan is the case judge. At the
time of the filing, the Debtor was estimated to have $1 billion to
$10 billion in both assets and liabilities.
The Debtor tapped Jones Day and Rayburn Cooper & Durham, P.A., as
bankruptcy counsel; King & Spalding, LLP and Shook, Hardy & Bacon
LLP as special counsel; McCarter & English, LLP as litigation
consultant; Bates White, LLC as financial consultant; and
AlixPartners, LLP as restructuring advisor. Epiq Corporate
Restructuring, LLC, is the claims agent.
An official committee of talc claimants was formed in the Debtor's
Chapter 11 case on Nov. 9, 2021. On Dec. 24, 2021, the U.S.
Trustee for Regions 3 and 9 reconstituted the talc claimants'
committee and appointed two separate committees: (i) the official
committee of talc claimants I, which represents ovarian cancer
claimants, and (ii) the official committee of talc claimants II,
which represents mesothelioma claimants.
The official committee of talc claimants I tapped Genova Burns LLC,
Brown Rudnick LLP, Otterbourg PC and Parkins Lee & Rubio LLP as its
legal counsel. Meanwhile, the official committee of talc claimants
II is represented by the law firms of Cooley LLP, Bailey Glasser
LLP, Waldrep Wall Babcock & Bailey PLLC, Massey & Gail LLP, and
Sherman Silverstein Kohl Rose & Podolsky P.A.
Re-Filing of Chapter 11 Petition
On Jan. 30, 2023, a panel of the Third Circuit issued an opinion
directing the Court to dismiss the 2021 Chapter 11 Case on the
basis that it was not filed in good faith. Although the Third
Circuit panel recognized that the Debtor "inherited massive
liabilities" and faced "thousands" of future claims, it concluded
that the Debtor was not in financial distress before the filing.
On March 22, 2023, the Third Circuit entered an order denying the
Debtor's petition for rehearing. The Third Circuit entered an
order denying LTL's stay motion on March 31, 2023, and, on the same
day, issued its mandate directing the Bankruptcy Court to dismiss
the 2021 Chapter 11 Case.
The Bankruptcy Court entered an order dismissing the 2021 Case on
April 4, 2023.
Johnson & Johnson on April 4, 2023, announced that its subsidiary
LTL Management LLC (LTL) has re-filed for voluntary Chapter 11
bankruptcy protection (Bankr. D.N.J. Case No. 23-12825) to obtain
approval of a reorganization plan that will equitably and
efficiently resolve all claims arising from cosmetic talc
litigation against the Company and its affiliates in North
America.
In the new filing, J&J said it has agreed to contribute up to a
present value of $8.9 billion, payable over 25 years, to resolve
all the current and future talc claims, which is an increase of
$6.9 billion over the $2 billion previously committed in connection
with LTL's initial bankruptcy filing in October 2021. LTL also has
secured commitments from over 60,000 current claimants to support a
global resolution on these terms.
MARAVAI TOPCO: S&P Downgrades ICR to 'B', Outlook Stable
--------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Life
sciences company Maravai Topco Holdings LLC provided revenue and
EBITDA guidance for 2023 that was sharply be to 'B' from 'B+'. S&P
also lowered its issue-level rating on the company's revolver and
first-lien debt to 'B' from 'B+'.
S&P said, "The stable outlook on Maravai reflects our expectation
that increasing adoption of non-coronavirus-related messenger
ribonucleic acid (mRNA) products complemented by
acquisition-related growth will support a high-single-digit
percentage expansion in its revenue in 2024. It also reflects our
projection that the company's EBITDA margin (S&P Global
Ratings-adjusted) will stabilize at about 25%, enabling Maravai to
generate discretionary cash flow of about $20 million after
mandatory distributions for tax purposes.
"The downgrade reflects our expectation that EBITDA will decline
sharply in 2023. Maravai reported weak results in second-quarter
2023, spurred by a significant decline in coronavirus
vaccine-related sales and weaker results in its base business
because of more cautious research and development (R&D) spending by
its pharmaceutical customers due to macroeconomic pressures. As a
result, the company lowered its revenue guidance for 2023 by about
$110 million (26% lower than its previous guidance) and its EBITDA
guidance by about $90 million (55% lower than its prior guidance).
Maravai's EBITDA outlook also represents a 42% decline from 2022.
The significant drop in EBITDA in part reflects Maravai's
high-fixed cost base including ongoing investments in the company's
manufacturing facilities, which we expect will compress its EBITDA
margin in the near term. Given the lower-than-anticipated demand
for its products in 2023 and likely into 2024, we expect its EBITDA
margin (S&P Global Ratings-adjusted) will be suppressed at about
23%-25% over the next couple of years. As a result, we expect S&P
Global Ratings-adjusted leverage will rise to about 17x (8x
excluding our tax receivable agreement [TRA] adjustment) in 2023
before declining to 15x (7x excluding the TRA adjustment) in
2024."
Longer-term growth prospects remain favorable based on the diverse
application of its products and exposure to high growth markets.
The pandemic accelerated the development and application of mRNA
technologies and we believe Maravai's mRNA products are well
positioned to expand into other therapeutic and vaccine development
programs. Despite our expectation for lower coronavirus
vaccine-related sales, we project Maravai's revenue will increase
in the high-single-digit percentage area in 2024 and 2025. This
reflects the broader adoption of the company's mRNA products,
including within the fast-growing cell and gene therapy, and
biologics markets, complemented by tuck-in acquisitions. The use of
Maravai's CleanCap analogs in the R&D of mRNA vaccines provides
greater efficiency and lower costs than other methods. During the
second quarter of 2023, the company experienced an increase in
commitments for its "for research use" (RUO) services while also
reporting double the amount of signed contracts for its "good
manufacturing practice" (GMP) services compared with the first
quarter; both of which support our expectation for solid organic
growth in its nucleic acid production segment in 2024. At the same
time, S&P expects modest organic growth in Maravai's biologics
safety testing business based on the broad application of the
company's assays across biologic manufacturing and presence in the
growing cell and gene therapy market.
S&P said, "We expect Maravai will continue investing in its
operations to enhance manufacturing capabilities and expand its
production capacity. The company has been actively investing in its
facilities and expects its capital spending will peak in the $55
million-$65 million range in 2023 (compared with below $20 million
historically). These investments will enable its customers to
continue manufacturing along the different phases in a clinical
trial and transfer the late-phase programs into Maravai's GMP mRNA
manufacturing facility. We believe the company's expanded
infrastructure with additional capabilities and capacity, and the
opportunities to apply its CleanCap products to other programs
beyond coronavirus vaccines, position it to serve the longer-term
needs of its customers."
Maravai's sizable cash balance provides cushion for
underperformance. The company generated substantial cash flow over
the past couple years because of pandemic-induced demand for its
CleanCap analogs. Maravai had about $580 million of cash as of June
30, 2023. S&P said, "We believe the most likely use of cash would
be for tuck-in acquisitions to complement its existing portfolio.
We do not expect the company would earmark the cash for debt
repayment given its ownership by a financial sponsor and lack of
publicly stated leverage target. Therefore, we do not net cash in
our leverage calculation."
S&P said, "Maravai's TRA could pressure the rating if we expect the
company to settle the liability with funded debt. The company
received tax benefits when its pre-IPO owners exchanged their
partnership interests for publicly traded shares. The TRA requires
the company to share 85% of these accumulated tax savings with
pre-IPO owners (primarily GTCR and founders), when they are
realized. We view the payments under the TRA that would have
otherwise been paid in taxes as a call on the company's future cash
flows. Therefore, we include the liability within our adjusted
leverage calculation.
"However, we do not believe that the TRA fundamentally alters
Maravai's credit quality. We view the risk of the company using
debt to settle the TRA--thereby driving up reported leverage--as
low. We would not expect the company to settle the TRA with debt
given that TRA payments are only due when tax payments would have
otherwise been due, which would generally only happen when Maravai
has generated profits and cash flow to create taxable income. At
present, we do not view the TRA outflows as burdensome and the
company's ample liquidity can cover the cash outflows associated
with the TRA.
"The stable outlook on Maravai reflects our expectation that
although reduced demand for coronavirus vaccine-related analogs
will result in significantly lower revenue in 2023, increasing
adoption of non-coronavirus related mRNA products complemented by
acquisition-related growth will support a high-single-digit
percentage expansion in the company's top-line revenue in 2024. It
also reflects our projection that Maravai's EBITDA margin (S&P
Global Ratings-adjusted) will stabilize at about 25%, enabling the
company to generate discretionary cash flow of about $20 million
after mandatory distributions for tax purposes.
"We could consider downgrading Maravai if revenue growth is slower
than expected and its EBITDA margin remains suppressed, leading to
minimal discretionary cash flow after mandatory distributions. We
could also consider a downgrade if we believe the company will fund
large amount of TRA or other shareholder returns using debt such
that it materially drives up reported leverage.
Although unlikely over the next 12 months, we could consider
upgrading Maravai if it continues to expand in scale with
consistent organic growth, increases its adjusted EBITDA, and
generate discretionary cash flow (after mandatory distributions for
tax purposes) to debt of at least 5%.
"Governance factors are a moderately negative consideration in our
credit rating analysis of Maravai. Our assessment of the company's
financial risk profile as highly leveraged reflects corporate
decision-making that prioritizes the interests of controlling
owners, in line with our view of most rated entities owned by
private-equity sponsors. Our assessment also reflects the generally
finite holding periods and a focus on maximizing shareholder
returns."
MAYVILLE HOLDINGS: Case Summary & 11 Unsecured Creditors
--------------------------------------------------------
Debtor: Mayville Holdings, LLC
d/b/a Prairie Ridge Assited Living - Mayville
f/d/b/a Advantage Management Mayville, LLC
N4365 State Road 73
Columbus, WI 53925
Business Description: The Debtor owns and operates an assisted
living facility.
Chapter 11 Petition Date: September 30, 2023
Court: United States Bankruptcy Court
Western District of Wisconsin
Case No.: 23-24460
Judge: Hon. Beth E. Hanan
Debtor's Counsel: Evan P. Schmit, Esq.
KERKMAN & DUNN
839 N. Jefferson St., Ste. 400
Milwaukee, WI 53202-3744
Phone: 414-277-8200
Email: eschmit@kerkmandunn.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Micheal Eisenga as sole member of First
American Properties.
A copy of the Debtor's list of 11 unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/EAIFP6I/Mayville_Holdings_LLC__wiebke-23-24460__0004.0.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/HVPYMHA/Mayville_Holdings_LLC__wiebke-23-24460__0001.0.pdf?mcid=tGE4TAMA
MEDIMPACT HOLDINGS: S&P Assigns 'B+' ICR, Outlook Stable
--------------------------------------------------------
S&P Global Ratings assigned its 'B+' issuer credit rating to San
Diego, Calif.-based MedImpact Holdings Inc.
S&P said, "At the same time, we assigned our 'B+' issue-level and
'3' recovery rating to the proposed senior secured credit facility,
which will be issued by subsidiary MI OpCo Holdings Inc. The '3'
recovery rating indicates our expectation for meaningful recovery
(50%-70%; rounded estimate: 65%) in the event of a payment
default.
"The stable outlook reflects our expectation that MedImpact will
generally maintain leverage between 3x and 4x as it pursues and
integrates acquisitions.
"We based our issuer credit rating analysis on MedImpact Holdings
Inc. (Holdco), which is the parent company for MI Opco Holdings
Inc. (MI Opco; the borrower, core PBM operations), MINCA Inc.
(noncore investments assets), and other noncore subsidiaries."
The 'B+' issuer credit rating reflects MedImpact's modest scale
compared with that of three dominant competitors in the industry.
MedImpact's narrow focus and modest scale in the competitive
pharmacy benefit manager (PBM) sector, where its top three
competitors command around 80% of the market share, is a key
constraint on S&P's rating. Scale is the most important competitive
advantage in the PBM market. MedImpact is the sixth-largest PBM,
though its scale (gross revenues less than $10 billion) far trails
the top three competitors (all over $100 billion).
MedImpact is one of the largest independent PBMs, which could make
it attractive to health plan customers. A key differentiating
factor for the company is that it is not owned by a health plan and
may be perceived as independent. This could be attractive to
potential health plan clients, which may have reservations about
working with a PBM owned by a competitor. However, this could also
be a disadvantage with larger employers because PBMs owned by
health plans can market themselves by providing integrated
services. In S&P's opinion, MedImpact's independence has so far not
yet proved to be an advantage.
Large client losses have introduced earnings volatility over the
past few years, but MedImpact has seen significant margin
improvement in 2023.MedImpact faced significant PBM client losses
in recent years, including California Medicaid and Geisinger Health
Plan in 2021, representing a meaningful decline in EBITDA. New
client wins in the company's fee-for-service contracts have offset
those losses. As fee-for-service sales do not include drug spend in
revenue or expense, this has resulted in overall revenue declines
of 20% in 2022 and a further expected decline of 10% in 2023.
However, new client wins and increased service fees from its
aggregation relationships have bolstered margins. S&P expects
MedImpact will generate around $300 million of EBITDA in 2023, up
from $240 million in 2022 and $190 million in 2021.
Regulatory scrutiny is a key risk to the business. Regulatory
oversight and political scrutiny on drug pricing and the PBM
business model could negatively affect profitability. Several bills
in Congress could increase reporting requirements or rules
surrounding pricing transparency, among other provisions, can
affect PBMs' traditional revenue sources (including rebates and
spread pricing), the ability to negotiate discounts with network
pharmacies, and limit the economic benefits achievable through
pharmacy benefit management. Efforts to control health care costs,
including prescription drug costs, are continuing at the federal
and state government level
S&P said, "Our base-case scenario assumes MedImpact will draw on
its $650 million term loan in the near term to fund acquisitions,
sustaining adjusted debt to EBITDA between 3x and 4x.Pro forma the
refinancing of the existing capital structure, we estimate adjusted
leverage would be around 2.3x for fiscal-year-end 2023 if the
delayed draw term loan was undrawn. As per the terms of its
financing, MedImpact will have 90 days to fund the delayed draw
term loan and close on its planned acquisition opportunities.
However, should these opportunities not close, we assume the
company would pursue other debt funded M&A, as management has
demonstrated the willingness and intention to increase leverage to
the mid-3x range for the right opportunity.
"Our stable outlook on MedImpact reflects our expectation for
continued EBITDA expansion from the company's core PBM operations
and debt to EBITDA maintained between 3x to 4x due to debt-funded
M&A."
S&P could consider a lower rating if
-- debt to EBITDA remains above 4x and free operating cash flow
(FOCF) to debt stays below 10%. This would most likely occur
because of worsening pricing pressure in the PBM business
(potentially as a result of regulatory changes) or further large
client losses.
S&P could consider raising its rating on MedImpact if:
-- Debt to EBITDA remains below 3x and FOCF to debt stays above
15%;
-- Management's stated financial policy is in line with these
stronger credit metrics; and
-- S&P believes the PBM industry is less susceptible to potential
regulatory shocks.
S&P said, "We consider MedImpact's management and governance to be
weaker than that of its peers, which leads us to apply a negative
one-notch adjustment to our stand-alone credit profile on the
company." MedImpact's founder owns nearly 100% of the company and
it undertakes a significant number of related-party transactions.
For example, the founder owed MedImpact Holdings $446 million and
has partially funded interest payments by contributing assets that
he owned (valued at an estimated fair value) rather than paying
cash interest. MI Opco has also historically paid some dividends to
MINCA.
In addition, there are significant intercompany transactions
between MI Opco, the borrower, and MINCA. A number of MINCA's
portfolio companies also sell services to MI Opco as well as third
parties. MINCA also has real estate holdings and leases office
space to MI Opco. S&P also thinks there are risks that MINCA's
investment portfolio will dilute management's focus on the MI Opco
business.
Finally, MedImpact settled a minority shareholder lawsuit in late
2019, which was brought in late 2018 when the company tried to
repurchase shares from minority shareholders funded by a $130
million term loan to facilitate a spin-off of MINCA.
S&P said, "We also believe MedImpact has moderately outsized
exposure to social risk factors, due to heavy regulatory scrutiny
on PBMs. This includes a number of proposals to limit spread
pricing, particularly on government contracts, though MedImpact
does not engage in spread pricing with its government contracts.
There is also controversy on the use of rebates, from which
MedImpact earns less than 5% of its revenue from all of its
clients. Many PBMS state that if rebates were removed, they would
replace this revenue source with a different service fee. Given a
competitive market, there could be risk to this strategy. We would
note that the Congressional Budget Office recently estimated that
removing rebates would increase government spending. Lastly, there
are also proposals to improve transparency of PBMs. MedImpact
maintains that clients and brokers have numerous ways to audit or
review claims. It also maintains that it does not steer members to
its in-house pharmacy. However, there are risks that new
transparency regulations or laws, if enacted, could be disruptive
to the company or create additional costs."
METROPOLITAN BREWING: Case Summary & 16 Unsecured Creditors
-----------------------------------------------------------
Debtor: Metropolitan Brewing, LLC
3057 N Rockwell St,
Chicago, IL 60618
Business Description: Metropolitan Brewing is a manufacturer of
German-style beers in Chicago, Illinois.
Chapter 11 Petition Date: October 3, 2023
Court: United States Bankruptcy Court
Northern District of Illinois
Case No.: 23-13209
Judge: Hon. Deborah L. Thorne
Debtor's Counsel: Matthew E. McClintock, Esq.
GOLDSTEIN & MCCLINTOCK LLLP
111 W Washington Street
Suite 1221
Chicago, IL 60602
Tel: (312) 337-7700
Fax: (312) 277-2305
Email: mattm@goldmclaw.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Tracy Hurst as authorized representative
of the Debtor.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 16 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/TAT5DOQ/Metropolitan_Brewing_LLC__ilnbke-23-13209__0001.0.pdf?mcid=tGE4TAMA
MI OPCO: Moody's Assigns 'B2' CFR & Rates New First Lien Loans 'B2'
-------------------------------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family Rating and
a B2-PD Probability of Default Rating to MI OpCo Holdings Inc.
("MedImpact"). Moody's also assigned B2 ratings to the company's
proposed first-lien senior secured credit facilities, consisting of
a $50-75 million revolver expiring in 2028, a $550 million term
loan due in 2029, and a $650 million delayed draw term loan due in
2029. The ratings outlook is stable.
Net proceeds from these facilities will be used to repay
outstanding balances on MedImpact's existing Revolving Credit and
Term Loan A facilities, pay associated fees and expenses, and to
fund potential near-term acquisition opportunities.
ESG factors are material to the ratings assignment. Social risk
exposure for MedImpact includes the potential for changes in the US
healthcare market, including legislative and regulatory changes
which could constrain profits for PBMs. Among governance
considerations, MedImpact's concentrated ownership provides unique
risk factors including those related to oversight, controls and
succession planning. And although financial leverage within MI OpCo
Holdings, Inc. is currently modest, distributions (to the extent
allowable in the credit agreement) cannot be ruled out.
RATINGS RATIONALE
MedImpact's B2 CFR rating reflects its position as the 5th largest
pharmacy benefit manager (PBM) in the US. The company is
distinguished by its independent model, not affiliated with a
health insurer or retailer. This appeals to many clients, which
include employers, regional health plans and government entities.
However, the PBM industry's rapid consolidation into large
companies that integrate health insurers with PBMs suggest
advantages of that model, including breadth and scale, and
contribute to increase competitive pressure. The rating also
incorporates an elevated business risk as regulatory and/or
legislative changes could materially erode MedImapct's future
earnings. The rating also reflects governance risks related to a
highly concentrated ownership structure.
These risks are tempered by a track record of moderate financial
leverage and positive free cash flow. Furthermore, a growing cash
discount card business adds revenue diversity at higher margins
than the core PBM. Pro forma for the proposed refinancing and
acquisition, Moody's estimates MedImpact's leverage to be roughly
4.0x (assuming the DDTL is fully drawn). However, Moody's expects
leverage to decline towards 3.5x within 12-18 months reflecting
earnings growth.
The stable outlook reflects Moody's expectations that MedImpact's
will generate solid free cash flow despite earnings volatility and
will maintain its leverage between 3.5x-4.5x over the next 12-18
months.
Moody's anticipates that MedImpact will maintain adequate liquidity
reflecting modest free cash flow assuming no changes in vendor
terms, and back up liquidity provided by the $50-75 million
revolving credit facility. Moody's expects good cushion under
financial maintenance covenants. MedImpact typically operates with
a working capital deficit, which poses liquidity risk if multiple
vendors were to rapidly change payment terms with MedImpact.
MedImpact's ESG credit impact score is CIS-4 indicating that the
rating is lower than it would have been if ESG risk exposures did
not exist. The CIS-4 score reflects social risk exposures (S-4)
mainly stemming from customer relations and demographics and
societal. There is a variety of legislative and regulatory
proposals aimed at drug pricing and transparency, which could
constrain profits for PBMs. These trends also contribute to PBM
industry consolidation, which is creating formidable competitors to
MedImpact. Governance risk (G-4) considerations include MedImpact's
over 95% ownership by its founder, Chair and CEO which provides
unique risk factors including those related to oversight, controls
and succession planning. There are also material related party
transactions with companies outside the credit group, including a
rebate aggregator company. And although financial leverage within
MI OpCo Holdings, Inc. is currently modest, distributions to fund
other businesses (to the extent allowable in the credit agreement)
cannot be ruled out.
The B2 rating for the senior secured debt is the same as the
Corporate Family Rating as it is the only class of debt in the
capital structure.
The proposed first lien term loan is expected to have no financial
maintenance covenants while the proposed Delayed Draw Facility will
contain a financial maintenance covenant of 3.75x for 6 fiscal
quarters following the funding of Delayed Draw Facility, stepping
down to 3.5x for the remaining life. The availability of the
proposed Delayed Draw Facility is subject to a pro forma leverage
of 3.25x. In addition, the first lien credit facility contains
incremental facility capacity up to the greater of $300.0 million
and 100.0% of Consolidated EBITDA plus unlimited amounts up to:
First Lien Net Leverage of 2.0x. The proposed revolving credit
facility is subject to (1) an EBITDA interest coverage ratio of
2.5x for 6 fiscal quarters after closing, stepping up to 2.75x
afterwards and (2) an EBITDA net leverage ratio of 3.5x except
during the 6 quarters following the acquisition of the Prospective
Target when the leverage ratio is set at 3.75x. The 100% asset-sale
proceeds prepayment requirement has a leverage-based step-down to
25%, subject to First Lien Net Leverage reaching 2.75x. Collateral
leakage is permitted through transfers of assets to unrestricted
subsidiaries; Only subsidiaries that are wholly-owned must act as
subsidiary guarantors; dividends or transfers of partial ownership
interests could jeopardize guarantees, with no explicit protective
provisions limiting such releases. Dividends and other
distributions are permitted subject to a $100 million general
basket.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to an upgrade include a demonstrated
ability to generate steady growth in new businesses and increasing
revenue diversity from the discount card business, growth in free
cash flow generation and improved liquidity. Quantitatively,
Debt/EBITDA sustained below 3.5x could support an upgrade.
Factors that could lead to a downgrade include an increase in
customer termination rates, contraction in profit margins due to
significant pricing concessions, or liquidity pressure arising from
changes in vendor terms. Quantitatively, debt/EBITDA sustained
above 4.5x could lead to a downgrade.
MI OpCo Holdings, Inc. is the borrowing entity for MedImpact, a
pharmacy benefit manager headquartered in San Diego, California.
The company serves a number of customers including employers,
regional managed care organizations, Medicaid health plans and
hospital systems. MedImpact is a private company, over 95%-owned by
founder and CEO of the company. The company generated revenue of
$7.6 billion in the twelve months ended June 30, 2023.
The principal methodology used in these ratings was Distribution
and Supply Chain Services published in February 2023.
MTPC LLC: Court Confirms First Amended Plan
-------------------------------------------
Judge Randal S. Mashburn has entered an order confirming the First
Amended Chapter 11 Plan of MTPC, LLC, Case No. 20-05438 (including
the Plan Supplement and all transactions contemplated in the Plan)
pursuant to Section 1129 of the Bankruptcy Code.
The following releases by holders of Claims and Interests in
Section 6.05 of the Plan are approved:
As of the Effective Date, except as otherwise provided in the
Plan or arising from intentional fraud, gross negligence, or
willful misconduct, the Releasing Parties are deemed to have
released the Released Parties from any and all claims, interests,
obligations, rights, suits, damages, Causes of Action, remedies and
liabilities whatsoever, including any direct claims held by any of
the Releasing Parties against the Released Parties or derivative
claims asserted on behalf of the Debtor, whether known or unknown,
foreseen or unforeseen, existing or hereinafter arising, in law,
equity, or otherwise, whether for tort, contract, violations of
federal or state securities laws, or otherwise, that each Releasing
Party would have been legally entitled to assert (whether
individually or collectively), based on or relating to, or in any
manner arising from, in whole or in part, the Debtor, the Chapter
11 Case, the sale of substantially all of the Debtor's assets, the
subject matter of, or the transactions or events giving rise to,
any claim or Interest that is treated in the Plan, the business or
contractual arrangements between the Debtor and any Released Party,
the restructuring of claims and Interests before or in the Chapter
11 Cases, the negotiation, formulation, or preparation of the Plan,
the Sale Order, the Purchase Agreement, or related agreements,
instruments, or other documents, or upon any other act or omission,
transaction, agreement, event, or other occurrence relating to the
Debtor taking place on or before the Effective Date.
Notwithstanding anything to the contrary in the foregoing, the
releases set forth above do not release any post-Effective Date
obligations of any party under the Plan or any document,
instrument, or agreement (including those set forth in the Plan
Supplement) executed to implement the Plan.
The following exculpation of the Exculpated Parties in Section
6.06(e) of the Plan is approved:
Except as otherwise set forth in the Plan, none of the
Exculpated Parties shall have or incur any liability to any Person
or entity for any action taken or omitted to be taken in connection
with or related to the formulation, preparation, dissemination,
implementation, confirmation, or consummation of the Plan, the
Disclosure Statement, the Sale Order, the Purchase Agreement, or
any contract, release, or other agreement or document created or
entered into, or any other action taken or omitted to be taken in
connection with the Plan, the administration of the Plan or
property to be distributed pursuant to the Plan, the Sale
Transaction, and actions taken or omitted to be taken in connection
with the Chapter 11 Case or the operations, monitoring, or
administration of the Debtor during the Chapter 11 Case (other than
for illegal conduct, willful or wanton conduct, or gross
negligence, or fraud as determined by a Final Order of a court of
competent jurisdiction), and the Liquidation Trustee and GUC
Liquidation Trustee shall have no liability for any action taken or
omitted to be taken in connection with or related to the winding
down and post-confirmation administration of the Estate, except for
intentional fraud, gross negligence, or willful misconduct.
The appointment of Michael E. Collins of Manier & Herod, P.C. as
the GUC Liquidation Trustee, pursuant to the terms of the Plan and
the GUC Liquidation Trust Agreement included in the Plan
Supplement, is approved in all respects effective as of the date of
execution of the GUC Liquidation Trust Agreement. The GUC
Liquidation Trustee is authorized to carry out all rights and
duties as set forth in the Plan (including as set forth in Section
5.10 of the Plan and the GUC Liquidation Trust Agreement and shall
be compensated in accordance with the GUC Liquidation Trust
Agreement.
On the Effective Date, all GUC Liquidation Trust Assets shall vest
in the GUC Liquidation Trust, free and clear of all Liens, Claims,
charges, or other encumbrances, on behalf of holders of Allowed GUC
Settlement Claims; provided, however, that all holders of GUC
Settlement Claims reserve their rights to Distributions from the
GUC Liquidation Trust Assets in accordance with the Plan and this
Confirmation Order. This Confirmation Order shall constitute a
determination that the transfer of the GUC Liquidation Trust Assets
to the GUC Liquidation Trust under the Plan is legal, valid, and
enforceable.
Pursuant to section 1123(b)(1) of the Bankruptcy Code: (a) Class 1
Other Priority Claims and Class 2 Secured Tax Claims are Unimpaired
under the Plan; and (b) Class 3 Secured Lender Prepetition Claim;
Class 5 GUC Settlement Claims; Class 6 Insured Claims; Class 7 Bond
Deficiency Claims; Class 8 Non-Settling General Unsecured Claims;
Class 9 Insider Claims; Class 10 Intercompany Claims; Class 11
Subordinated Claims; and Class 12 Interests are Impaired under the
Plan.
MTPC's Liquidating Plan
MTPC, LLC, submitted a First Amended Chapter 11 Plan.
The Plan contemplates a liquidation of the Debtor's assets and the
resolution of all outstanding Claims against and Interests in the
Debtor. It also includes a settlement between the Debtor and the
Committee that will facilitate a Distribution to holders of
non-insider general unsecured claims, as more fully described in
the Plan. The Debtor has run a sale process for the sale of
substantially all its assets. The Plan will distribute proceeds
from the sale and create (i) a Liquidation Trust to pursue certain
causes of action, wind down the Debtor's Estate, and make
Distributions to holders of Allowed Claims, other than GUC Claims,
pursuant to the terms of the Plan and Liquidation Trust Agreement
and (ii) a GUC Liquidation Trust to reconcile GUC Settlement Claims
and make Distributions to holders of Allowed GUC Settlement Claims
pursuant to the terms of the Plan and GUC Liquidation Trust
Agreement. The Debtor is seeking to have the hearing on the
approval of the Disclosure Statement on August 8, 2023, and then
the Confirmation Hearing on or around September 14, 2023.
The Plan's goal is to distribute proceeds from the Bankruptcy Court
approved sale of substantially all the Debtor's Assets. The Plan
will also create two trusts: (i) a Liquidation Trust and appoint a
Liquidation Trustee to pursue certain causes of action and wind
down the Debtor's estate, and (ii) a GUC Liquidation Trust and
appoint the GUC Liquidation Trustee to reconcile GUC Settlement
Claims and make Distributions to Allowed GUC Settlement Claims.
Subject to the provisions in this Plan and except to the extent the
Debtor or the Liquidation Trustee, as applicable, and the holder of
an Allowed Administrative Claim agree to different treatment, the
Debtor or the Liquidation Trustee, as applicable, shall pay, in
full satisfaction and release of such Claim, to each holder of an
Allowed Administrative Claim, Cash, in an amount equal to such
Allowed Administrative Claim, on the later of (i) the Effective
Date and (ii) the first Business Day after the date that is thirty
(30) calendar days after the date on which such Administrative
Claim becomes an Allowed Administrative Claim, or as soon
thereafter as is practicable. Allowed Administrative Claims shall
be paid (x) first, from the funds in the Administrative and
Priority Claims Reserve, and (y) second, from Available Cash. For
the avoidance of doubt, Professional Fee Claims shall be Allowed
Administrative Claims.
Under the Plan, Class 5 GUC Settlement Claims total $1,592,526 and
will recover 1-3% of their claims. In full and final satisfaction,
settlement, release, and discharge of and in exchange for each
Class 5 GUC Settlement Claim, such holder of each such Allowed GUC
Settlement Claim shall receive its Pro Rata share of uncertificated
beneficial interests in the GUC Liquidation Trust representing the
right of each holder of an Allowed GUC Settlement Claim to receive
Distributions from the GUC Liquidation Trust in accordance with the
Plan and the GUC Liquidation Trust Agreement. Class 5 is impaired.
"GUC Liquidation Trust" means the trust described in Article V of
the Plan to be established under Tennessee trust law that shall
effectuate the terms of the Plan as it relates to the GUC
Settlement Claims, including conducting the reconciliation of GUC
Settlement Claims and making Distributions to holders of Allowed
GUC Settlement Claims from the GUC Liquidation Trust Assets.
"GUC Liquidation Trust Agreement" means the trust agreement entered
into by the GUC Liquidation Trustee as of the Effective Date,
substantially in form and substance as that filed as part of the
Plan Supplement, as it may be amended from time to time in
accordance with its terms.
"GUC Liquidation Trust Assets" means the GUC Liquidation Trust
Pool, which is the sole source of recovery of holders of GUC
Settlement Claims.
"GUC Liquidation Trust Interests" means the uncertificated
beneficial interests in the GUC Liquidation Trust representing the
right of each holder of an Allowed GUC Settlement Claim to receive
Distributions from the GUC Liquidation Trust in accordance with
Article V of this Plan and the GUC Liquidation Trust Agreement.
"GUC Liquidation Trust Pool" means the Settlement Payment, which
shall be used to pay for the GUC Liquidation Trustee's fees and
expenses and any Distribution to Allowed GUC Settlement Claims.
"GUC Liquidation Trustee" means [Michael E. Collins of Manier &
Herod, P.C.]
"GUC Settlement Claim" means an Unsecured Claim that is not an
Administrative Claim, a Professional Fee Claim, a Priority Tax
Claim, a Secured Claim, a Deficiency Claim, a Priority Claim, a
Non-Settling General Unsecured Claim, an Insider Claim, an Insured
Claim, a Bond Deficiency Claim, a 502(h) Claim, a Subordinated
Claim, or an Intercompany Claim. Class 8 Non-Settling General
Unsecured Claims. In full and final satisfaction, settlement,
release, and discharge of and in exchange for each Class 8
Non-Settling General Unsecured Claim, such holder of each such
Allowed Non-Settling General Unsecured Claim shall receive its Pro
Rata share of uncertificated beneficial interests in the
Liquidation Trust representing the right of each holder of a
Non-Settling General Unsecured Claim to receive Distributions from
the Liquidation Trust in accordance with the Plan and the
Liquidation Trust Agreement. Class 8 is impaired.
"Liquidation Trust" means the trust described in Article V of the
Plan to be established under Tennessee trust law that shall
effectuate the wind down of the Debtor and make Distributions
pursuant to the terms of the Plan and Liquidation Trust Agreement.
With respect to any action required or permitted to be taken by the
Liquidation Trust, the term includes the Liquidation Trustee or any
other person authorized to take such action in accordance with the
Liquidation Trust Agreement.
"Liquidation Trust Agreement" means the agreement to be entered
into by the Liquidation Trustee as of the Effective Date,
substantially in form and substance as that filed as part of the
Plan Supplement, as it may be amended from time to time in
accordance with its terms.
"Liquidation Trust Assets" means from and after the Effective Date
(a) all Assets of the Debtor and the proceeds thereof save for and
except the GUC Liquidation Trust Pool; (b) all legal and equitable
interests of the Debtor in Causes of Action, including the
Avoidance Actions, and the proceeds thereof; (c) all legal and
equitable defenses or counterclaims of the Debtor to Claims; (d)
the Liquidation Trust Funding Reserve; and (e) any other Assets to
be vested in the Liquidation Trust pursuant to this Plan and the
Liquidation Trust Agreement.
"Liquidation Trust Funding Reserve" means the reserve created by
the Debtor or the Liquidation Trustee on or before the Effective
Date from the Sale Proceeds to be utilized by the Liquidation
Trustee to effectuate the liquidation of the remaining Assets
hereunder, including, without limitation, to fund any necessary or
appropriate litigation against third parties, in accordance with
the Plan. The Liquidation Trustee may replenish the Liquidation
Trust Funding Reserve from Available Cash from time to time.
"Liquidation Trust Interests" means the uncertificated beneficial
interests in the Liquidation Trust representing the right of each
holder of an Allowed Bond Deficiency Claim and Allowed Class 8
Non-Settling General Unsecured Claim to receive Distributions from
the Liquidation Trust in accordance with Article V of this Plan and
the Liquidation Trust Agreement.
"Liquidation Trustee" means the Person identified in the Plan
Supplement as the Liquidation Trustee, and any successor
Liquidation Trustee appointed as provided in the Liquidation Trust
Agreement and retained as of the Effective Date pursuant to the
terms of the Liquidation Trust Agreement, as the fiduciary
responsible for implementing the applicable provisions of the Plan
and the Liquidation Trust Agreement.
On or prior to the Effective Date, the Liquidation Trustee and the
Debtor shall execute the Liquidation Trust Agreement. The
Liquidation Trust shall become effective on the Effective Date. On
the Effective Date, the Liquidation Trust shall be deemed to be
valid, binding, and enforceable in accordance with the terms and
provisions of the Plan and the Liquidation Trust Agreement. After
the Effective Date, the Liquidation Trust Agreement may be amended
in accordance with its terms without further order of the
Bankruptcy Court. The Liquidation Trust Agreement shall be
satisfactory in form and substance to the Debtor and the Secured
Lender.
Counsel for MTPC, LLC:
Marcus A. Helt, Esq.
Debbie E. Green, Esq.
Jack G. Haake, Esq.
MCDERMOTT WILL & EMERY, LLP
2501 North Harwood Street, Suite 1900
Dallas, TX 75201
Tel: (214) 210-2821
Fax: (972) 528-5765
E-mail: mhelt@mwe.com
dgreen@mwe.com
jhaake@mwe.com
- and -
David E. Lemke, Esq.
Tyler N. Layne, Esq.
HOLLAND AND KNIGHT, LLP
511 Union Street, Suite 2700
Nashville, TN 37219
Tel: (615) 244-6380
Fax: (615) 244-6804
E-mail: David.Lemke@hklaw.com
Tyler.Layne@hklaw.com
A copy of the Order dated September 15, 2023, is available at
https://tinyurl.ph/NtRCw from PacerMonitor.com.
About MTPC LLC
MTPC LLC is a proton-therapy cancer-treatment center that serves a
multi-state area of the Southeastern United States and began
operations in 2018. It is a freestanding center with three active
treatment rooms including one fixed beam and two gantries. MTPC is
located in a 43,500-square-foot building adjacent to the campus of
the Williamson Medical Center, in Franklin, Tenn.
MTPC's affiliate, The Proton Therapy Center, LLC, is a Tennessee
limited liability company that was organized in 2010. It is a
freestanding center with three active treatment rooms including one
fixed beam and two gantries. Proton Therapy Center is located in an
88,000-square-foot building on the campus of the Provision Case
CARES Cancer Center at Dowell Springs, in Knoxville, Tenn., a
comprehensive healthcare campus focusing on cancer treatment,
patient care, research, and education.
PCPT Hamlin, another affiliate of MTPC, is a Florida limited
liability company that was organized in 2018. It includes an
approximately 36,700-square-foot building in the 900-acre Hamlin
planned development in the "Town Center" of the 23,000-acre
"Horizon West" planning area of West Orange County.
MTPC and its affiliates sought Chapter 11 protection (Bankr. M.D.
Tenn. Lead Case No. 20-05438) on Dec. 15, 2020.
As of Aug. 31, 2020, MTPC's unaudited financial statements
reflected total assets of approximately $105.6 million and total
liabilities of approximately $131.2 million. Proton Therapy
Center's unaudited financial statements reflected total assets of
approximately $93.4 million and total liabilities of approximately
$130.2 million. Meanwhile, PCPT Hamlin's unaudited financial
statements reflected total assets of approximately $139.2 million
and total liabilities of approximately $138.5 million.
The Hon. Randal S. Mashburn is the case judge.
The Debtors tapped Waller Lansden Dortch & Davis LLP and McDermott
Will & Emery LLP as bankruptcy counsels; Trinity River Advisors,
LLC as restructuring advisor; and CRS Capstone Partners, LLC as
financial advisor. Stretto is the claims agent.
The U.S. Trustee for Region 8 appointed an official committee of
unsecured creditors on Jan. 8, 2021. The committee is represented
by Sills Cummis & Gross, PC and Manier & Herod, PC.
MXP OPERATING: Files Emergency Bid to Use Cash Collateral
---------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Texas,
Sherman Division, authorized MXP Operating, LLC to use cash
collateral on an interim basis in accordance with the budget.
HKMF Holdings Company, LLC successor to Seven Energy Investments,
LLC bda Alpha Seven Energy asserts a lien and/or ownership position
in the cash collateral and proceeds.
The Debtor is permitted to use cash collateral to pay those
expenses which become due prior to the final hearing in accordance
with the terms of the Budget, however, the Debtor will not make the
payment to the engineers and on any items under the Well Operations
-Workover and Repair section of the budget.
As previously reported by the Troubled Company Reporter, a result
of a litigation between the Debtor and one of its creditors Seven
Energy Investments, LLC bda Alpha Seven Energy has instructed the
purchasers of the Debtor's Oil and Gas not to remit the sales
proceeds to Debtor. This led to withheld funds from the Debtor. The
court compelled the funds to be released, and Alpha's counsel
argued they had a security interest in the funds.
The Debtor's reorganization chances depend on their ability to use
Alpha's alleged Collateral to continue operations and implement a
reorganization plan.
A hearing on the matter is set for November 7, 2023 at 10 o'clock
am.
A copy of the order is available at https://urlcurt.com/u?l=XFZoKk
from PacerMonitor.com.
About MXP Operating, LLC
MXP Operating, LLC operates a company providing operating services
for Oil and Gas wells in Texas and Oklahoma.
The Debtor filed its voluntary petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D. Tex. Case No. 23-41446) on
August 11, 2023. The petition was signed by Rachel T. Patman, Esq.
as managing member. At the time of filing, the Debtor estimated
$2,732,000 in assets and $8,603,928 in liabilities.
Judge Brenda T. Rhoades oversees the case.
Eric A. Liepins, Esq. at Eric A. Liepins, P.C. represents the
Debtor as counsel.
NAKED JUICE: BlackRock Debt Strategies Marks 2L Loan at 21% Off
---------------------------------------------------------------
BlackRock Debt Strategies Fund, Inc has marked its $1,565,000 loan
extended to Naked Juice LLC to market at $1,232,246 or 79% of the
outstanding amount, as of June 30, 2023, according to BlackRock
Debt's Form N-CSRS report for the first half of 2023, filed with
the Securities and Exchange Commission.
BlackRock DSFI is a participant in a Second Lien Term Loan to Naked
Juice LLC. The loan accrues interest at a rate of 11.34% (3-mo. CME
Term SOFR at 0.50% Floor + 6.00%) per annum. The loan matures on
January 24, 2030.
BlackRock Debt Strategies Fund, Inc is registered under the
Investment Company Act of 1940, as amended, as closed-end
management investment companies and is referred to herein
collectively as the Fund.
Naked Juice LLC is the entity resulting from a spin-off from
PepsiCo, with PAI Partners owning 61% and Pepsi retaining a 39%
stake. Naked Juice, LLC owns the Tropicana, Naked Juice, KeVita and
other select juice brands.
NEW HAVEN TRUCK: Court OKs Cash Collateral Access Thru Oct 31
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Connecticut, New
Haven Division, authorized New Haven Truck and Auto Body, Inc. to
use cash collateral on an interim basis in accordance with the
budget, with a 20% variance, through October 31, 2023.
Citizens Bank, National Association asserts an interest in the
Debtor's cash collateral.
As adequate protection against any post-petition diminution of the
Lender's cash collateral under 11 U.S.C. Sections 361 and 363, the
Lender is granted replacement or substitute liens in all
post-petition assets of the Debtor and proceeds thereof, and the
replacement liens will have the same validity, extent, and priority
that the Lender possessed as to said liens on the Petition Date.
The Lender's liens and any replacement thereof pursuant to the
order, will be subject and subordinate to a carve-out of such liens
for amounts payable by the Debtor for (i) fees of the United States
Trustee under 28 U.S.C. Section 1930(a)(6); (ii) wages and benefits
due the Debtor's employees and (iii) court approved fees of the
Debtor's professionals.
The Debtor and the Lender have agreed to an adequate protection
payment of $3,000 per month to be made by the 26th day of each
month commencing with August 26, 2023.
A continued hearing on the matter is set for October 25, 2023 at 11
a.m.
A copy of the order is available at https://urlcurt.com/u?l=uioWra
from PacerMonitor.com.
About New Haven Truck and Auto Body, Inc.
New Haven Truck and Auto Body, Inc. is a complete vehicle collision
and body repair shop located in East Haven, Connecticut.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Conn. Case No. 23-30298) on April 28,
023. In the petition signed by William S. Snow, Jr., president, the
Debtor disclosed up to $10 million in both assets and liabilities.
Stuart H. Caplan, Esq., at the Law Offices of Neil Crane, LLC,
represents the Debtor as legal counsel.
NUSTAR ENERGY: Fitch Hikes LongTerm IDR to 'BB', Outlook Stable
---------------------------------------------------------------
Fitch Ratings has upgraded the Long-Term Issuer Default Ratings
(IDRs) of NuStar Energy, L.P. (NuStar) and NuStar Logistics, L.P.'s
(Logistics) to 'BB' from 'BB-'. The Rating Outlook for both
entities is Stable. In addition, Logistics' senior unsecured
ratings have been upgraded to 'BB'/'RR4' from 'BB-'/'RR4' and
junior subordinated notes to 'B+'/'RR6' from 'B'/'RR6', and
NuStar's preferred equity rating has been upgraded to 'B+'/'RR6'
from 'B'/'RR6'.
The upgrade is related to leverage that is expected to be sustained
below Fitch's prior upgrade sensitivity level. Fitch's lower
leverage forecast is driven by the early redemption of NuStar's
series D preferred units, a portion of which was funded by a more
than $200 million equity issuance.
The ratings reflect the company's diversified asset base, contract
structure with a mix of minimum volume commitment (MVC) contracts
and acreage dedications, as well as some structurally exclusive
assets, and appropriate leverage. Concerns include meaningful
volume exposure, beyond MVC contracted levels, and a small amount
of direct commodity price spread exposure. The Stable Outlook is
based on Fitch's view of supportive fundamentals underlying
NuStar's businesses including expectations for continued crude oil
production growth in the Permian Basin, further increased demand
for renewable fuels along the West Coast and resilient demand for
refined products across North America.
KEY RATING DRIVERS
Improved Financial Profile: Fitch forecasts NuStar to have EBITDA
leverage around 5.0x in 2023 and over the forecast period. Given
NuStar's size, its position in the refined petroleum products value
chain and its contract portfolio, expected leverage is appropriate
for the middle of the 'BB' rating category. Fitch's leverage
expectations have improved following NuStar's issuance of over $200
million in common equity, the proceeds from which were used for the
early redemption of the company's remaining series D preferred
units.
In addition to an improved leverage picture, the redemption of
series D preferred units is also expected to improve cash flows,
given the relatively lower yield on NuStar common equity compared
to the 13.75% coupon on the series D preferred units. Fitch does
not expect the company to redeem any of its remaining preferred
units.
Contractual Support: Roughly one third of NuStar's EBITDA is
expected to come from contracts where the company will receive
payment regardless of whether a product is moved or not. These
contracts are with high credit quality counterparties including
roughly 66% of 2Q23 revenue coming from investment grade rated
entities and approximately 13% coming from large private or
international (not rated) customers. This provides good visibility
into a portion of future expected cash flows. Additionally, roughly
another third of forecast EBITDA is expected to come from fixed-fee
volume exposed arrangements where NuStar has structural
exclusivity.
The company operates the only pipelines that carry crude oil into,
and refined products out of, a number of Valero refineries. The
advantaged location and high capacity utilization of these
refineries offer more certainty to expected NuStar volumes,
compared to other fixed-fee fully volume exposed arrangements (i.e.
acreage dedications). Fitch notes that, once operational, the
agreement that NuStar has with OCI to transport ammonia will also
have characteristics indicative of structural exclusivity.
Some Volume and Price Exposure: NuStar generates roughly one third
of its EBITDA from fixed-fee volume exposed contracts and less than
5% from direct commodity price spread exposed activities. This
exposure provides less visibility into future cash flow. Outside of
the Fuels Marketing businesses (i.e. direct commodity price spread
exposure), expected volumes and throughput for NuStar are supported
by the relative attractiveness of its Permian crude oil pipeline
system. The Permian Basin continues to be the preeminent oil
producing region in the U.S., with breakeven costs that support
continued near-term development expansion.
The company's exposure to the Permian somewhat reduces near-term
volumetric risk, compared to issuers with exposure to relatively
less attractive basins. For Fuels Marketing, NuStar seeks to reduce
volatility through the use of hedging; however, this business
remains a source of cash flow variability for the company.
Renewables Momentum: NuStar benefits from an early mover advantage
in renewable fuels on the West Coast, increasing both the diversity
of its asset base and supporting near-to-medium-term growth
expectations. Additionally, the company has a unique franchise in
its large-scale ammonia pipeline system, to participate in the
growth of "blue" or "green" ammonia. Both businesses offer NuStar
growth opportunities outside of its traditional liquid petroleum
operations and an ability to participate directly in the sector's
move towards energy transition.
Strong Financial Flexibility: In June the company extended the
maturity date on its $1 billion unsecured revolving credit facility
from April 2025 to January 2027 and extended the maturity date on
its $100 million receivables financing facility to July 2026 from
January 2025. NuStar has no debt maturities before October 2025. As
of June 30, 2023, NuStar had available liquidity of $754 million
including $4 million of cash on hand and roughly $750 million
available on its revolving credit facility. Fitch considers
NuStar's liquidity as meaningfully improved over the past few years
and expects liquidity to remain adequate over the forecast period.
Rating Linkage: There is a parent subsidiary relationship between
NuStar and Logistics. Fitch determines NuStar's standalone credit
profile (SCP) based on consolidated metrics and considers
Logistics' SCP stronger than NuStar's. As such, Fitch has followed
the stronger subsidiary path. Legal ring fencing is open given the
cross guarantees between NuStar and Logistics and the minimal
limitations on flows between the entities. Access and control is
also open given NuStar's 100% ownership interest in Logistics. Due
to the aforementioned rating linkages, Fitch rates both entities on
a consolidated credit profile with the same IDRs.
DERIVATION SUMMARY
NuStar's closest rated peers are Buckeye Partners, L.P. (BB/Stable)
and Plains All American L.P. (PAA: BBB-/Positive). All three
feature operations that focus predominantly on the liquid petroleum
midstream value chain providing pipeline, terminalling and storage
services, among other activities. NuStar has smaller scale and less
geographic and operational diversity, compared to both Buckeye and
PAA.
Leverage at NuStar is expected to remain around 5.0x over the
forecast period. This compares to falling below 6.0x by 2024 at
Buckeye and below 3.5x by 2024 at PAA.
Buckeye's diverse asset base and larger relative size and scale are
offset by the expected leverage difference and leads to the
assignment of the same IDRs for NuStar and Buckeye. The combination
of much larger size and scale and meaningfully lower leverage
account for the two-notch difference between the IDRs of NuStar and
PAA.
KEY ASSUMPTIONS
- Crude and refined product production consistent with the Fitch
price deck;
- Pipeline segment results show continued upward momentum over the
forecast period, driven in large part by volume growth on the
company's Permian pipeline system, as well as incremental growth
projects on the ammonia pipeline system;
- Storage segment results in 2023 to benefit from inflation-indexed
rate increases as well as growth capital spent in the West Coast
U.S. franchise, largely offset by weakness at the St. James
Terminal;
- 2023 Fuels Marketing segment results in-line with current
underlying commodity spread margins impacting, among other, the
company's butane blending business;
- Growth capex and maintenance capex for 2023 in line with
management guidance;
- Distributions to common unitholders grow annually at a low-single
digit rate;
- No meaningful asset sales or equity issuances;
- Base interest rates applicable to the company's outstanding
variable rate debt obligations reflects the Fitch Global Economic
Outlook.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- If EBITDA leverage were expected to be sustained below 4.5x;
- A meaningful increase in geographic or business line diversity
and/or a meaningful increase in the percentage of EBITDA coming
from long-term take or pay-type contracts, organically or through
an acquisition or acquisitions funded in a debt-friendly manner.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Actual or expected EBITDA leverage above 5.5x;
- Significant increases in capital spending beyond Fitch's
expectations with negative consequences for the credit profile;
- An acquisition or acquisitions that meaningfully raise the
business risk of NuStar.
LIQUIDITY AND DEBT STRUCTURE
As of June 30, 2023, NuStar had total liquidity of $754 million,
which included $750 million undrawn on its $1.0 billion revolver,
after accounting for $4.6 million in letters of credit. Cash on the
balance sheet was $4 million. The maturity on the revolver is in
January 2027.
NuStar's ability to draw on the revolver is restricted by a
leverage covenant as defined in the bank agreement, which does not
allow leverage to be greater than 5.0x for covenant compliance.
Bank defined leverage was 3.73x, as of June 30, 2023. Fitch expects
NuStar to remain in compliance with its covenants over the forecast
period. Fitch notes that the covenant calculation allows for the
exclusion of junior subordinated notes ($402.5 million) and
preferred equity Series A, B, C and D, totaling over $750 million
(after the full redemption of the series D units earlier this
month). The covenant calculation allows for inclusion of pro forma
EBITDA for material projects and acquisitions, providing some
cushion in calculations.
NuStar also has various notes outstanding aggregating $2.5 billion.
The nearest unsecured maturity is the $600 million 5.75% notes due
Oct. 1, 2025.
The company also has a $100 million receivable financing agreement.
The borrowers are NuStar and NuStar Finance LLC (NuStar Finance), a
special purpose vehicle (SPV) and wholly-owned subsidiary of
NuStar. There was $71.2 million of borrowings outstanding under the
agreement as of June 30, 2023. The securitization program extends
until July 1, 2026.
ISSUER PROFILE
NuStar is a publicly traded master limited partnership that is
primarily focused on the transportation and storage of crude oil,
refined products and anhydrous ammonia with operations in United
States and Mexico.
SUMMARY OF FINANCIAL ADJUSTMENTS
Fitch applies 50% equity credit to Logistics' junior subordinated
notes due 2043 and 50% equity credit to NuStar's Series A, B and C
preferred equity securities.
ESG CONSIDERATIONS
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
NuStar Logistics,
L.P. LT IDR BB Upgrade BB-
senior
unsecured LT BB Upgrade RR4 BB-
junior
subordinated LT B+ Upgrade RR6 B
NuStar Energy L.P. LT IDR BB Upgrade BB-
preferred LT B+ Upgrade RR6 B
OFF LEASE ONLY: Wins Cash Collateral Access on Final Basis
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
Off Lease Only LLC, Off Lease Only Parent LLC, and Colo Real Estate
Holdings LLC to use cash collateral on a final basis in accordance
with the budget.
As previously reported by the Troubled Company Reporter, the
Debtors require the use of cash collateral to facilitate the full
wind-down of their operations, transfer the Ally Collateral to the
Ally Parties for liquidation and sale, and administer the Chapter
11 Cases.
The Debtors' capital structure consists of outstanding funded debt
obligations in the aggregate principal amount of approximately
$138.654 million, comprised of (i) approximately $67.4 million
outstanding pursuant to the Floorplan Agreement; (ii) $5 million in
principal outstanding pursuant to the Spirit Note; (iii) $13.450
million in principal outstanding pursuant to the Katy Loan
Agreement; and (iv) $52.9 million in principal and paid-in-kind
interest outstanding pursuant to the Cerberus Note.
Off Lease Only LLC, as borrower, Off Lease Only Parent LLC, as
guarantor, and Ally Bank and Ally Financial are party to the Master
Wholesale Agreement, dated as of October 11, 2010. Pursuant to the
Floorplan Agreement, Ally financed the Debtors' acquisition of the
majority of their inventory through a $180 million line of credit.
Pursuant to the Floorplan Agreement, Ally also holds $10 million of
the Debtors cash as restricted cash.
OLO, as borrower, Parent, as guarantor, and Spirit Realty, L.P. as
lender are party to the Loan Agreement, dated as of March 25,
2022, pursuant to which Spirit provided a $13.45 million
construction loan for use in constructing a new dealership in Katy
TX. In addition, OLO, as maker, Parent, as guarantor, and Spirit,
as holder, are party to the Promissory Note, dated as of May 17,
2023 pursuant to which OLO issued a $5 million promissory note to
Spirit. The obligations pursuant to the Spirit Note are unsecured.
Parent, as maker, OLO and Colo Real Estate Holdings LLC, as
guarantors, and Cerberus Off Lease Only LLC, as holder, are party
to that certain Promissory Note, dated as of August 5, 2022. The
principal amount of the Cerberus Note is approximately $46.7
million, and as of the Petition Date, $52.9 million in principal
and paid-in-kind interest are outstanding.
As adequate protection, the Prepetition Secured Parties were
granted continuing, valid, binding, enforceable, and perfected
Liens, which will be senior in priority to the Prepetition Lien
held by the applicable Prepetition Secured Party, upon the
Prepetition Secured Party's Prepetition Collateral.
To the extent of any Diminution in Value of their respective
interests in the Prepetition Collateral, and subject in all
respects to the Carve Out, the Prepetition Parties were granted
allowed superpriority administrative expense claims in each of the
Chapter 11 Cases and any Successor Cases. The Adequate Protection
Superpriority Claims will have priority over all administrative
expense claims and unsecured claims against the Debtors or their
estates.
A copy of the order is available at https://urlcurt.com/u?l=cqSHPJ
from PacerMonitor.com.
About Off Lease Only LLC
Prior to the Petition Date, Off Lease Only LLC and affiliates were
used car retailer, operating dealerships. The Company operated five
used car dealerships in Florida and one in Texas. However, the
Company sold cars to customers throughout the US. The Company
ceased operations shortly before the Petition Date and intends to
wind down its business and allow its floorplan lender to collect
the vehicles securing its loan during the Chapter 11 Cases.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Lead Case No. 23-11388) on
September 7, 2023. In the petition signed by Leland Wilson, chief
executive officer, the Debtor disclosed up to $500 million in both
assets and liabilities.
Judge Craig T. Goldblatt oversees the case.
The Debtors tapped Prokkauer Rose LL and Pachulski Stang Ziehl &
Jones LLp as co-counsel, FTI Consulting, Inc. as financial advisor,
Bofa Securities, Inc. as investment banker, and Stretto, Inc. as
claims and noticing agent and administrative advisor.
PALATIN TECHNOLOGIES: Posts $27.5M Net Loss in FY Ended June 30
---------------------------------------------------------------
Palatin Technologies, Inc. reported a net loss of $27.54 million on
$4.85 million of total revenues for the year ended June 30, 2023,
compared to a net loss of $36.20 million on $1.47 million of total
revenues for the year ended June 30, 2022.
As of June 30, 2023, the Company had $17.94 million in total
assets, $17.80 million in total liabilities, and $134,073 in total
stockholders' equity.
As of June 30, 2023, Palatin's cash, cash equivalents and
marketable securities were approximately $11.0 million plus $2.9
million of accounts receivables, compared to cash and cash
equivalents of $19.6 million with $1.7 million of accounts
receivables as of March 31, 2023, and $29.9 million with $1.8
million of accounts receivable as of June 30, 2022. Based on its
current operating plan, the Company believes that existing cash,
cash equivalents, marketable securities and receivables will be
sufficient to fund currently anticipated operating expenses through
calendar year 2023.
Philadelphia, Pennsylvania-based KPMG LLP, the Company's auditor
since 2002, issued a "going concern" qualification in its report
dated Sept. 28, 2023, citing that the Company has incurred
operating losses and negative cash flows from operations since
inception and will need additional funding to complete planned
product development efforts that raise substantial doubt about its
ability to continue as a going concern.
A full-text copy of the Company's Annual Report on Form 10-K as
filed with the Securities and Exchange Commission is available for
free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/911216/000165495423012335/ptn_10k.htm
About Palatin
Headquartered in New Jersey, Palatin -- www.Palatin.com -- is a
biopharmaceutical company developing first-in-class medicines based
on molecules that modulate the activity of the melanocortin
receptor systems, with targeted, receptor-specific product
candidates for the treatment of diseases with significant unmet
medical need and commercial potential. Palatin's strategy is to
develop products and then form marketing collaborations with
industry leaders to maximize their commercial potential.
PERSHARD INVESTMENTS: Court OKs Interim Cash Collateral Access
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Florida,
West Palm Beach Division, authorized Pershard Investments, LLC to
use cash collateral on an interim basis in accordance with the
budget.
The Debtor requires the use of cash collateral to continue to
maintain the business.
Wells Fargo holds a security interest in all of the Debtor's assets
including all accounts, receivables, future, fixtures, equipment,
etc.
Navitas holds a security interest in all of the Debtor's assets
including all accounts, receivables, future, fixtures, equipment,
etc. at the 143-1/2 N Congress Ave, Ste 22 location.
GreatAmerica Financial Services has a valid first position blanket
lien that is properly perfected and enforceable against all of
Debtor's personal property located at 2939 SW High Meadow Ave.,
Palm City, FL 34990 and 2145 SE Federal Hwy, Stuart, FL 34994
securing aggregate indebtedness.
Navitas has a valid first position blanket lien that is properly
perfected and enforceable against all of Debtor's personal property
located at 11762 SE Federal Hwy, Hobe Sound, 33455 securing
aggregate indebtedness The estimated value of the secured assets at
the time of the bankruptcy filing was approximately $6,000.
North Mill Credit Trust has a valid first position blanket lien
that is properly perfected and enforceable against all of Debtor's
personal property located at 4956-16 Le Chalet Blvd; 6744 Forest
Hill Blvd; 6534 S Kanner Hwy, Suite 201; and 4075 S State Rd 7
securing aggregate indebtedness.
In connection with the Debtor's proposed use of cash collateral,
the Creditors will have, nunc pro tunc as of the commencement of
the Chapter 11 cases, a replacement lien pursuant to 11 U.S.C.
Section 361(2) on and in all property of the Debtor acquired or
generated after the Petition Date.
The Creditors will not have or be granted a Replacement Lien on or
against any claims or causes of action arising under 11 U.S.C.
Sections 542 through 550 or on or against the proceeds of the
Avoidance Actions.
On or before November 3, 2023, the Debtors will file a report
comparing the approved budgets and the actual expenses for October
1 through October 31, 2023, with an explanation of any substantial
differences.
In the event that diminution occurs in the value of cash collateral
from and after the Petition Date as a result of the Debtors' use
thereof in an amount in excess of the value of the Replacement
Liens granted, then the Creditors will be granted an administrative
claim under 11 U.S.C. Section 507(b), with priority over all other
administrative expense claims, subject to the Carve Out.
Notwithstanding anything to the contrary, the Creditors'
super-priority administrative expense claim will not attach to or
be paid from the proceeds of the Avoidance Actions. The Replacement
Liens granted to the Creditors will be valid and perfected without
the need for the execution or filing of any further documents or
instruments.
The Replacement Liens will be subject and subordinate to any and
all fees payable to the Subchapter V Trustee, the U.S. Trustee
and/or the Clerk of the Bankruptcy Court.
Commencing July 1, 2023 and continuing on the 1st day of each month
thereafter, until otherwise ordered by the Court, the Debtor will
make adequate protection payments to Creditors in the amount of
$500 each per month.
A further hearing on the matter is set for November7, 2023 at 2:30
p.m.
A copy of the Court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=jEohrV from PacerMonitor.com.
The Debtor projects $30,328 in gross profit and $25,132 in total
expenses for one month.
About Pershard Investments, LLC
Pershard Investments, LLC owns and operates two Great Clip
franchise locations.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Fla. Case No. 23-14552) on Ju ne 12,
2023. In the petition signed by Raam K. Pershard, managing member,
the Debtor disclosed up to $50,000 in assets and up to $500,000 in
liabilities.
Judge Mindy A. Mora oversees the case.
Brian K. McMahon, Esq., at Brian K. McMahon, PA, represents the
Debtor as legal counsel.
PHI GROUP: Delays Filing of Annual Report
-----------------------------------------
PHI Group, Inc. filed a 12b-25 with the Securities and Exchange
Commission notifying the delay in the filing of its Annual Report
on Form 10-K for the year ended June 30, 2023.
The Company said it is unable to file, without unreasonable effort
and expense, its Form 10-K due to the requirement for additional
time by the auditors to review its financial information to be
included in the referenced Form 10-K.
About PHI Group
Headquartered in Irvine, California, PHI Group, Inc.
(www.phiglobal.com) is primarily engaged in mergers and
acquisitions, advancing PHILUX Global Funds, SCA, SICAV-RAIF, a
"Reserved Alternative Investment Fund" under the laws of
Luxembourg, and establishing the Asia Diamond Exchange in Vietnam.
Besides, the Company provides corporate finance services, including
merger and acquisition advisory and consulting services for client
companies through its wholly owned subsidiary PHILUX Capital
Advisors, Inc. (formerly PHI Capital Holdings, Inc.) and invests in
selective industries and special situations aiming to potentially
create significant long-term value for the Company's shareholders.
PHILUX Global Funds intends to include a number of sub-funds for
investment in select growth opportunities in the areas of
agriculture, renewable energy, real estate, infrastructure, and the
Asia Diamond Exchange in Vietnam.
PHI Group reported a net loss of $21.15 million for the year ended
June 30, 2022, compared to a net loss of $6.55 million for the year
ended June 30, 2021. As of Dec. 31, 2022, the Company had $508,632
in total assets, $7.39 million in total liabilities, and a total
stockholders' deficit of $6.88 million.
Bangalore, India-based M.S. Madhava Rao, the Company's auditor,
issued a "going concern" qualification in its report dated Jan. 13,
2023, citing that Company has an accumulated deficit of $71,717,973
and had a negative cash flow from operations amounting to
$1,545,570 for the year ended June 30, 2022. These factors raise
substantial doubt about the Company's ability to continue as a
going concern.
PRIME CORE: Redaction of Customer Names in Chapter 11 Okayed
------------------------------------------------------------
Rick Archer of Law360 reports that a Delaware bankruptcy judge told
cryptocurrency custodial business Prime Core Technologies on
Tuesday, September 19, 2023, it can redact the names of its
customers from its Chapter 11 filings and serve them with notices
by email.
About Prime Core
Prime Core Technologies, Inc. and three of its affiliates sought
Chapter 11 bankruptcy protection (Bankr. D.N.J. Lead Case No.
23-11161) on Aug. 16, 2023. The petitions were signed by Jor Law as
interim chief executive officer. The Hon. J. Kate Stickle presides
over the Debtors' cases.
The Debtors listed $50 million to $100 million in estimated assets
and $100 million to $500 million estimated liabilities.
McDermott Will & Emery LLP serves as counsel to the Debtors. The
Debtors' financial advisor is M3 Advisory Partners, LP; their
investment banker is Galaxy Digital Partners LLC; and their claims
and noticing agent is Stretto.
REGENCY CONVERSIONS: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Regency Conversions, Inc.
4709 Lone Star Blvd.
Fort Worth TX 76106
Business Description: The Debtor is engaged in the business
of motor vehicle manufacturing.
Chapter 11 Petition Date: October 2, 2023
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 23-43013
Debtor's Counsel: Brandon Tittle, Esq.
GLAST, PHILLIPS & MURRAY, P.C.
14801 Quorum Dr., Ste. 500
Dallas TX 75254
Tel: 972-419-7186
Email: btittle@gpm-law.com
Debtor's
Financial
Advisor: LANE GORMAN TRUBITT, LLC
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by G. Wayne Davis as majority shareholder.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/7PEF52A/Regency_Conversion_Inc__txnbke-23-43013__0002.0.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/7A5NSRI/Regency_Conversion_Inc__txnbke-23-43013__0001.0.pdf?mcid=tGE4TAMA
REMARK HOLDINGS: Forge New Agreement with Ionic
-----------------------------------------------
Remark Holdings Inc. disclosed in a Form 8-K Report filed with the
Securities and Exchange Commission that the Company and Ionic
Ventures, LLC have entered into a letter agreement effectively
amending a prior Purchase Agreement from October 6, 2022. The
agreement also superseded previous letter agreements inked on July
12th and August 10th of 2023.
Under the Letter Agreement, the parties agreed, among other
things:
(i) to allow Remark to deliver one or more irrevocable written
notices to Ionic in a total aggregate amount not to exceed $20
million, which total aggregate amount shall be reduced by the
aggregate amount of previous Exemption Purchase Notices;
(ii) to amend the per-share purchase price for purchases under
an Exemption Purchase Notice to 80% of the average of the two
lowest daily volume-weighted average prices over a specified
measurement period;
(iii) to amend the definition of the specified measurement
period to stipulate that, for purposes of calculating the final
purchase price, such measurement period begins the trading day
after Ionic pays Remark the amount requested in the purchase
notice. The calculation of the dollar volume of Remark common stock
traded on the principal market to determine the length of the
measurement period shall begin on the trading day after the
previous measurement period ends;
(iv) that any additional Exemption Purchase Notices that are
not in accordance with the terms and provisions of the Purchase
Agreement shall be subject to Ionic's approval;
(v) to amend section 11(c) of the ELOC Purchase Agreement to
increase the Additional Commitment Fee from $500,000 to $3,000,000;
and
(vi) by September 29, 2023, amend the Debenture Transaction
Documents to include a so-called Most Favored Nation provision.
This provision will provide Ionic with the necessary protection
against any future financing, settlement, exchange, or other
transaction whether with an existing or new lender, investor, or
counterparty. If such amendment is not made by September 29, 2023,
the Additional Commitment Fee shall be further increased to
$3,750,000.
About Remark Holdings
Remark Holdings, Inc. (NASDAQ: MARK) –
http://www.remarkholdings.com-- delivers an integrated suite of AI
solutions that help organizations monitor, understand, and act on
threats in real time. Remark consists of an international team of
sector-experienced professionals who have created video analytics.
The Company's GDPR-compliant and CCPA-compliant solutions focus on
market sectors including retail, federal, and state governmental
entities, public safety, hospitality, and transportation. The
company's headquarters are in Las Vegas, Nevada, USA, with
operational offices in New York and international offices in
London, England.
Remark Holdings reported a net loss of $55.48 million for the year
ended Dec. 31, 2022, compared to net income of $27.47 million for
the year ended Dec. 31, 2021. As of March 31, 2023, the Company had
$14.17 million in total assets, $39.95 million in total
liabilities, and a total stockholders' deficit of $25.78 million.
Los Angeles, California-based Weinberg & Company, P.A., the
Company's auditor since 2020, issued a "going concern"
qualification in its report dated April 17, 2023, citing that the
Company has suffered recurring losses from operations and negative
cash flows from operating activities and has a negative working
capital and a stockholders' deficit that raise substantial doubt
about its ability to continue as a going concern.
RENALYTIX PLC: Posts $45.6 Million Net Loss in FY Ended June 30
---------------------------------------------------------------
Renalytix plc filed with the Securities and Exchange Commission its
Annual Report on Form 10-K reporting a net loss of $45.61 million
on $3.40 million of revenue for the 12 months ended June 30, 2023,
compared to a net loss of $45.28 million on $2.97 million of
revenue for the 12 months ended June 30, 2022.
As of June 30, 2023, the Company had $30.63 million in total
assets, $23.66 million in total liabilities, and $6.97 million in
total shareholders' equity.
Iselin, New Jersey-based Ernst & Young LLP, the Company's auditor
since 2021, issued a "going concern" qualification in its report
dated Sept. 28, 2023, citing that the Company has suffered
recurring losses and negative cash flows from operations, expects
to incur additional losses and require substantial additional
capital to fund its operations, and has stated that substantial
doubt exists about the Company's ability to continue as a going
concern.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1811115/000095017023050231/rnlx-20230630.htm#item_1_business
About Renalytix
Headquartered in United Kingdom, Renalytix (LSE: RENX) (NASDAQ:
RNLX) -- www.renalytix.com -- has engineered a new solution that
enables early-stage chronic kidney disease progression risk
assessment. The Company's lead product, KidneyIntelX, has been
granted Breakthrough Designation by the U.S. Food and Drug
Administration and is designed to help make significant
improvements in kidney disease prognosis, transplant management,
clinical care, patient stratification for drug clinical trials, and
drug target discovery.
RESHAPE LIFESCIENCES: $8-Mil. Securities Offering Now Effective
---------------------------------------------------------------
ReShape Lifesciences Inc. said Sept. 29 its recently filed
Registration Statement on Form S-1 is now effective.
Pursuant to the Registration Statement, as amended, ReShape
Lifesciences is "offering on a best efforts basis up to 8,510,638
units, each consisting of one share of our common stock, par value
$0.001 per share, and warrants to purchase one and one-half shares
of common stock, at an assumed offering price of $0.94 per unit,
which is equal to the closing price of our common stock on the
Nasdaq Capital Market on September 6, 2023, for gross proceeds of
up to $8,000,000. Each common warrant will have an exercise price
of $0.94 per share of common stock (based upon the assumed offering
price and equal to 100% of the public offering price of each unit
sold in this offering), will be exercisable immediately, and will
expire five years from the date of issuance."
"We are also offering to each purchaser of units that would
otherwise result in the purchaser's beneficial ownership exceeding
4.99% of our outstanding common stock immediately following the
consummation of this offering the opportunity to purchase units
consisting of one pre-funded warrant (in lieu of one share of
common stock) and one common warrant. A holder of pre-funded
warrants will not have the right to exercise any portion of its
pre-funded warrants if the holder, together with its affiliates,
would beneficially own in excess of 4.99% (or, at the election of
the holder, such limit may be increased to up to 9.99%) of the
number of shares of common stock outstanding immediately after
giving effect to such exercise. Each pre-funded warrant will be
exercisable for one share of common stock. The purchase price of
each unit including a pre-funded warrant will be equal to the price
per unit including one share of common stock, minus $0.0001, and
the remaining exercise price of each pre-funded warrant will equal
$0.0001 per share. The pre-funded warrants will be immediately
exercisable (subject to the beneficial ownership cap) and may be
exercised at any time until all of the pre-funded warrants are
exercised in full. For each unit including a pre-funded warrant we
sell (without regard to any limitation on exercise set forth
therein), the number of units including a share of common stock we
are offering will be decreased on a one-for-one basis."
"There is no minimum number of securities or minimum aggregate
amount of proceeds for this offering to close. Because this is a
best-efforts offering, the placement agent does not have an
obligation to purchase any securities, and, as a result, there is a
possibility that we may not be able to sell the maximum offering
amount. We expect that the offering will end two trading days after
we first enter into a securities purchase agreement relating to the
offering and the offering will settle delivery versus
payment/receipt versus payment. Accordingly, we and the placement
agent have not made any arrangements to place investor funds in an
escrow account or trust account since the placement agent will not
receive investor funds in connection with the sale of the
securities offered hereunder."
"The shares of our common stock and pre-funded warrants, if any,
and the accompanying common warrants can only be purchased together
in this offering but will be issued separately and will be
immediately separable upon issuance. We are also registering the
shares of common stock issuable from time to time upon exercise of
the common warrants and pre-funded warrants included in the units
offered hereby."
"Our common stock is traded on the Nasdaq Capital Market under the
symbol "RSLS." On September 6, 2023, the closing price for our
common stock, as reported on the Nasdaq Capital Market, was $0.94
per share. The public offering price per unit will be determined at
the time of pricing and may be at a discount to the then current
market price. The recent market price used throughout this
prospectus may not be indicative of the final offering price. The
final public offering price will be determined through negotiation
between us and investors based upon a number of factors, including
our history and our prospects, the industry in which we operate,
our past and present operating results, the previous experience of
our executive officers and the general condition of the securities
markets at the time of this offering."
"There is no established public trading market for the pre-funded
warrants or common warrants, and we do not expect a market to
develop. Without an active trading market, the liquidity of the
pre-funded warrants and common warrants will be limited. In
addition, we do not intend to list the pre-funded warrants or the
common warrants on the Nasdaq Capital Market, any other national
securities exchange or any other trading system," stated the
Company.
A full copy of the Company's Form S-1/A filing is available at
https://tinyurl.com/3wt52f3r
About ReShape Lifesciences
ReShape Lifesciences Inc., formerly Obalon Therapeurtics, Inc., is
a weight loss and metabolic health-solutions company, offering an
integrated portfolio of proven products and services that manage
and treat obesity and metabolic disease.
Reshape Lifesciences reported a net loss of $46.21 million for the
year ended Dec. 31, 2022, compared to a net loss of $63.15 million
for the year ended Dec. 31, 2021. As of March 31, 2023, the
Company had $16.35 million in total assets, $8.59 million in total
liabilities, and $7.76 million in total stockholders' equity.
Irvine, California-based RSM US LLP, the Company's auditor since
2022, issued a "going concern" qualification in its report dated
April 17, 2023, citing that the Company has suffered recurring
losses and negative cash flows. The Company currently does not
generate revenue sufficient to offset operating costs and
anticipates such shortfalls to continue. This raises substantial
doubt about the Company's ability to continue as a going concern.
ROY BLACKWELL: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Roy Blackwell Enterprises, Inc.
250 Menefee Street
Covington, TN 38019
Chapter 11 Petition Date: October 2, 2023
Court: United States Bankruptcy Court
Western District of Tennessee
Case No.: 23-24865
Judge: Hon. Jennie D Latta
Debtor's Counsel: Bo Luxman, Esq.
LUXMAN LAW FIRM
44 N. 2nd Street, Suite 1004
Memphis, TN 38103
Tel: (901) 526-7770
Fax: (901) 526-7957
Email: Bo@luxmanlaw.com
Total Assets: $1,120,661
Total Liabilities: $2,894,996
The petition was signed by Larry Avist Jr. 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/2JRJRAI/Roy_Blackwell_Enterprises_Inc__tnwbke-23-24865__0001.0.pdf?mcid=tGE4TAMA
SA NW UPSCALE: Case Summary & Three Unsecured Creditors
-------------------------------------------------------
Debtor: SA NW Upscale Hospitality Group, LLP
15639 Interplace Road
San Antonio TX 78249
Chapter 11 Petition Date: October 3, 2023
Court: United States Bankruptcy Court
Western District of Texas
Case No.: 23-51371
Judge: Hon. Michael M. Parker
Debtor's Counsel: Martin Seidler, Esq.
LAW OFFICES OF MARTIN SEIDLER
11107 Wurzbach
Suite 504
San Antonio TX 78230-2592
Phone: (210) 694-0300
Email: Marty@Seidlerlaw.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Vikas B. Bhakta as agent/partner.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/NKJRPRA/SA_NW_UPSCALE_HOSPITALITY_GROUP__txwbke-23-51371__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's Three Unsecured Creditors:
Entity Nature of Claim Claim Amount
1. IH10/Loop1604 Partners, LTD Disputed Business $0
10003 NW Military Hwy # 2205 Debt
San Antonio, TX 78231
2. Dye, Sherry Bryce Attorney Fees $0
1919 San Pedro Ave.
San Antonio, TX 78212
3. Bexar County Clerk/ $0
100 Dolorosa,#104
San Antonio, TX 78205
SALEM MEDIA: Agrees With Lenders to Extend Forbearance Until Nov. 3
-------------------------------------------------------------------
Salem Media Group, Inc. and certain subsidiaries of the Company
party to the Credit Agreement and the Forbearance Agreement,
entered into an Amendment Number Nine to Credit Agreement and
Amendment to Forbearance Agreement and Amendment Number Seven to
Credit Agreement and Amendment Number One to Guaranty and Security
Agreement, dated as of Sept. 28, 2023, with the lenders, and Wells
Fargo Bank, National Association, as administrative agent,
according to a Form 8-K filed by the Company with the Securities
and Exchange Commission.
The Amendment amends the Credit Agreement, dated as of May 19,
2017, by and among the Company and the other Loan Parties that are
borrowers thereunder, the Lenders and the Agent, and the
Forbearance Agreement and Amendment Number Seven to Credit
Agreement and Amendment Number One to Guaranty and Security
Agreement, dated as of Aug. 7, 2023, by and among the Loan Parties,
the Lenders and the Agent.
The Amendment extends the current Forbearance Period under the
Forbearance Agreement through and including Nov. 3, 2023.
In addition, among other things, the Amendment amends the Credit
Agreement by requiring the Borrowers to maintain availability of at
least $1,000,000 at all times from Aug. 7, 2023 until, but not
including Nov. 3, 2023, and $5,000,000 at all times from Nov. 3,
2023 and thereafter.
A copy of the Amendment is available for free at:
https://www.sec.gov/Archives/edgar/data/1050606/000119312523247394/d533042dex101.htm
About Salem Media
Headquartered in Texas, Salem -- www.salemmedia.com -- is a
domestic multimedia company specializing in Christian and
conservative content, with media properties comprising radio
broadcasting, digital media, and publishing. Its content is
intended for audiences interested in Christian and family-themed
programming and conservative news talk.
* * *
As reported by the TCR on Sept. 8, 2023, S&P Global Ratings lowered
its issuer credit rating on Salem Media Group Inc.to 'CCC-' from
'CCC'. S&P said, "We expect Salem's leverage to remain elevated in
2023 and 2024. S&P Global Ratings economists expect prolonged slow
economic growth in the back half of 2023 and into 2024, which will
keep advertising trends depressed."
Also in September 2023, Moody's Investors Service downgraded Salem
Media Group, Inc.'s Corporate Family Rating to Caa3 from Caa1.
Moody's said the downgrade of the CFR to Caa3 reflects Salem's weak
operating performance pressured by subdued radio advertising
demand, high financial leverage, a deteriorating liquidity profile
and the uncertainty around the company's ability to refinance its
$25 million ABL revolving facility before its expiration in March
2024.
SANDY HOOK: Case Summary & Four Unsecured Creditors
---------------------------------------------------
Debtor: Sandy Hook Investments, LLC
7710 Banyan Terrace
Fort Lauderdale, FL 33321
Business Description: The Debtor owns four properties in Florida
having a total current value of $1.05
million.
Chapter 11 Petition Date: October 2, 2023
Court: United States Bankruptcy Court
Southern District of Florida
Case No.: 23-18070
Judge: Hon. Peter D. Russin
Debtor's Counsel: Adam I. Skolnik, Esq.
LAW OFFICE OF ADAM I. SKOLNIK, PA
1761 West Hillsboro Boulevard
Suite 207
Deerfield Beach, FL 33442
Phone: 561-265-1120
Email: askolnik@skolniklawpa.com
Total Assets: $1,071,009
Total Liabilities: $804,000
The petition was signed by Cecelia Gail Ramos as managing member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's four unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/TNURSHQ/Sandy_Hook_Investments_LLC__flsbke-23-18070__0001.0.pdf?mcid=tGE4TAMA
SIGNAL HOLDINGS: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Signal Holdings LLC
4803 West 121st Street
Hawthorne, CA 90250
Case No.: 23-16459
Business Description: Signal Holdings owns residential property
and commercial space located at 4803 West
121st Street, Hawthorne, Calif., having
a current value of $1.39 million.
Chapter 11 Petition Date: October 3, 2023
Court: United States Bankruptcy Court
Central District of California
Judge: Hon. Sandra R. Klein
Debtor's Counsel: Andrew A. Moher, Esq.
MOHER LAW GROUP
424 F Street Suite 203
San Diego, CA 92101
Tel: 619-269-6204
Fax: 619-923-3303
Email: amoher@moherlaw.com
Total Assets: $1,395,000
Total Liabilities: $742,156
The petition was signed by Jared James Grogan as managing member.
The Debtor stated it has no unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/5FXJOSQ/Signal_Holdings_LLC__cacbke-23-16459__0001.0.pdf?mcid=tGE4TAMA
STARNET LLC: Seeks to Hire Myers Jackson as Auctioneer
------------------------------------------------------
Starnet LLC seeks approval from the U.S. Bankruptcy Court for the
Northern District of Texas to employ Myers Jackson as auctioneer.
The firm will list and sell via auction the Debtor's real property
located in Cedar Hill, Texas.
The firm will be paid a buyers premium of 10 percent.
As 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:
Myers Jackson
P.O. Box 2014
Grapevine, TX 76099
Tel: (844) 400-2828
About Starnet LLC
Starnet, LLC is a single asset real estate as defined in 11 U.S.C.
Section 101(51B). The Debtor is the owner in fee simple title of a
real property located at 2413 Briarwood Cove, Cedar Hill, Texas,
valued at $1.6 million.
Starnet sought relief under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. N.D. Texas Case No. 23-31943) on Sep. 1, 2023. In the
petition filed by its managing member, Paul Faure, the Debtor
reported $1,000,001 to $10 million in total assets and total
liabilities.
Eric A. Liepins, Esq., at Eric A. Liepins PC represents the Debtor
as counsel.
SUPPLY CHAIN WAREHOUSES: Court OKs Interim Cash Collateral Access
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Georgia
authorized Supply Chain Warehouses Savannah LLC to use cash
collateral on an interim basis in accordance with the budget to
operate its Warehouse Business.
The Debtor has decreased certain line-item expenses and has
increased certain other line-item expenditures as a result of
operational changes, increase volume of services, and an increase
in periods in certain months.
As previously reported by the Troubled Company Reporter, the Debtor
sought to increase the authorized use of the certain line items in
the budget by amending the Final Order by:
a. Revenue - Adjust revenue projections;
b. Reduce Expenditures for the following line items:
i. Salary - the Debtor has reduced the number of Salary
employees;
ii. Temporary Workers Payroll - The Debtor has reduced the
number of temporary workers for the period of September through May
2023;
iii. Copier Rental and Maintenance- Amount has been reduced;
and
iv. Pest Control- Reduced amount based on current
expenditures.
c. Increased wages and benefit expenses due to three pay periods in
certain months (September 2023 and March 2024):
i. Salary;
ii. Payroll Taxes
iii. Benefits; and
iv. Owner's Salary.
d. Increase the expenditures due in increases in costs:
i. Drayage and Chassis Change - Increase due to increase in
drayage services;
ii. Electricity- Increased due to hotter than anticipated
months;
iii. Prologis (Cure Amount)- Adjusted the amounts to cure
amounts per Assumption Order.
A copy of the order is available at https://urlcurt.com/u?l=r4euiy
from PacerMonitor.com.
About Supply Chain Warehouses Savannah, LLC
Supply Chain Warehouses Savannah, LLC operates warehousing and
storage facility. The Debtor sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. S.D. Ga. Case No. 23-40540) on
June 23, 2023. In the petition signed by Phillip Lowell Stover,
managing member, the Debtor disclosed up to $10 million in both
assets and liabilities.
Judge Edward J. Coleman III oversees the case.
Jon Levis, Esq., at Levis Law Firm, LLC, represents the Debtor as
legal counsel.
THORCO INC: US Trustee Says Disclosures Inadequate
--------------------------------------------------
The Acting United States Trustee objects to Thorco Inc.'s
Disclosure Statement dated July 24, 2023, and filed on July 31,
2023.
The United States has reviewed the objection to the Disclosure
Statement filed by MO Somers, LLC and believes the objections
contained therein are well taken. In addition, the Disclosure
Statement is deficient for the following other reasons:
United States Trustee points out that the financial information,
and liquidation analysis omit important information and valuable
assets, include bogus liabilities, and is therefore misleading and
inaccurate:
* The Financial Information and Liquidation Analysis do not
include or disclose certain assets of the Debtor. In particular,
the schedules identify the Debtor as having a fee simple interest
in 80 acres of real property on Boone Road in Somers, MT. The
Montana Cadastral valued the property in 2022 at just under
$47,000. In Debtor's original schedules, the Debtors estimate the
value of 200 acres, that the Montana Cadastral valued in 2022 at
just under $119,000, as being worth $7,000,000. As such, the United
States Trustee believes the 80 acres of real property on Boone Road
likely has considerable value and the Debtors have completely
omitted it from the Financial Information section and Liquidation
Analysis of the Disclosure Statement.
* In addition, the Financial Information and Liquidation
Analysis contain liabilities that are not actual debts, and does
not properly explain the nature of certain debts that impact the
overall financial picture of the Debtor. The United States Trustee
does not believe the liabilities to Dennis and Donna Thornton or to
Whitefish Credit Union are actual liabilities. Those two debts
account for $14,959,950.00 of the total $15,457,493.34 included in
the List of Creditors and used by the Debtor to calculate the
estimated payment to creditors in a chapter 7 liquidation. The
United States Trustee does not believe these would be valid claims
in a chapter 7 proceeding. Whitefish Credit Union has not asserted
a claim, and the Thornton's personal claim against Thorco is based
upon this same non-existent, or extinguished, claim of Whitefish
Credit Union.
* The actual, noncontingent claims in this case are very
minimal. In a chapter 7 proceeding, a chapter 7 trustee would not
be pursuing the adversary proceeding against Whitefish Credit Union
because there are plenty of assets to pay all valid claims in full.
The total claims after deducting the Whitefish Credit Union claim,
the Thornton's claims, and the contingent claims are only
approximately $140,000. Based upon the Debtor's most recent monthly
operating report, a chapter 7 trustee could pay all these claims in
full tomorrow—or yesterday for that matter—with only the cash
on hand. This highlights yet another deficiency in the liquidation
analysis, the omission of cash on hand. The July monthly operating
report showed an ending cash balance of approximately $190,000. And
Debtor's counsel recently contacted the United States Trustee,
concerned about exceeding FDIC insured limits, and indicated that
the balance was approaching and would likely exceed $250,000 soon.
The United States Trustee further points out that the disclosure
statement and plan are inconsistent in discussing the type of plan
debtor is proposing. The Disclosure Statement indicates the Plan
of Reorganization is a "Property Sale Plan." and explains that the
DIP's ability to obtain bonds for new work has been substantially
impaired. However, the Plan itself provides that all unsecured
creditors, other than Whitefish Credit Union and the Thorntons,
will be paid within 6 months of confirmation from net harvest
proceeds. This is confusing, seems inconsistent and as such the
Disclosure Statement should be denied.
The United States Trustee asserts that the disclosure statement
does not provide adequate detail or information regarding the
debtor's historical income or projected income or regarding the
timing and amount of payments to creditors under the plan. The
Disclosure Statement does not provide any historical financial
information of the Debtor and only provides conclusory and minimal
information regarding projected future income. The Disclosure
Statement and/or Plan should include a budget that sets forth
projected monthly income and expenses, including plan payments it
will make. The Disclosure Statement and Plan should also provide a
precise date and amount of the payments that it will make to each
of the creditors.
About Thorco Inc.
Thorco, Inc., is classified under heavy and civil engineering
construction and has been in business for more than 10 years. It is
located in Kalispell, Mont.
Thorco filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. D. Mont. Case No. 22-90119) on July 29,
2022, with as much as $50,000 in both assets and liabilities.
Christy L. Brandon serves as Subchapter V trustee.
Judge Joseph M. Meier oversees the case.
The Debtor tapped Klinkhammer Law Offices as bankruptcy counsel;
Kris A. McLean Law Firm, PLLC as special counsel; and Andrew
Johnson CPA, PLLC as accountant.
TOPPOP LLC: Creditors to Get Proceeds From Liquidation
------------------------------------------------------
TopPop LLC filed with the U.S. Bankruptcy Court for the Eastern
District of New York a Small Business Chapter 11 Plan dated
September 26, 2023.
The Debtor is engaged in the processing and packaging of alcoholic
and non-alcoholic beverages into single serve soft containers for
various private label vendors throughout the United States and
Canada.
A point in time came during the 2Q of 2023 where the landlord of
the Debtor's primary production facility in Pennsauken, New Jersey
elected to commence eviction proceedings to recover the Pennsauken
facility. TopPop's in ability work out an adequate payment
arrangement for the repayment of its rent arrears left TopPop with
no other option to seek the protection of the Bankruptcy Court and
file the instant Chapter 11 proceeding.
In August 2023, the Debtor's then primary source of new business
cancelled all new work requisitions requiring the Debtor to cease
the use of variable temporary labor and furlough approximately 60%
of its permanent employees. The Debtor, unable to find a suitable
purchaser or additional sources of working capital, continued to
curtail its day to day operations until September 22, 2023, when
management elected to cease operations and seek the liquidation of
its equipment and remaining inventory.
The Debtor has elected to cease operations and liquidate its
equipment and remaining inventory. The Debtor anticipates the sale
of its assets shall generate proceeds sufficient to pay all
administrative, priority tax and secured claims in full and pay a
dividend to allowed general unsecured creditors.
This Plan of Reorganization proposes to pay creditors of the Debtor
from the proceeds of the liquidation of the Debtor's equipment and
remaining inventory. If the Debtor does not receive an acceptable
bulk sale offer for its assets and inventory, the Debtor shall
promptly apply for the retention of a qualified auctioneer and
conduct a sale of its assets within 45 days of the filing of this
Plan.
Non-priority unsecured creditors holding allowed claims, as a
class, will each receive a distribution of their respective pro
rate share of any residual from the proceeds of the liquidation of
the debtor's assets after payment to all allowed administrative,
secured and priority claims.
Class 3 consists of Non-priority unsecured creditors. Allowed
Non-Priority Unsecured claims, as a class shall be paid a pro-rate
share of any residual from the proceeds of the liquidation of the
debtor's assets after payment to all allowed administrative,
secured and priority claims. This Class is impaired.
Class 4 consists of Equity security holders of the Debtor. The
Debtor shall retain the residual property of the Estate, in any.
The Plan is based upon the liquidation of the Debtor's equipment
and remaining inventory. If the Debtor does not receive an
acceptable bulk sale offer for its assets and inventory, the Debtor
shall promptly apply for the retention of a qualified auctioneer
and make its best effort to conduct a sale of its assets within 45
days of the filing of this Plan. Dividends to creditors shall be
paid from the proceeds of the auction sale which shall be retained
in escrow by Debtor's attorney pending the resolution of all
appropriate applications with regard to the allowance of any claims
filed in this case and paid to creditors on the Effective Date.
A full-text copy of the Chapter 11 Plan dated September 26, 2023 is
available at https://urlcurt.com/u?l=tKBx8C from PacerMonitor.com
at no charge.
Attorney for the Plan Proponent:
Richard S. Feinsilver, Esq.
Law Firm of Richard S. Feinsilver
One Old Country Road Suite 347,
Carle Place, NY 11514
Telephone: (516) 873-6330
Facsimile: (516) 873-6183
Email: feinlawny@yahoo.com
About TopPop LLC
TopPop LLC, doing business as TopPop Packaging, operates a beverage
manufacturing business in Amityville, N.Y.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. E.D.N.Y. Case No. 23-72310) on June 28,
2023, with $1 million to $10 million in assets and liabilities.
Gerard Luckman, Esq., a partner at Forchelli Deegan Terrana, LLP,
has been appointed as Subchapter V trustee.
Judge Alan S. Trust oversees the case.
Richard S. Feinsilver, Esq., at the Law Firm of Richard S.
Feinsilver, is the Debtor's bankruptcy counsel.
TRIUMPH GROUP: Moody's Ups CFR to Caa1 & Alters Outlook to Stable
-----------------------------------------------------------------
Moody's Investors Service upgraded its ratings for Triumph Group,
Inc.'s, including the corporate family rating to Caa1 from Caa2 and
the probability of default rating to Caa1-PD from Caa2-PD.
Concurrently, Moody's affirmed the B2 rating on the senior secured
first lien notes due 2028 and upgraded the rating on the senior
unsecured notes due 2025 to Caa2 from Caa3. The speculative grade
liquidity (SGL) rating is unchanged at SGL-3. The outlook was
changed to stable from positive.
The ratings upgrades reflects Moody's view that the ongoing
recovery in commercial aerospace markets will drive earnings
growth, increased cash generation, and a gradual improvement in
Triumph's credit metrics.
RATINGS RATIONALE
The Caa1 CFR reflects Triumph's weak credit metrics and
historically weak cash generation against Moody's expectations of a
sustained improvement in earnings and cash flow over the next two
years. The improvement in Triumph's credit metrics will be driven
by the ongoing recovery in commercial aerospace and steady demand
in the company's military markets.
Triumph has a relatively short-dated capital structure with $500
million of notes maturing in mid-2025 ($485 million outstanding as
of June 30, 2023). Debt-to-EBITDA as of June 2023 is very high at
around 11x (including a sizable pension adjustment). Triumph's
ability to sustainably grow earnings and grow into its capital
structure will be a key rating consideration over the next 18
months.
The CFR is supported by Triumph's considerable scale and
well-established presence as an aerospace supplier. Recent business
wins, coupled with ongoing de-risking efforts and the sale of the
unprofitable structures business, collectively create a path to
improved earnings and cash generation. This will support a more
stable and predictable business going forward.
The stable outlook reflects Moody's expectation of steady operating
performance along with sustained earnings growth and a gradual
improvement in credit metrics.
The SGL-3 speculative grade liquidity rating denotes Moody's
expectations of adequate liquidity over the next 12-18 months. Cash
totaled $146 million as of June 2023. Moody's anticipates positive
free cash flow generation during the fiscal 2024 year ending March
31, 2024 with FCF-to-debt in the low single-digits. The company
does not have a revolving credit facility. Therefore, external
liquidity is limited to a $100 million accounts receivable facility
with roughly $64 million of availability as of June 2023 and an
expiration of November 2024.
Triumph's ESG considerations reflect its environmental, social and
governance risk. Triumph has high exposure to environmental and
social risks due to carbon transition. From a governance
perspective, the company has very high financial leverage with
debt-to-EBITDA of around 11x, which limits near-term financial
flexibility.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to a ratings upgrade include the
refinancing and maturity extension of Triumph's senior unsecured
notes due 2025. Sustained earnings growth and FCF-to-debt
consistently in the low single-digits would also be supportive of
an upgrade.
Factors that could lead to a ratings downgrade include an inability
to consistently grow earnings or weakening liquidity and an
inability to sustainably generate positive free cash flow.
Headquartered in Radnor, Pennsylvania, Triumph Group, Inc. designs,
engineers, manufactures, repairs and overhauls a broad portfolio of
aerospace and defense systems, components and subsystems. Revenues
for the twelve months ended June 2023 were $1.4 billion.
The principal methodology used in these ratings was Aerospace and
Defense published in October 2021.
TRUE NORTH CLASSICAL ACADEMY: S&P Assigns 'BB' ICR, Outlook Stable
------------------------------------------------------------------
S&P Global Ratings assigned its 'BB' issuer credit rating (ICR) to
True North Classical Academy (TNCA), Fla. The outlook is stable.
An ICR reflects our view of an obligor's general creditworthiness,
focusing on its capacity and willingness to meet financial
commitments when they come due. It does not apply to any specific
financial obligation because it does not take into account the
obligation's nature and legal covenants, standing in bankruptcy or
liquidation, statutory preferences, or legality and
enforceability.
"The rating reflects our view of TNCA's healthy demand, favorable
operating environment, high-performing academic designation for all
four of its schools, highly competent management team, and
liquidity of more than 100 days' cash on hand," said S&P Global
Ratings credit analyst John Miceli.
The stable outlook reflects S&P's opinion that over the one-year
outlook period TNCA will meet enrollment growth projections with
progress on its capital and expansion projects as it grows into its
substantial debt.
URBAN ONE: Ernst & Young Stays as Outside Auditor
-------------------------------------------------
Urban One, Inc. has held its 2023 Annual Meeting of Stockholders,
during which the Company's stockholders:
(1) elected Terry L. Jones and Brian W. McNeill as Class A
directors to serve until the 2024 annual meeting of stockholders or
until their successors are duly elected and qualified.
(2) elected Catherine L. Hughes, Alfred C. Liggins, III, B.
Doyle Mitchell, and D. Geoffrey Armstrong as Class B directors to
serve until the 2024 annual meeting of stockholders or until their
successors are duly elected and qualified.
(3) ratified Ernst and Young, LLP as its independent
registered public accounting firm for the fiscal year ending
December 31, 2023.
About Urban One
Urban One, Inc., formerly known as Radio One, Inc., headquartered
in Silver Spring, MD, is an urban-oriented multimedia company that
operates or owns interests in radio broadcasting stations (32% of
revenue as of LTM Q4 2022) generated by 66 stations in 13 markets,
cable television networks (43% of revenue), an 80% ownership in
Reach Media (9% of revenue), and ownership of Interactive One, its
digital platform, as well as other internet-based properties (16%
of revenue), largely targeting an African-American and urban
audience. The Chairperson, Catherine L. Hughes, and President,
Alfred C. Liggins III (Chairperson's son), maintain voting control
and hold a significant ownership position. The company reported
consolidated revenue of $485 million as of LTM Q4, 2022.
Moody's Investors Service affirmed Urban One, Inc.'s B3 Corporate
Family Rating, B3-PD Probability of Default Rating, and B3 senior
secured notes rating. The speculative grade liquidity rating was
upgraded to SGL-1 from SGL-2 reflecting very good liquidity. The
outlook was changed to stable from positive.
The affirmation of the CFR and stable outlook reflect Urban One's
relatively high pro forma leverage (4.9x as of Q4 2022 pro forma
for sale of the company's minority ownership position in MGM
National Harbor, LLC (National Harbor) and including Moody's
standard adjustments) as well as Moody's expectations that
operating performance will decline in 2023 due to lower political
advertising revenue in a non-election year and from lower cable TV
revenue. Cable TV was a source of strength during the pandemic, but
is likely to be pressured from lower ratings and a decline in
subscribers as consumers continue to migrate to streaming services
from cable TV. Social considerations were a key driver of the
rating action, as Moody's expects the negative secular pressures in
the cable TV division to increase as media consumption continues to
migrate to streaming services.
VG IMPERIAL: Court OKs Cash Collateral Access Thru Jan 2024
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of New York
authorized VG Imperial Inc. to use cash collateral on an interim
basis in accordance with the budget from the petition date through
through January 1, 2024.
On July 15, 2020, the Debtor executed an Amended Loan Authorization
and Agreement with the U.S. Small Business Administration in the
principal amount of $500,000, which was modified by a First
Modification of Note dated August 9, 2021. The Note is secured by
an Amended Security Agreement dated August 9, 2021.
On November 2, 2022, the SBA filed a secured proof of claim in the
amount of $524,101.
The Debtor is authorized and directed to remit monthly adequate
protection payments in the amount of $1,500 to the SBA to be paid
by the fifth day of the month, or, if such date falls on a
Saturday, Sunday, or legal holiday, the next business day
thereafter. The first Adequate Protection Payment will be paid by
October 5, 2023. The Adequate Protection Payments made thereunder
will be credited against the pre-petition secured obligation due
and owing the SBA as of the Petition Date, provided however, that
the SBA reserves its rights to assert claims for the payment of
additional amounts provided for under the pre-petition loan
documents.
To the extent of any diminution in the value of the SBA's
collateral, including its cash collateral, the SBA is granted
valid, binding and enforceable post-petition replacement liens upon
and security interests in all assets of the Debtor, regardless of
whether such assets are acquired by the Debtor prior to the
Petition Date or after the Petition Date which liens will be senior
to all other security interest in, liens upon or claims against any
of the Collateral, subject to the Carve Out.
These events constitute and "Event of Default":
i. Failure by the Debtor to timely make an Adequate Protection
Payment;
ii. Use by the Debtor of cash collateral in excess of the
Budget;
iii. The entry of any order by the Court granting relief from or
modifying the automatic stay;
iv. Dismissal of this Chapter 11 case or conversion of the
Chapter 11 case to a Chapter 7 case, or appointment of a Chapter 11
trustee, or examiner with enlarged powers, or other responsible
person; and/or
v. A default by the Debtor in reporting financial or
operational information as and when required under the Interim
Order or the Pre-Petition SBA Agreements that is not cured by the
Debtor within five business days following delivery of written
notice of such default to the Debtor's counsel and the Office of
the United States Trustee.
A copy of the order is available at https://urlcurt.com/u?l=31gxvc
from PacerMonitor.com.
About VG Imperial Inc.
VG Imperial Inc. sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D.N.Y. Case No. 22-42627) on October 21,
2022. In the petition signed by Viktor V. Ryptyk, president, the
Debtor disclosed up to $500,000 in both assets and liabilities.
Judge Nancy Hershey Lord oversees the case.
The Law Offices of Alla Kachan, PC, represents the Debtor as legal
counsel.
WCS PROPERTY: Continued Status Conference Continued Until Oct. 5
----------------------------------------------------------------
WCS Property Group, LLC's case came on for a continued status
conference on September 7, 2023. At the Continued Status
Conference, the WCS Property Group represented that the Debtor
intends to file a Plan and Disclosure Statement by September 30,
2023. Having reviewed the record and having heard the respective
positions of the parties represented at the Continued Status
Conference, the Court has determined the Continued Status
Conference should be continued and the procedures described in this
Order should be implemented.
Judge Catherine Peek McEwen accordingly entered an order that the
Continued Status Conference will be continued until October 5, 2023
at 01:30 PM in Courtroom 8B, Sam M. Gibbons United States
Courthouse, 801 N. Florida Avenue, Tampa, FL 33602.
The Disclosure Statement and Plan filed by the Debtor must, at a
minimum, contain adequate information pertaining to the Debtor in
the following areas:
(a) Pre− and post−petition financial performance;
(b) Reasons for filing Chapter 11;
(c) Steps taken by the Debtor since the filing of the petition to
facilitate reorganization by the Debtor;
(d) Projections reflecting how the Plan will be feasibly
consummated;
(e) A liquidation analysis; (f) A description of the Federal tax
consequences to the Debtor;
(g) An estimate of total administrative expenses and explanation
of how any such expenses not paid in full on the effective date of
the Plan (to the extent permitted by the Code or the claimant's
agreement) will be paid.
If the Debtor fails to file a Plan and Disclosure Statement by the
date of the Continued Status Conference, the Debtor must appear at
the Continued Status Conference and show cause why the case should
not be dismissed or converted to a case under Chapter 7 pursuant to
11 U.S.C. 1112(b).
About WCS Property Group
WCS Property Group, LLC, owns commercial real property in Sarasota,
which it leases out to various tenants.
WCS Property Group sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Fla. Case No. 23-02820) on July 3,
2023, with $1 million to $10 million in both assets and
liabilities. Taylor Santos, manager, signed the petition.
Judge Catherine Peek McEwen oversees the case.
Buddy D. Ford, PA, is the Debtor's legal counsel.
WHEEL PROS: Moody's Affirms Caa3 CFR on Debt Exchange Completion
----------------------------------------------------------------
Moody's Investors Service affirmed Wheel Pros, Inc.'s ("Wheel
Pros") corporate family rating at Caa3 and probability of default
rating at Caa3 PD/LD. The "/LD" appended to the PDR reflects a
limited default designation following the completion of the
company's debt exchange and will be removed from the PDR after
three business days. At the same time, Moody's assigned a B1 rating
to Wheel Pros' asset-based credit facility (ABL) and a B2 rating to
the company's new FILO term loan. Moody's affirmed both of Wheel
Pros' existing debts that were subject to the exchange, including
the Caa3 rating on its first lien term loan and the C rating for
the senior unsecured notes. Lastly, Moody's assigned a stable
outlook, Caa3 rating to a new first lien term loan and a Ca rating
to new second lien secured notes issued by WP NewCo, LLC, a new
subsidiary of Wheel Pros. The outlook for Wheel Pros remains
stable.
The rating actions reflect ongoing weakness in Wheel Pros'
operating performance, and Moody's view that the capital structure
is unsustainable absent a significant recovery in earnings.
Governance considerations were a key driver of the rating actions
reflecting an aggressive financial strategy that has resulted in a
highly leveraged balance sheet, negative free cash flows and a
distressed debt exchange transaction, which Wheel Pros completed on
September 22nd. In the transaction, consenting term loan lenders
(with 99.7% participation) contributed $235 million in a new money
FILO term loan with net proceeds used to pay down a majority of the
company's $200 million asset-based credit facility. In addition,
consenting lenders participated in a new $1,014 million first lien
term loan issued at WP NewCo, LLC to fund open market repurchases
of Wheel Pros' existing first lien term loan at discounted prices
of 85% if participating in new money and 60% if not participating
in new money. Lastly, several unsecured noteholders participated in
a new $272 million second lien secured note to repurchase existing
unsecured notes at par.
Moody's views the transaction as a distressed exchange because term
loan creditors recognized losses relative to the original principal
amount. The transaction improves Wheel Pros' liquidity by restoring
availability to the company's ABL. However, total debt is only
slightly reduced following the transaction and therefore
insufficient given the company's still sizable debt service
expense. As a result, Moody's expects Wheel Pros to operate with
unsustainable financial leverage and free cash flow to be burdened
by high interest expense through 2024. Therefore, Moody's believes
there is still risk that Wheel Pros could engage in additional
distressed transactions if earnings don't materially improve.
RATINGS RATIONALE
Wheel Pros' Caa3 CFR reflects the company's very high financial
leverage, negative free cash flow, and a demonstrated history of an
aggressive financial policy with debt funded acquisitions,
shareholder returns and a distressed debt exchange. The highly
discretionary nature of the company's primary products (custom
vehicle wheels) creates significant demand risk. Wheel Pros has
experienced a significant drop off in demand in 2022 and 2023
following robust growth in prior years. Moody's expects demand to
slowly recover in 2024, but notes that any weakening to consumers
disposable income could pressure Wheel Pros' volumes. The company
does maintain a leading market position and strong brand
recognition to capture demand from automotive enthusiast
consumers.
Lower volumes and higher costs significantly eroded earnings in
2023. The company has enacted sizeable cost saving actions, mostly
tied to restructuring its 4 Wheel Parts business it acquired in
2022, which should improve earnings over the next twelve months. In
addition, Wheel Pros' profitability will benefit from lower
material and freight costs compared to prior years. Moody's expects
earnings to increase substantially in 2024 as run-rate cost savings
are realized, but debt/EBITDA still expected to remain at an
unsustainable level near 10x next year.
Moody's views Wheel Pros' liquidity to be improved but still weak
with an expectation for the company to maintain a modest cash
position and for slightly negative free cash flow in 2024.
Liquidity is supported by substantial availability under the
company's $200 million ABL, which was extended to 2028 as part of
the company's recent refinancing transaction. Moody's expects Wheel
Pros to utilize the ABL to support working capital needs on a
seasonal basis, but will maintain sufficient availability while
doing so. The company typically invests in inventory at the
beginning of the year.
The stable outlook reflects Moody's view that Wheel Pros will
gradually improve earnings over the next twelve months from
meaningful cost savings.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if Wheel Pros exhibits consistent
organic revenue growth and an improvement in earnings to support a
trajectory of reducing debt/EBITDA to a more sustainable level. In
addition, Wheel Pros would need to maintain adequate liquidity with
free cash flow approaching breakeven.
The ratings could be downgraded if liquidity deteriorates, the
likelihood of default, including a distressed exchange, increases,
or an expectation for lower recovery rates on Wheel Pros' various
debt tranches materializes.
The principal methodology used in these ratings was Automotive
Suppliers published in May 2021.
Wheel Pros, Inc., headquartered in Greenwood Village, Colorado, is
a wholesale distributor of custom and proprietary branded wheels,
performance tires and related accessories in the aftermarket
automotive segment. The company is owned by an affiliated fund
controlled by private equity financial sponsor Clearlake Capital
Group, L.P. Revenue for the last twelve months ending June 30,
2023 approximated $1.6 billion.
WHITEWATER WHISTLER: Moody's Rates New $500MM Sec. Term Loan 'Ba2'
------------------------------------------------------------------
Moody's Investors Service assigned a Ba2 rating to WhiteWater
Whistler Holdings, LLC's proposed new $500 million senior secured
Term Loan B1 due 2030. The company's Ba2 Corporate Family Rating
and stable rating outlook are unaffected.
WhiteWater Whistler's proposed transaction will result in modestly
lower interest costs. Moody's expects to withdraw ratings on
WhiteWater Whistler's existing Term Loan B following its
extinguishment.
RATINGS RATIONALE
The secured Term Loan is rated Ba2, same as the Ba2 CFR, reflecting
a single class of debt with no other priority-claim debt present
ahead of the Term Loan in WhiteWater Whistler's capital structure.
WhiteWater Whistler's Ba2 CFR reflects its relatively predictable
distributions from its majority ownership interest in Whistler.
Whistler's credit profile is underpinned by the over 90% of
take-or-pay contracts (minimum volume commitments, MVCs) on its
pipeline system that transports natural gas from the highly
prolific and low-cost Permian Basin to the demand centers connected
to the US Gulf Coast, LNG export centers, and Mexico.
About 85% of WhiteWater Whistler's revenue comes from
investment-grade shippers with an overall weighted average
remaining contract life of over 11 years on the Whistler mainline
and a weighted average counterparty credit rating of Baa1.
Whistler's cash flows are derived under multi-year firm fixed price
Transportation Services Agreements (TSA) with multiple creditworthy
shippers that are expected to provide both significant deleveraging
at Whistler as well as more meaningful distributions to its equity
owners over time.
The positive credit features incorporated in WhiteWater Whistler's
ratings are counterbalanced by the proposed term loan's structural
subordination to Whistler's $1.8 billion of project level balance
sheet debt. WhiteWater Whistler has no physical assets nor does it
generate revenue or cash flow. It is entirely dependent on
distributions from Whistler to service its term loan, which are
subject to the terms of Whistler's debts.
The stable outlook reflects Whistler's fully contracted and highly
predictable cash flow profile and Moody's expectation of declining
financial leverage over time.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
A material improvement in Whistler's credit profile and scale would
be required to consider a ratings upgrade for WhiteWater Whistler.
In addition, if proportionately consolidated debt/EBITDA declines
below 4x with FFO/debt above 20% alongside a strong contractual
position then the ratings could be upgraded. A downgrade could
occur should the credit profile of Whistler materially decline,
including if the credit quality of its contracted shippers
deteriorates and remaining contract term shortens significantly.
FFO/debt that falls below 10% could also result in a downgrade.
Whitewater Whistler Holdings, LLC is an I Squared Capital backed
holding company that owns a 62.5% operating interest in the
Whistler natural gas pipeline and other associated assets in
Texas.
The principal methodology used in this rating was Natural Gas
Pipelines published in July 2018.
WINDOW SYSTEMS: Court OKs Cash Collateral Access Thru Oct 10
------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas,
Houston Division, authorized Window Systems of Texas, Inc. to use
cash collateral on an interim basis in accordance with the budget,
through October 10, 2023.
The Debtor depends on the use of cash collateral for payroll and
general operating expenses. Revenue is generated through the
Debtor's commercial glass and glazing contractor business.
A search in the Texas Secretary of State shows that allegedly
secured positions are held by Unknown UCC (UCC Filing
19-0006033365), SBA (UCC Filing 20-0022896867), Unknown UCC (UCC
Filing 22-0053812972), Unknown UCC (UCC 23-0000454442) and Legal
Advance Funding (UCC Filing 23-0039245927).
The court ruled that as adequate protection for the use of cash
collateral, the parties are granted replacement liens on all
post-petition cash collateral and post-petition acquired property
to the same extent and priority they possessed as of the Petition
Date.
The holders of allowed secured claims with a perfected security
interest in cash collateral, if any, as that term is defined in the
Code, will be entitled to a replacement lien in post-petition
accounts receivable, contract rights, and deposit accounts to the
same extent allowed and in the same priority as those interests
held as of the Petition Date.
A further hearing on the matter is set for October 10 at 9:30 a.m.
A copy of the order is available at https://urlcurt.com/u?l=0brHwP
from PacerMonitor.com.
About Window Systems of Texas, Inc.
Window Systems of Texas, Inc. sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 23-33685) on
September 26, 2023. In the petition signed by David Mallette,
president, the Debtor disclosed up to $50,000 in assets and up to
$1 million in liabilities.
Judge Jeffrey P. Norman oversees the case.
Robert C Lane, Esq., at The Lane Law Firm, represents the Debtor as
legal counsel.
WISE HEALTH: Fitch Lowers IDR to 'B+', On Watch Negative
---------------------------------------------------------
Fitch Ratings has downgraded to 'B+' from 'BB+' and placed on
Rating Watch Negative Wise Health System's (Wise) Issuer Default
Rating (IDR) and the ratings on series 2014A, 2021A, 2021B and
2021C hospital revenue bonds issued by Decatur Hospital Authority
on behalf of Wise.
Entity/Debt Rating Prior
----------- ------ -----
Wise Health
System (TX) LT IDR B+ Downgrade BB+
Wise Health
System (TX)
/General
Revenues/1 LT LT B+ Downgrade BB+
The three-notch downgrade and Negative Watch reflect the change in
Fitch's assessment of Wise's operating risk and financial profiles
to 'b' from 'bb' due to deterioration in the hospital's operating
performance in fiscal 2022, and the expectation of sizable
operating and net losses in fiscal 2023.
The rating actions further reflect very weak balance sheet metrics
characterized by deteriorating liquidity and a very constrained
cash to adjusted debt metric driven by the reduction in cash, as
outstanding debt has not increased. Wise recently paid off the
remaining balance of its series 2013A bonds; which was less than
$500,000 outstanding.
To address its operating challenges, Wise has been cutting expenses
and reducing or eliminating unprofitable services. Additionally, in
August 2023, Wise entered into an asset purchase agreement with
Medical City Healthcare, a division of HCA. Under the agreement,
Medical City has agreed to acquire all Wise Health System assets.
Closing is scheduled for the fourth quarter of 2023. Upon closing,
Wise will be required to use transaction proceeds to defease, or
pay-off all outstanding debt obligations.
The ratings and watch negative reflect Fitch's expectation that the
asset purchase agreement with Medical City Healthcare will close as
expected.
SECURITY
The bonds are secured by the gross revenues of the Decatur Hospital
Authority's hospital facilities, a fully funded debt service
reserve fund, and a first lien and mortgage on certain property and
land on which the Decatur Hospital Authority's hospital facilities
are located.
KEY RATING DRIVERS
Revenue Defensibility - 'bb'
Leading Market Share
Wise maintains the appearance of a generally favorable payor mix
with a combined Medicaid and self-pay mix of less than 20%.
However, the mix of Medicaid and self-pay is reversed from what is
typical for acute care hospitals, reflecting Wise's rural market
and elevated numbers of indigent care patients. Additionally,
commercial and managed care reimbursement, which accounts for about
35% of gross revenues, has become less remunerative and less
reliable post pandemic given Wise's size and limited negotiating
ability. Still, Wise maintains the leading inpatient market share
position for acute care services in its primary service area of
Wise County from where over 80% of inpatient admissions originate.
Historically, no other hospital or system has accounted for more
than 5% of the inpatient market in Wise County, with the closest
competing hospital located about 30 miles away.
While Wise continues to advertise its core bariatric surgery
service-line nationwide and continues to serve other regional
markets with bariatric services in leased facilities, all of Wise's
secondary service area locations except two have been closed. In
addition to its main Decatur, TX hospital location, Wise now only
maintains two acute surgical hospitals in Fort Worth (Parkway) and
in Argyle, TX. Those facilities, located in Tarrant and Denton
counties, offer not only bariatric surgeries but also other
outpatient surgical procedures.
Demographic trends in Wise County, which is located about 40 miles
NW of Fort Worth, continue to be favorable and support Fitch's
expectation that Wise's payor mix should remain relatively stable
or improve over time. Although still small at less than 75,000
residents, the Wise County population continues to grow. The
five-year population growth trend, at 13.9%, remains well above
state and national averages. Median household income of $75,482
(2021) is also favorable to the state and national averages. The
service area is a bedroom community for the D/FW metroplex and the
local economy is supported by manufacturing, petroleum production,
agriculture, and retail businesses. Fitch understands from
management that construction is planned for a new development with
400 single family homes within the Decatur city limits.
Additionally, 10,000 homes are under development or in the planning
stage on a former 3,500-acre ranch within Wise County. The county
is one of the last remaining areas near the Dallas-Fort Worth
metroplex that has yet to be built out.
Operating Risk - 'b'
Challenged Operations; Very Limited Capital Needs or Plans
The very weak operating risk assessment reflects the deterioration
of operating performance since 2022 due to prior volume declines
that have yet to fully rebound, the absence of any additional
Federal stimulus, inflationary pressures affecting Wise's expense
base, particularly labor, and unfavorable commercial reimbursement
that has resulted in parts of Wise's formerly profitable operations
no longer being viable. Wise's operating challenges are compounded
by having a larger than typical percentage of its payor mix
comprised of self-pay, and indigent care patients.
While outpatient volumes at Wise's main Decatur hospital are
improving, surgeries, which remain a key service line for Wise,
have been volatile over the past few years due to physician
turnover and, more recently have become more challenging for Wise
to offer due to below cost reimbursement, particularly for
surgeries requiring implants. Wise is also performing fewer
bariatric cases per month than it had in the past given the recent
increase of diabetes medications being prescribed for weight loss.
To help address its operating challenges, Wise has implemented
three reductions in staff, has reduced the use of agency nurses
(although Wise was never a significant user), terminated an
expensive group purchasing organization contract, and is evaluating
whether it remains economical to continue to provide certain
services. Labor expense, a key pressure affecting the hospital
sector overall, has been reduced by $8 million per year, with
another $8 million to $10 million of opportunity under evaluation.
Management noted that its expense base is shrinking monthly, in
part due to cost cutting measures, but also due to management's
efforts to close unprofitable facilities and service lines.
For fiscal 2023, Fitch expects Wise to generate deficit operations
and EBTIDA margins. At those levels, Wise's operating cost
flexibility is very weak and consistent with a 'b' operating risk
assessment. At present, Wise continues to meet its debt service
obligations; however, Wise does not expect to meet its minimum 1.2x
debt service coverage covenant for fiscal 2023, which will result
in a technical event of default. Last year, Wise engaged outside
consultants to assist with its operating challenges and labor cost
management.
Fitch considers Wise's lifecycle investment needs to be moderate.
Wise's age of plant of seven years is young, reflecting significant
capital previously deployed to open new facilities. In an effort to
preserve liquidity, Wise has scaled back capital spending to $3.0
million to $3.5 million for fiscal 2023, the minimum necessary to
address patient safety and repairs. While Wise's low age of plant
and market position afford it the ability to underspend for a
period of time, an extended period of investment below depreciation
would be viewed unfavorably by Fitch.
Due to the pending Medical City Healthcare transaction, Fitch has
not prepared forward looking scenarios beyond FYE 2023.
Financial Profile - 'b'
Weak Balance Sheet
Wise has a very weak financial profile risk assessment of 'b'.
Unrestricted cash was $69 million at June 30, down from $101
million at the Dec. 31, 2022 FYE, representing about 68 days of
expenses. Due to the decline in unrestricted reserves, cash to
adjusted debt at June 30 was approximately 36%, down from 58% at
the fiscal year-end. Total outstanding debt at June 30 was $185.1
million, including GASB 87 lease liabilities of $67.7 million. On
Sept. 1, Wise paid off the remaining $435,000 balance of its series
2013A bonds. To protect remaining liquidity, Wise maintains a very
conservative asset allocation, with 100% of its investments in cash
and cash equivalents. Upon closing of the Medical City Healthcare
asset purchase agreement, transaction proceeds will be utilized to
pay-off or defease all of Wise's outstanding bond obligations.
Fitch views Wise's balance sheet as approaching tenuous and
offering a limited margin of safety. Under the MTI, Wise must
maintain at least 60 days cash on hand and at least 40%
unrestricted cash-equivalents to debt to avoid an event of default.
While debt service coverage is expected to be below 1.0x, it does
not rise to an event of default provided Wise maintains at least 75
days of operating and maintenance expenses in cash. At present
Wise's ability to meet its minimum days cash requirement at FYE is
uncertain, but Fitch believes it is unlikely.
Asymmetric Additional Risk Considerations
No additional asymmetric risk considerations are applicable to this
analysis.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Failure of the Medical City Healthcare transaction to close as
expected by Wise's fiscal year-end would result in reassessment of
the IDR and long-term bond ratings;
- Further deterioration of unrestricted cash;
- A declaration of an event of default or bankruptcy.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Growth in Wise's unrestricted cash and investments such that cash
to adjusted debt is expected to stabilize above 75%;
- Compliance with the 1.2x debt service coverage covenant;
- Breakeven or better operations.
PROFILE
Wise is a healthcare system headquartered in Decatur, TX and owned
and operated by the Decatur Hospital Authority. The authority is
not a taxing district and the system is not supported by taxes.
Wise operates a 99-bed general acute care hospital in Decatur,
located about 40 miles northwest of downtown Fort Worth.
Wise also operates the 24-bed Parkway Surgical and Cardiovascular
Hospital in the northern section of Fort Worth, TX and the 12-bed
Wise Health Surgical Hospital in Argyle, TX. All other secondary
service area locations have been closed. Wise reported
approximately $390 million in total revenues for fiscal 2022 (Dec.
31 YE).
ESG CONSIDERATIONS
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' 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. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
WOLVERINE MUTUAL: A.M. Best Cuts Fin. Strength Rating to B-(Fair)
-----------------------------------------------------------------
AM Best has downgraded the Financial Strength Rating to B- (Fair)
from B++ (Good) and the Long-Term Issuer Credit Rating to "bb-"
(Fair) from "bbb" (Good) of Wolverine Mutual Insurance Company
(Wolverine) (Dowagiac, MI). The outlook of these Credit Ratings
(ratings) is negative.
These ratings reflect Wolverine's 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 ratings downgrade reflects considerable deterioration in the
company's capitalization through the first half of 2023 as
reflected in a nearly 20% decline in policyholder surplus. This has
been driven by increased weather-related losses and ongoing
inflationary pressures. The most recent policyholder surplus
decline is in addition to double-digit percentage decreases in each
of the past two year-end reporting periods. As a result,
Wolverine's risk-adjusted capitalization has deteriorated
significantly with corresponding increases in the company's
underwriting leverage metrics.
Additionally, the company's ERM assessment has been revised to
marginal reflecting the ongoing challenges in the company's
management of its concentrated risk profile. Given recent increases
in the company's reinsurance retention and level of
co-participation, weather-related losses have had an increased
affect on operating results.
While the company has implemented a number of corrective actions
including rate increases, expense management initiatives and
tightened underwriting guidelines, the ultimate impact of these
efforts is uncertain. Accordingly, the negative outlooks highlight
that continuation of these adverse results where further reductions
in capitalization could lead to additional negative rating action.
ZYMERGEN INC: Case Summary & 30 Largest Unsecured Creditors
-----------------------------------------------------------
Lead Debtor: Zymergen Inc.
1440 Stanford Avenue
Emeryville CA 94608
Business Description: Zymergen, which was founded in April 2013,
is a science and material innovation company
focused on designing, developing and
commercializing bio-based products for use
in a variety of industries. Zymergen's
business initially focused on providing
research and development services to
customers and collaboration partners using
Zymergen's proprietary platform, which
includes its metagenomic library, data
science and software tools. Starting in
late 2019 and early 2020, Zymergen shifted
to a revenue model focused on using its
proprietary platform and expertise to
develop, market, and commercialize its own
bio-based products, seeking to provide more
sustainable alternatives as compared to
traditional chemical companies that often
use petrochemicals for product development.
Chapter 11 Petition Date: October 3, 2023
Court: United States Bankruptcy Court
District of Delaware
Four affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Zymergen Inc. (Lead Case) 23-11661
Lodo Therapeutics Corporation 23-11662
enEvolv, Inc. 23-11663
Genesis Acquisition Sub, LLC 23-11664
Judge: Hon. Karen B. Owens
Debtors' Counsel: Derek C. Abbott, Esq.
Curtis S. Miller, Esq.
Matthew O. Talmo, Esq.
Sophie Rogers Churchill, Esq.
MORRIS, NICHOLS, ARSHT & TUNNELL LLP
1201 Market Street, 16th Floor
Wilmington, Delaware 19801
Tel: (302) 658-9200
Fax: (302) 658-3989
Email: dabbott@morrisnichols.com
cmiller@morrisnichols.com
mtalmo@morrisnichols.com
srchurchill@morrisnichols.com
Debtors'
Claims &
Noticing
Agent: EPIQ CORPORATE RESTRUCTURING, LLC
Zymergen Inc.'s
Estimated Assets: $100 million to $500 million
Zymergen Inc.'s
Estimated Liabilities: $100 million to $500 million
The petitions were signed by Claire Smith as senior vice president
of Finance.
Full-text copies of the petitions are available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/MRBXC5I/Zymergen_Inc__debke-23-11661__0001.0.pdf?mcid=tGE4TAMA
https://www.pacermonitor.com/view/MY4K7RI/enEvolv_Inc__debke-23-11663__0001.0.pdf?mcid=tGE4TAMA
https://www.pacermonitor.com/view/M4H5ZDA/Lodo_Therapeutics_Corporation__debke-23-11662__0001.0.pdf?mcid=tGE4TAMA
https://www.pacermonitor.com/view/NFEMNYY/Genesis_Acquisition_Sub_LLC__debke-23-11664__0001.0.pdf?mcid=tGE4TAMA
Consolidated List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
1. Wilmer Cutler Pickering Hale Legal Fees $2,085,809
and Dorr LLP
One Front Street, Suite 3500
San Francisco, CA 94111
Contact: Susan Muck
Phone: 628-235-1028
Email: susan.muck@wilmerhale.com
2. BRE-BMR 5300 Chiron LP Lease $1,838,659
4570 Executive Drive, Suite 400
Attn: Legal Department
San Diego, CA 92121
Contact: Marie Lewis
Email: legalreview@biomedrealty.com
3. DPR Construction Trade Debt $863,757
Attn: Mike Marston
1450 Veterans Blvd
Redwood City, CA 94063
Contact: George Pfeffer
Fax: 650-474-1451
Email: mikema@dpr.com
4. Morgan Lewis & Bockius, LLP Legal Fees $822,775
One Market, Spear Street Tower
28th FL
San Francisco, CA 94105-1596
Contact: Charlene Shimada
Phone: 415-442-1475
Email: charlene.shimada@morganlewis.com
5. Morrison Foerster Legal Fees $435,795
425 Market Street
San Francisco, CA 94105-2482
Contact: Jina Choi
Phone: (415) 268-6274
Email: jchoi@mofo.com
6. Corteva Agriscience Trade Debt $209,016
9330 Zionsville Road
Attn: General Patent Counsel
Indianapolis, IN 46268
Contact: Mark Pederson
Phone: 833-267-8382
Email: laurie.yoshida@corteva.com
7. SB James Construction Trade Debt $193,463
California Inc.
1450 Halyard Drive
West Sacramento, CA 95691
Contact: Shailesh Nigam
Phone: 916-290-8618
Email: silasnigam@sbjames.com
8. Greenlight Biosciences Inc. Trade Debt $171,530
200 Boston Ave., Suite 1000
Medford, MA 02155
Contact: Andrey J Zarur, PHD
Phone: 161-761-68188
Email: contact@greenlightbiosciences.com
9. Are-East River Science Lease $156,488
Park, LLC
26 North Euclid Avenue
Pasadena, CA 91101
Contact: Joel S. Marcus
Phone: 626-578-0777
Email: corporateinformation@are.com
10. Ehrlich & Craig LLP Legal Fees $69,474
803 Hearst Avenue
Berkeley, CA 94710
Contact: Miles Ehrlich
Phone: (510) 548-3600
Email: miles@ehrlich-craig.com
11. Solvay USA Inc. Trade Debt $65,000
504 Carnegie Center
Attn: General Counsel
Princeton, NJ 08540
Contact: Mitchell Stier
Tel: 609-860-4000
Fax: 609-860-2250
Email: mitchell.stier-ext@solvay.com
thomas.canova@solvay.com
12. MSR Mechanical LLC Trade Debt $60,267
4501 California Court
Benicia, CA 94510
Contact: Jason Perry
Phone: 925-681-2797
Email: jlamb@msrmech.com
13. Justworks Trade Debt $57,113
55 Water Street, Floor 29
Attn: Ali Wahlin
New York, NY 10041
Contact: Michael Seckler
Phone: 888-534-1711
Email: mseckler@just.works.com
14. Linde Gas & Equipment Inc. Trade Debt $27,347
Dept LA 21511
Pasadena, CA 91185-1511
Contact: General Counsel
Tel: 184454633
Fax: 18007729985
Email: contactus@linde.com
15. Dome Construction Trade Debt $24,246
Corporation
393 E Grand Ave
South San Francisco, CA 94080
Contact: General Counsel
Tel: 6504165600
Fax: 6504165602
Email: contactus@domebuilds.com
16. California Compression, LLC Trade Debt $24,118
4659 Las Positas Rd
Livermore, CA 94551
Contact: General Counsel
Phone: 9256679017
Email: jim@calcompression.net
17. Hangzhou Keying Chem Co., Ltd. Trade Debt $20,320
Jintong International
Building, No 113
Huayungang Street, Gong
Shu District
Hangzhou 310015
China
Contact: Bob Han
Tel: 8657185378921
Fax: 8657185378913
Email: dyinfo@dycnchem.com
18. Terracon Consultants, Inc. Trade Debt $20,162
10841 S. Ridgeview Road
Olathe, KS 66061
Contact: Stephanie Price
Phone: 9135996886
Email: elprice@terracon.com
19. Aramark Uniform & Trade Debt $16,785
Career Apparel, LLC
115 North First Street
Burbank, CA 91502
Contact: Debbie Albert
Phone: 2152383634
Email: albert-debbie@aramark.com
20. Agilent Technologies Inc. Trade Debt $15,702
Attn: Legal Dept
5301 Stevens Creek Blvd
Santa Clara, CA 95051
Contact: Bill Sullivan
Phone: 4083458886
Email: lscacontracts@agilent.com
21. Charles River Laboratories Trade Debt $15,633
GPO Box 27812
New York, NY 10087-7812
Contact: Jeffrey Hung
Phone: 7812226000
Email: jhung@vigenebio.com
22. DENS Facilities Trade Debt $15,000
Services Inc.
405 S. Kimball Avenue
Southlake, TX 76092
Contact: General Counsel
Email: info@densfs.com
23. Versa Engineering & Trade Debt $14,000
Technology Inc.
Attn: Exec VP
1320 Willow Pass Rd, Ste 500
Concord, CA 94520
Contact: Fred Fong
Tel: 9254054505
Fax: 9258874474
Email: contact@versaet.com
24. Schindler Elevator Trade Debt $13,239
Corporation
20 Whippany Road
Morristown, NJ 07960
Contact: Silvio Napoli
Phone: 9733976500
Email: michelle.link@schindler.com
25. Vatit USA Inc. Trade Debt $11,281
DBA Tecex
1206 Laskin Rd
Virginia Beach, VA 23451
Contact: General Counsel
Tel: 7574374333
Email: franciscom@tecex.com;
olivern@tecex.com
26. Vistra Trade Debt $11,271
31st James Ave
Boston, MA 02116
Contact: Jim Burke
Email: investor@vistracorp.com
27. Cooley LLP Legal Fees $5,195
3175 Hanover Street
Palo Alto, CA 94304-1130
Contact: Shannon Eagan
Phone: 650 843 5909
Email: seagan@cooley.com
28. Conifer Point Trade Debt $5,000
Pharmaceuticals LLC
3805 Old Easteon Road
Attn: John L. Kulp
Doylestown, PA 18902
Contact: John Kulp
Phone: 2155896367
Email: john.kulp@coniferpoint.com
29. Therma Holdings LLC Trade Debt $4,792
1601 Las Plumas Ave
San Jose, CA 95133
Contact: Mike Fisher
Phone: 4083473400
Email: bcorcoran@therma.com
30. Plato HQ Trade Debt $4,776
251 Little Falls Drive
Wilmington, DE 19808
Contact: General Counsel
Email: hello@platohq.com
[*] Seyfarth Shaw Launches Servicing/Special Servicing Practice
---------------------------------------------------------------
Seyfarth Shaw LLP on Oct. 3, 2023, disclosed that it has launched a
new Servicing/Special Servicing practice group. The new practice
will be chaired by Katie Schwarting, who recently joined the
international law firm and is based in the firm's Charlotte, NC
office.
Seyfarth's Servicing & Special Servicing team is positioned to help
clients adeptly navigate intricacies within today's dynamic and
constantly evolving real estate and financial markets, while
steadfastly safeguarding their interests. It starts with 16
lawyers.
"With looming loan maturities, a higher interest rate environment,
and downward pressure on valuations across asset classes, servicers
and special servicers require dynamic counsel to effectively
address borrower demands and achieve competitive resolutions," said
Schwarting. "Seyfarth is uniquely positioned through our vast
experience and innovative thinking to address seamlessly issues
that impact our clients across securitization, tax, securities,
regulation, asset management, loan modifications, new loan
origination, workouts, foreclosures, insolvency, and litigation."
The Seyfarth Servicing & Special Servicing team represents many of
the largest commercial real estate servicers and special servicers
in the US, including several among the top 10. It also counsels a
wide variety of loan servicers, including commercial
mortgage-backed securities (CMBS), Freddie Mac and collateralized
loan obligations (CLO) securitizations for special servicers,
master servicers, and sub-servicers. The new practice group will
also assist servicers and mezzanine servicers with servicing
arrangements for Fannie Mae, life company, warehouse lending, and
other finance facilities.
"The addition of this significant practice group with a
highly-accomplished team of lawyers led by Katie Schwarting
positions Seyfarth to lead the market in loan servicing and special
servicing," said Paul Mattingly, partner and national chair of
Seyfarth's Real Estate department.
A major focus of the practice is to assist clients in reviewing,
managing, negotiating, and documenting borrower requests related to
warehouse loans, portfolio loans, CMBS, Fannie Mae, and Freddie
Mac's Multifamily Securitization (K Series) program, while ensuring
compliance with all applicable servicing standards and tax rules.
Ms. Schwarting, as the group chair, focuses primarily on CMBS and
Freddie Mac securitizations, regulatory issues impacting
securitization, asset management, and workout and foreclosure
strategies and the sale of servicing rights.
The practice's capabilities encompass a broad range of services
such as securitization reviews, assumptions and change of control
transactions, defeasance, easements, casualty/ condemnation events,
partial releases, loan extensions, loan splits and participations,
subordinate debt, and commercial condominium conversions.
About Seyfarth
With more than 900 lawyers across 18 offices, Seyfarth Shaw LLP
provides top tier advisory, litigation, and transactional legal
services to clients worldwide.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
TCR subscribers have free access to our on-line news archive.
Point your Web browser to http://TCRresources.bankrupt.com/and use
the e-mail address to which your TCR is delivered to login.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Philadelphia, Pa., USA.
Randy Antoni, Jhonas Dampog, Marites Claro, Joy Agravante,
Rousel Elaine Tumanda, Joel Anthony G. Lopez, Psyche A. Castillon,
Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and
Peter A. Chapman, Editors.
Copyright 2023. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $975 for 6 months delivered via
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firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Peter A.
Chapman at 215-945-7000.
*** End of Transmission ***