/raid1/www/Hosts/bankrupt/TCR_Public/231009.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, October 9, 2023, Vol. 27, No. 281
Headlines
117 SPENCER: Wins Cash Collateral Access Thru Jan 2024
129 N WALNUT: May Use $35,000 of Cash Collateral Thru Oct 31
129 N WALNUT: Unsecureds Will Get 100% of Claims in Plan
2370 FOREST: Capital Contributions to Fund Plan
ACPRODUCTS HOLDINGS: $1.40BB Bank Debt Trades at 19% Discount
AFTERSHOCK COMICS: Files Emergency Bid to Use Cash Collateral
AI DESIGN: Voluntary Chapter 11 Case Summary
ALL STAR GLASS: Has Deal on Cash Collateral Access
ANTIGUA INVESTMENTS: Lucy Sikes Named Subchapter V Trustee
ANZEN SOLUCIONES: Case Summary & 20 Largest Unsecured Creditors
APOSTOLIC ASSEMBLY: Unsecureds to Get $150 per Month for 24 Months
ART & DENTISTRY: Seeks Cash Collateral Access
ASP CHROMAFLO: $235MM Bank Debt Trades at 18% Discount
ASTRA ACQUISITION: $500MM Bank Debt Trades at 39% Discount
AVAMERE NPS: Case Summary & Three Unsecured Creditors
BAUSCH + LOMB: Fitch Keeps 'B-' IDR on Watch Evolving
BAUSCH HEALTH: Fitch Affirms 'CCC' LongTerm Issuer Default Rating
BERTUCCI'S RESTAURANTS: Cash Collateral Access OK'd on Final Basis
BLUE DIAMOND: Unsecured Creditors to Recover 100% over 5 Years
BLUE LIGHTNING: Files Emergency Bid to Use Cash Collateral
BLUE STAR: Falls Short of Nasdaq Bid Price Requirement
BRICK CITY: Voluntary Chapter 11 Case Summary
BURDOCK AND ASSOCIATES: Case Summary & 20 Unsecured Creditors
BW HAMPTON: Has Deal on Cash Collateral Access Thru Dec 31
CAMBREX CORP: Moody's Alters Outlook on 'B2' CFR to Negative
CANOO INC: Inks $45M Convertible Preferred Stock Purchase Agreement
CAPROCK LAND: Wins Interim Cash Collateral Access
CBAK ENERGY: Falls Short of Nasdaq Minimum Bid Price Requirement
CBAK ENERGY: Unit to Acquire 5% Stake in BAK Power for $35.6M
CELL-NIQUE CORPORATION: Court OKs Deal on Cash Collateral Access
CELSIUS NETWORK: Seeks to Extend Solicitation Exclusivity to Nov 30
CENTRAL OKLAHOMA: Unsecureds Will Get 100% of Claims in Plan
CNA EQUITY: Case Summary & 20 Largest Unsecured Creditors
COLORADO FOOD: Mark Dennis of SL Biggs Named Subchapter V Trustee
CONNER CREEK: Wins Interim Cash Collateral Access
CONTINENTAL AMERICAN: Court OKs Cash Collateral Access Thru Oct 17
CORELOGIC INC: $750MM Bank Debt Trades at 17% Discount
CPC ACQUISITION: $1.03BB Bank Debt Trades at 19% Discount
CROOM PROPERTIES: Case Summary & Six Unsecured Creditors
CURIA GLOBAL: $1.19BB Bank Debt Trades at 18% Discount
DGS REALTY: Seeks to Continue Using Cash Collateral Thru Dec 31
DIAMOND SPORTS: $635MM Bank Debt Trades at 48% Discount
DIEBOLD NIXDORF: Appoints 4 New Directors
DIGIPATH INC: Hires Fruci & Associates as New Auditor
DRUNKEN DONKEY: Continued Operations to Fund Plan
E.L. SERVICES: Court OKs Interim Cash Collateral Access Thru Dec 31
EGAE LLC: Voluntary Chapter 11 Case Summary
EMERGENT BIOSOLUTIONS: Names Two Pharmaceutical Veterans to Board
ENDEAVOR GROUP: S&P Upgrades ICR to 'BB-', Outlook Positive
EVOLUTION MICRO: Files Emergency Bid to Use Cash Collateral
FARWAY MARINA: Seeks to Extend Plan Exclusivity to December 22
FLAME NEWCO: S&P Assigns 'CCC+' ICR, Outlook Stable
FRANCHISE GROUP: S&P Downgrades ICR to 'B', Outlook Negative
GALLERIA 2425: Unsecureds to Get $200K per Quarter for 11 Quarters
GENERAL PEST: Seeks Cash Collateral Access
GENERATION BRIDGE: S&P Assigns 'BB' Rating on Term Loan B
GLOBAL MEDICAL: $1.98BB Bank Debt Trades at 31% Discount
GOLDEN DEVELOPING: Files Emergency Bid to Use Cash Collateral
GOLDEN KEY: Unsecureds Will Get 100% of Claims in Plan
GOPHER RESOURCE: $510MM Bank Debt Trades at 16% Discount
GRAND RIVER HOSPITAL: S&P Affirms 'BB+' Rating on 2018 GO Bonds
HART INC: Caroline Djang Named Subchapter V Trustee
HERITAGE SPECIALTY: Seeks Cash Collateral Access
HOT'Z POWER: Amends IRS Secured Claim Pay Details
ICAP ENTERPRISES: Seeks $6.75MM DIP Loan from Serene Investment
IDEAL PROTEIN: Chapter 15 Case Summary
INNOVATIVE GENOMICS: Court OKs Cash Collateral Access Thru Oct 21
INT'L LONGSHORE: Class 3A Unsecureds to Get Share of GUC Fund
IQOR US INC: $300MM Bank Debt Trades at 29% Discount
JKW ENTERPRISES: Case Summary & Five Unsecured Creditors
JL DANIELS: John Caraway Named Subchapter V Trustee
JLM COUTURE: Seeks Cash Collateral Access
JMWAYS LLC: Case Summary & 20 Largest Unsecured Creditors
JO-ANN STORES: $675MM Bank Debt Trades at 68% Discount
LEARNING CURVE: Seeks Cash Collateral Access
LEHIGH VALLEY: Moody's Assigns Ba1 Rating on $8.4MM Revenue Bonds
LERETA LLC: $250MM Bank Debt Trades at 20% Discount
LEXFIT LLC: Case Summary & 19 Unsecured Creditors
MACHETE EQUIPMENT: Chris Quinn Named Subchapter V Trustee
MACHINE TOOL: Court OKs Cash Collateral Access Thru Dec 21
MATADOR RESOURCES: Fitch Affirms 'BB-' LongTerm IDR, Outlook Pos.
MATCH GROUP: S&P Alters Outlook to Positive, Affirms 'BB' ICR
MAVENIR SYSTEMS: $585MM Bank Debt Trades at 22% Discount
MIKU INC: Unsecureds to Split $50K in Liquidating Plan
MINE HILL ANESTHESIA: Lender Seeks to Prohibit Cash Access
MOLEKULE GROUP: Seeks $3MM DIP Loan From Bridge Coast et al.
MOLEKULE INC: Unsecureds Will Get 1.39% of Claims in Joint Plan
MOUNTAIN VIEW: Court OKs Cash Collateral Access Thru Oct 31
MOUROUX FAMILY: Amends Unsecured Claims Pay Details
MV REALTY PBC: Court OKs Interim Cash Collateral Access
NABIEKIM ENTERPRISES: Court OKs Cash Collateral Access Thru Dec 31
NASHFIT LLC: Investment & Continued Operations to Fund Plan
NEP GROUP INC: $240MM Bank Debt Trades at 21% Discount
NOBLE HEALTH II: Amends Plan to Include Several Secured Claims Pay
NOBLE HEALTH: Amends Plan to Include Phil Hagedorn Secured Claim
NOBLE HOUSE: Court OKs $12MM DIP Loan from Wells Fargo
NOVA CHEMICALS: S&P Downgrades LT ICR to 'BB-', Outlook Negative
ORLY EQUITIES: Involuntary Chapter 11 Case Summary
OROVILLE, CA: S&P Places 'B' 2019 Rev. Bonds Rating on Watch Neg.
PALMER DRIVES: Unsecured Claims Under $3K to be Paid in Full
PANACEA LIFE: To Acquire PUR LIFE Medical Franchise for $1-Mil.
PANOS FITNESS: Court OKs Interim Cash Collateral Access
PARATEK PHARMACEUTICALS: Suspending Filing of Reports With SEC
PERFORMERS THEATRE: Future Earnings to Fund Plan
PLUMBING TECHNOLOGIES: Unsecureds Will Get 25% over 5 Years
PRETIUM PKG: $1.25BB Bank Debt Trades at 25% Discount
PRETIUM PKG: $350MM Bank Debt Trades at 51% Discount
PRIME CORE: Amends Unsecured Claims Pay Details
PROJECT ALPHA: S&P Assigns Prelim 'B' Debt Rating, On Watch Pos.
PRR 200: Case Summary & Seven Unsecured Creditors
QUANERGY SYSTEMS: Unsecureds Will Get 8.5% to 10.3% in Plan
RESTORATION HARDWARE: S&P Downgrades ICR to 'B+', Outlook Stable
RIHH LLC: Court OKs Cash Collateral Access on Final Basis
S&G HOSPITALITY: Wins Cash Collateral Access Thru Nov 30
SAMSON TOURS: Case Summary & 16 Unsecured Creditors
SCCW INDUSTRIAL: Creditors to Get Proceeds From Liquidation
SHOWFIELDS INC: Case Summary & 20 Largest Unsecured Creditors
SIGNAL PARENT: $550MM Bank Debt Trades at 17% Discount
SIMPLETECH REPAIR: Court OKs Cash Collateral Access on Final Basis
SMG INDUSTRIES: Releases Pro Forma Financials, Stockholder Update
ST. LUKE'S HOSPITAL: S&P Lowers Revenue Bond LT Rating to 'BB+'
ST. PAUL CONSERVATORY: S&P Cuts Lease Revenue Debt Rating to 'BB-'
STADIUMS EXPORT: Case Summary & Three Unsecured Creditors
STAT EMERGENCY: Unsecureds to Split $60K over 3 Years
SUNSET DEBT MERGER: $1.63BB Bank Debt Trades at 16% Discount
TEAM HEALTH: $1.59BB Bank Debt Trades at 27% Discount
TEHUM CARE: M2 LoanCo Ups Interim DIP Loan to $8.5MM
THAI KITCHEN: Files Emergency Bid to Use Cash Collateral
TRITEK INT'L: Windom Unsecureds to Recover 11% to 14% in Plan
VISTA CLINICAL: Files Emergency Bid to Use Cash Collateral
WASTEQUIP LLC: S&P Alters Outlook to Negative, Affirms 'CCC+' ICR
WESTERN GLOBAL: Unsecureds to Recover 3% to 5% in Joint Plan
WEWORK INC: To Withhold $95.2M Interest Payments on Some Notes
WW INTERNATIONAL: $945MM Bank Debt Trades at 25% Discount
YH&R CONSTRUCTION: Voluntary Chapter 11 Case Summary
ZIP TOP: Seeks Cash Collateral Access
[] Kirkland, Foley Co-Chair Nov 29 Distressed Investing Conference
[^] BOND PRICING: For the Week from October 2 to 6, 2023
*********
117 SPENCER: Wins Cash Collateral Access Thru Jan 2024
------------------------------------------------------
The U.S. Bankruptcy Court for the District of Massachusetts
authorized 117 Spencer, LLC to use cash collateral on an interim
basis on the same terms and conditions as the previous order,
through January 25, 2024.
As previously reported by the Troubled Company Reporter, as
adequate protection, Country Bank and Resource Capital, were
granted replacement liens on the same types of post-petition
property of the Debtor's estates against which the Secured
Creditors held liens as of the Petition Date. The Replacement Liens
will maintain the same priority, validity and enforceability as the
Secured Creditors' respective pre-petition liens. The Replacement
Liens will be recognized only to the extent of the post-petition
diminution in value of the Secured Creditors' pre-petition
collateral resulting from the Debtor's use of the cash collateral.
Commencing on August 20, 2023, and continuing thereafter on the
20th day of each successive month, the Debtor was directed to
provide the following reporting to each Secured Creditor: (a) a
budget to actual report with respect to the Budget, and (b) a copy
of the Debtor's monthly operating report filed with the Court.
On or before September 15, 2023, the Debtor was directed to file
with the Court a budget to actual report for the Budget Period and
a further Budget for the Debtor's operations for the period between
October 1, 2023 and December 31, 2023.
A continued hearing on the matter is set for January 25, 2024 at 10
p.m.
A copy of the court's order is available at
https://urlcurt.com/u?l=zmEFhA from PacerMonitor.com.
About 117 Spencer, LLC
117 Spencer, LLC is a Massachusetts limited liability company that
was formed in 2019 to own and operate the real estate located at
117 Main Street, Spencer, Massachusetts. The Debtor has always been
in the business of operating the Property, and has not had any
other material business operations. Lisa Venuto and Peter Venuto,
who are married, collectively own 100% of the Debtor's membership
interests. Peter Venuto is the manager of the Debtor.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Mass. Case No. 23-40590) on July 21,
2023. In the petition signed by Peter Venuto (by Lisa Venuto under
power of attorney), the Debtor disclosed up to $10 million in both
assets and liabilities.
Judge Elizabeth D. Katz oversees the case.
D. Ethan Jeffery, Esq., at Murphy & King, Professional Corporation,
represents the Debtor as legal counsel.
129 N WALNUT: May Use $35,000 of Cash Collateral Thru Oct 31
------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of New York
authorized 129 N Walnut Street LLC to use cash collateral on an
interim basis in accordance with the budget through October 31,
2023.
The Debtor is permitted to pay post-petition expenses of up to
$50,000 and only pay actual and necessary expenses of its operation
as set forth in the budget.
To the extent of the diminution in the value of any interest it has
in rents, Basis Multifamily Finance I LLC, is granted a first
priority lien on (i) all property acquired by the Debtor after the
filing of the case and any proceeds thereof, and (ii) any of the
Debtor's assets not already subject to Basis' alleged security
interest and any proceeds thereof -- in addition to any existing
liens it may hold on the Property and the Rents or otherwise.
As further adequate protection, the Debtor must pay Basis $30,550
on or before the last business day of each month during the term of
the order, which may be paid from the Rents. Basis will be granted
an allowed superpriority administrative expense claim, pursuant to
11 U.S.C. Section 507(b), with priority over all administrative
expense claims and unsecured claims against the Debtor, to the
extent of the diminution of its alleged interest in the value of
the Rents.
Basis will not have any lien on any avoidance actions under
subchapter 5 of the Bankruptcy Code. Any substitute lien or
adequate protection claim granted will be subordinate to (i) the
payment of United States Trustee's fees pursuant to 28 U.S.C. Sec.
1930 (a)(6) plus interest at the statutory rate for any fees not
paid in a timely manner, and any fees payable to the Clerk of the
Bankruptcy Court; and (ii) reasonable fees and expenses of a
Chapter 7 trustee allowable pursuant to 11 U.S.C. section 726(b) in
an amount not to exceed $10,000.
A copy of the order is available at https://urlcurt.com/u?l=CfIKr2
from PacerMonitor.com.
About 129 N Walnut Street LLC
129 N Walnut Street LLC owns a 41-unit apartment building in 129 N
Walnut Street in East Orange, N.J. 129 N Walnut Street LLC sought
protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr.
E.D.N.Y. Case No. 22-42104) on September 2, 2022. In the petition
signed by Samuel Rosenbaum, its managing member, the Debtor
disclosed up to $10 million in both assets and liabilities.
Judge Elizabeth S. Stong oversees the case.
The Law Offices of Isaac Nutovic is the Debtor's counsel.
129 N WALNUT: Unsecureds Will Get 100% of Claims in Plan
--------------------------------------------------------
129 N Walnut Street LLC submitted a Disclosure Statement for Second
Amended Plan dated October 3, 2023.
The Debtor is a limited liability company which owns real property
located at 129 N Walnut Street, East Orange, New Jersey (the
"Property"). The Debtor is 100% owned by Sam Rosenbaum.
The Debtor owns a residential building with 42 apartments located
at 129 North Walnut Street, East Orange, NJ 07017 (the "Property").
The Debtor acquired the Property from Yitzchokk LLC (the "Seller")
by deed dated November 19, 2021. To finance the purchase price of
$5,400,000 and supplement Rosenbaum's advances of more than
$1,000,000, the Debtor obtained a loan (the "Loan") from Basis
Multifamily Capital LLC in the amount of $4,320,000.
The Loan was secured by a mortgage on the Property, an assignment
of rents and a guaranty provided by Rosenbaum (collectively, the
"Loan Documents"). The Debtor believes the Loan and the Loan
Documents were subsequently assigned to Basis Finance, which
assigned them to Federal Home Loan Mortgage Corporation ("FHLMC")
and that shortly before the commencement of this case, FHLMC re
assigned the Loan and Loan Documents to Basis Finance.
After the Loan was re-assigned to Basis Finance, it also refused to
consider providing any requirements for a second mortgage on the
Property and pressured the Debtor to commit to refinance the Loan.
When the Debtor refused, Basis Finance sent a notice of default
(the "Default Notice"). The Default Notice directed the Debtor to
cease collecting rents and demanded payment prior to September 1,
2022 of the unpaid principal balance --$4,272,322.66 - in addition
to alleged "Lender Costs" of $1,846,775.48. The Default Notice
threatened the Debtor with the loss of the use of the rents of the
Property. Accordingly, on September 2, 2022, the Debtor commenced
this chapter 11 bankruptcy case.
The Debtor's only significant asset is the Property which was
purchased for $5,420,000 approximately 1 year ago. The only other
assets the Debtor has are claims against Basis Finance, Old
Republic and Riverside Abstract LLC.
Class 2 consists of all unsecured claims. This class is not
impaired. The holders of class 2 claims will receive 100% of their
allowed claims in cash on the Effective Date. The holder of a
$141,000 Claim in this class has agreed to defer payment until the
Property is refinanced or sold. Cash needed on confirmation to make
payments to the creditors in this class is expected to be less than
$16,000.
Class 3 consists of Equity Interests. The holder of the membership
interests in the Debtor shall retain their equity interests. Sam
Rosenbaum shall (i) contribute the funds necessary to confirm this
Plan and (ii) agree that repayment of any Unsecured or
Administrative Claim he has against the Debtor will only be paid
from the proceeds of a sale or refinance of the Property after the
Mortgagee's claim has been paid in full.
Rosenbaum has secured a personal loan of up to $850,000 to lend to
the Debtor for funding initial plan payments and any amounts needed
post confirmation to fulfill its plan commitments. Prior to the
date to be set by the Bankruptcy Court for a hearing on
confirmation of the Plan, Rosenbaum shall cause no less than
$450,000 to be deposited in escrow with Debtor's counsel for
distribution on the Effective Date of the Plan.
A full-text copy of the Disclosure Statement dated October 3, 2023
is available at https://urlcurt.com/u?l=Bc5oSF from
PacerMonitor.com at no charge.
Attorneys for the Debtor:
Isaac Nutovic, Esq.
Law Offices of Isaac Nutovic
261 Madison Avenue, 26th Floor
New York, NY 10016
Tele: (212) 421-9100
Email: inutovic@nutovic.com
About 129 N Walnut Street LLC
129 N Walnut Street LLC owns a 41-unit apartment building in 129 N
Walnut Street LLC. The Property is currently fully occupied. The
Property is the Debtor's sole tangible asset. The Debtor's sole
source of revenue are the rents paid by tenants at the Property.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D.N.Y. Case No. 22-42104) on Sept. 2,
2022. In the petition signed by Samuel Rosenbaum, managing member,
the Debtor disclosed up to $10 million in both assets and
liabilities.
Judge Elizabeth S. Stong oversees the case.
The Law Offices of Isaac Nutovic is the Debtor's counsel.
2370 FOREST: Capital Contributions to Fund Plan
-----------------------------------------------
2370 Forest LLC filed with the U.S. Bankruptcy Court for the
District of New Jersey a Disclosure Statement describing Chapter 11
Plan dated October 3, 2023.
The Debtor is a New Jersey Limited Liability Company whose primary
asset is real property located at 2370 Forest Drive, Lakewood, New
Jersey 08701 (the "Property") where the principal of the Debtor
resides with his family.
Arthur Spitzer is the Debtor's managing member and owns the sole
real Property located at 2370 Forest Circle, Lakewood, NJ. The
Debtor listed its sole Property in its schedules as having a value
of $869,900.00.
The Debtor filed Chapter 11 because its secured creditor U.S. Bank,
N.A. obtained a judgment in the foreclosure matter styled, U.S.
Bank, N.A. v. 2370 Forest, LLC; F-002175-21.
Class 1 consists of the Secured Claim of US Bank Trust National
Association in the amount of $656,901.43. The Debtor proposes to
cure prepetition and postpetition arrears by making 60 monthly
payments on this claim in the amount of $8,562.34. This figure
includes the monthly base mortgage payment of $4,979.67as well as
the cure payment of $3,582.67 at 8.49% interest pursuant to the US
Bank proof of claim. The Debtor values collateral at $869,900.
The holder of the Claim in this Class shall retain its prepetition
lien, and all rights of the holder of the Claim in this Class, to
the extent not inconsistent with the Plan shall remain as set forth
in the prepetition loan documents and as provided by applicable
nonbankruptcy law. In the event of default the Debtor shall have a
30-day grace period to cure default. In the event the debtor fails
to cure within the grace period, the Debtor shall market and sell
the property within 9 months.
Class 2 consists of General unsecured claims in the amount of
$11,049.76. The Claims in this Class shall receive monthly payments
of $184.16. This Class is impaired.
Class 3 consists of Ownership interests. This Class shall retain
ownership of its equity interests in the Debtor.
The Plan shall be funded by capital contributions made by the
managing member of the Debtor, Arthur Spitzer. Within 2-3 months
from the Effective Date, the Debtor will fund the plan from through
his equity in 2 properties in Jersey City: one is at 45 Corneilson
Avenue; the other property is at 77 Forest Street. Both of those
are under contract and the 45 Corneilson property will be sold
within the next 2 months.
The Debtor is currently working on accessing the equity in these
properties to fund a reinstatement of the U.S. Bank, N.A. loan
secured by the Debtor's property in this case. In the event of
default, the Debtor shall market and sell the Property within 9
months. The sale of the Property shall provide funds needed to pay
creditors under the Plan. The sale to a prospective buyer shall be
subject to approval of the Bankruptcy Court upon motion filed
pursuant to section 363 of the Bankruptcy Code.
The sale shall be free and clear of all liens, claims and
encumbrances, with valid liens to attach to the proceeds of sale,
and any outstanding real property taxes or municipal assessments,
and the Secured Claim of US Bank shall be paid at closing from the
proceeds of sale, and the Confirmation Order shall expressly so
provide. In the event of any future Foreclosure Action, US Bank
shall be paid from the proceeds of the sheriff sale in accordance
with its priority.
A full-text copy of the Disclosure Statement dated October 3, 2023
is available at https://urlcurt.com/u?l=Z2iwEi from
PacerMonitor.com at no charge.
Attorneys for Debtor:
Timothy P. Neumann, Esq.
Geoffrey P. Neumann, Esq.
Broege, Neumann, Fischer & Shaver, LLC
25 Abe Voorhees Drive
Manasquan, NJ 08736
Telephone: (732) 223-8484
Email: timothy.neumann25@gmail.com
geoff.neumann@gmail.com
About 2370 Forest
Arthur Spitzer, a creditor of 2370 Forest, LLC, filed an
involuntary Chapter 7 petition against the company (Bankr. D.N.J.
Case No. 23-13765) on May 1, 2023. On June 20, 2023, the case was
converted to one under Chapter 11.
Judge Christine M. Gravelle oversees the case.
Broege, Neumann, Fischer & Shaver, LLC serves as the Debtor's legal
counsel.
ACPRODUCTS HOLDINGS: $1.40BB Bank Debt Trades at 19% Discount
-------------------------------------------------------------
Participations in a syndicated loan under which ACProducts Holdings
Inc is a borrower were trading in the secondary market around 81.3
cents-on-the-dollar during the week ended Friday, October 6, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $1.40 billion facility is a Term loan that is scheduled to
mature on May 17, 2028. The amount is fully drawn and
outstanding.
ACProducts Holdings, Inc. manufactures cabinets. The Company offers
single and multi-family home builders, distributors, home centers,
cabinetry, and other related products.
AFTERSHOCK COMICS: Files Emergency Bid to Use Cash Collateral
-------------------------------------------------------------
Aftershock Comics, LLC and Rive Gauche Television ask the U.S.
Bankruptcy Court for the Central District of California, San
Fernando Division to use cash collateral on an interim basis for
the one-week period from October 1, 2023 to October 6, 2023.
During the period, the Debtors are seeking to use $59,772 of cash
collateral for expenses, and is expected to generate $79,948 of
income. At the end of the Period, the Debtors are expected to have
$20,176 more in cash than when the Period started.
Access Road Capital LLC is the Debtors' senior secured lender. The
Debtors originally borrowed $11.090 million from ARC in March 2020.
The Debtors are jointly and severally liable to repay the Loan.
ARC and the Debtors entered into a subsequent agreement that
provided the Debtors with a $2.392 million line of credit. The
Debtors are jointly and severally liable to repay the Loan, and the
Lender asserts the Loan is secured by all, or substantially all, of
the Debtors' assets.
ARC filed duplicate proofs of claims in each of the Debtors'
bankruptcy cases in the amount of $15.651 million as secured
claims.
Although the Debtors' businesses were highly successful prior to
the COVID-19 pandemic, the circumstances surrounding the Pandemic
have detrimentally impacted the Debtors' operations and financial
condition.
In addition, the Debtors' financial problems were exacerbated by
liquidity problems associated with insufficient junior capital to
fund the high cash requirements of their new business ventures that
have long investment lead times.
As a result of these liquidity and other financial issues, the
Debtors were unable to make certain Loan payments to the Lender
(and several of their other creditors and vendors). The Lender
asserted that defaults occurred under the Loan, and: (1) provided
the Debtors with a written Notice of Default; and (2) on October
10, 2022, initiated an action in the California Superior Court
titled "Access Road Capital, LLC v. Rive Gauche Television, et
al.," LASC Case No.22STCV33196 against the Debtors and other
parties. Although the Debtors attempted pre-petition to negotiate
in good faith to reach an agreement with the Lender, those
negotiations reached an impasse.
The Lender will be adequately protected in three ways, which
provides a basis for the immediate and ongoing authorization for
the Debtors to use cash collateral. First, the Debtors will be
adequately protected by a large equity cushion well over 20%.
Second, as additional adequate protection, the Debtors propose that
the Court authorize the Debtors to grant and provide the Lender
with replacement Adequate Protection Liens on, and security
interests in, the assets of the Debtors' estate. Third, in addition
to the foregoing two forms of adequate protection, the Lender will
also be further adequately protected by the Debtors' use of cash
collateral pursuant to the Budget to maintain operations and
preserve the value of the Lenders' collateral.
A copy of the motion is available at https://urlcurt.com/u?l=XZ3n0z
from PacerMonitor.com.
About AfterShock Comics
AfterShock Comics, LLC -- https://Aftershockcomics.com -- is an
American comic book publisher launched in 2015. The company is
based in Sherman Oaks, Calif. AfterShock Comics and affiliate Rive
Gauche Television filed petitions for relief under Chapter 11 of
the Bankruptcy Code (Bankr. C.D. Calif. Lead Case No. 22-11456) on
Dec. 19, 2022.
Judge Martin R. Barash oversees the cases.
At the time of filing, AfterShock Comics reported $10 million to
$50 million in both assets and liabilities while Rive Gauche
reported $50 million to $100 million in assets and $10 million to
$50 million in liabilities.
The Debtors are represented by David L. Neale, Esq., at Levene,
Neale, Bender, Yoo & Golubchik L.L.P.
The U.S. Trustee for Region 16 appointed two separate committees to
represent unsecured creditors in the Chapter 11 cases of AfterShock
Comics, LLC and Rive Gauche Television.
AI DESIGN: Voluntary Chapter 11 Case Summary
--------------------------------------------
Debtor: AI Design LLC
d/b/a Custom Metal Glass
d/b/a CMG
60 Herbert Avenue
Closter, NJ 07624
Business Description: CMG is an architectural metal and glass
designer, fabricator and installer. CMG
creates canopies, building facades, stairs,
railings, entrances, lobbies, foyers, and
greenhouses.
Chapter 11 Petition Date: October 7, 2023
Court: United States Bankruptcy Court
District of New Jersey
Case No.: 23-18795
Debtor's Counsel: Rosemarie E. Matera, Esq.
KIRBY AISNER & CURLEY LLP
700 Post Road
Suite 237
Scarsdale, NY 10583
Tel: (914) 401-9503
Email: RMatera@kacllp.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Leeron Mosayov as member.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/YPYV5UQ/AI_Design_LLC__njbke-23-18795__0001.0.pdf?mcid=tGE4TAMA
ALL STAR GLASS: Has Deal on Cash Collateral Access
--------------------------------------------------
All Star Glass, LLC asks the U.S. Bankruptcy Court for the District
of Colorado for authority to use cash collateral and provide
adequate protection in accordance with its agreement with the U.S.
Small Business Administration.
The SBA claims a lien on all of the Debtor's inventory and
accounts. On November 2, 2021, the Debtor received a Disaster
COVID-19 Economic Injury Loan from the SBA where the SBA loaned
$500,000 to the Debtor. On or about March 7, 2022, the Loan was
amended and the loan was increased to $1.250 million. In exchange
for the loan, the Debtor gave the SBA essentially a blanket lien
which includes the Debtor's inventory, equipment, accounts and
general intangibles. Payments on the loan are due to start within
twenty-four months of the initial loan date. The monthly payments
will be $6,393 once they commence in November 2023.
A search of the Uniform Commercial Code records at the Secretary of
State's Office reflects tax liens. The tax liens have been
released.
The parties agreed that the Debtor may use cash collateral through
and including November 30, 2023.
A copy of the motion is available at https://urlcurt.com/u?l=zrsqfL
from PacerMonitor.com.
About All Star Glass, LLC
All Star Glass, LLC is a privately held commercial & residential
glass company. The Debtor sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. D. Colo. Case No. 23-14377) on
September 27, 2023. In the petition signed by William R. Glover,
member, the Debtor disclosed up to $500,000 in assets and up to $1
million in liabilities.
Bonnie Bell Bond, Esq., at Law Office of Bonnie Bell Bond,
represents the Debtor as legal counsel.
ANTIGUA INVESTMENTS: Lucy Sikes Named Subchapter V Trustee
----------------------------------------------------------
The Acting U.S. Trustee for Region 5 appointed Lucy Sikes as
Subchapter V trustee for Antigua Investments, LLC, doing business
as Canterbury House.
Ms. Sikes will be paid an hourly fee of $365 for her services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Ms. Sikes declared that she is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Lucy G. Sikes
P.O. Box 52545
Lafayette, LA 70505-2545
Telephone: 337-366-0214
Facsimile: 337-628-1319
Email: lucygsikes1@gmail.com
About Antigua Investments
Antigua Investments, LLC owns a land and building located at 16th
St., Alexandria, La.,valued at $3 million.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. W.D. La. Case No. 23-80536) on Sept. 22,
2023, with $3,071,950 in assets and $1,204,905 in liabilities. Jose
Alejandro Porras, member, signed the petition.
Judge Stephen D. Wheelis oversees the case.
Thomas R. Willson, Esq. represents the Debtor as legal counsel.
ANZEN SOLUCIONES: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Anzen Soluciones, S.A. de C.V.
Av. Marina Nacional numero 60, piso 3
Colonia Tacuba, C.P. 11320
Ciudad de Mexico Mexico
Business Description: The Debtor is a consulting, outsourcing and
technology firm.
Chapter 11 Petition Date: October 6, 2023
Court: United States Bankruptcy Court
District of Delaware
Case No.: 23-11687
Judge: Hon. J. Kate Stickles
Debtor's Counsel: Jeremy W. Ryan, Esq.
POTTER ANDERSON & CORROON LLP
1313 North Market Street, Sixth Floor
Wilmington DE 19801
Tel: (302) 984-6000
Email: jryan@potteranderson.com
Estimated Assets: $100 million to $500 million
Estimated Liabilities: $100 million to $500 million
The petition was signed by James S. Feltman as chief restructuring
officer.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/WQ4JH2Q/Anzen_Soluciones_SA_de_CV__debke-23-11687__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
1. Tax Administration Service Tax $105,000,000
(Mexico)
Phone: (52) 55 627 22 728
2. S C Proteccion Y Asesoria SC Legal Services $201,677
Email: facturacion@proteccionyasesoria.com
3. Extend Solutions SA De CV Internal $64,122
Co Branza Licenses
Email: cobranza@agilethought.com (Office)
4. Maria Dolores Garcia Litigation $54,800
Martinez
5. Concentrix CVG LLC Licenses for $47,927
Susan Digirolamo Santander
EMAIL: susan.digirolamo@concentrix.com
6. Inmobiliaria Sky Office $47,827
De Yucatan S.A. DE Merida
Email: facturacion@skycapital.mx
Phone: 8132338210
7. Victor Alberto Litigation $47,130
Santana Delgadillo
8. Luis Raul Gonzalez Calderon Litigation $44,101
9. Latix NS SA De CV $36,622
10. Roel Y Roel Legal Services $29,102
Abogados SC
Raquel, Carina, Jorge
Email: raquel@roelabogados.com
11. Icorptti SA De CV $22,578
12. Atcon Estrategicos S.A. $15,294
DE C.V.
Montserrat Cruz
Email: montserrat.cruz@atconmx.net
Phone: 5545055746
13. Google LLC License $8,625
14. Servicio De Enlace Personal $8,067
15. Pegaso PCS SA De CV License $7,343
16. KC Rentas S.A. DE C.V. Computer Lease/ $7,270
R. Cesareo, R. Mendieta KC Rentas
EMAIL: rcesareo@kapali.com.mx
17. IQ4 S.A. DE C.V. $7,268
18. Industrias Ordonez SA DE CV Furniture $5,230
19. Erik Namur Campesino SC On Demand $4,853
IR. Sanchez, J. Carranza, C. Obranza
Email: facturacion@notaria94.com.mx
Phone: 5526241840
20. Inmobiliaria Kaza Loans $2,583
Para Todos SA DE
Rafael Grinberg
EMAIL: rafaelgrinberg@gmail.com
APOSTOLIC ASSEMBLY: Unsecureds to Get $150 per Month for 24 Months
------------------------------------------------------------------
The Apostolic Assembly of Love filed with the U.S. Bankruptcy Court
for the Southern District of Texas a Subchapter V Plan dated
October 2, 2023.
The Debtor is a church and ministry located in Houston, Texas. The
Debtor was founded and incorporated in the State of Texas on as a
non-profit corporation on March 14, 1985.
The Debtor's primary asset is its cathedral located at 8042 Braniff
Street, Houston, Texas (the "Braniff Property"). The Debtor is
managed by its Pastor Louis W. Osborne, Jr.
Class 1 shall consist of secured claims held by 8301 Braniff, LLC
and AMI Lending Inc. Commencing the first day of the calendar month
following the Effective Day, the Reorganized Debtor shall pay
consecutive monthly payments, to Braniff and AMI Lending with
interest bearing on the respective claims, from the Effective Date,
at the rate of 8.00% per annum for a period of 24 months. No later
than October 1, 2025, the remaining secured claims of Braniff and
AMI will be paid in full by the Reorganized Debtor.
The Reorganized Debtor will pay Braniff consecutive monthly
payments of $1,300.00 and consecutive monthly payments of $5,200.00
to AMI commencing the first day of the calendar month following the
Effective Date for a period of 24 months. The remaining secured
claims of Braniff and AMI shall be paid in full no later than
October 1, 2025 by the Reorganized Debtor.
Class 2 shall consist of Allowed General Unsecured Claims. In full
satisfaction, holders of claims in Class 2 shall receive monthly
Pro Rata Cash payments of $150.00, reflecting the Debtor's
Disposable Income for a period of 24 months. Payments shall
commence the first day of the calendar month following the
Effective Date. Class 2 is impaired and entitled to vote on the
Plan.
The equity interest holder of this Plan shall retain his respective
equity interest.
The payments contemplated in this Plan shall be funded from income
generated from donations received from the Debtor's parishioners
and from the sale of the Braniff Property.
The post-confirmation management of the Debtor shall remain with
Pastor Louis W. Osborne, Jr., manager of the Debtor.
A full-text copy of the Subchapter V Plan dated October 2, 2023 is
available at https://urlcurt.com/u?l=jIAqwe from PacerMonitor.com
at no charge.
Attorney for the Debtor:
Brendon Singh, Esq.
Tran Singh, LLP
2502 La Branch Street
Houston TX 77004
Telephone: (832) 975-7300
Facsimile: (832) 975-7301
Email: bsingh@ts-llp.com
,About The Apostolic Assembly
The Apostolic Assembly of Love is a tax-exempt religious
organization in Houston, Texas.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. S.D. Texas Case No. 23-32494) on July 3,
2023, with $1 million to $10 million in assets and $500,000 to $1
million in liabilities. Louis Willie Osborne, Jr., president,
signed the petition.
Judge Eduardo V. Rodriguez oversees the case.
Susan Tran Adams, Esq., at Tran Singh, LLP, is the Debtor's legal
counsel.
ART & DENTISTRY: Seeks Cash Collateral Access
---------------------------------------------
Art & Dentistry, LLC asks the U.S. Bankruptcy Court for the
District of Maryland for authority to use cash collateral and
provide adequate protection.
Dr. Ellen Brodsky, has owned and operated the Debtor's dental
practice since 2000. On October 29, 2012, Dr. Brodsky was injured
by a light fixture that had been improperly installed and which
fell from the ceiling of an examination room, causing closed-head
brain injury. The injury severely impacted the business's income,
and the practice has struggled financially due to COVID and staff
turnovers. Since then, the practice has relied on part-time,
contract dentists, and the debtor believes it can rebuild revenue
through a Chapter 11 plan. The Debtor has also been delinquent in
paying rent, leading to a consent judgment with the landlord in
April 2021. The Debtor's finances have deteriorated, and the
landlord is pursuing eviction.
Of record, the creditor with the senior lien against the Debtor's
assets is Wells Fargo Bank, N.A., whose original UCC-1 was recorded
September 10, 2009, and was continued thereafter by periodic
continuation statements, the most recent of which was filed March
14, 2019. However, in 2020 Wells Fargo sent the Debtor a notice
that it was cancelling the Debtor's debt. Because its financing
statement remains of record, the Debtor will treat Wells Fargo as
if it were still a secured creditor, although disputed.
Second in priority of filing is the United States Small Business
Administration, which perfected a lien against all the Debtor's
assets with the filing of a UCC-1 on May 6, 2020. SBA is owed
approximately $166,500.
The third and final lien claimant is "E Advance Services," which
filed its UCC-1 on June 28, 2023, and is owed approximately
$26,500.
E Advance Services is one of three "merchant cash advance"
companies to which the Debtor turned in recent months in order to
get by. The business model of the MCAs is doubtless familiar to
this Court. In exchange for money advanced to the Debtor, the MCAs
purport to "purchase" future receivables. Largely, their business
is structured to try to avoid usury laws for, while their contracts
do not express an accurate rate of interest for those advances,
undersigned counsel has calculated annual interest rates ranging
roughly from 130% to 144%.
The MCA agreements are little more than disguised security
agreements, if that. As noted above, only one of the MCA "lenders"
has recorded a financing statement against the Debtor.
Collectively, the Debtor owes the MCA companies approximately
$70,000.
The UCC-1 filings are all what are commonly referred to as
"blanket" liens, intended to encumber all the Debtor's assets.
The Debtor has yet to file its schedules, but when filed, those
schedules will show few assets of any liquidation value other than
its receivables, due primarily from dental insurance companies. The
face amount of those receivables is $131,714, of which the Debtor
expects to actually collect approximately $66,000.
The use of the cash collateral is intended and designed to create
replacement cash collateral. Whatever interests the secured parties
may have in the Debtor's assets will be protected by preservation
of their pre-petition security interests.
A copy of the motion is available at https://urlcurt.com/u?l=iMmsOF
from PacerMonitor.com.
About Art & Dentistry
Art & Dentistry is a local dental practice offering general and
cosmetic dentistry, teeth whitening, implants, veneers and other
services.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Md. Case No. 23-16790) on September 22,
2023. In the petition signed by Ellen Brodsky, managing member, the
Debtor disclosed up to $500,000 in assets and up to $10 million in
liabilities.
ASP CHROMAFLO: $235MM Bank Debt Trades at 18% Discount
------------------------------------------------------
Participations in a syndicated loan under which ASP Chromaflo Dutch
I BV is a borrower were trading in the secondary market around 81.7
cents-on-the-dollar during the week ended Friday, October 6, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $235.4 million facility is a Term loan that is scheduled to
mature on November 18, 2023. About $223.5 million of the loan is
withdrawn and outstanding.
ASP Chromaflo Dutch I B.V. produces and supplies chemicals. The
Company serves customers in the United States and the Netherlands.
ASTRA ACQUISITION: $500MM Bank Debt Trades at 39% Discount
----------------------------------------------------------
Participations in a syndicated loan under which Astra Acquisition
Corp is a borrower were trading in the secondary market around 60.8
cents-on-the-dollar during the week ended Friday, October 6, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $500 million facility is a Term loan that is scheduled to
mature on October 25, 2029. The amount is fully drawn and
outstanding.
Zayo Group is a privately held company headquartered in Boulder,
Colorado, with European headquarters in London, England. The
company provides communications infrastructure services.
AVAMERE NPS: Case Summary & Three Unsecured Creditors
-----------------------------------------------------
Two affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Avamere NPS Stables LLC 23-00285
c/o James Smith
44050 Ashburn Shopping Plaza
Suite 195-637
Ashburn, VA 20147
Avamere NPS Carpenters LLC 23-00286
Business Description: The Debtors are engaged in activities
related to real estate.
Chapter 11 Petition Date: October 5, 2023
Court: United States Bankruptcy Court
District of Columbia
Judge: Hon. Elizabeth L. Gunn
Debtors' Counsel: Justin P. Fasano, Esq.
MCNAMEE HOSEA, P.A.
6404 Ivy Lane, Suite 820
Greenbelt, MD 20770
Tel: 301-441-2420
Fax: 301-982-9450
Email: jfasano@mhlawyers.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petitions were signed by James Smith as managing member.
A full-text copy of Avamere NPS Stables's 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/6HFQGZY/Avamere_NPS_Stables_LLC__dcbke-23-00285__0001.0.pdf?mcid=tGE4TAMA
BAUSCH + LOMB: Fitch Keeps 'B-' IDR on Watch Evolving
-----------------------------------------------------
Fitch Ratings has maintained Bausch + Lomb Corporation's (BLCO)
'B-' Issuer Default Rating (IDR) and its 'BB-'/'RR1' senior secured
debt on Rating Watch Evolving. The rating actions consider the
$1.75 billion acquisition of Novartis' ocular surface
pharmaceuticals.
The Rating Watch Evolving reflects the potential for BLCO's ratings
to be upgraded should Bausch Health Companies' and Bausch Health
Americas' (collectively BHC) ownership diminish through the
distribution and/or sale of their remaining interests. Conversely,
BLCO's ratings could be downgraded should BHC's ratings be
downgraded before a potential separation.
BLCO's ratings could also be downgraded should Fitch reconsider the
strength of the linkage between the entities that results in less
than the current two-notch uplift. Resolution of the Rating Watches
may occur more than six months in the future.
KEY RATING DRIVERS
Acquisition to Increase Leverage: BLCO has acquired Novartis'
ocular surface pharmaceuticals portfolio, which includes Xiidra.
This is a growing product for the treatment of Dry Eye Disease and
should contribute significantly to the company's profitability and
carries meaningful higher margins than overall BLCO. The
acquisition also includes a mid-stage developmental pharmaceutical
product and AcuStream (an investigational device intended to
facilitate precise dosing and accurate delivery of certain topical
ophthalmic medications).
Fitch views the acquisition as strategically sound, as it increases
the company's presence in the ophthalmic pharmaceutical market.
However, it will increase leverage in the intermediate term. Fitch
forecasts EBITDA leverage of 5.6x and declining to 4.5x during the
forecast period.
BLCO's Ratings Tied to BHC's: The primary driver of BLCO's ratings
is Bausch Health Companies Inc. (BHC) ' CCC' IDR until the
separation is finalized. Fitch views the ringfencing and access and
control factors to be porous, thereby allowing BHC's credit profile
to influence BLCO's. Until separation, any changes in the linkage
could lower BLCO's ratings.
Supply Chain/Inflation: Supply chain constraints and inflationary
pressures are moderating for many firms in the healthcare sector.
BLCO is generally managing these issues through building stocks of
raw materials and active pharmaceutical ingredients. In addition,
the company is adding redundancies in its suppliers.
Reliably Increasing Demand: Aging demographics, improved income
demographics in emerging markets, increasing digital screen times
and the ongoing increase in the incidence of diabetes will likely
drive low- to mid-single-digit growth in the demand for eye health
products and services during the intermediate term. A significant
number of BLCO's products enjoy leading market positions and strong
brand recognition. Consumables and contracted services account for
roughly 78% of BLCO's revenues, and the company's product portfolio
has only limited exposure to market exclusivity losses.
Pipeline to Support Growth: Innovation is important to remain
competitive in the eye health market. Fitch believes the company's
R&D efforts will help to drive intermediate- and long-term revenue
growth while also supporting margins. BLCO makes consistent and
significant investments in new product development. Its R&D efforts
span all three businesses with intensity geared more toward
surgical and ophthalmic pharmaceuticals. Fitch expects the company
will also continue to pursue innovation in its Vision Care business
with technological advancements being more incremental in nature.
Margin Expansion: Fitch assumes that margins will improve over the
forecast period. Improving sales mix and manufacturing efficiency
gains should increase gross margins. SG&A as a percent of sales are
forecast to decline, owing to strong management of other operating
costs. Increasing revenue should provide additional operating
leverage. In addition, less than 15% of BLCO's revenues are exposed
to branded pharmaceuticals pricing issues in the U.S.
Consistently Positive FCF: Advancing sales, improving margins,
solid working capital management and moderate capex requirements
should support consistently positive and increasing FCF. Fitch does
not expect that BLCO will pay dividends or engage in share
repurchases during the near term. Capital deployment will focus on
internal investment, external collaborations and targeted
acquisitions.
For a leading global eye health company, BLCO has relatively
minimal contingent liability risk regarding product liability,
intellectual property and other regulatory issues. Fitch expects
the company to reduce leverage primarily through debt reduction and
EBITDA growth.
DERIVATION SUMMARY
BLCO's 'B-'/Rating Watch Evolving rating is based on it being a
majority-owned subsidiary of Bausch Health until the separation.
Fitch views BLCO as a stronger subsidiary than the weaker parent
with a more diversified portfolio, lower leverage and solid free
cashflow. Fitch no longer views BLCO's standalone credit profile as
investment grade given the weaker than expected EBITDA and the
significant amount of debt added for the acquisition. BLCO's
ratings are two notches higher than the consolidated parent's IDR.
The notching is based on Fitch's assessment of the ringfencing as
porous due to the lack of significant restrictive investment or
dividend covenants.
Fitch also views access and control as porous due to some
overlapping board of directors members. Until separation, BLCO's
ratings will be influenced by BHC's. For details on BHC's Rating
Derivation, see "Fitch Affirms Bausch Health's IDR at 'CCC';
Downgrades Second-Lien and Unsecured Debt", dated Oct. 3, 2022.
On a standalone basis, Fitch compares BLCO to other speculative
grade issuers including Avantor, Inc. (BB/Positive Outlook), ICU
Medical (BB/Stable Outlook) and Bayou Intermediate II, LLC
(B+/Negative Outlook).
BLCO is significantly smaller than Avantor. BLCO also operates in
consumer health and prescription pharmaceuticals, providing some
similar product diversification when compared to Avantor. BLCO also
presents a moderate degree of regulatory risk regarding drug
pricing.
BLCO is more geographically diversified and has larger scale than
ICU Medical and Bayou TopCo. BLCO also presents similar level of
moderate degree of regulatory risk, except BLCO has higher
regulatory risk regarding drug pricing. In addition, BLCO is solely
focused on eye health, while its peers serve various end-market
customers.
KEY ASSUMPTIONS
- Mid- to high-single-digit organic revenue growth driven by the
uptake of new product commercialization moderate offset by
increased competitive pressure for some established products;
- Annual FCF generation greater than $200 million - $300 million
during the forecast period with moderately improving operating
EBITDA margins;
- Dividends are not included in the forecast, but if instituted
would decrease FCF by the same amount as Fitch defines as cash flow
from operations-capex-dividends;
- Novartis portfolio acquisition increases EBITDA leverage.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Fitch viewing BLCO on a standalone basis;
- An upgrade at BHC.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Evidence of factors related to ring-fencing and access and
control that would lead Fitch to rate BLCO on a consolidated basis
with BHC or with a one notch uplift rather than two notches;
- A downgrade at BHC.
LIQUIDITY AND DEBT STRUCTURE
BLCO Liquidity: Fitch expects BLCO will have sufficient liquidity
in the near term with a $250 million draw on its $500 million on
its five-year secured revolving credit facility at Aug. 2, 2023 and
no near-term debt maturities given a roughly $2.5 billion secured
five-year term loan. In addition, Fitch forecasts meaningfully
positive annual FCF during the forecast period. The company has
mandatory annual amortization on its term loan of $25 million. At
June 30, 2023, the company had $384 million of cash on hand. During
the third quarter, BLCO issued a $500 million IL term loan and $1.4
billion of secured first-lien notes to fund the acquisition of
Novartis' ocular surface pharmaceuticals and pay down revolver
borrowings.
Recovery and Notching Assumptions
The recovery analysis assumes that BLCO would be considered a going
concern in bankruptcy and that the company would be reorganized
rather than liquidated. Fitch estimates a going concern enterprise
value (EV) of $5.18 billion for BLCO and assumes that
administrative claims consume 10% of this value in the recovery
analysis.
The going concern EV is based upon estimates of post-reorganization
EBITDA and the assignment of an EBITDA multiple. Fitch's estimate
of BLCO's going concern (GC) EBITDA at $740 million. The assumed
going concern EBITDA reflects Fitch's expectation of Xiidra's
contribution and BLCO reorganizes as the result of a potential BHC
Chapter 11 filing. The current GC EBITDA is greater than the last
time Fitch reviewed BLCO. The increase follows Fitch's recent
review where Fitch believes Xiidra's performance is more durable
than originally estimated. Post-spinoff from BHC, Fitch could
assign BLCO a lower GC EBITDA.
Fitch assumes a recovery EV/EBITDA multiple of 7.0x for BLCO. This
is generally in-line with the 6.0x-7.0x Fitch typically assigns to
medical device/specialty pharmaceutical manufacturers. In Fitch's
view, BLCO's operating environment does not face many of the
challenges that pure pharmaceutical companies often face.
Fitch applies a waterfall analysis to the going concern EV based on
the relative claims of the debt in the capital structure, and
assumes that the company would fully draw the revolvers in a
bankruptcy scenario. The senior secured credit facility, including
the term loans and revolver and the secured bonds are assumed to
total $4.9 billion assuming a fully drawn RCF and have outstanding
recovery prospects in a reorganization scenario and are rated
'BB-'/'RR1'/Rating Watch Evolving.
ISSUER PROFILE
BLCO is currently a majority-owned subsidiary of BHC and a leading
global eye health company with a portfolio of over 400 products.
The company has a global research, development, manufacturing and
commercial footprint of approximately 12,000 employees and a
presence in approximately 90 countries.
ESG CONSIDERATIONS
Bausch + Lomb Corporation has an ESG Relevance Score of '4' for
Exposure to Social Impacts due to pressure to contain health care
spending growth, highly sensitive political environment, and social
pressure to contain costs or restrict pricing, which has a negative
impact on the credit profile, and is relevant to the ratings in
conjunction with other factors. Pharmaceuticals account for less
than 15% of the firm's total sales.
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
----------- ------ -------- -----
Bausch + Lomb
Corporation LT IDR B- Rating Watch Maintained B-
senior
secured LT BB- Rating Watch Maintained RR1 BB-
BAUSCH HEALTH: Fitch Affirms 'CCC' LongTerm Issuer Default Rating
-----------------------------------------------------------------
Fitch Ratings has affirmed Bausch Health Companies' (BHC) and
Bausch Health America's (BHA) (collectively: Bausch Health)
Long-Term Issuer Default Ratings (IDRs) at 'CCC' and first-lien
debt at 'B'/'RR1'. In addition, Fitch has downgraded BHC's
second-lien debt to 'CC'/'RR6' from 'B-'/'RR2' and BHC/BHA's
unsecured debt to 'C'/'RR6' from 'CC'/'RR6', due to incurred
structurally senior debt at both Bausch + Lomb Corporation (BLCO)
and at BHC/BHA.
The 'CCC' IDRs reflect BHC's elevated refinancing risk amid the
following two key uncertainties: when and to what degree does
competition impact BHC's XIFAXAN product, and whether and when the
company completes its separation from Bausch + Lomb Corporation
(BLCO). The BLCO separation would reduce diversification and
increase leverage.
KEY RATING DRIVERS
XIFAXAN Rulings Mixed to BHC's Credit: Recent favorable rulings
related to Bausch's key XIFAXAN product have mixed implications for
its credit profile. Cashflows should be more durable and less
adversely affected from competition assuming the decisions are held
through the rest of the litigation process. However, those benefits
may increase the likelihood that Bausch proceeds with its
separation from BLCO. A U.S. District Court final judgment prevents
the U.S. Food and Drug Administration from approving Norwich's
abbreviated new drug application (ANDA) for XIFAXAN before Oct. 2,
2029.
BLCO Separation Underway: The potential loss of BLCO's operating
and financial stability upon a separation or divestment of its
interests creates significant risk to BHC's credit profile despite
offering limited synergies with the branded pharma business. Fitch
estimates BHC ex-BLCO's leverage could exceed 7x prior to any
decline in XIFAXAN revenues.
BLCO became a publicly traded company in 1H22 after the sale of 11%
of its shares in an initial public offering. Since that time, the
retained interests have become unrestricted under the terms of
BHC's debt agreements. The 2022 distressed debt exchange helped
satisfy some of the requirements needed to distribute the remaining
interests through an in-kind transaction. Barring a sale of these
interests, which is not expected, there would be no proceeds from
such transactions and therefore no potential debt reduction to
offset the loss of diversification and cashflows.
Operations Stabilizing: BHC's operating fundamentals improved
during 1H23 driven by increasing revenues of Solta Medical, Salix
and International. Advancing sales combined with relatively stable
margins drove increases in cash generation. The company moderately
reduced debt during the period.
Reliance on New Products: The stabilization of Bausch Health's
operating profile relies on an increased focus on developing an
internal research and development pipeline, which Fitch believes is
constructive for the company's credit profile over the long term.
This strategy is not without risk since Bausch Health needs to ramp
up the utilization of recently-approved products through successful
commercialization efforts. These products include Siliq (for the
treatment of moderate-to-severe plaque psoriasis, although with
safety restrictions) and Bryhali (plaque psoriasis).
The company has a phase II candidate, RED-C, for the prevention of
cirrhosis complications related to hepatic encephalopathy. BHC also
has a phase II pipeline candidate for the treatment of ulcerative
colitis, a candidate to treat acne and a number of products that it
will incorporate into its International business as greenfield
geographic expansion opportunities. Fitch expects that the company
will inevitably need to pursue external pipeline candidates through
M&A and/or collaborations. BHC, like many other specialty
pharmaceutical manufacturers perform only limited early-stage drug
discovery and development.
DERIVATION SUMMARY
Bausch Health's 'CCC' IDRs reflect elevated refinancing risk amid
uncertainty related to competition against a key product and
whether or when it separates from a key segment. Key financial
metrics are stronger than the current IDR but would likely
deteriorate significantly in the event of one or both of the events
above. Bausch's rating relative to specialty pharmaceutical
industry peers Mallinckrodt plc and Endo International plc is
largely a function of the peers currently restructuring through
bankruptcy.
BHC's rating also reflects gross debt leverage that is higher than
peers. But unlike its peers, BHC does not face contingent
liabilities related to the opioid epidemic. However, the company
does face significant patent expiry risk, which is amplified by the
proposed spinoff of BLCO.
In deriving Bausch Health's ratings, Fitch compares the credit
profiles of Bausch Health Companies, Bausch Health Americas and
Bausch + Lomb Corporation. Using Fitch's "Parent and Subsidiary
Rating Linkage Criteria," Fitch considers Bausch Health a weak
parent relative to Bausch + Lomb Corporation. As Fitch assesses the
ring fencing and access & control as porous, it assessed the parent
on the consolidated basis and notch Bausch + Lomb relative to the
parent's IDR.
In determining Bausch Health Americas' ratings, Fitch views it as
the stronger subsidiary and Bausch Health Companies the weaker
parent. Fitch believes there is open ring fencing and access &
control; therefore, Fitch assesses the entities at the consolidated
level with no notching between the two.
KEY ASSUMPTIONS
- EBITDA of $2.3 billion-$2.4 billion should BLCO be spun-off and
significantly lower if XIFAXAN patent defense does not prevail;
- No material acquisitions, dividends or share repurchases.
- BHC can generate meaningful FCF prior to a potential BLCO
separation and potentially flat to negative if XIFAXAN patent
defense does not prevail and BLCO is separated.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Favorable resolution of XIFAXAN patent litigation;
- BHC chooses not to spin-off BLCO favorable resolution of
XIFAXAN patent litigation.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- BHC completes the spin-off of BLCO prior to a favorable
resolution of XIFAXAN patent litigation;
- Significant and durable deterioration of FCF generation.
LIQUIDITY AND DEBT STRUCTURE
BHC Liquidity: BHC had adequate near-term liquidity at June 30,
2023. BHC reports $579 million of consolidated cash and equivalents
of which $384 million is held at Bausch + Lomb and would require a
pro rata dividend to be used at the parent level. At Aug. 3, 2023,
the company had full availability on its $600 million A/R facility
and $950 million availability on its revolver.
Debt Instrument Notching & Recovery Assumptions:
In determining the instrument ratings based on the issuer default
rating, Fitch conducts a going concern analysis. The recovery
analysis assumes that Bausch Health would be considered a going
concern (GC) in bankruptcy and that the company would be
reorganized rather than liquidated. Fitch estimates a standalone
reorganized EV for Bausch Health of $10.5 billion. Fitch assumes
that administrative claims consume 10% of this value in the
recovery analysis.
Fitch's estimate of BHC's GC EBITDA, excluding BLCO, is $1.5
billion reflecting a scenario where XIFAXAN loses significant
market share and the company experiences some shortfalls in
commercializing the R&D pipeline.
Fitch assumes a recovery EV/EBITDA multiple of 7.0x for Bausch
Health. This is at the higher end of the 6.0x-7.0x Fitch typically
assigns to specialty pharmaceutical manufacturers reflecting it
being more diversified than many of its peers.
Fitch assumes $480 million will be drawn on its A/R facility and a
full $975 million drawn on its revolving credit facility. Fitch
applies a waterfall analysis to the going concern EV based on the
relative claims of the debt in the capital structure. The A/R
facility and first-lien senior secured credit facility and
first-lien senior secured notes, which are assumed to total $9.9
billion have outstanding recovery prospects and are rated
'B'/'RR1', three notches above the IDR. The second lien secured
notes which are assumed to total $0.4 billion and the senior
unsecured notes ($5.8 billion) have poor recovery prospects and
rated 'CC'/RR6' and 'C'/RR6', respectively.
The inclusion or exclusion of BHC's equity interests in BLCO do not
influence the notching and therefore the separation, in and of
itself, would not necessarily influence the notching of BHC's
instruments relative to its issuer default rating. The above
analysis assumes BLCO's equity value (assuming its RCF is fully
drawn) would contribute only $150 million to BHC's recovery given
38.6% of the shares are collateralizing unrated secured debt.
ISSUER PROFILE
BHC is a multinational healthcare company headquartered in Laval,
Quebec that develops, manufactures and markets pharmaceutical and
medical products.
ESG CONSIDERATIONS
Bausch Health Companies Inc. has an ESG Relevance Score of '4' for
Exposure to Social Impacts due to pressure to contain healthcare
spending growth; a highly sensitive political environment, and
social pressure to contain costs or restrict pricing, which has a
negative impact on the credit profile, and is relevant to the
rating in conjunction with other factors.
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
----------- ------ -------- -----
Bausch Health
Americas, Inc. LT IDR CCC Affirmed CCC
senior
unsecured LT C Downgrade RR6 CC
senior secured LT B Affirmed RR1 B
Bausch Health
Companies Inc. LT IDR CCC Affirmed CCC
senior
unsecured LT C Downgrade RR6 CC
senior secured LT B Affirmed RR1 B
senior secured LT B Affirmed RR1 B
Senior Secured
2nd Lien LT CC Downgrade RR6 B-
BERTUCCI'S RESTAURANTS: Cash Collateral Access OK'd on Final Basis
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida,
Orlando Division, authorized Bertucci's Restaurants, LLC to use
cash collateral on a final basis.
The court said all prior interim orders granting the Motion to Use
Cash Collateral (Doc. Nos. 28, 92, 157, 182, 202, 296, and 340) are
deemed final.
As previously reported by the Troubled Company Reporter, the Debtor
is permitted to use cash collateral to pay:
a. the amounts expressly authorized by the Court, including
payments to the United States Trustee for quarterly fees; and
b. the current and necessary expenses set forth in the budget,
plus an amount not to exceed 10% for the expenses.
During the interim period, PHL Holdings, LLC and Rewards Network
were each granted perfected post-petition lien against cash
collateral to the same extent and with the same validity and
priority as its respective prepetition lien, without the need to
file or execute any documents as may otherwise be required under
applicable non-bankruptcy law. The replacement liens granted will
secure all obligations owing from the Debtor to PHL and Rewards
Network, as the case may be.
A copy of the Court's order is available at
https://urlcurt.com/u?l=tXcJv6 from PacerMonitor.com.
About Bertucci's Restaurants, LLC
Bertucci's Restaurants, LLC is a Florida limited liability company
that was formed in May 2018. The Company owns and operates
approximately 47 Italian-themed restaurants under the name
Bertucci's Brick Oven Pizza & Pasta.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Fla. Case No. 22-04313) on December 5,
2022. In the petition signed by Jeffrey C. Sirolly, its secretary,
the Debtor disclosed up to $50,000 in assets and up to $100 million
in liabilities.
Judge Grace E. Robson oversees the case.
R. Scott Schuker, Esq., at Shuker and Dorris, P.A., is the Debtor's
legal counsel.
BLUE DIAMOND: Unsecured Creditors to Recover 100% over 5 Years
--------------------------------------------------------------
Blue Diamond Energy, Inc. and its affiliates filed with the U.S.
Bankruptcy Court for the Southern District of Mississippi a Joint
Disclosure Statement for Plan of Reorganization dated October 2,
2023.
Blue Diamond is a Mississippi corporation which serves as a holding
company for Escambia Operating Company, LLC ("EOC") and Escambia
Asset Company, LLC ("EAC"), and owns 100% of the membership in
those companies.
EOC actively operates 12 producing oil and gas wells in the Big
Escambia Creek Field ("BEC Field"). EOC also operates the Big
Escambia Creek Refinery ("BEC Refinery"). EAC owns mineral
interests of various types, most of which are in the BEC field.
The Debtors' Plan of Reorganization will afford the Debtors the
opportunity and ability to continue in business as a viable goibg
concern, and will maximize the recovery of all creditors under the
circumstances.
The goal of this Chapter 11 case is to reorganize the Debtors by
restructuring their debt. The Debtors intend to pay all creditors
100% of their claims, and the resources are available in the BEC
Field and BEC Refinery to do so.
The Debtors have no voluntary secured debt, the only secured debt
being statutory liens for oil field services that have been
properly perfected under Alabama law. The Plan calls for the
holders of such liens to be paid with statutory interest over a
5-year period. The Plan first calls for all mineral interest
holders to be paid in full according to their interests along with
any statutory interest over a 5-year period. Lastly, unsecured
creditors will be paid in full over a 5-year period.
Class 6 consists of General Unsecured Claims. Allowed General
Unsecured Claims will be paid in full over a 5-year period without
interest. The allowed unsecured claims total $3,085,316. This Class
will receive a distribution of 100% of their allowed claims.
Class 7 consists of Administrative Convenience Claims. All
Unsecured Claims that are in an amount of $5,000 or less, or that
become $5,000 or less by agreement between the Claimant and the
Debtors will be paid in full within 1 year after the effective date
without interest. The allowed unsecured claims total $25,000. This
Class will receive a distribution of 100% of their allowed claims.
Thomas Swarek will retain his interest in Blue Diamond.
Blue Diamond Energy, Inc. will retain its interest in EOC.
Blue Diamond Energy, Inc. will retain its interest in EAC.
The Cash required to be distributed under the Plan shall be
provided by the Debtors' ongoing operations as the operator of the
BEC Field Oil Refinery.
A full-text copy of the Joint Disclosure Statement dated October 2,
2023 is available at https://urlcurt.com/u?l=aURGKb from
PacerMonitor.com at no charge.
Attorney for Debtors:
Patrick A. Sheehan, Esq.
Sheehan & Ramsey, PLLC
492 Porter Avenue
Ocean Springs, MS 39564
Telephone: (228) 875-0572
Facsimile: (228) 875-0895
Email: Pat@sheehanramsey.com
About Blue Diamond Energy
Blue Diamond Energy, Inc. and affiliates, Escambia Operating Co.,
LLC and Escambia Asset Company, LLC, filed petitions for relief
under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Miss. Lead
Case No. 23-50490) on April 3, 2023. In its petition, Blue Diamond
reported $10 million to $50 million in both assets and liabilities.
Thomas Swarek, president of Blue Diamond, signed the petition.
Judge Jamie A. Wilson oversees the case.
The Debtors tapped Steve Wright Mullins, Sr., Esq. at Mullins Law
Firm and Sheehan & Ramsey, PLLC as bankruptcy counsels; and
Matthews, Cutrer & Lindsay, P.A. as accountant.
BLUE LIGHTNING: Files Emergency Bid to Use Cash Collateral
----------------------------------------------------------
Blue Lightning Holdings, Inc., Blue Lightning Transportation
Solutions, Inc., and Truckers Pipeline, Inc. ask the U.S.
Bankruptcy Court for the Northern District of Texas, Fort Worth
Division, for authority to use cash collateral to increase
operations.
The cash collateral at issue amounts to $71,596 in sale proceeds
from vehicles sold at auction by Ritchie Bros. Auctioneers
(America) Inc., and Ironplanet, Inc. The said sale proceeds are
directly traceable to vehicles on which certain ad valorem taxing
authorities and Centerstone SBA Lending, Inc. held first liens and
first priority security interests, respectively.
The proposed use is the purchase of two replacement vehicles that
can be used in the operation of the Debtors' business to generate
income for the Debtors.
The Debtors can adequately protect the interests of the ad valorem
taxing authorities and Centerstone by providing such parties with
post-petition liens on the replacement collateral in the same
priority and to the same extent that such liens exist on the Sale
Proceeds. To the extent that any other party holds a junior
security interest on the Sale Proceeds, that interest too can be
adequately protected by a junior lien on the replacement
collateral.
A copy of the motion is available at https://urlcurt.com/u?l=1nX3PY
from PacerMonitor.com.
About Blue Lightning Holdings
Blue Lightning Holdings, Inc. and its affiliates filed voluntary
petitions for Chapter 11 protection (Bankr. N.D. Texas Lead Case
No. 23-41064) on April 15, 2023. At the time of the filing, Blue
Lightning Holdings reported as much as $50,000 in assets and $1
million to $10 million in liabilities.
Judge Mark X. Mullin oversees the cases.
The Debtors tapped Howard Marc Spector, Esq., at Spector & Cox,
PLLC as legal counsel and Sabrina Hill, CPA, PLLC as accountant.
BLUE STAR: Falls Short of Nasdaq Bid Price Requirement
------------------------------------------------------
Blue Star Foods Corp. said in a Form 8-K filed with the Securities
and Exchange Commission that it received a notice letter from the
Listing Qualifications Department of The Nasdaq Stock Market LLC
notifying the Company that, based upon the closing bid price of the
Company's common stock, par value $0.0001 per share, for 30
consecutive business days, the Company is not currently in
compliance with the requirement to maintain a minimum bid price of
$1.00 per share for continued listing on The Nasdaq Capital Market,
as set forth in Nasdaq Listing Rule 5550(a)(2).
The Notice has no immediate effect on the continued listing status
of the Company's Common Stock on The Nasdaq Capital Market, and,
therefore, the Company's listing remains fully effective.
The Company is provided a compliance period of 180 calendar days
from the date of the Notice, or until March 24, 2024, to regain
compliance with Nasdaq Listing Rule 5550(a)(2). If at any time
before March 24, 2024, the closing bid price of the Company's
Common Stock closes at or above $1.00 per share for a minimum of 10
consecutive business days, Nasdaq will provide written notification
that the Company has achieved compliance with the Minimum Bid
Requirement, and the matter would be resolved.
If the Company does not regain compliance with the Minimum Bid
Requirement during the initial 180-calendar day period, the Company
may be eligible for an additional 180-calendar day compliance
period. To qualify, the Company would be required to meet the
continued listing requirement for market value of publicly held
shares and all other initial listing standards for The Nasdaq
Capital Market, with the exception of the Minimum Bid Requirement,
and would need to provide written notice of its intention to cure
the deficiency during the second compliance period, by effecting a
reverse stock split, if necessary.
The Company said it will continue to actively monitor the closing
bid price of its Common Stock and will seek to regain compliance
with all applicable Nasdaq requirements within the allotted
compliance periods. If the Company does not regain compliance
within the allotted compliance periods, including any extensions
that may be granted by Nasdaq, Nasdaq will provide notice that the
Company's Common Stock will be subject to delisting. The Company
would then be entitled to appeal that determination to a Nasdaq
hearings panel.
About Blue Star Foods
Based in Miami, Florida, Blue Star Foods Corp.
--https://bluestarfoods.com -- is an international sustainable
marine protein company based in Miami, Florida that imports,
packages and sells refrigerated pasteurized crab meat, and other
premium seafood products. The Company's main operating business,
John Keeler & Co., Inc. was incorporated in the State of Florida in
May 1995. The Company's current source of revenue is importing blue
and red swimming crab meat primarily from Indonesia, Philippines
and China and distributing it in the United States and Canada under
several brand names such as Blue Star, Oceanica, Pacifika, Crab &
Go, First Choice, Good Stuff and Coastal Pride Fresh, and steelhead
salmon and rainbow trout fingerlings produced under the brand name
Little Cedar Farms for distribution in Canada.
Blue Star reported a net loss of $13.19 million for the year ended
Dec. 31, 2022, compared to a net loss of $2.61 million for the year
ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had $8.68
million in total assets, $9.92 million in total liabilities, and a
total stockholders' deficit of $1.24 million.
Houston, Texas-based MaloneBailey, LLP, the Company's auditor since
2014, issued a "going concern" qualification in its report dated
April 17, 2023, citing that the Company has suffered recurring
losses from operations and has a net capital deficiency that raise
substantial doubt about its ability to continue as a going concern.
BRICK CITY: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: Brick City Investment Group, LLC
189-197 Bloomfield Ave
Bloomfield, NJ 07003
Chapter 11 Petition Date: October 6, 2023
Court: United States Bankruptcy Court
District of New Jersey
Case No.: 23-18750
Debtor's Counsel: Marc C Capone, Esq.
GILLMAN, BRUTON & CAPONE, LLC
60 Highway 71 Unit 2
Spring Lake NJ 07762
Email: mcapone@gbclawgroup.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Evangelos Drosos as managing member.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/BUJYWYI/Brick_City_Investment_Group_LLC__njbke-23-18750__0001.0.pdf?mcid=tGE4TAMA
BURDOCK AND ASSOCIATES: Case Summary & 20 Unsecured Creditors
-------------------------------------------------------------
Debtor: Burdock and Associates, Inc.
d/b/a Burdock Group
d/b/a Burdock Group Consultants
859 Outer Road
Orlando, FL 32814
Business Description: The Debtor is an international safety and
regulatory compliance consulting firm.
Chapter 11 Petition Date: October 6, 2023
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 23-04165
Debtor's Counsel: R.Scott Shuker, Esq.
SHUKER & DORRIS, P.A.
121 S. Orange Avenue
Suite 1120
Orlando, FL 32801
Tel: (407) 337-2060
Email: rshuker@shukerdorris.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by George A. Burdock 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/XF5MIQY/Burdock_and_Associates_Inc__flmbke-23-04165__0001.0.pdf?mcid=tGE4TAMA
BW HAMPTON: Has Deal on Cash Collateral Access Thru Dec 31
----------------------------------------------------------
The BW Hampton Group, Inc. asks the U.S. Bankruptcy Court for the
Central District of California, Los Angeles Division, for authority
to use cash collateral in accordance with its agreement with
secured lender Allstar Financial Services, Inc.
The parties agreed that the Debtor may use cash collateral for the
period from July 1, 2023 through and including December 31, 2023.
The Debtor owns and rents a 6,097 square foot office building
located at 1210-1212 S. Brand Boulevard, Glendale, CA 92104. The
Debtor values the Property at $3.750 million based on a November
2022 appraisal of the Property.
The Debtor acquired the Property in 2013. In October 2017, the
Debtor refinanced the Property with a loan from Lender. The Lender
made the loan to Debtor in the original principal amount of $2.210
million. The loan was evidenced by a promissory note wherein the
Debtor agreed to make monthly payments of interest only over five
years and, upon the maturity date, pay the principal amount of
$2.210 million. The maturity date of the Note was December 1, 2022.
During the COVID-19, Pandemic, the Debtor's tenant, Asian Journal
Publications, Inc., suffered a substantial decline in its business
in the form of fewer customers and losses of advertising revenue.
As a result, Asian Journal was unable to pay the Debtor and the
Debtor was unable to make several monthly interest payments to the
Lender. The Debtor was also unable to make the balloon payment when
it came due on December 1, 2022. The Lender issued a notice of
default and a notice of trustee sale. A foreclosure sale was
scheduled for June 7, 2023. On June 7, 2023, prior to the scheduled
foreclosure, the Debtor commenced the case to stop the foreclosure
sale so that it can reorganize its financial affairs.
In November 2022, the value of the Property was appraised to be
$3.750 million. The Debtor acknowledges that as of June 7, 2023,
the unpaid balance on the Note, with interest and costs was the sum
of $2.442 million and further, that interest continues to accrue at
the note rate plus attorney fees and costs thereafter incurred by
Allstar.
Based on the November 2022 appraised value of $3.750 million and a
claim of $2.442 million of Lender, the Debtors believe there is a
34.9% equity cushion in the Property.
An acknowledgment by the Debtor that as of June 7, 2023, the unpaid
balance on the Note, with interest and costs was the sum of $2.442
million and further, that interest continues to accrue at the note
rate plus attorney fees and costs thereafter incurred by Allstar.
To provide adequate protection to the Lender, the Debtor:
a. Grants Allstar a replacement lien on the revenue generated
postpetition from the Property to the extent that Allstar's cash
collateral is actually used; and
b. Agrees to make monthly adequate protection payments in the
amount of $15,654 to Allstar upon entry of an order approving the
Stipulation for the months of July through September, 2023 and
thereafter monthly by the 7th day of each month through and
including December, 2023.
A copy of the motion is available at https://urlcurt.com/u?l=NsmJYn
from PacerMonitor.com.
About BW Hampton Group
The BW Hampton Group, Inc., a company in Glendale, Calif., filed
its voluntary petition for Chapter 11 protection (Bankr. C.D.
Calif. Case No. 23-13518) on June 7, 2023, with $1 million to $10
million in both assets and liabilities.
Judge Sandra R. Klein oversees the case.
Laura Portillo, Esq., at Portillo Ronk Legal Team serves as the
Debtor's bankruptcy counsel.
CAMBREX CORP: Moody's Alters Outlook on 'B2' CFR to Negative
------------------------------------------------------------
Moody's Investors Service affirmed Cambrex Corporation's B2
corporate family rating and B2-PD probability of default rating.
Concurrently, Moody's affirmed the B2 rating of the backed senior
secured first lien bank facility. The outlook was changed to
negative from stable.
The change in rating outlook to negative reflects Moody's
expectation for operational headwinds, driven by softer demand from
customers to persist over the next 12-18 months. These trends are
largely attributed to Cambrex's clients electing to prioritize
their later stage development projects, as well as reduced demand
from biotech clients. As result, Moody's expects financial leverage
will be sustained above 6.0x, into 2024. Additionally, the change
in outlook reflects weakening in the company's liquidity, reflected
in negative free cash flows and the growing reliance on the
revolving facility to execute strategic initiatives.
RATINGS RATIONALE
Cambrex's B2 Corporate Family Rating reflects high financial
leverage, with Moody's adjusted debt/EBITDA of 6.5x as of June 30,
2023, and which will remain above 6.0x into 2024. Further, Cambrex
is solely focused on producing and developing small molecules.
Expanding capacity to support new volume with minimal business
disruption, while offsetting inflationary pressures will be
critical to Cambrex's ability to grow earnings. Cambrex is reliant
on customers' new product launches, which are subject to FDA
approval, to sustain and grow revenue. Supporting Cambrex's credit
profile are its capabilities as a fully integrated CDMO. For
customers, there are significant costs to switch to other
suppliers, which adds some durability to supplier relationships.
Cambrex has a long track record of regulatory compliance, long-term
customer relationships and high quality manufacturing
capabilities.
Moody's expects that Cambrex will maintain good liquidity over the
next 12 months. The company's liquidity is supported by a modest
cash balance of approximately $19 million, as of June 30, 2023.
While the timing of working capital spike, and elevated capital
expenditures driven by investments in capacity expansion in
manufacturing facilities has reduced company's free cash flow,
Moody's expects Cambrex will generate $5-$15 million of free cash
flow over the next 12 months. These cash sources provide sufficient
coverage for the required 1% amortization (roughly $11.5 million)
of the first-lien senior secured term loan. Cambrex liquidity is
further bolstered by a recently upsized $240.5 million of the
senior secured 1st lien revolving credit facility (up from $216
million) that will expire in December 2026. The facility had
approximately $140 million drawn as of June 30, 2023. The revolver
has a springing maximum first lien net leverage financial covenant
that is tested once borrowings exceed 35%. Moody's expect Cambrex
to maintain ample cushion under the covenant.
Cambrex's senior secured first-lien debt (term loans and revolvers)
is rated B2, the same as the CFR, given it is the vast majority of
liabilities in the capital structure. The facilities are secured
through a first priority security interest in all the assets of the
borrower and the guarantors. All of the rated debt has downstream
guarantees from Catalog Intermediate Inc., where Cambrex's
financials are reported.
Cambrex's CIS-4 indicates the rating is lower than it would have
been if ESG risk exposures did not exist. Amongst environmental
risks is exposure to waste and pollution management related to its
production sites. Social risks include product quality and supply
chain reliability. Like other providers of services for the
pharmaceutical industry, Cambrex faces - albeit indirectly - rising
exposure to regulatory and legislative efforts aimed at reducing
healthcare costs and in particular drug prices and reimbursement
rates. Governance risks reflect company's high financial leverage,
as well as private equity ownership, which creates risk of
aggressive financial policies.
The negative outlook reflects Cambrex's current weak credit metrics
and slower path to de-lever to levels in line with a B2 CFR.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could downgraded if a weakening of operating cash flow
or increase in investment needs leads to sustained negative free
cash flow, or if the company's liquidity deteriorates. Ratings
could also be downgraded if the company undertakes significant
debt-funded acquisitions or shareholder distributions.
Specifically, debt/EBITDA sustained above 6.0x, could result in a
downgrade.
Moody's could consider a ratings upgrade if Cambrex can demonstrate
a path to achieving a sustainable base of earnings growth along
with the strategic benefits of being a fully integrated CDMO.
Specifically, Cambrex would need to sustain debt/EBITDA below 5.0x
and maintain good liquidity highlighted by consistent positive free
cash flows, for the ratings to be upgraded.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
Cambrex Corporation is a contract development and manufacturing
organization (CDMO), with a focus primarily on small molecules.
Most of its revenue is generated from developing and manufacturing
active pharmaceutical ingredients (API) used in clinical-stage, and
commercial stage drugs (both branded and generic). Cambrex
Corporation also provides finished dosage form contract
manufacturing, and early stage development services. Cambrex
Corporation is owned by private equity sponsor Permira Funds.
Reported revenues for the twelve months ended June 30, 2023 were
approximately $791 million.
CANOO INC: Inks $45M Convertible Preferred Stock Purchase Agreement
-------------------------------------------------------------------
Canoo announced that it has entered into a purchase agreement with
a foreign strategic institutional investor, for an investment of
$45 million. Canoo and the investor agreed to work together in
good faith to negotiate one or more additional investments for up
to $150 million. The closing and sale are expected to occur as
promptly as practicable, subject to customary closing conditions.
Tony Aquila, chairman, investor, and CEO, commented, "The capital
raised through this convertible preferred stock supports Canoo's
mission and demonstrates our disciplined, milestone driven approach
to capital is aligned with the phased manufacturing capacity ramp
required to satisfy our customer demand."
Under the purchase agreement, the investor agreed to purchase $45
million of Series B Cumulative Perpetual Reedemable Preferred
Stock. The Preferred Stock ranks senior to the common stock. Each
share of Preferred Stock has a stated value of $1,000 and dividends
on the Preferred Stock may be paid in either cash, in kind or, at
the option of the holders, in shares of common stock. The company
will pay dividends at an annual rate of 7.50% from the original
issuance date through the fifth anniversary of the closing date.
After that date, the dividend rate will increase by 1.50%;
provided, however, the maximum dividend rate on the Preferred Stock
shall be capped at 12.0% per annum. The investor has the right, at
its option, to convert its Preferred Stock into common stock at a
conversion price of 120% of the average closing prices per share of
the common stock over the preceding 10 trading days. In connection
with the purchase agreement, the company issued to the investor
warrants to purchase 22.96 million shares of common stock.
Subsequent tranches and terms are to be mutually agreed upon by the
parties at a future date.
About Canoo
Torrance, California-based Canoo Inc. -- www.canoo.com -- is a
mobility technology company with a mission to bring electric
vehicles to everyone and provide connected services that improve
the vehicle ownership experience. The company has developed
breakthrough electric vehicles that are reinventing the automotive
landscape with bold innovations in design, pioneering technologies,
and a unique business model that spans the full lifecycle of the
vehicle.
Canoo reported a net loss and comprehensive loss of $487.69 million
for the year ended Dec. 31, 2022, compared to a net loss and
comprehensive loss of $346.77 million for the year ended Dec. 31,
2021. As of Dec. 31, 2022, the Company had $496.47 million in
total assets, $259.90 million in total liabilities, and $236.57
million in total stockholders' equity.
Los Angeles, California-based Deloitte & Touche LLP, the Company's
auditor since 2021, issued a "going concern" qualification in its
report dated March 30, 2023, citing that the Company has suffered
recurring losses from operations, has generated recurring negative
cash flows from operating activities, and expects to continue to
incur net losses and negative cash flows from operating activities
in accordance with its ongoing activities. These matters raise
substantial doubt about the Company's ability to continue as a
going concern.
CAPROCK LAND: Wins Interim Cash Collateral Access
-------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas,
Amarillo Division, authorized Caprock Land Company, LLC to use cash
collateral on an interim basis in accordance with the budget.
Based on certain of the Debtor's actions that StoneX Solutions, LLC
believes constitute one or more events of default under applicable
contractual agreements and give rise to, inter alia, various claims
and causes of action, StoneX asserts a secured claim against all
the Debtor's asset.
To the extent that the value of the Collateral securing StoneX's
secured claim exceeds StoneX's allowed pre-Petition Date claim,
which StoneX asserts is not less than $16 million, StoneX is
entitled to payment of interest and fees, costs and other charges
accrued or incurred on and after the Petition Date pursuant to 11
U.S.C. Section 506(b).
The Debtor is permitted to use cash collateral in the ordinary
course of its business solely to pay (i) certain actual, ordinary
and necessary expenses that are due and owing and set forth in the
amended budget; and (ii) any other expenses approved by the prior
written consent of StoneX, in its sole discretion.
As adequate protection, StoneX is granted valid, binding,
enforceable, and perfected continuing first-priority liens and
security interests in and on the Debtor's one-half interest in the
aircraft described as a Textron M2, No. N525KB, and the Debtor's
cattle.
The Replacement Lien will be a first priority lien on the
Additional Collateral in all respects, except that the Replacement
Lien in the aircraft will be subject to the existing third-party
mortgage.
The Replacement Lien will serve as adequate protection for the use
of the cash collateral to the extent of any diminution of StoneX's
pre-petition secured claim.
All liens and security interests granted pursuant to the Interim
Order are deemed attached, effective, valid, and perfected as of
the Petition Date.
To the extent of diminution in the value of StoneX's pre-petition
secured claim, and subject to the Debtor's reservation of rights to
object to the validity, priority, and extent of StoneX's
pre-petition secured claim, StoneX will have a super-priority
administrative expense claim pursuant to 11 U.S.C. Section 507(b)
in the Debtor's Chapter 11 Case and against the Debtor's bankruptcy
estate.
The events that constitute an "Event of Default" include:
(a) the Debtor's Chapter 11 Case is converted to a case under
Chapter 7 of the Bankruptcy Code;
(b) The Court grants StoneX, or any other creditor, relief
from the automatic stay with respect to enforcement rights related
to the Collateral;
(c) The Chapter 11 Case is dismissed, except to the extent
Debtor and StoneX agree to such dismissal;
(d) The Court authorizes the appointment of a Chapter 11
Trustee in the Chapter 11 Case; and
(e) The Interim Order is reversed, revoked, stayed, rescinded
or vacated.
A final hearing on the matter is set for November 9, 2023 at 1:30
p.m.
A copy of the court's order is available at
https://urlcurt.com/u?l=mkSzqo from PacerMonitor.com.
About CapRock Land Company, LLC
CapRock Land Company, LLC is a global logistics company that
manages organic feed ingredients around the world to the benefit of
its end customers. CapRock operates seven storage facilities across
the U.S.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Tex. Case No. 23-20172) on August 25,
2023. In the petition signed by Thomas Bunkley, owner, the Debtor
disclosed up to $10 million in assets and $50 million in
liabilities.
Judge Robert L. Jones oversees the case.
Steven L. Hoard, Esq., at Mullin Hoard & Brown, LLP, represents the
Debtor as legal counsel.
StoneX Commodity Solutions LLC, as lender, is represented by
Polsinelli PC.
CBAK ENERGY: Falls Short of Nasdaq Minimum Bid Price Requirement
----------------------------------------------------------------
CBAK Energy Technology, Inc. disclosed in a Form 8-K filed with the
Securities and Exchange Commission that the Company received a
letter from the listing qualifications department staff of The
Nasdaq Stock Market indicating that the Company is not in
compliance with the $1.00 minimum bid price requirement set forth
in Nasdaq Listing Rule 5550(a)(2) for continued listing on The
Nasdaq Capital Market.
The Bid Price Deficiency Notice has no immediate effect on the
listing of the Company's common stock, and the Company's common
stock continues to trade on the Nasdaq Capital Market under the
symbol "CBAT."
In accordance with Nasdaq listing rule 5810(c)(3)(A), the Company
has 180 calendar days from the date of the Bid Price Deficiency
Notice, or until March 25, 2024, to regain compliance with respect
to the Bid Price Requirement. The Bid Price Deficiency Notice
states that to regain compliance with the Bid Price Requirement,
the closing bid price of the Company's common stock must meet or
exceed $1.00 per share for a minimum of ten consecutive business
days during the compliance period ending March 25, 2024.
If the Company fails to regain compliance with the Bid Price
Requirement by March 25, 2024, the Company may be eligible for an
additional 180-day compliance period to demonstrate compliance with
the Bid Price Requirement. To qualify, the Company will be
required to meet the continued listing requirement for market value
of publicly held shares and all other initial listing standards for
The Nasdaq Capital Market, with the exception of the Bid Price
Requirement, and will need to provide written notice to Nasdaq of
its intention to cure the deficiency during the second compliance
period by effecting a reverse stock split, if necessary. If the
Company does not qualify for the second compliance period or fails
to regain compliance with the Bid Price Requirement during the
second 180-day period, Nasdaq will notify the Company of its
determination to delist the common stock, at which point the
Company would have an opportunity to appeal the delisting
determination to a Hearings Panel.
The Company intends to actively monitor the closing bid price of
the Company's common stock between now and March 25, 2024 and may,
if appropriate, evaluate available options to resolve the
deficiency and regain compliance with the Bid Price Requirement.
While the Company is exercising diligent efforts to maintain the
listing of its common stock on Nasdaq, there can be no assurance
that the Company will be able to regain or maintain compliance with
Nasdaq listing standards.
About CBAK Energy
Liaoning Province, People's Republic of China-based CBAK Energy --
www.cbak.com.cn -- is a manufacturer of new energy high power
lithium batteries that are mainly used in light electric vehicles,
electric vehicles, electric tools, energy storage including but not
limited to uninterruptible power supply (UPS) application, and
other high-power applications. Its primary product offering
consists of new energy high power lithium batteries, but it is also
seeking to expand into the production and sale of light electric
vehicles.
CBAK Energy reported a net loss of $11.33 million for the year
ended Dec. 31, 2022, compared to net income of $61.56 million for
the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had
$244.03 million in total assets, $119.65 million in total
liabilities, and $124.38 million in total equity.
Hong Kong, China-based Centurion ZD CPA & Co., the Company's
auditor since 2016, issued a "going concern" qualification in its
report dated April 14, 2023, citing that the Company has
accumulated deficit from recurring net losses and significant
short-term debt obligations maturing in less than one year as of
Dec. 31, 2022. All these factors raise substantial doubt about its
ability to continue as a going concern.
CBAK ENERGY: Unit to Acquire 5% Stake in BAK Power for $35.6M
-------------------------------------------------------------
CBAK Energy Technology, Inc. announced that its wholly-owned
subsidiary, Nanjing CBAK New Energy Technology Co., Ltd, has
reached an agreement with Shenzhen BAK Battery Co., Ltd. to
acquire, from BAK Battery, a 5% stake in Shenzhen BAK Power Battery
Co., Ltd., an unrelated, well-respected power battery R&D and
manufacturing company.
Under the terms of the agreement, Nanjing CBAK will acquire a 5%
stake in BAK Power for RMB260 million (or approximately $35.57
million), based on a mutually agreed-upon fair market valuation of
RMB5.2 billion (or approximately $710 million). As one of China's
leading companies in the development of model 46800 batteries, BAK
Power has agreed to supply its battery products to CBAK Energy,
creating synergy with models 46115 and 46157 batteries developed by
CBAK Energy and reinforcing product supply while establishing
non-compete agreements for certain key customers.
Founded in 2001, BAK Power, as one of the foremost lithium battery
manufacturers in China, is dedicated to developing a global new
energy business. Leveraging its core technology of self-developed
lithium batteries, BAK Power focuses on promoting efficient power
supply for electric vehicles and providing stable energy storage
system products. BAK Power is recognized for its research and
development of power batteries and advancing cylindrical lithium
battery technology. BAK Power has consistently remained at the
forefront of the industry due to its forward-looking approach and
continuous innovation.
Existing main shareholders of BAK Power include renowned Chinese
financial institutions, including: China Cinda Asset Management
Co., Ltd., one of China's largest asset management companies;
Shenzhen Capital Group Co., Ltd., a top-tier Chinese private equity
firm; and CMS Capital Co., Ltd., one of the largest broker-owned
investment firms in China.
Yunfei Li, chairman and chief executive officer of CBAK Energy,
stated, "We're thrilled to be bringing CBAK Energy and BAK Power
together. This strategic acquisition of a minority interest in BAK
Power will enable us to leverage our collective expertise and
resources to drive innovation and deliver advanced products to our
customers, enhancing our leading position in the power battery
industry and further strengthening our capability in cylindrical
lithium battery production and electric energy solutions."
About CBAK Energy
Liaoning Province, People's Republic of China-based CBAK Energy --
www.cbak.com.cn -- is a manufacturer of new energy high power
lithium batteries that are mainly used in light electric vehicles,
electric vehicles, electric tools, energy storage including but not
limited to uninterruptible power supply (UPS) application, and
other high-power applications. Its primary product offering
consists of new energy high power lithium batteries, but it is also
seeking to expand into the production and sale of light electric
vehicles.
CBAK Energy reported a net loss of $11.33 million for the year
ended Dec. 31, 2022, compared to net income of $61.56 million for
the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had
$244.03 million in total assets, $119.65 million in total
liabilities, and $124.38 million in total equity.
Hong Kong, China-based Centurion ZD CPA & Co., the Company's
auditor since 2016, issued a "going concern" qualification in its
report dated April 14, 2023, citing that the Company has
accumulated deficit from recurring net losses and significant
short-term debt obligations maturing in less than one year as of
Dec. 31, 2022. All these factors raise substantial doubt about its
ability to continue as a going concern.
CELL-NIQUE CORPORATION: Court OKs Deal on Cash Collateral Access
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of New York
authorized Cell-Nique Corporation to use cash collateral on an
interim basis in accordance with the budget and its agreement with
the U.S. Internal Revenue Service.
IRS claims a pre-petition perfected security interest in and lien
on all of the Debtor's personal property. As of the Petition Date,
the balance alleged to be due on account of the lien was
approximately $49,045.
As adequate protection of IRS's interest in the Collateral,
including the cash collateral, IRS is granted, pursuant to 11
U.S.C. Sections 361(2), 363(c)(2) and 363(e) of the Bankruptcy
Code, continuing valid, binding, enforceable and perfected liens
and security interests as existed as of the Petition Date in and to
the Collateral and all of the Debtor's accounts receivable.
As further adequate protection, the Debtor will provide to IRS a
roll-over security interest in and lien on all Post-Petition
Collateral obtained or received after the Petition Date of the kind
and nature specified in the pro-petition Loan Documents based upon
the equities of the case in accordance with 11 U.S.C. Section 522.
As further adequate protection of IRS's interest in the Collateral,
including the cash collateral, the Debtor will make monthly
payments to IRS in the amount of $972.
These events constitute an "Event of Default":
a. The conversion of the Chapter 11 case to one under Chapter 7 of
the Code;
b. The appointment of any Chapter 11 Trustee;
c. The dismissal of Debtor's bankruptcy case; and/or
d. The cessation of Debtor's normal business operations or the sale
of Debtor's business.
A copy of the order is available at https://urlcurt.com/u?l=wqkwtP
from PacerMonitor.com.
About Cell-Nique Corporation
Cell-Nique Corporation is a grocery and related product merchant
wholesaler.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. N.Y. Case No. 23-10815) on August 10,
2023. In the petition signed by Daniel Ratner, president, the
Debtor disclosed up to $50 million in both assets and liabilities.
Judge Robert E. Littlefield Jr. oversees the case.
Peter A. Pastore, Esq., at O'Connell and Aronowitz, P.C.,
represents the Debtor as legal counsel.
CELSIUS NETWORK: Seeks to Extend Solicitation Exclusivity to Nov 30
-------------------------------------------------------------------
Celsius Network, LLC and its subsidiaries ask the U.S. Bankruptcy
Court for the Southern District of New York to extend its
exclusive period to solicit acceptances of a chapter 11 plan to
November 30, 2023.
This is the Debtors' fourth request for exclusivity extension.
Absent the requested extension, the solicitation exclusivity
period expires on September 29, 2023. The Debtors stated that
since they obtained their third exclusivity extension, the Court
approved the disclosure statement, and the Debtors began
solicitation of votes on the plan.
The Debtors also claimed that they have made substantial progress
since the last exclusivity extension independent of the plan and
disclosure statement. The Debtors stated that they reached
consensual resolutions with the U.S. Department of Justice, the
Securities and Exchange Commission, the Federal Trade Commission,
and the U.S. Commodity Futures Trading Commission that will avoid
disruption and delay to these cases and dilution of account
holder recoveries.
The Debtors further stated that they resolved the Committee's
class claim by executing a settlement agreement that should
greatly streamline the claims reconciliation process and allow
distributions to be made to creditors promptly upon the effective
date of the plan, increasing the scheduled claims of account
holders (other than custody claims) who do not opt out of the
class claim settlement by 5% on account of claims relating to the
Debtors' prepetition fraud, misrepresentations, and other
noncontractual claims.
The Debtors explained that the extension will ensure that all
stakeholders can thoroughly review and understand the revised
plan and disclosure statement to decide whether to vote to accept
or reject the plan in an efficient, organized fashion. The
Debtors also stated that the extension will provide them with the
necessary runway to confirm the plan and maintain on track to
emerge from chapter 11 — and return substantial value to
creditors — this year.
Celsius Network, LLC and its subsidiaries are represented by:
Joshua A. Sussberg, P.C.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
601 Lexington Avenue
New York, NY 10022
Tel: (212) 446-4800
- and -
Patrick J. Nash, Jr., Esq.
Ross M. Kwasteniet, Esq.
Christopher S. Koenig, Esq.
Dan Latona, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
300 North LaSalle Street
Chicago, IL 60654
Tel: (312) 862-2000
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.
CENTRAL OKLAHOMA: Unsecureds Will Get 100% of Claims in Plan
------------------------------------------------------------
Central Oklahoma United Methodist Retirement Facility, Inc. d/b/a
Epworth Villa filed with the U.S. Bankruptcy Court for the Western
District of Oklahoma a Disclosure Statement to accompany Plan of
Reorganization dated October 2, 2023.
Epworth Villa wasformed in 1986. Affiliated with the Oklahoma
Conference of the United Methodist Church, Epworth Villa is a
continuing care retirement community (or CCRC), often referred to
as a Life Plan Community (or LPC), for persons aged 62 and older,
and is located at 14901 N. Pennsylvania Avenue, Oklahoma City,
Oklahoma.
At the commencement of this Case the Debtor filed the Plan, which
comprises the full terms of Epworth Villa's proposed
reorganization. The Plan provides for the continued operation of
Epworth Villa's business while restructuring its secured bond debt
(consisting of the Existing Bonds). The Plan's proposed
restructuring of the Debtor, will have minimal impact on Residents
or creditors other than Holders of Existing Bond Claims and
affiliates of the Debtor.
Among other things, the Residency Agreements of current residents
will be assumed and continued without modification, and the Claims
of all prepetition and administrative creditors will be paid in
full. The Debtor's secured bond debt will be restructured so that
upon emergence from bankruptcy the Debtor's liquidity will be
enhanced and its debt service will be substantially reduced.
The Debtor has submitted a reorganization Plan because it believes
that its proposed financial restructuring will provide more value
to creditors than a liquidation of the assets of Epworth Villa. To
achieve such optimal value, the Plan contemplates treatment of the
Debtor's secured and unsecured creditors in accordance with the
classifications and treatments set forth more fully in the Plan.
Class 3 consists of all General Unsecured Claims against the
Debtor. Except to the extent that a Holder of an Allowed General
Unsecured Claim against the Debtor agrees to a different treatment
of such Claim, on the Effective Date or as soon as reasonably
practicable thereafter, the Debtor will pay an amount equal to 100%
of the Allowed Amount of such Class 3 Claim, in each case subject
to all defenses or disputes the Debtor may assert as to the
validity or amount of such claims. Accordingly, Class 3 Claims are
Unimpaired.
Class 4 consists of all claims for refunds of entrance fees
pursuant to Residency Agreements of former Residents. In full
satisfaction of an Allowed Former Resident Refund Claim, on the
later of the Effective Date or the date on which the Former
Resident Refund Claim becomes due and payable under the applicable
Residency Agreement, each Holder thereof shall receive payment of
100% of the Allowed Amount of such Claim in accordance with the
applicable Residency Agreement. To the extent the Former Resident
Refund Claim is due and payable on the Effective Date, such Claim
shall be satisfied from the Entrance Fee Escrow pursuant to the
Plan. Accordingly, Class 4 Claims are Unimpaired.
Class 5 consists of all Interests in Epworth Villa. The sole
Interest Holder in Epworth Villa is Epworth Living, Inc. The fate
of the equity Interest in Epworth Villa, held by Epworth Living,
Inc., will be determined by the actions of the Impaired classes of
Claims: If any Class of Impaired Claims does not accept the Plan,
then the Class 5 Interests shall be cancelled and extinguished
under the Plan; if all Classes of Impaired Claims accept the Plan,
then the Class 5 Interest Holder shall retain its Interests.
Accordingly, Class 5 Interests are Impaired.
The Confirmation Order shall authorize, among other things, all
actions as may be necessary or appropriate to effect any
transaction described in, approved by, contemplated by, or
necessary to effectuate the Plan.
On the Effective Date, Epworth Villa, the Issuer, and the Holder(s)
of Existing Bond Claim(s) shall undertake and consummate the
Restructuring Transaction, under which, among other things, the
Series 2023A Bonds shall be issued, and the Series 2023B Bonds and
the Series 2023C Bonds shall be issued and exchanged for the
Existing Bonds, upon the terms and conditions stated in and
provided for in the Series 2023 Bond Documents. Eighty-five percent
of the Existing Bonds shall be exchanged for the Series 2023B
Bonds, and the remaining fifteen percent plus accrued and unpaid
interest on the Existing Bonds shall be exchanged for the Series
2023C Bonds.
A full-text copy of the Disclosure Statement dated October 2, 2023
is available at https://urlcurt.com/u?l=AeqmpJ from
PacerMonitor.com at no charge.
Proposed Attorneys for the Debtor:
Graydon Dean Luthey, Jr., Esq.
Sidney K. Swinson, Esq.
Mark D.G. Sanders, Esq.
GABLEGOTWALS
110 N. Elgin Avenue, Suite 200
Tulsa, Oklahoma 74120-1495
Telephone: 918.595.4800
Facsimile: 918.595.4990
Email: dluthey@gablelaw.com
sswinson@gablelaw.com
msanders@gablelaw.com
Craig M. Regens, Esq.
Scott E. Kiplinger, Esq.
GABLEGOTWALS
BOK Park Plaza
499 W. Sheridan Avenue, Suite 2200
Oklahoma City, Oklahoma 73102
Telephone: 405.235.5500
Facsimile: 405.235.2875
Email: cregens@gablelaw.com
skiplinger@gablelaw.com
About Central Oklahoma
Central Oklahoma United Methodist Retirement Facility, Inc. d/b/a
Epworth Villa is a locally owned not-for-profit Life Plan Community
serving senior adult singles and couples ages 55 and above.
The Debtor filed Chapter 11 Petition (Bankr. W.D. Okla. Case No.
23-12607) on September 29, 2023, with $10 million to $50 million in
assets and $50 million to $100 million in liabilities. Ron Kelly,
president and chief operating officer, signed the petition.
Sidney K. Swinson, Esq. of GABLE & GOTWALS, is the Debtor's legal
counsel.
CNA EQUITY: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: CNA Equity Group, Inc.
f/d/b/a Platinum One Realty and Mortgage
2303 Camino Ramon, Ste 160
San Ramon, CA 94583
Business Description: CNA is a full-service mortgage company
servicing Northern and Southern California.
Chapter 11 Petition Date: October 6, 2023
Court: United States Bankruptcy Court
Northern District of California
Case No.: 23-41294
Debtor's Counsel: Chris Kuhner, Esq.
KORNFIELD, NYBERG, BENDES, KUHNER & LITTLE P.C.
1970 Broadway, Ste 600
Oakland, CA 94612
Tel: 510-763-1000
Fax: 510-273-8669
Total Assets: $1,661,089
Total Liabilities: $2,102,967
The petition was signed by Michael Mulry 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/DI5L7VI/CNA_Equity_Group_Inc__canbke-23-41294__0001.0.pdf?mcid=tGE4TAMA
COLORADO FOOD: Mark Dennis of SL Biggs Named Subchapter V Trustee
-----------------------------------------------------------------
The U.S. Trustee for Region 11 appointed Mark Dennis, a certified
public accountant at SL Biggs, as Subchapter V trustee for Colorado
Food Enterprises, Inc.
Mr. Dennis will be paid an hourly fee of $400 for his services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Mr. Dennis declared that he is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Mark D. Dennis, CPA
SL Biggs, A Division of SingerLewak, LLP
2000 S. Colorado Blvd., Tower 2, Ste. 200
Denver, CO 80222
Phone: 303-226-5471
Email: mdennis@slbiggs.com
About Colorado Food Enterprises
Colorado Food Enterprises, Inc. is a collection of locally owned
companies that provide a variety of products and food production
services. It is based in Denver, Colo.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. D. Colo. Case No. 23-14259) on Sept. 21,
2023, with $774,251 in assets and $5,006,437 in liabilities. James
Teran, president, signed the petition.
Judge Michael E. Romero oversees the case.
Aaron A. Garber, Esq., at Wadsworth Garber Warner Conrardy, P.C.,
represents the Debtor as legal counsel.
CONNER CREEK: Wins Interim Cash Collateral Access
-------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Michigan,
Southern Division, authorized Corner Creek Center LLC to use cash
collateral on an interim basis in accordance with the budget.
The Debtor requires the use of cash collateral to fund debt service
and pay ordinary and necessary costs and expenses.
Specifically, the Debtor projects that it will need to spend
approximately $205,000 in the first 30 days to avoid immediate and
irreparable harm.
The Debtor is indebted to the following secured creditors and are
secured by the following:
A. Conner Lender LLC-Secured lien on all assets of the Debtor
including the real estate located at 4777 East Outer Drive,
Detroit, Mi 48234. The value of the real estate per an appraisal in
2020 is approximately $10 million. The approximate debt to Conner
Lender is approximately $1.250 million.
B. U.S. Small Business Administration-Secured lien on all personal
property of the Debtor in the amount of $149,900.
C. Corporation Service Company-Secured lien on all personal
property of the Debtor.
As adequate protection, Conner Lender, SBA, and CSC are granted
replacement liens and security interests on all further accounts
receivable, cash and deposit accounts in the same priority,
validity and extent that the Debtor's interest in the cash
collateral existed as of the Petition Date.
The Adequate Protections Liens granted are in addition to all
security interests, liens, rights of Conner Lender, SBA, and CSC
existing as of the Petition Date.
The Debtor must pay adequate protection payments to Conner Lender
in the amount of $26,041 monthly, the first monthly payment of
which will be due on October 13, 2023 and is an amount equal to the
monthly interest accruing under the applicable loan documents. All
subsequent monthly adequate protection payments must be in an
amount equal to $26,041 and are due on the first of each month
beginning on November 1, 2023.
A final hearing on the matter is set for October 25, 2023 at 11
a.m.
A copy of the Debtor's order is available at
https://urlcurt.com/u?l=LFem8J from PacerMonitor.com.
About Corner Creek Center LLC
Corner Creek Center LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D. Mich. Case No. 23-48356) on
September 22, 2023. In the petition signed by Andrew McLemore,
managing member, the Debtor disclosed up to $50,000 in assets and
up to $10 million in liabilities.
Judge Thomas J. Tucker oversees the case.
Scott M. Kwiatkowski, Esq., at Goldstein Bershad & Fried PC,
represents the Debtor as legal counsel.
CONTINENTAL AMERICAN: Court OKs Cash Collateral Access Thru Oct 17
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Kansas authorized
Continental American Corporation and Pioneer National Latex, Inc.
to use cash collateral on an interim basis in accordance with the
budget, through October 17, 2023.
The Debtors require the use of cash collateral to pay for their
regular expenses, including costs of goods, wages, leases,
utilities, taxes, administrative expenses, and other ordinary
operational costs.
The Debtors are seeking to use approximately $4 million of cash
collateral. The Debtors anticipate that during the Specified
Period, the net impact on cash collateral will be a reduction of
approximately $950,000.
White Oak Commercial Finance, LLC holds a senior blanket security
interest in and to the Debtors' cash collateral, together with a
significant portion of the Debtor's fixed assets. CIBC Bank USA
also holds a blanket security interest in and to the Debtors' cash
collateral, which is second to the lien of White Oak. CIBC's claim
of approximately $3.8 million is primarily secured by a lien on
real estate owned by one of CAC's non-filing, nonsubsidiary
affiliates, Vlamis Enterprises Wichita, LLC, which holds a value of
approximately $8 million. CIBC's claim is not impacted by the cases
therein, and it will continue to receive payment post-petition
through lease payments rendered by CAC to VEW for occupancy of the
real estate. Finally, VFI KR SPE I, LLC holds a blanket security
interest in and to the Debtors' cash collateral, as well as other
personal property. White Oak holds a claim in the amount of
approximately $7.7 million. VFI holds a claim in the amount of
approximately $2.6 million.
As adequate protection, CIBC and VFI are granted valid, binding,
enforceable , non-avoidable, and automatically perfected, nunc pro
tunc to the Petition Date, postpetition security interest in and
replacement liens and post-petition liens on all assets of the
Debtor.
To the extent provided by 11 U.S.C. Sections 503(b) and 507(b),
CIBC and VFI are granted an allowed superpriority administrative
expense claim in these cases and any Successor Case.
These events constitute an "Event of Default":
1) the entry of an order by the Court granting relief from or
modifying the automatic stay of 11 U.S.C. Section 362 (i) to allow
any creditor to execute upon or enforce a lien on or security
interest in any of the Collateral, other than forms of Collateral
in which such moving party has a senior priority lien;
2) dismissal of the case or conversion of the case to Chapter 7
case;
3) the sale after the Petition Date of any portion of any of the
Debtors' assets outside the ordinary course of dealing and without
approval by the Court under 11 U.S.C. section 363;
4) the Debtors' failure to (i) comply with the Budget (other than
with respect to payment of the Adequate Protection Fees) and
related reporting and covenant requirements, or (ii) perform, in
any material respect, any of their obligations under this Interim
Order, including, but not limited to, the Debtors' failure to make
any payments, or dispose of Prepetition Collateral or Collateral;
5) an order will be entered staying, reversing, vacating, amending,
or rescinding any of the terms of the Interim Order without the
consent of the Revolving Lender;
6) except as contemplated by the DIP Rollup, the entry of an order
or judgment by the Court or any other court: (i) modifying,
limiting, subordinating, or avoiding the priority of the
obligations of the Debtors under the Interim Order, the obligations
of the Debtors under the Prepetition Financing Documents, or the
perfection, priority, or validity of the prepetition liens or the
Adequate Protection Liens granted to a Prepetition Secured Party;
(ii) imposing, surcharging, or assessing against the Prepetition
Secured Parties' claims or the Prepetition Collateral or the
Collateral, any costs or expenses, whether pursuant to 11 U.S.C.
Bankruptcy Code section 506(c) or otherwise; (iii) impairing any of
the Prepetition Secured Parties' right to credit bid; and (iv)
authorizing the Debtors to obtain postpetition credit or the
incurrence of postpetition indebtedness that is secured by a
security interest, mortgage, or other lien on all or any portion of
the Prepetition Collateral or Collateral;
7) any cash collateral or the Carve-Out is used, whether or not
pursuant to Court order, in a manner not permitted by the Interim
Order; and
8) the Debtors' failure to maintain insurance in amounts and types
reasonably acceptable to Prepetition Secured Parties or as required
under the Prepetition Financing Documents, or the Debtors' failure
to cause all applicable post-petition taxes to be paid on or before
their due dates.
A final hearing on the matter is set for October 16, 2023 at 1:30
p.m.
A copy of the order is available at https://urlcurt.com/u?l=Z27FHY
from PacerMonitor.com.
About Continental American Corporation
Continental American Corporation operates a balloon manufacturing
business. The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Kan. Case No. 23-10938) on September 22,
2023. In the petition signed by Daniel A. Flynn, chief executive
officer, the Debtor disclosed up to $100 million in assets and up
to $50 million in liabilities.
Judge Mitchell L. Herren oversees the case.
David Prelle Eron, Esq., at Prelle Eron & Bailey, P.A., represents
the Debtor as legal counsel.
CORELOGIC INC: $750MM Bank Debt Trades at 17% Discount
------------------------------------------------------
Participations in a syndicated loan under which CoreLogic Inc is a
borrower were trading in the secondary market around 83.1
cents-on-the-dollar during the week ended Friday, October 6, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $750 million facility is a Term loan that is scheduled to
mature on June 4, 2029. The amount is fully drawn and
outstanding.
CoreLogic, Inc. provides consumer, financial and property
information, analytics and services. The Company combines public,
contributory and proprietary data to develop predictive decision
analytics, as well as offers mortgage and automotive credit
reporting, property tax, valuation, flood determination, and
geospatial analytics and services.
CPC ACQUISITION: $1.03BB Bank Debt Trades at 19% Discount
---------------------------------------------------------
Participations in a syndicated loan under which Cpc Acquisition
Corp is a borrower were trading in the secondary market around 80.8
cents-on-the-dollar during the week ended Friday, October 6, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $1.03 billion facility is a Term loan that is scheduled to
mature on December 29, 2027. The amount is fully drawn and
outstanding.
CPC Acquisition Corp is in the chemicals industry.
CROOM PROPERTIES: Case Summary & Six Unsecured Creditors
--------------------------------------------------------
Debtor: Croom Properties, LLC
6405 Genevieve Drive
Alexandria LA 71301
Chapter 11 Petition Date: October 6, 2023
Court: United States Bankruptcy Court
Western District of Louisiana
Case No.: 23-80564
Judge: Hon. Stephen D. Wheelis
Debtor's Counsel: Thomas R. Willson, Esq.
THOMAS R. WILLSON
1330 Jackson Street, Suite
Alexandria LA 71301
Tel: (318) 442-8658
Email: rocky@rockywillsonlaw.com
Total Assets: $33,500
Total Liabilities: $1,062,377
The petition was signed by David C. Croom as member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's six unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/5H7DMKI/Croom_Properties_LLC__lawbke-23-80564__0001.0.pdf?mcid=tGE4TAMA
CURIA GLOBAL: $1.19BB Bank Debt Trades at 18% Discount
------------------------------------------------------
Participations in a syndicated loan under which Curia Global Inc is
a borrower were trading in the secondary market around 82.1
cents-on-the-dollar during the week ended Friday, October 6, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $1.19 billion facility is a Term loan that is scheduled to
mature on August 30, 2026. About $1.17 billion of the loan is
withdrawn and outstanding.
Curia Global, Inc., operates as an integrated chemistry outsourcing
company. The Company offers discovery biology, synthetic and
medicinal chemistry, DMPK and bioanalytical, and small-scale
manufacturing services. Curia Global serves pharmaceutical and
biotech companies worldwide.
DGS REALTY: Seeks to Continue Using Cash Collateral Thru Dec 31
---------------------------------------------------------------
DGS Realty, LLC asks the U.S. Bankruptcy Court for the District of
New Hampshire for authority to continue using cash collateral and
provide adequate protection to PHH Mortgage Services through
December 31, 2023.
The cash collateral will be used solely and exclusively for the
purpose of paying the mortgage and taxes of the Debtor in the
ordinary course of business to the extent provided for in the
Budget and such other costs and expenses as may be authorized in
writing by the Secured Lender, as appropriate.
PHH Mortgage, as the cash collateral lien holder, is the servicer
for U.S. Bank National Trust Association, as Trustee for Lehman
Brothers Small Balance Commercial Mortgage Pass-Through
Certificates, Series 2006-3.
PHH Mortgage holds or claims to hold:
-- a blanket first priority mortgage of record on the real
estate at 74 Regional Drive, and 72 Regional Drive, both in
Concord, New Hampshire; and
-- a collateral assignment of the rents thereof.
The PHH Mortgage First Priority Mortgage and Rent Assignment secure
the payment of $2.1 million, which is evidenced by a promissory
note in the original principal amount of $862,500.
The Debtor proposes not to spend or use more than $10,192 per month
during the period between November 1, 2023 and December 31, 2023,
without the written consent of the secured lender, as appropriate.
The cash collateral will be used solely and exclusively for the
purpose of paying the mortgage and taxes of the Debtor in the
ordinary course of business to the extent provided for in the
Budget and such other costs and expenses as may be authorized in
writing by the Secured Lender, as appropriate.
The Debtor will provide PHH Mortgage with adequate protection for
any loss or diminution in value of the cash collateral securing
their claims to the extent such claims qualify as secured claims
under Bankruptcy Code Section 506 pending the further Court order
or orders.
PHH Mortgage is being paid $6,750 per month plus real estate tax
escrow in the amount of $3,066 each month as adequate protection
payments beginning on February 1, 2022, and on the same date of
each month thereafter during the Use Term. These are the Debtor's
normal monthly payments.
The Proposed Order includes a "winding down" proviso under which
the Court reserves the right to enter further orders as may be
necessary regarding the use of cash collateral to provide for
payment of any administrative claims for wage and trade creditors
who have supplied goods or services to the Debtor during the period
of operation under the order (and any stipulation) which remain
unpaid at the time of termination of authorized cash collateral
usage, and which goods or services have created additional
collateral for the secured claimant.
The Budget for November and December, 2023 includes the monthly
payment for the Debtor consisting of a $376 payment to the Small
Business Association representing the first payment for the secured
loan from the SBA. The Debtor obtained the loan prior to filing
Chapter 11; however, the loan provided that payments were to
commence February 1, 2023.
A copy of the motion is available at https://urlcurt.com/u?l=DmlUaD
from PacerMonitor.com.
A copy of the budget is available at https://urlcurt.com/u?l=JMb07x
from PacerMonitor.com.
The Debtor projects $99,800 in total income and $10,192 in total
expenses for November 2023 and $99,984 in total income and $10,192
in total expenses for December 2023.
About DGS Realty
Concord, New Hampshire-based DGS Realty, LLC, owns a parcel of land
with three buildings on the property known as 74 Regional Drive,
Concord, New Hampshire. Formed around May 10, 2017, the company is
owned by David H. Booth, Manager, Stephen W. Booth, and Gregory A.
Booth, each having a 1/3 interest.
DGS Realty filed a Chapter 11 petition (Bankr. D.N.H. Case No.
22-10028) on January 24, 2022. In the petition signed by David H.
Booth, the manager, the Debtor estimated assets and debts between
$1 million and $10 million.
Judge Bruce A. Harwood oversees the 2022 case.
Representing the Debtor as counsel is Eleanor Wm Dahar, Esq., at
Victor W. Dahar Professional Association.
The company is an affiliate of Walter H. Booth Clause 4 Trust,
which sought bankruptcy protection (Bankr. D.N.H. Case No.
16-11598) on Nov. 16, 2016. DGS Realty previously filed a Chapter
11 petition (Bankr. D.N.H. Case No. 18-10024) on Jan. 11, 2018.
DIAMOND SPORTS: $635MM Bank Debt Trades at 48% Discount
-------------------------------------------------------
Participations in a syndicated loan under which Diamond Sports
Group LLC is a borrower were trading in the secondary market around
51.7 cents-on-the-dollar during the week ended Friday, October 6,
2023, according to Bloomberg's Evaluated Pricing service data.
The $635 million facility is a Term loan that is scheduled to
mature on May 25, 2026. About $630.2 million of the loan is
withdrawn and outstanding.
Diamond Sports Group, LLC operates as a sports marketing company.
The Company offers seminars, combine, speed and agility
assessments, recruiting tools, and online training sessions for
sports including football, baseball, soccer, and basketball.
DIEBOLD NIXDORF: Appoints 4 New Directors
-----------------------------------------
Diebold Nixdorf, Inc. disclosed in a Form 8-K Report filed with the
Securities and Exchange Commission that the Company's Board of
Directors has increased the size of the Board from seven to eight
members. The Board appointed Patrick J. Byrne, Matthew J. Espe,
Mark Gross, and David H. Naemura, to the Board, effective
immediately. They filled the three prior vacancies on the Board, as
well as the additional vacancy created by the increase. Each new
director's term will expire at the Company's 2024 Annual Meeting of
Shareholders. In addition, Byrne was appointed as Chair of the
Board.
Byrne is senior vice president of operational transformation at GE.
In his role, he is responsible for driving GE's priorities around
safety, quality, delivery and cost. Previously, Byrne served as
chief executive officer of GE Digital, where he led the company's
software businesses focused on digital transformation. Prior to GE,
Byrne was at Fortive and Danaher, where he led multiple technology
businesses. He has served as a member of the board of directors for
multiple publicly traded companies, including currently serving as
chairman of Verra Mobility and previously serving as an independent
director at Micron Technology.
Espe serves as a board member and advisor to public companies,
private equity firms, and non-profit organizations. In January
2017, he was recruited by Sterling Partners to lead the
transformation of Radial Inc. and oversaw the successful sale of
the company. He previously served as chief executive officer of
Armstrong World Industries, chairman and chief executive officer of
IKON Office Solutions, and held various roles at GE, including
president and chief executive officer of GE Lighting. He currently
serves as an independent director at WESCO International, Anywhere
Real Estate, Inc., and Korn Ferry.
Gross is an executive with more than 25 years of critical
leadership experience, financial expertise, and deep insight into
leading business transformations. He currently serves as executive
chairman of Southeastern Grocers, co-chairman of Northeast Grocery
Inc., and as a board member and chairman of the audit committee of
Acosta. He previously served as president and chief executive
officer of Supervalu, was Co-President of C&S Wholesale Grocers,
Inc., founded Surry Investment Advisors, and was an attorney in the
Restructuring Group at Skadden, Arps, Slate, Meagher and Flom.
Naemura is the chief financial officer of Neogen Corporation. Prior
to that role, he served as chief financial officer of Vontier
Corporation, previously served as chief financial officer of Gates
Industrial Corporation and was a group chief financial officer at
Danaher Corporation. He began his career as an auditor at Deloitte
& Touche.
With these most recent appointments, Diebold Nixdorf's board now
consists of eight directors. Octavio Marquez, Diebold Nixdorf's
president and chief executive officer, will continue to serve as a
non-independent director, and the new directors join the following
independent directors of the company's board:
Arthur F. Anton is the retired chairman and chief executive officer
of the Swagelok Company and former partner at Ernst & Young LLP. He
is currently a director of The Sherwin Williams Company, lead
director of Olympic Steel, chairman and director of SunCoke Energy,
and a former director of University Hospitals Health System in
Cleveland, Ohio.
Marjorie L. Bowen is a retired managing director at Houlihan Lokey,
where she headed the firm's industry-leading fairness opinion
practice. Since 2007, she has served on numerous public and private
boards and is currently the chair of the audit committee and a
board member of CBL Properties.
Emanuel R. Pearlman is the founder, chairman and chief executive
officer, Liberation Investment Group. He is currently a director of
MidCap Financial Investment Corporation and director and chair of
the audit committee of Network-1 Technologies.
CEO Marquez said: "I am excited about the composition of the new
board, which will provide strong leadership around operations,
finance, and corporate governance. Our focus remains on delivering
best-in-class solutions to our customers and creating value for our
stakeholders. I couldn't be more optimistic about the future of
Diebold Nixdorf."
Byrne, incoming Diebold Nixdorf chair, said: "I am honored to take
on the role of chair at such an exciting time for Diebold Nixdorf.
I look forward to working closely with Octavio and the leadership
team as we focus on long-term success, growth, and operational
performance. I strongly support Diebold Nixdorf's customer-centric
culture and its commitment to delivering for all its stakeholders.
I look forward to helping lead the company through such an exciting
part of its journey."
About Diebold Nixdorf
Diebold Nixdorf, Incorporated automates, digitizes and transforms
the way people bank and shop. As a partner to the majority of the
world's top 100 financial institutions and top 25 global retailers,
its integrated solutions connect digital and physical channels
conveniently, securely and efficiently for millions of consumers
each day.
Diebold Nixdorf and several affiliated entities sought protection
under Chapter 11 of the U.S. Bankruptcy Code on June 1, 2023. The
cases are jointly administered under the case of Diebold Holding
Company, Inc., Bankr. S.D. Texas Lead Case No. 23-90602. In the
petition signed by Jonathan B. Leiken, president, Diebold Holding
disclosed $3.09 billion in assets and $2.57 billion in
liabilities.
Diebold Nixdorf Dutch Holding B.V. commenced voluntary
reorganization proceedings pursuant to the Wet Homologatie
Onderhands Akkoord under Netherlands law in the District Court of
Amsterdam. Diebold Netherlands sought recognition of the Dutch
Proceeding under Chapter 15 of the Bankruptcy Code.
Judge David R. Jones oversees the Chapter 11 cases.
The Chapter 11 Debtors tapped Jones Day and Jackson Walker LLP as
legal counsel; Ducera Partners LLC as investment banker; FTI
Consulting, Inc. as financial advisor; and Kroll Restructuring
Administration, LLC as claims and noticing agent.
Carlin Adrianopoli has been appointed as Foreign Representative for
the purposes of any case commenced under Chapter 15.
Davis Polk advised an ad hoc group of secured creditors.
* * *
On July 13, 2023, the U.S. Bankruptcy Court entered an order
confirming the Debtors' Second Amended Joint Prepackaged Chapter 11
Plan of Reorganization. On Aug. 2, 2023, the Dutch Court entered
an order sanctioning the Netherlands WHOA Plan of Diebold Nixdorf
Dutch Holding B.V. and the Dutch Scheme Companies in the Dutch
Scheme Proceedings.
DIGIPATH INC: Hires Fruci & Associates as New Auditor
-----------------------------------------------------
The Board of Directors of Digipath, Inc., on Sept. 27, 2023,
approved the engagement of Fruci & Associates II, PLLC as the
Company's independent registered public accounting firm for the
Company's fiscal year ending Sept. 30, 2023, following review of
proposals from the independent registered public accounting firms
that participated in the Board's competitive process. Following
the appointment, M&K CPAS, PLLC, the Company's current independent
registered public accounting firm, was dismissed.
Digipath noted that M&K's reports on the Company's financial
statements for the fiscal years ended Sept. 30, 2022 and 2021 did
not contain any adverse opinion or disclaimer of opinion, nor were
they qualified or modified to audit scope or accounting principles
but did include explanatory paragraphs and footnotes questioning
the Company's ability to continue as a going concern. During the
Company's fiscal years ended Sept. 30, 2022 and 2021 and through
M&K's dismissal on September 27, 2023, there were (i) no
disagreements as defined in Item 304 of Regulation S-K on any
matter of accounting principles or practices, financial statement
disclosure, or auditing scope or procedure, which disagreements, if
not resolved to the satisfaction of M&K, would have caused it to
make reference in connection with any opinion to the subject matter
of the disagreement. (ii) no reportable events, as defined under
Item 304(a)(1)(v) of Regulation S-K.
The Company also disclosed that during the fiscal years ended Sept.
30, 2022 and Sept. 30, 2021 and the subsequent interim periods
through Sept. 27, 2023, neither the Company nor anyone on its
behalf has consulted with Fruci regarding: (i) the application of
accounting principles to a specific transaction, either completed
or proposed, or the type of audit opinion that might be rendered on
the Company's financial statements, and neither a written report
was provided to the Company nor oral advice was provided that Fruci
concluded was an important factor considered by the Company in
reaching a decision as to any accounting, auditing, or financial
reporting issue; (ii) any matter that was the subject of a
disagreement within the meaning of Item 304(a)(1)(iv) of Regulation
S-K and the related instructions; or (iii) any matter that was a
reportable event within the meaning of Item 304(a)(1)(v) of
Regulation S-K.
About DigiPath
Headquartered in Las Vegas, Nevada, Digipath, Inc. --
www.digipath.com -- offers full-service testing lab for cannabis,
hemp and ancillary cannabis and hemp infused products serving
growers, dispensaries, caregivers, producers, patients and
eventually all end users of cannabis and botanical products.
DigiPath reported a net loss of $2.06 million for the year ended
Sept. 30, 2022, compared to a net loss of $686,503 for the year
ended Sept. 30, 2021. As of Dec. 31, 2022, the Company had $1.18
million in total assets, $3.73 million in total liabilities,
$333,600 in series B convertible preferred stock, and a total
stockholders' deficit of $2.88 million.
Houston, Texas-based M&K CPAS, PLLC, the Company's auditor since
2017, issued a "going concern" qualification in its report dated
Jan. 17, 2023, citing that the Company has recurring losses from
operations and insufficient working capital, which raises
substantial doubt about its ability to continue as a going concern.
DRUNKEN DONKEY: Continued Operations to Fund Plan
-------------------------------------------------
Drunken Donkey Private Club and its Debtor Affiliates filed with
the U.S. Bankruptcy Court for the Eastern District of Texas a Joint
Plan of Reorganization dated October 2, 2023.
Drunken Donkey Lewisville was established in February 2014 by
Jessica Putnam and Nick Vogiatzis as an American Craft Beer Bar &
Scratch Food kitchen.
The Debtors propose to restructure their current indebtedness and
continue its operations to provide a dividend to the creditors of
Debtor.
The Debtors have continued to operate the companies since the
filings. The Debtors, Colony and Lewisville have been profitable
during the pendency of the bankruptcies, however, sales have lagged
behind historical levels. It is anticipated that after
confirmation, the Debtors will continue in business. Based upon the
projections, the Debtors believes they can service the debt to the
creditors.
Class 11 consists of the Unsecured Claims in Colony. All unsecured
creditors of Colony, including any claims of Lacy Haislip, Pearl
Capital, Small Business Association and Rewards Network
Establishment Services, shall share pro rata in the unsecured
creditors pool. The Colony shall make monthly payments commencing
30 days after the effective date of $2,000 into the unsecured
creditors' pool. The amount represents the Colony's disposable
income as that terms is defined in Section 1191(d) of the
Bankruptcy Code. The Debtor shall make 36 payments into the
unsecured creditors pool. The Class 11 creditors are impaired.
Class 12 consists of Allowed Unsecured Creditors of Lewisville. All
unsecured creditors of Lewisville, including any deficiency claims
of Ally or Santander, and the claims of the Small Business
Association, shall share pro rata in the unsecured creditors pool.
The Lewisville shall make monthly payments commencing 30 days after
the effective date of $1,000 into the unsecured creditors' pool.
The amount represents the Lewisville's disposable income as that
terms is defined in Section 1191(d) of the Bankruptcy Code. The
Debtor shall make 36 payments into the unsecured creditors pool.
The Class 12 creditors are impaired.
The current owner will receive no payments under the Plan, however,
she will be allowed to retain her ownership in the Debtors.
Debtors anticipate the continued operations of the businesses to
fund the Plan.
A full-text copy of the Joint Plan dated October 2, 2023 is
available at https://urlcurt.com/u?l=8WZLK4 from PacerMonitor.com
at no charge.
Proposed Attorneys for Debtor:
Eric A. Liepins, Esq.
Eric A. Liepins, PC
12770 Coit Road, Suite 850
Dallas, TX 75251
Telephone: (972) 991-5591
Facsimile: (972) 991-5788
Email: eric@ealpc.com
About Drunken Donkey Private Club
Drunken Donkey Private Club sought protection for relief under
Chapter 11 of the Bankruptcy Code (Bankr. E.D. Texas Case No.
23-41260) on July 14, 2023, with as much as $1 million in both
assets and liabilities.
Judge Brenda T. Rhoades oversees the case.
Eric A. Liepins, Esq., at Eric A. Liepins, P.C., is the Debtor's
counsel.
E.L. SERVICES: Court OKs Interim Cash Collateral Access Thru Dec 31
-------------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of California
authorized E.L. Services, Inc. to use cash collateral on an interim
basis in accordance with a budget, through December 31, 2023.
A further hearing on the matter is scheduled for December 13 at
10:30 a.m.
The status conference is set for December 13 at 10:30 a.m.
A copy of the order is available at https://urlcurt.com/u?l=dRWd9A
from PacerMonitor.com.
About E.L. Services, Inc.
E.L. Services, Inc., a landscape and maintenance company located in
Dublin, California, filed a Chapter 11 petition (Bankr. N.D. Cal.
Case No. 21-41087) on August 25, 2021. On the Petition Date, the
Debtor estimated $50,000 to $100,000 in assets and $1 million to
$10 million in liabilities. The petition was signed by Steven P.
Baca, general manager.
Judge William J. Lafferty oversees the case.
The Debtor tapped Kornfield, Nyberg, Bendes, Kuhner & Little P.C.
to serve as its counsel.
EGAE LLC: Voluntary Chapter 11 Case Summary
-------------------------------------------
Debtor: EGAE, LLC
337 E. 4th Avenue, Unit 1
Anchorage, AK 99501
Business Description: EGAE, LLC owns and operates an apartment
building in Anchorage, Alaska.
Chapter 11 Petition Date: October 5, 2023
Court: United States Bankruptcy Court
District of Alaska
Case No.: 23-00169
Judge: Hon. Gary Spraker
Debtor's Counsel: John C. Smith, Esq.
GERALD K. SMITH AND JOHN C. SMITH LAW OFFICES,
PLLC
6720 East Camino Principal
Suite 203
Tucson, AZ 85715
Tel: (520) 722-1605
Email: john@smithandsmithpllc.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Marc Marlow 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/QCECEYQ/EGAE_LLC__akbke-23-00169__0001.0.pdf?mcid=tGE4TAMA
EMERGENT BIOSOLUTIONS: Names Two Pharmaceutical Veterans to Board
-----------------------------------------------------------------
Emergent BioSolutions Inc. announced the appointment of Neal Fowler
and Don DeGolyer to its Board of Directors effective Oct. 1, 2023,
with initial terms expiring at Emergent's 2024 annual meeting of
stockholders. Both joined as independent directors and bring more
than 70 years of combined biopharmaceutical industry and sales
experience.
"Neal and Don bring unique and extensive expertise to Emergent as
the company defines its future in this post-pandemic environment,"
said Emergent Chairman Dr. Zsolt Harsanyi, Ph.D. "Maintaining our
focus on our mission of protecting and enhancing life, these
industry veterans add valuable insight and experience as Emergent
continues to partner with governments to prepare for public health
threats and save lives."
Mr. Fowler will serve on the Audit and Finance Committee, and Mr.
DeGolyer will serve on the Compensation Committee.
Currently, Mr. Fowler is the chief executive officer of Pathalys
Pharma, Inc., a biomedicines company focused on chronic kidney
disease. He previously served as CEO of Liquidia Corporation
(Nasdaq: LQDA), transforming the company from an early-stage
research platform into a publicly traded biomedicines company.
While at Liquidia, Mr. Fowler also co-founded and served as CEO of
Envisia Therapeutics (acquired), an ophthalmology company focused
on therapeutics. Prior to Liquidia, Mr. Fowler worked for seven
years with Johnson and Johnson, serving as president of Centocor,
Inc., a global multi-billion dollar subsidiary focused on
biomedicines, and President of Ortho-McNeil Neurologics, a company
focused on neurological disorders. He started his career with Eli
Lilly and Company, working for thirteen years in a variety of
sales, marketing and business development roles in both the
pharmaceutical and medical device divisions. Mr. Fowler is the
current chair of NCBIO and a past chair of the UNC Eshelman School
of Pharmacy Foundation.
Mr. Fowler earned his Bachelor of Science degree in Pharmacy and
Master of Business Administration both from the University of North
Carolina at Chapel Hill.
With over 35 years of healthcare and corporate leadership
experience, Mr. DeGolyer was most recently the founder and director
of Vertice Pharma (a Warburg Pincus company), focused on specialty
pharmaceuticals for U.S. institutional use, from 2015 until the
company's sale in 2022. Prior to Vertice, he was chief operating
officer of Endo International, a Nasdaq-listed specialty
pharmaceutical company, from 2013-2015.
Between 2009 and 2013, he served on the Executive Committee of
Sandoz AG (a Novartis company), one of the largest global generic
companies, as CEO, Sandoz Inc., a $3.5bn generic pharmaceuticals
and biosimilars company where he was responsible for leading over
3,000 associates in North America.
Mr. DeGolyer started his career with Pfizer, Johnson & Johnson and
Novartis in commercial roles of increasing responsibility. He
previously served on the Board of HLS Therapeutics (commercial
stage CV/CNS company) and TYME Technologies (development stage
cancer company), both publicly traded companies, where he was also
Chairman of the Compensation Committees. He also serves on several
non-profit boards including Make-a-Wish-NJ and The Strong Women
Foundation.
Mr. DeGolyer received his Bachelor of Arts from the University of
Rochester and earned a Master of Business Administration from
Fairleigh Dickinson University.
Messrs. DeGolyer and Fowler will each receive an initial new
director grant of restricted stock units with a value equivalent to
$375,000 under the Emergent BioSolutions Inc. Amended and Restated
Stock Incentive Plan. The restricted stock units will vest in
three equal installments over a three-year period, subject to the
applicable director's continued service on the Board. As
non-employee directors, Messrs. DeGolyer and Fowler will receive
additional compensation in accordance with the Company's
non-employee director compensation practices. Messrs. DeGolyer and
Fowler will also enter into the Company's standard indemnification
agreement.
About Emergent Biosolutions
Headquartered in Gaithersburg, MD, Emergent Biosolutions Inc. is a
global life sciences company focused on providing innovative
preparedness and response solutions addressing accidental,
deliberate and naturally occurring public health threat. The
Company's solutions include a product portfolio, a product
development portfolio, and a contract development and
manufacturing
("CDMO") services portfolio.
Tysons, Virginia-based Ernst & Young LLP, the Company's auditor
since 2004, issued a "going concern" qualification in its report
dated March 1, 2023, citing that the Company does not expect to be
in compliance with debt covenants in future periods without
additional sources of liquidity or future amendments to its Credit
Agreement, has a working capital deficiency, and has stated that
substantial doubt exists about the Company's ability to continue as
a going concern.
ENDEAVOR GROUP: S&P Upgrades ICR to 'BB-', Outlook Positive
-----------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on Endeavor
Group Holdings Inc. to 'BB-' from 'B+' and its issue-level ratings
on the debt held by the company's borrowing subsidiary, WME IMG
Holdings LLC, to 'BB-' from 'B+'. S&P's '3' recovery rating remain
unchanged.
S&P said, "At the same time, we raised our issue-level ratings on
debt held by the company's borrower subsidiary, UFC Holdings LLC,
to 'BB' from 'B+' and revised our recovery rating to '2' from '3'.
"The positive outlook reflects our view that the company's S&P
Global Ratings-adjusted leverage could remain below the 4.5x upside
threshold even when factoring any potential acquisitions or
shareholder distributions. The outlook also reflects our view that
Endeavor will continue to benefit from strong organic revenue
growth across all its business segments."
The combination of Zuffa Parent, LLC (UFC) and WWE Entertainment
Group Inc. will drive Endeavor Group Holdings Inc.’s S&P Global
Ratings-adjusted leverage below 4.0x over the next 12 months.
We believe the addition of WWE to Endeavor significantly improves
the consolidated group's overall competitive positioning,
particularly in the sports entertainment business.
Endeavor will now own 51% of TKO Operating Company LLC, which holds
all UFC and WWE assets, while TKO Group Holdings Inc. will hold the
remaining 49%. Endeavor will control TKO through its majority
equity stake and majority representation on the board of directors
(six out of 11 seats). Former WWE shareholders now hold about 49%
of TKO and the remaining seats on the board. S&P's view the
combination of WWE and UFC to be significantly deleveraging for
Endeavor given WWE's existing low leverage profile and as there is
no incremental debt raise associated with the transaction.
S&P said, "Furthermore, we expect Endeavor will utilize its
existing expertise to supplement and strengthen WWE's media rights,
live events, and consumer products segments. The company has also
indicated opportunities to pursue cost efficiencies as it
integrates UFC's and WWE's cost bases.
"On a pro forma basis, we expect Endeavor's S&P Global
Ratings-adjusted leverage to remain below 4.5x and its free
operating cash flow (FOCF) to debt to remain above 10% on a
sustained basis over the next 12 months. We expect significant
transaction costs as part of this combination in 2023, including
distributions to existing WWE shareholders, redemption of its
convertible notes, and other one-time compensation and transaction
expenses that could push its S&P Global Ratings-adjusted leverage
temporarily above 4.5x in 2023.
"We expect the Writers Guild of America (WGA) and Screen Actors
Guild (SAG-AFTRA) strikes to be a drag on Endeavor's representation
business this year, but we believe its diverse revenue base will
offset most of this pressure. While the WGA strike has ended, the
SAG-AFTRA strike is still causing a near standstill of film and TV
productions in Hollywood. Some of Endeavor's talent across both
guilds were or remain unpaid during the strikes, affecting its
commissioning revenue. Moreover, project development, especially
writing work, was postponed for the duration of the strike,
potentially slowing down revenue recovery even after the strike
ends. We expect overall representation revenues to be flat to
decline up to 5% in 2023 despite growing 2% year over year in the
first half of the year.
"However, we expect Endeavor's diverse revenue base will more than
offset the forecasted decline in the representation business. The
company's owned sports properties segment, which includes UFC prior
to the WWE combination, grew about 10% in the first half of 2023,
primarily driven by higher live event revenue and higher media
rights fees. In addition, the company's events segment grew about
3% in the same period due to new media production deals. The
company's new sports data and technology segment grew about 22%
mainly due to the acquisition of OpenBet in September 2022 and
growth in IMG ARENA."
Endeavor's revenue will continue to benefit from strong secular
trends supporting demand for premium content, live sports, and
events. S&P expects Endeavor to continue to see strong demand for
the talent its agents represent in motion pictures, TV, music, and
sports. Film and TV revenue prospects will remain strong due to
demand for premium Hollywood talent. Much of this demand is
supported by studios hoping to increase the volume of available
content on their respective streaming platforms (Netflix, Disney+,
Warner Bros. Discovery, Paramount, etc.).
Over the past year, the market has reset its expectations for the
growth of content investments made by these streaming services. S&P
believes expectations for this demand have lessened somewhat.
However, premium Hollywood talent, such as that represented by
Endeavor, will remain in demand as studios prioritize high-profile
talent and fewer productions over a high-volume, lower-quality
approach.
The company's new majority stake in TKO significantly improves its
scale and market share, particularly within its sports
entertainment platform, and further improves its revenue diversity
across the entertainment ecosystem. The growth in popularity of
live sports also creates new opportunities for TKO as the media
landscape continues to evolve through the proliferation and
maturation of streaming and direct-to-consumer media consumption.
S&P said, "The positive outlook reflects our view that Endeavor's
S&P Global Ratings-adjusted leverage could remain below the 4.5x
upside threshold even when accounting for any potential
acquisitions or shareholder distributions. The outlook also
reflects our view that the company will continue to benefit from
strong organic revenue growth across all its business segments."
S&P could revise its outlook to stable if we expect Endeavor's S&P
Global Ratings-adjusted leverage will rise and remain above 4.5x.
This could happen if:
-- The company experiences poor demand for its entertainment
products that hinders ticket sales to live events;
-- Major media contract losses or represented talent departures
weaken its competitive advantage and market share; or
-- The company pursues a more aggressive financial policy that
includes substantial debt-financed acquisitions or shareholder
distributions.
S&P could raise its rating if:
-- The company successfully integrates UFC and WWE with minimal
operational challenges;
-- S&P expects Endeavor will maintain S&P Global Ratings-adjusted
leverage below 4.5x on a sustained basis even after incorporating
potential additional acquisitions, shareholder distributions, and
volatility over the economic cycle; and
-- The company commits to a financial policy that includes
maintaining S&P Global Ratings-adjusted leverage below 4.5x on a
sustained basis.
EVOLUTION MICRO: Files Emergency Bid to Use Cash Collateral
-----------------------------------------------------------
Evolution Micro, LLC asks the U.S. Bankruptcy Court for the Middle
District of Florida, Orlando Division, for authority to use cash
collateral and provide adequate protection to the U.S. Small
Business Administration.
The Debtor requires the use of cash collateral to fund ordinary
business operations and necessary expenses in accordance with the
cash budget.
SBA may hold a first-position security interest in the Debtor's
cash and/or cash equivalents.
Secured Lender Solutions, De Lage Landen Financial Services, Inc.,
Cadence Bank, N.A., Funding Circle, LLC, and/or Wells Fargo Bank,
N.A. are the holders of inferior position security interests in the
Debtor's cash, accounts and cash equivalents.
As adequate protection for the use of cash collateral, the Debtor
proposes to grant the Secured Creditors a replacement lien on
post-petition cash collateral to the same extent, priority, and
validity as their pre-petition liens, to the extent Debtor's use of
cash collateral results in a decrease in value of the Secured
Creditors' interest in the cash collateral.
All interests in cash collateral are adequately protected by
replacement liens and the proposed adequate protected is fair and
reasonable and sufficient to satisfy any diminution in value of the
prepetition collateral.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=5YsmRY from PacerMonitor.com.
The Debtor projects total cash paid out, on a monthly basis, as
follows:
$105,975 for October 2023;
$156,275 for November 2023; and
$206,475 for December 2023;
About Evolution Micro, LLC
Evolution Micro, LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Fla. Case No. 23-04081) on September
29, 2023. In the petitoin signed by Fazleabbas Khaki, member, the
Debtor disclosed up to $10 million in both assets and liabilities.
Justin M. Luna, Esq. , at Latham Luna Eden & Beaudine LLP,
represents the Debtor as legal counsel.
FARWAY MARINA: Seeks to Extend Plan Exclusivity to December 22
--------------------------------------------------------------
Farway Marina, Inc. asks the U.S. Bankruptcy Court for the
Eastern District of New York to extend its exclusive periods to
file a plan of reorganization and to solicit acceptances thereof
to December 22, 2023 and February 20, 2024, respectively.
The Debtor explained that these extensions will allow it to
continue its efforts to propose and confirm a plan of
reorganization that provides for payment to all classes of
creditors, and thus bring its case to a successful conclusion.
The Debtor stated that its case was filed with a myiad of
problems, including:
(i) potentially losing certain of its parcels in a tax
foreclosure sale,
(ii) difficult neighbors causing financial and other
problems for the Debtor, and, as a result, denying the
Debtor the ability to generate income to save its
properties.
The Debtor claimed that, during the case, among other things, it:
(a) negotiated a new agreement with the New York City
Department of Finance with respect to the payment of its
current real estate taxes,
(b) evicted the troublesome tenant causing the Debtor
problems, so as to soon be in a position to lease its
properties to generate revenue as a part of its plan to
successfully exit from bankruptcy,
(c) through an agent, commenced discussions with a
construction company interested in leasing certain of
its properties, which is expected to provide revenue
sufficient for the Debtor to obtain the exit financing,
secured by some or all of its properties and emerge from
bankruptcy as a reorganized entity.
Alternatively, the Debtor explained that it is prepared to retain
a broker to market and sell its properties in the unlikely event
that it is unsuccessful in leasing some or all of its properties.
Farway Marina, Inc. is represented by:
Steven B. Eichel, Esq.
Lori Schwartz, Esq.
LEECH TISHMAN ROBINSON BROG, PLLC
875 Third Avenue, 9th Floor
New York, NY 10022
Tel: (212) 603-6300
About Farway Marina
Farway Marina, Inc., a company in Far Rockaway, N.Y., filed its
voluntary petition for Chapter 11 protection (Bankr. E.D.N.Y.
Case No. 23-41446) on April 27, 2023, with as much as $50,000 in
assets and $1 million to $10 million in liabilities. Judge Jil
Mazer-Marino oversees the case.
Leech Tishman Robinson Brog, PLLC is the Debtor's legal counsel.
FLAME NEWCO: S&P Assigns 'CCC+' ICR, Outlook Stable
---------------------------------------------------
S&P Global Ratings assigned our 'CCC+' issuer credit rating to
Flame NewCo, the new holding company of Phoenix Services
International LLC.
At the same time, S&P assigned its 'B-' issue-level rating to the
company's secured term loan maturing in 2028. The recovery rating
is '2'.
The stable outlook reflects S&P's expectation that the
sustainability of its capital structure depends on the performance
of its new contracts negotiated during bankruptcy and smaller debt
load.
Post-bankruptcy, the sustainability of Flame NewCo's capital
structure still depends on uncertain earnings and cash flow because
the company requires capital spending to sustain its current
operations and acquire new contracts to offset contracts that are
ending. Flame NewCo has emerged from bankruptcy and is operating
with its newly renegotiated contracts, and substantially lower
debt. S&P said, "We expect Flame NewCo could maintain leverage
below 4x over the coming 12 months if the company can sustain
improved run-rate EBITDA with new contracts. The company's new
capital structure comprises of a $106 million term loan that
matures in June 2028 and carries an interest rate that has a cash
and payment-in-kind (PIK) component. Our debt calculations also
reflect about $54 million of finance and operating leases. We
believe the company's debt burden could increase over the next
couple of years as the term loan accrues PIK interest and it
continues to support its growth and new site investments with
incremental lease financing."
S&P said, "While Flame NewCo's business is smaller post-bankruptcy,
we expect profitability to improve as the renegotiated contracts
should better reflect the current high-cost operating environment.
Additionally, the contracts should provide more downside protection
during periods of low steel production through a new fixed-fee
component. As such, we see potential for a sustained improvement in
profitability over the coming 12 to 24 months, with EBITDA margins
to recovering toward 20% this year, compared to an average of 13.5%
since 2020 but still below historical levels of almost 30% in 2017.
In the years prior to bankruptcy, the company had been trying to
improve the profitability of some contracts that contributed to
five consecutive years of declining EBITDA and negative free cash
flow. However, the bankruptcy resulted in the company rejecting
customer contracts where both parties could not agree on contract
terms that met the company's new investment and return targets. The
company also divested its French and Belgian operations and shut
down its operations in Finland and the United Arab Emirates (UAE).
These sites and the loss of certain customer contracts, reflects
about $95 million of annual revenue, or more than 20% of 2022
revenue.
"We see a risk that these increasing capital requirements could
result in negative FOCF. We expect elevated capex needs over the
next couple of years as the company undertakes catch-up maintenance
at its existing sites and growth spending to acquire new
contracts." To replace ending and nonrenewing contracts, the
company is assessing opportunities with new and existing customers
in the U.S., Brazil, and South Africa that could generate EBITDA
margins over 25% and enhance the overall profitability of its
portfolio of contracts. The company is focusing on developing
business in copper, stainless steel, nickel, and other base metals
as part of its diversification strategy.
Flame NewCo's business is characterized by its exposure to the
cyclical steel industry, its limited size, and its high customer
concentration. Flame NewCo's top three customers account for
approximately 75% of revenue. Such a narrow operating profile makes
the company more vulnerable to contract renewal risk and steel
markets downturns. Flame NewCo is indirectly exposed to volatile
steel market conditions and competition from imports through
changes in production levels. The company should benefit from
decent earnings visibility with an average contract life of seven
years, further supported by the new fixed-fee component within its
contracts. However, the margin profile of contracts can decline
over the life of a contract as sites can require increasing
maintenance of equipment and machinery. S&P sees Flame NewCo as
having a capital-intensive business model, which requires
undertaking regular maintenance capital for equipment and machinery
to maintain the cost profile at its sites. Unanticipated outages,
maintenance expenses, or limited labor availability can lead to
margin erosion in addition to lower customer production at its
sites.
Declining profitability across its portfolio since 2018, followed
by significant cost inflation seen in 2022, particularly labor and
fuel costs, meant its contracts that were not able to absorb cost
increase and thus many became loss making. The company filed for
bankruptcy which enabled it to renegotiate these contracts. Going
forward, the remaining contracts have been structured with a
fixed-fee component and escalators that should support
profitability under the scenario of lower steel production.
S&P said, "The stable outlook reflects our expectation that the
sustainability of its capital structure depends on the performance
of its new contracts negotiated during bankruptcy and smaller debt
load. We anticipate that this could strengthen profitability and
cash flows and enable the company to begin undertaking investments
required to offset nonrenewing contracts and business.
"We could lower our ratings on Flame NewCo over the next 12 months
if it sustains negative FOCF that leads to deteriorating liquidity
and a view of increasing risk of a distressed restructuring. This
could occur if, despite the new contracts, the company is unable to
manage cost escalations or unable to replace contracts that are
ending or renewing, resulting in sustained cash burn.
"We could raise the rating on Flame NewCo if the company is able to
demonstrate a track record of improved profitability, signaling a
transition to sustainably generating positive or at least
break-even FOCF, while investing in new projects to sustain and
grow its business."
FRANCHISE GROUP: S&P Downgrades ICR to 'B', Outlook Negative
------------------------------------------------------------
S&P Global Ratings lowered its issuer-credit rating on Franchise
Group Inc. (FRG) to 'B' from 'B+'.
At the same time, S&P lowered the issue-level rating on the
company's second-lien term loan to 'CCC+' from 'B-'. S&P's 'B+'
rating on the company's first-lien term loan is unchanged.
The negative outlook reflects that S&P could lower its rating on
FRG over the next 12 months if operating performance faces more
pressure than forecast.
FRG recently completed its acquisition by a buyer group that
includes members of senior management and a consortium of lenders.
They are acquiring FRG in a take-private transaction.
S&P said, "We expect softening demand combined with elevated debt
post-acquisition to increase leverage. As a result of the
acquisition, FRG became a subsidiary of parent Freedom VCM Inc. It
was partially funded by debt taken on by Freedom that we include in
our leverage calculations and we now assess leverage at a group
level (including Freedom). Moreover, the company's performance in
the first half of 2023 has been lackluster, given continued
headwinds from consumer discretionary demand. We now expect group
leverage to be in the high-5x area for fiscal 2023 exceeding our
downside threshold of 5x.
"Second-quarter performance reflects continued weakness in the home
furnishing segment. FRG's revenues declined 5.1% in the second
quarter (ended July 1, 2023). This was largely driven by revenue
declines in the home furnishing segment, with a 26.2% decline at
Badcock and a 10.2% decline at American Freight. While the Pet
Supplies Plus segment, which is less discretionary, has had
positive momentum with 9.9% revenue growth in the second quarter,
it only constituted about 30% of revenue. We expect challenging
operating conditions will continue amid the high inflation
environment as consumers become more budget conscious and curb
discretionary spending.
"We forecast moderately positive free operating cash flow (FOCF).
As of July 1, FRG had $106 million balance sheet cash and $250
million available on its asset-based lending (ABL) facility. We
anticipate the recent redemption of all its outstanding preferred
shares and better working capital management should allow FRG to
build its balance sheet cash over the next 12 months and partially
reduce reliance on its ABL facility under potentially worsened
operating conditions. FRG's cash flow generation has modestly
improved, with roughly $9.3 million reported FOCF in the second
quarter, up from about $5.5 million in the first quarter. We
project the company will generate roughly $50 million this year
after accounting for capital spending of about $40 million.
"We expect that pro forma financial policy could be more aggressive
under new ownership as they dictate cash flow uses and could
prioritize shareholder returns. Furthermore, heightened competition
leads us to expect elevated risks for greater leverage volatility
not otherwise projected in our base-case forecast. We also view key
man risk as an important aspect of governance with CEO Brian Kahn
controlling Freedom and having the right to appoint a majority of
board members.
"FRG has yet to establish a sustained record for its business
strategies and financial policies. It has a history of expanding
rapidly through acquisitions, and we continue to view execution and
integration as key risks to the business. Inventory missteps at
American Freight resulted in underperformance at that segment.
Additionally, Badcock has faced double-digit percentage revenue
declines in the last four quarters. Though we view acquisitions a
part of FRG's growth strategy, they are mostly debt-funded, and
deleveraging has been slower than anticipated.
"The negative outlook reflects that we could lower our rating on
FRG over the next 12 months if its operating performance faces a
greater pressure than forecast."
S&P could lower its rating if:
-- Overall operating performance deteriorates further, including a
continuing decline in consumer demand; or
-- S&P Global Ratings-adjusted group leverage trending toward 6x;
and
-- The company is unable to generate material free cash flow.
S&P could raise the rating if the company:
-- Improves its overall operating performance; and
-- Sustains S&P Global Ratings-adjusted group leverage of less
than 5x.
GALLERIA 2425: Unsecureds to Get $200K per Quarter for 11 Quarters
------------------------------------------------------------------
Galleria 2425 Owner, LLC, filed with the U.S. Bankruptcy Court for
the Western District of Texas a Disclosure Statement in support of
Chapter 11 Plan of Reorganization dated October 3, 2023.
The Debtor is a Texas limited liability company founded in 2018.
The Debtor's primary asset is a Class A office building located at
2425 West Loop South, Houston, Texas 77027(the "Property").
As of the Petition Date, the Debtor was allegedly indebted to
National Bank of Kuwait, S.A.K.P., New York Branch ("NBK") pursuant
to a loan made to the Debtor by NBK (the "Loan"). The Loan is
evidenced by, inter alia: (i) a Loan Agreement by and between the
Debtor and NBK dated May 23, 2018; (ii) a Promissory Note dated May
23, 2018 made by the Debtor; and (iii) that certain Deed of Trust,
Assignment of Leases and Rents and Profits, Security Agreement and
Fixture Filing dated May 23, 2018 by and between the Debtor and
NBK; and (iv) a 2022 settlement agreement between the parties
(collectively, the "Loan Documents").
The Debtor filed for bankruptcy protection under Chapter 11 in
order to protect and preserve the Property and its ability to pay
creditors by enabling it to reorganize and restructure its
financial affairs to fund operations and payments to creditors. In
order to satisfy the Lender's and other creditors' claims, the
Debtor may market the Property for sale to a third party or seek
refinancing of Lender's claim from other lenders. The Debtor will
continue to manage and operate the Property until any potential
refinancing or sale is closed.
Generally speaking, the Plan provides for the payment to Claims
against the Debtor. Allowed Interests of the Equity Interest
Holders will be cancelled and terminated on the Effective Date, and
equity will be reissued to the new equity holder based on a $2.5
million contribution of new equity to fund the Plan.
The funds to be used for the payment of Allowed Claims or other
Distributions to be made under the Plan will come from the income
generated from the Property, the new equity contribution, plus any
other available funds or property that the Reorganized Debtor may
otherwise possess on or after the Effective Date, including,
without limitation, any such funds or property which may be
provided through additional capital contributions and the proceeds
of any sale, refinancing, or other disposition of the Debtor's
Assets.
Class 6 consists of the Holders of Unsecured Claims for Property
Repair and Maintenance. Allowed Unsecured Claims arising from the
provision of repair or maintenance services to the Property shall
be paid 100% of the Allowed amount without interest in 8
consecutive equal quarterly payments. The first quarterly payment
will be due and payable on the first Business Day of the first
calendar quarter that is more than 30 days after the Effective Date
and on the first Business Day of each respective calendar quarter
thereafter. Class 6 Claims are impaired by the Plan.
Class 7 consists of General Unsecured Claims. Allowed General
Unsecured Claims that are not Class 6 Claims shall receive a pro
rata share of 11 equal quarterly payments, each in the amount of
$200,000, the first payment of which will be due and payable on the
last Business Day of the first calendar quarter following the 24th
month after the Effective Date and on the last Business Day of each
respective calendar quarter thereafter. Class 7 Claims are impaired
by the Plan and are deemed to reject the Plan.
Class 8 consists of Equity Interest Holders. The Class 7 Allowed
Interests of the Equity Interest Holders shall be cancelled and
terminated on the Effective Date. Equity will be reissued to the
new equity holder based on a $2.5 million contribution of new
equity. The equity contribution is being made by an affiliated
investor. Class 8 Interests are impaired by the Plan and are deemed
to reject the Plan.
The funds used for the repayment of Claims or other Distributions
to be made under the Plan will come from the income generated from
the Property, the new equity contribution, plus any other available
funds or property that the Reorganized Debtor may otherwise possess
on or after the Effective Date, including, without limitation, any
such funds or property which may be provided through additional
capital contributions, and the proceeds of any sale, refinancing,
or other disposition of the Debtor's Assets.
Under the Plan, Administrative, Secured Claims, and Priority Tax
Claims are paid in full and Unsecured Creditors will receive more
than $2.3 million in distributions, rendering the Plan far better
than a Chapter 7 liquidation.
A full-text copy of the Disclosure Statement dated October 3, 2023
is available at https://urlcurt.com/u?l=cmpGFy from
PacerMonitor.com at no charge.
Counsel for the Debtor:
Melissa S. Hayward, Esq.
Hayward PLLC
10501 North Central Expy., Suite 106
Dallas, TX 75231
Telephone: (972) 755-7100
Email: mhayward@haywardfirm.com
About Galleria 2425 Owner
Galleria 2425 Owner, LLC, is a single asset real estate as defined
in 11 U.S.C. Section 101(51B).
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Texas Case No. 23-60036) on July 5,
2023. In the petition signed by Dward Darjean, manager, the Debtor
disclosed up to $50 million in assets and up to $100 million in
liabilities.
Judge Christopher M. Lopez oversees the case.
Melissa S. Hayward, Esq., at Hayward PLLC, is the Debtor's legal
counsel.
GENERAL PEST: Seeks Cash Collateral Access
------------------------------------------
General Pest Solutions, LLC asks the U.S. Bankruptcy Court for the
District of South Carolina for authority to use cash collateral and
provide adequate protection.
Prior to filing the Chapter 11 case, the Debtor obtained funds from
the following:
a. On November 29, 2018, from On Deck Capital, Inc. in the amount
of $30,000 and pledged accounts receivable and other intangibles as
collateral for the loan.
b. On January 17, 2020, from Loan Builder in the amount of $66,000
and pledged accounts receivable and other intangibles as collateral
for the loan on October 1, 2021.
c. On June 23, 2022, from White Road Capital LLC in the amount of
$34,562 and pledged accounts receivable and other intangibles as
collateral for the loan on June 23, 2022.
d. On September 6, 2023, from Stripe Capital Program in the amount
of $19,993 and pledged accounts receivable and other intangibles as
collateral for the loan.
On July 19, 2023, the Debtor entered into a Settlement Agreement
with On Deck Capital, Inc., which stated the amount due and owing
as $47,170, but established a settlement amount of $28,302 if paid
before June 28, 2025.
The Debtor contends that the accounts receivable and intangibles
securing the obligation owed to On Deck Capital, Inc. were $10,310
as of the date of the Petition and that those receivables and
intangibles constitute cash collateral as defined by section
363(a).
The Debtor contends that the accounts receivable and intangibles
securing the obligations owed to Loan Builder, Stripe Capital, and
White Road Capital LLC had no value as of the date of the Petition
as those liens were exhausted by the senior the lien held by On
Deck Capital, Inc. None of those junior liens were properly
perfected.
As adequate protection, On Deck will be granted a replacement lien
on its postpetition accounts receivable and intangibles in an
amount equal to its established secured claim.
A hearing on the matter is set for October 19, 2023 at 2 p.m.
A copy of the motion is available at https://urlcurt.com/u?l=iqLOew
from PacerMonitor.com.
About General Pest Solutions, LLC
General Pest Solutions, LLC sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. D. S.C. Case No. 23-02944) on
September 28, 2023. In the petition signed by Manuel Alberto Cora,
president, the Debtor disclosed up to $50,000 in assets and up to
$500,000 in liabilities.
Richard A Steadman, Jr., Esq., at Steadman Law Firm, P.A.,
represents the Debtor as legal counsel.
GENERATION BRIDGE: S&P Assigns 'BB' Rating on Term Loan B
---------------------------------------------------------
S&P Global Ratings assigned its 'BB' rating and '1' recovery rating
to the term loan B (TLB). The '1' recovery rating indicates the
expectation of very high recovery in an event of default.
Generation Bridge Northeast LLC (GBNE or the project) used the
proceeds from the issuance to fund a distribution to ArcLight
Capital Partners LLC (ArcLight or the sponsor) ($508 million),
fully repay the debt at Generation Bridge II LLC (GBII) ($334
million), and pay transaction costs associated with the issuance.
S&P said, "Based on our view of the project's competitive
potential, as well as projections of market-driven variables such
as energy and capacity pricing across NYISO and ISONE, we forecast
a minimum debt service coverage ratio (DSCR) of about 2.37x through
the forecast period (2023-2044).
"The stable outlook reflects our expectation of steady operations
and sufficient cash flow generation through the TLB period and
beyond to service the project's debt service obligations."
ArcLight Capital Partners LLC (ArcLight or the sponsor) has
consolidated its two portfolio companies, Generation Bridge LLC
(GB1) and Generation Bridge II LLC (GBII), into a single entity,
Generation Bridge Northeast LLC (GBNE or the project).
GBNE owns a portfolio of eight assets with a total net capacity of
about 5.1 GW across NYISO Zone J (Arthur Kill [873 MW]), NYISO ROS
(Bethlehem [877 MW], and Oswego [1,635 MW]); and ISONE (Bridgeport
[500 MW], New Haven Steam [437 MW], Montville [486 MW], CT Jets
[169 MW], and Devon [166 MW]). The project is wholly owned by
affiliates of ArcLight, and managed by Eastern Generation.
S&P's 'BB' rating reflects the project's portfolio nature,
ownership of competitive and performing CCGTs, and a relatively
conservative debt quantum. Following the consolidation of its two
separate portfolio projects, GB1 and GBII, ArcLight has raised $965
million in senior secured financing at GBNE (the consolidated
entity). The financing includes $865 million in TLB, proceeds of
which were used to pay a distribution ($508 million) to ArcLight,
repay the entire debt ($334 million) at GBII, and pay
transaction-related costs. The project, or GBNE, also secured
access to a $50 million TLC and a $50 million RCF. The TLB, priced
at 4.5%, and has a six-year term, maturing Aug. 22, 2029.
Prior to this financing, ArcLight also repaid the entire debt ($428
million) at GB1 from the asset sale proceeds of one of the
facilities in the GB1 portfolio.
The 'BB' rating on the senior secured TLB reflects the combination
of strengths (diversification advantage, cash flow visibility over
the next few years, inclusion of high-performing CCGTs) as well as
relatively conservative debt sizing ($170/kW), which S&P expects
will result in robust DSCRs over our forecast period. The project's
high reliance on capacity-related cash flows, as well as exposure
to decarbonization due to the inefficient nature of most of its
assets, offsets these strengths.
S&P said, "The stable outlook reflects our view that GBNE's
operational and financial performance will remain aligned with
expectations and the portfolio will generate sufficient cash flows
through its life to pay debt service obligations. Under our
base-case scenario, we forecast a minimum DSCR of about 2.4x during
the total debt life (2023-2044), which includes a hypothetical
refinancing scenario beyond the TLB maturity.
"We would consider a negative rating action if the project's
performance and cash sweeps were weaker than we expected, leading
to weaker-than-anticipated DSCRs, or TLB balance outstanding at
maturity materially exceeding our estimates. This could occur if
the assets in the project portfolio experience operational or
financial difficulties, triggered by events such as extended
outages, higher-than-expected operating or capital expenses, and/or
weaker-than-expected energy margins and capacity pricing in NYISO
and ISONE. We could also consider a negative rating action if the
TLB repayment was slower than anticipated due to GBNE's lenders
declining mandatory prepayments, to the extent unmitigated by
improved project economics. At the current rating, we expect GBNE's
DSCRs over our forecast period (2023-2044) will remain above
2.25x.
"Given the age and peaking nature of most of the assets in GBNE's
portfolio, as well as our view of the inherent regulatory and
environmental risks associated with these facilities, we believe
that an upgrade is highly unlikely without significant
deleveraging. We could consider raising the rating if the project's
debt repayment well exceeded our projections, such that we
anticipate minimum DSCR of 3.5x through the remaining asset life."
GLOBAL MEDICAL: $1.98BB Bank Debt Trades at 31% Discount
--------------------------------------------------------
Participations in a syndicated loan under which Global Medical
Response Inc is a borrower were trading in the secondary market
around 68.8 cents-on-the-dollar during the week ended Friday,
October 6, 2023, according to Bloomberg's Evaluated Pricing service
data.
The $1.98 billion facility is a Term loan that is scheduled to
mature on October 2, 2025. About $1.94 billion of the loan is
withdrawn and outstanding.
Global Medical Response Inc and GMR Buyer Corp provide emergency
air medical services.
GOLDEN DEVELOPING: Files Emergency Bid to Use Cash Collateral
-------------------------------------------------------------
Orchard Trails, LLC asks the U.S. Bankruptcy Court for the Southern
District of Florida, Fort Lauderdale Division, for authority to use
cash collateral nunc pro tunc to petition date and for an
additional 9 days.
The Debtor requires the use of cash collateral to, among other
things, fund all necessary operating expenses of the Debtor's
business as well as pay for regular and ordinary expenses of the
Debtor.
On January 9, 2023, the Debtor executed a Credit Application and
Agreement with AmerisourceBergen Drug Corporation. The Credit
Application granted ABDC a blanket lien and security interest on
substantially all of the Debtor's assets.
The Debtor proposes to maintain its payments to the Creditor in
accordance with the loan documents.
The use of cash collateral will enable the Debtor to (1) continue
the orderly operation of its business and avoid an immediate
shutdown of operations; (2) meet its obligations for necessary
ordinary course expenditures and other operating and personal
expenses; and (3) make such payments as may be authorized or
required under other orders entered by this Court, thereby avoiding
immediate and irreparable harm to the Debtor's estate.
A copy of the motion is available at https://urlcurt.com/u?l=yggEQs
from PacerMonitor.com.
About Golden Developing
Golden Developing Business Solutions, Inc. is a health and wellness
focused holding company that owns several businesses, all of which
are centered in the pharmacy business sector. It is based in Fort
Lauderdale, Fla.
Golden Developing Business Solutions filed a petition under Chapter
11, Subchapter V of the Bankruptcy Code (Bankr. S.D. Fla. Case No.
23-14893) on June 22, 2023, with $7,798,584 in assets and
$7,631,425 in liabilities. Stavros Triant, chief executive officer,
signed the petition.
Judge Scott M. Grossman oversees the case.
David L. Merrill, Esq., at The Associates is the Debtor's legal
counsel.
GOLDEN KEY: Unsecureds Will Get 100% of Claims in Plan
------------------------------------------------------
Golden Key Group, LLC, filed with the U.S. Bankruptcy Court for the
District of Maryland a Disclosure Statement for Plan of
Reorganization dated October 2, 2023.
The Debtor, established in 2002, organized under the laws of the
State of Delaware and headquartered in Reston, Virginia, is a
professional services firm dedicated to helping its federal and
commercial clients solve strategic, organizational, and operational
challenges, to prepare them to address their future needs.
The Debtor is a Delaware limited liability company whose members
are Gretchen L. McCracken (52.475248%), Bruce M. Tarpinian
(21.782178%) and Valerie H. Langstaff (25.742574%). The affairs of
the Debtor are carried out by Gretchen McCracken, its Chief
Executive Officer (CEO) and managing member.
Throughout the bankruptcy process, the Debtor has provided monthly
income and expense projections and has consistently over performed.
Debtor has utilized its post-petition success and monthly
projections as a reliable basis for developing the future annual
projections.
The Debtor asserts that the Plan offers an opportunity to end years
of litigation and impose common sense and responsible financial
management of the Debtor. The Debtor believes that use of
litigation as a solution to its financial, management and Plan
responsibilities should be a last resort. The Debtor will seek to
resolve Claims in good faith and proceed with formal objections
where necessary. The Debtor and its Professionals anticipate that
the Plan is feasible, and that the Debtor's reorganization is not
likely to be followed by any additional reorganization or
liquidation proceedings.
Based on the Debtor's Schedules and an initial review of the filed
Proofs of Claim, the estimated General Unsecured Claims total
approximately $1,616,676.24, exclusive of the COMTek Judgment. The
Debtor is reviewing these Claims and is evaluating the need to seek
Court disallowance of any Claims that it believes are not accurate.
Class 2 consists of the Unsecured Convenience Claims consisting of
those Allowed General Unsecured Claims in amounts equal to or less
than $25,000.00. In full and complete satisfaction, discharge and
release of the Class 2 Claims, the Debtor shall pay each Holder of
a Class 2 Claim 100% of its Allowed Claim, without interest, in
consecutive equal monthly installments, with the potential for a
quarterly additional payment of excess cash, commencing the month
immediately following Administrative Expense Claims being Paid in
Full. Payments will be made on a pro rata basis pari passu with
Classes 3 and 4. Class 2 is Unimpaired.
Class 8 consists of the Claims of General Unsecured Creditors. In
full and complete satisfaction, discharge and release of the Class
8 Claims, the Debtor shall pay each Holder of a Class 8 Claim 100%
of its Allowed Claim, without interest, in consecutive equal
monthly installments, with the potential for a quarterly additional
payment of excess cash, commencing in the month immediately
following Class 7 being Paid in Full. Payments will be made on a
pro rata basis pari passu with Class 9. Class 8 is Unimpaired.
Class 9 consists of the Disputed General Unsecured Judgment Claim
held by COMTek on account of a judgment entered in the Circuit
Court of Fairfax County, 19th Judicial Circuit of Virginia. In full
and complete satisfaction, discharge and release of the Class 9
Claim, the Debtor shall pay Class 9 100% of its Allowed General
Unsecured Claim, without interest, in consecutive equal monthly
installments, with the potential for a quarterly additional payment
of excess cash, commencing in the month immediately following Class
7 being Paid in Full. Payments will be made on a pro rata basis
pari passu with Class 8. Payments to Class 9 will not begin unless
and until the Claim is Allowed by Final Order and, if payments are
scheduled to begin prior to the Claim becoming an Allowed Claim,
the Debtor will deposit funds pursuant to the Disputed Claims
Reserve. Class 9 is Unimpaired.
Class 10 consists of all Allowed Interests in the Debtor. On or
after the Effective Date, Equity Interests in the Debtor shall be
extinguished, and Holders thereof shall not receive any
Distribution with respect to their Interest held in the Debtor.
Ownership in the Reorganized Debtor shall be held solely by
Gretchen McCracken. Gretchen McCracken will contribute New Value in
exchange for 100% of the equity ownership Interests in the
Reorganized Debtor by accepting a reduced salary and market
compensation for the first 12 months of the Plan which is in
addition to the salary reduction in the period prior to the filing
of the bankruptcy petition.
Based on an HR Benchmark survey, Debtor estimates that Gretchen L.
McCracken has indirectly contributed to the Debtor, more than
$650,000 in foregone compensation and benefits since the Debtor
filed the bankruptcy petition. The Debtor projects that the amount
of New Value being contributed by Gretchen McCracken is
approximately $1.3M in value.
The Plan will be funded from five sources: (1) Cash on hand on the
Effective Date, (2) recoveries from the pursuit of any claims,
rights, or other legal remedies the Debtor has or may have in the
future income derived from its operations, (3) additional principal
advanced by A/R Funding on the DIP Financing Agreement, (4) tax
refunds and/or tax credits which the Debtor is owed for any pre- or
post-petition period, and (5) available Cash from ongoing
operations. In addition, the New Value contribution by Gretchen
McCracken will further supplement the Plan funding. The Debtor
reserves the right to use funds from other sources not contemplated
herein to fund the Plan, and/or vary the proportions of funds from
these or such other sources, provided the intent and purposes of
the Plan are adequately addressed.
The Plan contemplates funding, from the on-going continued
operations of the Reorganized Debtor that will produce net positive
Cash receipts after taking into account regular Cash disbursements
made in the normal course of business of the Reorganized Debtor,
but before taking into account payments contemplated by the Plan.
A full-text copy of the Disclosure Statement dated October 2, 2023
is available at https://urlcurt.com/u?l=z5byvo from
PacerMonitor.com at no charge.
Counsel for Debtor:
Paul Sweeney, Esq.
YVS Law, LLC
11825 West Market Place, 2nd Floor
Fulton, MD 20759
Tel: 410-571-2780
Fax: 410-571-2798
Email: psweeney@yvslaw.com
About Golden Key Group
Golden Key Group, LLC, is a professional services firm dedicated to
helping federal and commercial clients solve today's strategic,
organizational and operational challenges while addressing their
future needs. Founded in 2002, Golden Key Group's solution
offerings include Human Capital Management Support, Human Resources
Operations, Employee Training and Leadership Development,
Professional Consulting Services, Program Management Office,
Acquisition and Category Management, Analytics and Information
Technology, Executive Search Services, and Select Solutions.
The Debtor sought protection under U.S. Bankruptcy Code (Bankr. D.
Md. Case No. 23-10414) on Jan. 20, 2023. In the petition signed by
Gretchen McCracken as CEO and managing member, the Debtor disclosed
up to $10 million in assets and up to $50 million in liabilities.
Judge Maria Elena Chavez-Ruark oversees the case.
Paul Sweeney, Esq., at Yumkas, Vidmar, Sweeney and Mulrenin, LLC,
is the Debtor's legal counsel.
GOPHER RESOURCE: $510MM Bank Debt Trades at 16% Discount
--------------------------------------------------------
Participations in a syndicated loan under which Gopher Resource LLC
is a borrower were trading in the secondary market around 84.0
cents-on-the-dollar during the week ended Friday, October 6, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $510 million facility is a Term loan that is scheduled to
mature on March 6, 2025. About $464.1 million of the loan is
withdrawn and outstanding.
Gopher Resource, LLC offers lead, plastic, and household waste
recycling services. Gopher Resource serves customers in North
America.
GRAND RIVER HOSPITAL: S&P Affirms 'BB+' Rating on 2018 GO Bonds
---------------------------------------------------------------
S&P Global Ratings revised its outlook to stable from negative and
affirmed its 'BB+' long-term rating and underlying rating (SPUR) on
Grand River Hospital District (GRHD), Colo.'s series 2018 general
obligation (GO) bonds.
"The outlook revision reflects our view that operations have
materially stabilized with further improvement expected due to
increased revenues and better expense management as well as strong
support from tax revenue," said S&P Global Ratings credit analyst
Blake Fundingsland. "In addition, the outlook revision reflects the
district's solid balance sheet and debt profile, with bonds that
are paid by separate tax revenue," Mr. Fundingsland added.
The bonds are secured by the district's full faith and credit and
are payable from the proceeds of an ad valorem property tax.
The 'BB+' rating reflects our view that GRHD operates in a highly
limited, rural service area with a narrow revenue base, which has
been susceptible to volume fluctuations. In addition, the
surrounding area, and therefore taxes used for operations, is
heavily reliant on the oil and gas industry, which has seen
volatility in recent years. However, there has been great growth in
tax revenue, which is expected to continue into fiscal 2024. The
rating incorporates a negative adjustment reflecting GRHD's small
operating revenue base, which remains below $150 million, which we
believe could expose GRHD to additional volume-fluctuation
pressures. Fiscal 2022 saw some improvement in volumes after more
than doubling the number of beds in the hospital in the recent
expansion project, but the staffing expenses remained elevated,
offsetting some of the benefit of increasing volumes.
The stable outlook reflects our view of improvement in operations
through increasing revenues, including the receipt of higher levels
of operating taxes, which are expected to continue given the latest
information available form assessors. The stable outlook also
reflects the expectation that unrestricted reserves will stabilize
with growth expected in DCOH as cash flow improves. Finally, the
stable outlook reflects the expectations that improving volume
trends will continue as GRHD recruits and appropriately staffs the
expanded hospital.
HART INC: Caroline Djang Named Subchapter V Trustee
---------------------------------------------------
The U.S. Trustee for Region 16 appointed Caroline Djang as
Subchapter V trustee for Hart, Inc.
Ms. Djang will be paid an hourly fee of $595 for her services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred. The compensation for her trustee administrator,
Laurie Verstegen, is $270 per hour.
Ms. Djang declared that she is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Caroline Djang
18400 Von Karman Ave., Suite 800
Irvine, CA 92612
Phone: (949) 263-6586
Email: cdjang@buchalter.com
About Hart Inc.
Hart, Inc., founded in 2012 in Orange County, Calif., was created
to enhance the healthcare system through the use of state
of-the-art data management software. It designed a platform that
seamlessly integrates all data sources into a unified source of
reliable, up-to-the-minute information.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. C.D. Calif. Case No. 23-11937) on Sept. 21,
2023, with $1,667,728 in assets and $21,510,861 in liabilities.
Dominique Gross, chief executive officer, signed the petition.
Judge Scott C. Clarkson oversees the case.
Zev Shechtman, Esq., at Danning, Gill, Israel & Krasnoff, LLP
represents the Debtor as legal counsel.
HERITAGE SPECIALTY: Seeks Cash Collateral Access
------------------------------------------------
Heritage Specialty Foods, LLC asks the U.S. Bankruptcy Court for
the District of Oregon for authority to continue using cash
collateral to pay the Debtor's necessary operating expenses
including Chapter 11 administrative expenses, through the effective
date of a confirmed plan.
Although the Final Cash Collateral Order expires on October 29,
2023, the Court's hearing on confirmation of the Plan will not be
held until November 29, 2023. The Debtor has successfully operated
as a Chapter 11 debtor in possession and requires continued use of
cash collateral to maintain its operations through the plan
confirmation process.
Although the Debtor's post-petition financial activity does not
rigidly match the Current Budget (indeed, no operating business is
likely to march in lockstep with financial projections), the
Debtor's post-petition operations -- as a general matter -- have
proceeded according to plan. Some large customers experienced
delayed launch dates, which pushed the company's production more
towards the end of the year than projected, but the Debtor has
retained all customers except one (which terminated a contract for
reasons entirely unrelated to Debtor's performance) and its
projected sales during the post-petition period remain
substantially on target.
The Debtor's financial position and performance since the Petition
Date illustrates that Commerce Bank is adequately protected through
replacement liens, cash payments, and improving collateral value.
The Final Cash Collateral Order provides adequate protection to
Commerce Bank via a replacement lien and interest-only payments. To
date, the Debtor has made the required adequate protection payments
and it will continue to do so.
The Debtor proposes continued use of cash collateral on the same
terms contained in the Final Cash Collateral Order.
A hearing on the matter is set for October 24, 2023 at 10 a.m.
A copy of the motion is available at https://urlcurt.com/u?l=Uov53O
from PacerMonitor.com.
About Heritage Specialty Foods, LLC
Heritage Specialty Foods, LLC is a family-owned manufacturer of
small-batch, kettle-cooked foods made from high-quality fresh
ingredients. The company specializes in ready-to-eat products
including soups, chilis, chowders, entrees, sauces, and marinades.
The company's primary sales channels are local and regional retail
markets, club stores, and foodservice outlets.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Ore. Case No. 23-31368-pcm11) on June
23, 2023. In the petition signed by Shane Hendren, president and
chief executive officer, the Debtor disclosed up to $10 million in
both assets and liabilities.
Stephen Raher, Esq., at Leonard Law Group LLC, represents the
Debtor as legal counsel.
HOT'Z POWER: Amends IRS Secured Claim Pay Details
-------------------------------------------------
Hot'z Power Wash, Inc., submitted a Fifth Amended Plan of
Reorganization for Small Business dated October 2, 2023.
This Plan of Reorganization proposes to pay Debtor's creditors from
the cash flow generated in the ordinary course of the Debtor's
business after confirmation.
Class 2 consists of the Secured Claim of the Internal Revenue
Service. Hotz will pay $12,975.15 to Class 2 by no later than
October 1, 2026. The claim will be paid in approximately equal
monthly installments at 7% interest compounded daily [Amended Claim
4]. Interest will be calculated and paid in accordance with the
Bankruptcy Code's requirements.
Class 3 consists of all other non-priority unsecured claims allowed
under Section 502 of the Code. The aggregate amount of Class 3
claims is approximately $790,914.92. Hotz will pay the projected
disposable income for 36 months following the Effective Date to
creditors in this class with allowed claims in the amount set forth
on the projections with this plan. The payments to unsecured
creditors will be escrowed by the Subpart V Trustee or the Debtor
and paid on at least a calendar quarterly basis.
The equity holders will retain the interest in the Debtor.
The Debtor will retain the property of the bankruptcy estate. The
officers and directors of the Debtor are anticipated to remain the
same after the Effective Date. James Finney will continue as the
sole director and officer of the Debtor after confirmation.
A full-text copy of the Fifth Amended Plan dated October 2, 2023 is
available at https://urlcurt.com/u?l=G58BVy from PacerMonitor.com
at no charge.
Attorney for the Debtor:
Reese W. Baker, Esq.
Baker & Associates
950 Echo Lane, Ste. 300
Houston, TX 770024
Telephone: (713) 869-9200
Facsimile: (713) 869-9100
Email: courtdocs@bakerassociates.net
About Hot'z Power Wash
Hot'z Power Wash, Inc., is a pressure washing company that
specializes in restaurant kitchen exhaust systems. The company has
been in business for over 10 years.
Hot'z Power Wash sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Texas Case No. 23-30749) on March 5,
2023, with up to $100,000 in both assets and liabilities. James
Finney, president of Hot'z Power Wash, signed the petition.
Judge Eduardo V. Rodriguez oversees the case.
The Debtor tapped Reese Baker, Esq., at Baker & Associates as legal
counsel, and Elna Tax Services, Inc., as accountant.
ICAP ENTERPRISES: Seeks $6.75MM DIP Loan from Serene Investment
---------------------------------------------------------------
iCap Enterprises, Inc. and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Eastern District of Washington for
authority to use cash collateral and obtain postpetition secured
financing pursuant to the Debtor-In-Possession Loan and Security
Agreement dated as of October 3, 2023, with Serene Investment
Management, LLC as lender.
The Debtors seek to obtain postpetition loans, advances and other
financial accommodations in an aggregate principal amount not to
exceed $5.250 million. The DIP loan commitment is raised to $6.750
million in the event the DIP Lender is granted a priming lien on
the collateral in which VH Willows Townhomes LLC, and its
affiliated entities assert an interest.
The Debtors will borrow, on an interim basis, postpetition
financing in an aggregate principal amount of up to $2.5 million,
consisting of (a) up to $2 million in new money loans and (b)
rolled-up loans under a Promissory Note with Debtors 725 Broadway,
LLC and ICAP Campbell Way, LLC dated September 13, 2023 in an
aggregate amount of $500,000 in principal plus accrued interest
thereon through the Petition Date.
The principal amount outstanding under the DIP Loan Facility will
accrue interest at a per annum rate equal to 18%.
The DIP facility is due and payable through the earliest to occur
of:
(i) The date that is 12 months after the Interim Order Entry
Date;
(ii) The effective date of the Loan Parties' chapter 11 plan;
(iii) Entry of an order by the Bankruptcy Court converting any
Case to a proceeding or proceedings under Chapter 7 of the
Bankruptcy Code;
(iv) Entry of a final order by the Bankruptcy Court dismissing
any Case;
(v) The date of filing or support by a Loan Party of a plan of
reorganization that does not provide for indefeasible payment in
full in cash of all Obligations owing hereunder; or
(vi) The date of termination of the DIP Loan Commitments and
the acceleration of any outstanding extensions of credit under the
Loan in accordance with the terms of the Agreement.
The Debtors do not have sufficient available sources of working
capital, including cash collateral, to pay administrative expenses
and conclude a sale of their assets without the financing.
Debtors 725 Broadway, LLC and ICAP Campbell Way, LLC are parties to
a promissory note for $500,000, dated September 13, 2023. The
proceeds were used to pay course expenses and prepare for
bankruptcy. The note is secured by a Deed of Trust, Assignment of
Leases and Rents, Security Agreement, and Fixture Filing, with
Chicago Title Company as the trustee. The total outstanding balance
as of the petition date was $500,000, plus accrued interest, costs,
fees, and expenses.
Various of the SPE Debtors and their real estate properties are
subject to deeds of trust for mortgages and other secured debt
arising from the acquisition, development, or ownership of real
property.
The Prepetition Mortgage Lenders are VH Willows Townhomes LLC, VH
1121 14th LLC, VH Senior Care LLC, VH Pioneer Village LLC, and VH
2nd Street Office LLC.
As adequate protection of the interests of the Prepetition Mortgage
Lenders in their respective Prepetition Collateral to the extent of
any Diminution in value of that Prepetition Collateral, the Debtors
will grant to the Prepetition Mortgage Lenders continuing, valid,
binding, enforceable and perfected security interests and liens on
such Prepetition Mortgage Lender's respective Prepetition
Collateral. The Adequate Protection Liens and the Liens of the
Prepetition Mortgage Lenders on their respective Prepetition
Collateral will be senior in priority to all other interests and
liens.
As additional adequate protection, the Debtors will pay the
Prepetition Mortgage Lenders interest payments at the contract rate
as required under any applicable agreement.
A copy of the motion is available at https://urlcurt.com/u?l=KTd2gE
from PacerMonitor.com.
About iCap Enterprises, Inc.
iCap Enterprises, Inc. and affiliaters were founded in 2007 by
Chris Christensen to invest in real estate opportunities in the
Pacific Northwest. iCap Enterprises et al. grew quickly, raising
more than $211 million in capital and deploying those funds toward
real estate investments.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. Wash. Lead Case No. 23-01243) on
September 29, 2023. In the petition signed by Lance Miller, chief
restructuring officer, iCap Enterprises disclosed up to $100
million in assets and up to $500 million in liabilities.
The Debtors tapped Buchalter, A Professional Corporation as
counsel, Paladin Management Group, LLC as restructuring financial
advisor, BMC Group Inc. as claims noticing agent and administrative
advisor.
IDEAL PROTEIN: Chapter 15 Case Summary
--------------------------------------
Four affiliates that concurrently filed voluntary petitions for
relief under Chapter 15 of the Bankruptcy Code:
Debtor Case No.
------ --------
Ideal Protein of America Inc. (Lead Case) 23-18159
120 NE 5th Avenue, Suite B
Delray Beach FL 33483
United States of America
9327-6369 Quebec Inc. 23-18160
Laboratoires C.O.P. Inc. 23-18161
Pharmalab Inc. 23-18162
Business Description: Ideal Protein provides weight loss and
wellness solutions.
Chapter 15 Petition Date: October 5, 2023
Court: United States Bankruptcy Court
Southern District of Florida
Foreign Proceeding: In the Matter of the Proposed Plan of
Compromise or Arrangement of
Laboratoires C.O.P. Inc.
Foreign Representative: Ernst & Young Inc.
Martin P. Rosenthal (authorized
representative)
2875 Boul. Laurier, Bureau 410
Quebec, Quebec G1V 0C7
Canada
Foreign
Representative's
Counsel: Paul Steven Singerman, Esq.
BERGER SINGERMAN LLP
1450 Brickell Avenue, Suite 1900
Miami, FL 33131
Tel: (305) 755-9500
Email: singerman@bergersingerman.com
Estimated Assets: Unknown
Estimated Debt: Unknown
A full-text copy of the Lead Debtor's Chapter 15 petition is
available for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/MR4MJOQ/Ideal_Protein_of_America_Inc__flsbke-23-18159__0001.0.pdf?mcid=tGE4TAMA
INNOVATIVE GENOMICS: Court OKs Cash Collateral Access Thru Oct 21
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Florida,
Miami Division, authorized Innovative Genomics, LLC to use cash
collateral on an interim basis in accordance with the budget, with
a 10% variance, through October 21, 2023.
The Debtor requires the use of cash collateral to fund the orderly
continuation of its business, pay operating expenses, and
administer the Chapter 11 case.
As adequate protection for the Debtor's use of cash collateral,
Simmons Bank and U.S. Small Business Administration are each
granted a replacement lien to the same extent as any pre-petition
lien, pursuant to 11 U.S.C. Section 361(2) on the property set
forth in its security agreements, without any prejudice to any
rights of the Debtor to seek to void the lien as to the extent,
validity, or priority of said liens.
The Debtor will make a $5,000 payment before October 20, 2023 to
Simmons as adequate protection in respect of equipment upon which
Simmons asserts a lien. The Debtor and Simmons will continue to
discuss whether, and to what extent, additional adequate protection
is appropriate as to other assets secured by Simmons' liens.
A further hearing on the matter is set for October 26 at 11 a.m.
A copy of the order is available at https://urlcurt.com/u?l=LyUZta
from PacerMonitor.com.
About Innovative Genomics
Innovative Genomics, LLC owns and operates a medical and diagnostic
laboratory in Miami, Fla.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 23-16852) on Aug. 28,
2023, with $1 million to $10 million in both assets and
liabilities. Enrique Perez-Paris, president, signed the petition.
Judge Robert A. Mark oversees the case.
R. Scott Shuker, Esq., at Shuker & Dorris, P.A. represents the
Debtor as legal counsel.
INT'L LONGSHORE: Class 3A Unsecureds to Get Share of GUC Fund
-------------------------------------------------------------
The International Longshore and Warehouse Union (the "ILWU") filed
with the U.S. Bankruptcy Court for the Northern District of
California a Plan of Reorganization for Small Business dated
October 2, 2023.
The Debtor is a non-profit labor organization exempt from federal
income tax, with approximately 40,000 members in over 50 local
unions and affiliates.
To address its significant liabilities, the Debtor filed this
subchapter V case to restructure its operations and affairs, and
emerge as a stronger organization and labor union, to the benefit
of the Debtor's many thousands of union members. All creditors
with allowed administrative and priority claims against the Debtor
will be paid in full on the Effective Date or otherwise in the
ordinary course of business. The Debtor is unaware of any secured
claims against the Debtor.
Pursuant to the Plan, holders of Class 3A Claims (ICTSI Litigation)
will receive the GUC Fund ($6.1 million) on the effective date of
the Plan in full and final satisfaction of such claims. Holders of
Class 3B Claims (Non-ICTSI Litigation General Unsecured Claims)
will have their claims reinstated on the effective date of the Plan
and will be paid in full in the ordinary course of business from
the Debtor's working capital reserve. Class 3B Claims are not
subject to the discharge.
The Debtor's financial projections show that the Debtor will have
(a) projected disposable income of $733,000.00 and (b) an ending
cash balance for the period of $548,000.00, which is net of the GUC
Fund ($6.1 million) to be funded on the effective date of the
Plan.
This Plan of Reorganization proposes to pay creditors of
International Longshore & Warehouse Union from Debtor's available
cash, including, with respect to general unsecured creditors, as
soon as reasonably practicable after the Effective Date.
Class 3A consists solely of the ICTSI Litigation Claim. Holders of
allowed Class 3A Claims shall receive their pro rata share of the
GUC Fund as soon as reasonably practicable after the Effective Date
or, if later, after their Class 3A Claim is allowed. For the
avoidance of doubt, upon making the GUC Fund payments to the
applicable holders, all Class 3A Claims shall be discharged
pursuant to Section 1141 of the Bankruptcy Code. Holders of allowed
Class 3A Claims are impaired.
Class 3B consists of any allowed non-priority unsecured claims,
other than the ICTSI Litigation Claim. Notwithstanding Section 1141
of the Bankruptcy Code, the Debtor expressly waives the right to
any discharge of the Class 3B Claims. As a result, Class 3B Claims
will be reinstated on the Effective Date and are unimpaired.
Moreover, any pending litigation, other than the ICTSI Litigation,
will be permitted to continue on and after the Effective Date.
Holders of allowed Class 3B Claims are unimpaired.
All creditors with allowed administrative and priority claims
against the Debtor will be paid in full on the Effective Date or
otherwise in the ordinary course of business. The Debtor is unaware
of any secured claims against the Debtor. With respect to general
unsecured creditors, (1) the ICTSI will receive the proceeds of the
GUC Fund as soon as practicable after the Effective Date, and (2)
any allowed Class 3B Claim will be paid from the Debtor's working
capital reserve in the ordinary course of business. In all events,
distributions will be made up to the allowed amount of the
creditor's claim.
As of the Effective Date, the Debtor's current management will
continue in their management of the Debtor and administer the Plan,
including, without limitation, the filing of objections to claims,
making Plan payments and distributions pursuant to the Plan, and
otherwise carrying out the provisions of the Plan.
GUC Fund: $6.1 million in cash, to be funded from Debtor's
available cash on the Effective Date, and held in a segregated
account for the benefit of holders of allowed Class 3A Claims.
A full-text copy of the Plan of Reorganization dated October 2,
2023 is available at https://urlcurt.com/u?l=aSfAt3 from
PacerMonitor.com at no charge.
Debtor's Counsel:
Jason H. Rosell, Esq.
PACHULSKI STANG ZIEHL & JONES LLP
One Sansome Street, Suite 3430
San Francisco, CA 94104
Tel: 415-263-7000
Email: jrosell@pszjlaw.com
About The International Longshore and Warehouse Union
The International Longshore and Warehouse Union (ILWU) is an
international labor union that represents a wide range of workers
on the West Coast of the United States, in Hawaii, and in British
Columbia, Canada including dock workers, warehouse workers, tourism
and hospitality workers, agricultural workers, miners, and others.
The Debtor filed Chapter 11 Petition (Bankr. N.D. Cal. Case No.
23-30662) on Sept. 30, 2023, with $1 million to $10 million in
assets and liabilities. William E. Adams, president, signed the
petition. Jason H. Rosell, Esq. of PACHULSKI STANG ZIEHL & JONES
LLP, is the Debtor's legal counsel.
IQOR US INC: $300MM Bank Debt Trades at 29% Discount
----------------------------------------------------
Participations in a syndicated loan under which iQor US Inc is a
borrower were trading in the secondary market around 71.4
cents-on-the-dollar during the week ended Friday, October 6, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $300 million facility is a payment-in-kind Term loan that is
scheduled to mature on November 19, 2025. The amount is fully
drawn and outstanding.
iQor is a global provider of customer engagement and technology
enable business process outsourcing solutions. Solutions include
customer service, third-party collections and accounts receivable
management to world's largest brands. The company uses integrated
digital capabilities and proprietary technology and analytics to
enhance the customer experience lifecycle.
JKW ENTERPRISES: Case Summary & Five Unsecured Creditors
--------------------------------------------------------
Debtor: JKW Enterprises, LLC
f/k/a Kenwood Warehouse Co.
2055 North Towne Lane NE
Cedar Rapids, IA 52402
Chapter 11 Petition Date: October 6, 2023
Court: United States Bankruptcy Court
Northern District of Iowa
Case No.: 23-00797
Debtor's Counsel: Joseph A. Peiffer, Esq.
AG & BUSINESS LEGAL STRATEGIES
PO Box 11425
Cedar Rapids, IA 52410
Tel: 319-363-1641
Email: joe@ablsonline.com
Total Assets: $812,500
Total Liabilities: $1,953,892
The petition was signed by Charles Johnston as managing member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's five unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/4RFQNZQ/JKW_Enterprises_LLC__ianbke-23-00797__0001.0.pdf?mcid=tGE4TAMA
JL DANIELS: John Caraway Named Subchapter V Trustee
---------------------------------------------------
The U.S. Bankruptcy Administrator for the Northern District of
Alabama appointed John Caraway, Jr. as Subchapter V Trustee for JL
Daniels Group, LLC.
The Subchapter V trustee can be reached at:
John M. Caraway, Jr.
2107 5th Avenue North, Ste. 301
Birmingham, AL 35203
Telephone No. (205) 214-7942
Email: johncarawayecf@outlook.com
About JL Daniels
JL Daniels Group, LLC, a company in Birmingham, Ala., filed a
petition under Chapter 11, Subchapter V of the Bankruptcy Code
(Bankr. N.D. Ala. Case No. 23-02503) on Sept. 21, 2023, with $1
million to $10 million in both assets and liabilities. James L.
Daniels, president, signed the petition.
Jacquese Antoinette Gary, Esq., at Gary Law, LLC represents the
Debtor as bankruptcy counsel.
JLM COUTURE: Seeks Cash Collateral Access
-----------------------------------------
JLM Couture, Inc. asks the U.S. Bankruptcy Court for the District
of Delaware for authority to use cash collateral and provide
adequate protection.
The Debtor requires the use of cash collateral from the Petition
Date through October 31, 2023 to pay, inter alia, its landlord, its
vendors and contractors, and the salaries of its employees.
Prior to the Petition Date, the Debtor obtained a small business
loan with the United States Small Business Association dated as of
July 23, 2020, with an approximate balance of $150,000 as of the
Petition Date. The SBA Note is secured by liens on substantially
all assets of the Debtor.
To the extent the Debtor sells merchandise, the Debtor receives
income from proceeds of each sale. The Debtor does have cash in its
bank accounts from sales prior to the Petition Date, as well as
cash from loan proceeds. As of the Petition Date, the Debtor has
approximately $151,000 in cash on hand, located in various bank
accounts. The Debtor intends to use portions of this cash, to pay
operating expenses of its business and expenses related to the
administration of the chapter 11 case.
The Debtor further seek an order deeming the SBA adequately
protected for the Debtor's use of cash collateral due to the fact
the SBA is over-secured in the Property and other assets of the
Debtor, the Debtor proposes granting replacement liens in its
assets as they are replenished, and the Debtor proposes making
payments the SBA, to the extent practicable and permitted by the
Court.
A copy of the motion is available at https://urlcurt.com/u?l=KrF4kv
from PacerMonitor.com.
About JLM Couture
For 30 years, JLM Couture, Inc. has been a leader in the wedding
gown industry, known for its innovative designs and unparalleled
commitment to quality.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 23-11659) on October 2,
2023. In the petition signed by Joseph L. Murphy, president and
chief executive officer, the Debtor disclosed up to $10 million in
both assets and liabilities.
Kevin S. Mann, Esq., at Cross & Simon, LLC, represents the Debtor
as legal counsel.
JMWAYS LLC: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: JMWays LLC
d/b/a Skyline Chili
3505 Grant Line Rd.
New Albany, IN 47150
Business Description: JMWays owns a building located on leased
land having a current value of $1.2 million.
Chapter 11 Petition Date: October 6, 2023
Court: United States Bankruptcy Court
Southern District of Indiana
Case No.: 23-90970
Judge: Hon. Andrea K. Mccord
Debtor's Counsel: Weston E. Overturf, Esq.
KROGER, GARDIS & REGAS, LLP
111 Monument Circle
Suite 900
Indianapolis, IN 46204
Tel: 317-777-7443
Total Assets: $1,357,890
Total Liabilities: $1,545,419
The petition was signed by William Jacobs as managing partner.
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/46NACCI/JMWays_LLC_dba_Skyline_Chili__insbke-23-90970__0001.0.pdf?mcid=tGE4TAMA
JO-ANN STORES: $675MM Bank Debt Trades at 68% Discount
------------------------------------------------------
Participations in a syndicated loan under which Jo-Ann Stores LLC
is a borrower were trading in the secondary market around 32.1
cents-on-the-dollar during the week ended Friday, October 6, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $675 million facility is a Term loan that is scheduled to
mature on June 30, 2028. About $661.5 million of the loan is
withdrawn and outstanding.
Jo-Ann Stores, LLC retails fabric and craft products. The Company
offers apparel, home decorating fabrics, notions, seasonal
accessories, floral, and framing products.
LEARNING CURVE: Seeks Cash Collateral Access
--------------------------------------------
The Learning Curve Academy, LLC asks the U.S. Bankruptcy Court for
the Western District of Pennsylvania for authority to use cash
collateral to continue to operate its business.
There are three UCC Financing Statements filed with the State of
Pennsylvania with respect to the assets of the Debtor that have not
been terminated.
The three recorded UCC Financing Statements with respect to the
assets of the Debtor are as follows:
a) File Number 2019043000684 filed on April 30, 2019 by the U.S.
Small Business Administration, which purports to establish blanket
security interest on all lienable assets of the Debtor.
b) File Number 2020030400405 filed on March 4, 2020 by CHTD
Company. The Debtor's c ounsel believes that CHTD Company is an
agent for one of the Debtor's creditors but no actual creditor is
listed on the UCC Financing Statement and it is impossible to
determine which creditor this UCC Financing Statement refers to.
c) File Number 2020042800733 filed on April 27, 2020 by Bridgeway
Capital, Inc., which purports to establish blanket security
interest on all lienable assets of the Debtor.
Based on the above, the Debtor believes that, if valid and
perfected, The Huntington National Bank would have first position
on cash collateral of the Debtor.
The Huntington National Bank is owed approximately $450,000 by the
Debtor and further believes that the assets of the Debtor subject
to any valid security interest are over encumbered by the amount
due to the The Huntington National Bank.
A copy of the motion is available at https://urlcurt.com/u?l=7cemXt
from PacerMonitor.com.
About The Learning Curve Academy, LLC
The Learning Curve Academy, LLC does business as a
pre-school/daycare center in Western Pennsylvania.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Pa. Case No. 23-22067) on September
29, 2023. In the petition signed by Joanne L. Fenchak, member, the
Debtor disclosed $50,000 in total assets and $500,000 in total
liabilities.
Christopher M. Frye, Esq., at Steidl & Steinberg, P.C., represents
the Debtor as legal counsel.
LEHIGH VALLEY: Moody's Assigns Ba1 Rating on $8.4MM Revenue Bonds
-----------------------------------------------------------------
Moody's Investors Service has assigned an initial Ba1 rating to the
Lehigh County General Purpose Authority, PA's $8.4 million Charter
School Revenue Bonds (Lehigh Valley Dual Language Charter School),
Series 2023. The project is for the Lehigh Valley Dual Language
Charter School, Inc., PA. Following the sale, the school will have
approximately $8.4 million in outstanding revenue debt. A stable
outlook has also been assigned.
RATINGS RATIONALE
The Ba1 rating for the Lehigh Valley Dual Language Charter School
(LVDLCS) revenue bonds considers the school's solid liquidity
levels, healthy debt service coverage experienced management team
and the school's recent and historical charter renewal success.
Challenges embedded in the credit profile include narrow operating
flexibility due to the school's limited scale of operations;
enrollment is capped at 450 students and the waitlist is modest.
The ownership structure is also somewhat complex, as the school
owns its building through a condominium structure, and the
condominium board is an additional, unusual governance
consideration.
Governance is a key driver of the initial rating action, similar to
all of Moody's initial ratings. The school's foundation and
management team have a proven track record of delivering positive
financial and operational results. However, despite the school's
strong credit fundamentals and a demonstrated history of effective
governance and sound financial management, the rating acknowledges
key person risk. The school's founder also serves a key role on the
board and continues to assist in the management and operations of
the school.
RATING OUTLOOK
The stable outlook reflects Moody's expectation that the school's
strong governance, established operating history, and satisfactory
student retention will continue to support stable operations going
forward. The stable outlook also reflects expectations that the
school will maintain liquidity and coverage levels well above
covenant requirements.
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATING
- Significant growth in operations and enrollment
- Very strong demand, retention, and academic performance
- Significant strengthening of cash position
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATING
- Decline in cash position
- Reduced enrollment levels, weakened demand or retention
- Academic performance below the district average
- Changes in condominium ownership structure which weaken the
schools voting position on the condominium board, or weaken
its operational flexibility
LEGAL SECURITY
Bonds are secured by payments to be made by LVDLCS and pursuant to
the Loan Agreement to Lehigh County General Purpose Authority (the
issuer) and pursuant to the Trust Indenture with the Trustee, US
Bank Trust Company. Pledged revenues includes school district
payments and all revenues received from the charter contract.
The requirement of LVDLCS to make payments that secure debt service
are absolute and unconditional, payable from all legally available
sources. Additional security is derived by a first lien mortgage
estate, assignment of leases and rents. Base payments are due
monthly. Pursuant to the loan agreement, LVDLCS will fund at
closing a $100,000 repair and replacement fund, which moneys may be
used to pay the cost of improvements, replacements, repair, pay
principal and interest if school payments are insufficient.
Following any disbursement from the repair and replacement fund and
beginning at the start of the fiscal year following such
disbursement, the school is required to deposit monthly in equal
installments amounts that would replenish the repair and
replacement fund over a twenty-four (24) month period to the Repair
and Replacement Fund Requirement. A debt service reserve fund is
established funded at the least of maximum annual debt service, is
10% of bond par value, or 125% of average annual debt service.
LVDLCS also covenants to maintain a coverage ratio at or above 1.10
to 1.00 annual debt service for any fiscal year, starting June 30,
2025. If coverage is below 1.10 to 1.00 but above 1.00 to 1.00,
then the LVDLCS will retain, at its expense, a management
consultant at the direction of 2/3rds of the bond holders. If debt
service is below 1.00 to 1.00 it is an event of default unless
LVDLCS has engaged a management consultant to the extent required
by 2/3rds of the bond holders and followed the applicable
recommendations or has 60 days cash on hand. Notwithstanding the
foregoing, it is an immediate event of default if LVDLCS has filed
to maintain a coverage ratio of 1.00 to 1.00 for two consecutive
years. LVDLCS also covenants that it will maintain days cash on
hand equal to at least 45 days as of each June 30 starting 2024.
The days cash on hand covenant commences June 30 2024. If days cash
on hand ever fall below the covenant requirements, the school is
required to retain 50% of excess net revenues until compliance is
met. Days cash on hand below covenants is not an event of default.
Additional covenants include an additional bonds provision in which
the academy may incur or assume Indebtedness with which does not
exceed $500,000 to fund the purchase of furniture, fixtures and
equipment, $1.5 million of short term debt and 10% of the school
pledged revenues. And that net income available for debt service is
equal to not less than 110% of combined annual debt service and
proposed debt service; and net income available for debt service
will equal not less than 120% of combined annual debt service for
the date three consecutive years after the new facility is placed
in service or when capitalized interest expires.
USE OF PROCEEDS
The bond proceeds will be used to refinance existing debt the
school used to purchase and renovate its facilities and pay costs
related thereto (including costs of issuance).
PROFILE
LVDLCS offers a dual language model of instruction that includes
both English and Spanish instruction. Students spend 50% of their
day in the English and Math classroom and 50% of the day in their
Spanish and Science classroom. Social studies instruction is
embedded into both language instruction classrooms. Ninety-seven
percent of LVDLCS's students are Hispanic and almost eighty percent
qualify for free or reduced lunch. Throughout LVDLCS's operating
years, the School has serviced primarily Bethlehem Area School
District and Allentown School District students, however, LVDLCS
has had students from a total of 16 different districts. In
addition, LVDLCS has completed the Middle States Accreditation
process and is accredited through 2028.
METHODOLOGY
The principal methodology used in this rating was US Charter
Schools published in September 2016.
LERETA LLC: $250MM Bank Debt Trades at 20% Discount
---------------------------------------------------
Participations in a syndicated loan under which Lereta LLC is a
borrower were trading in the secondary market around 80.1
cents-on-the-dollar during the week ended Friday, October 6, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $250 million facility is a Term loan that is scheduled to
mature on August 6, 2028. The amount is fully drawn and
outstanding.
Headquartered in Pomona, California, Lereta LLC is a
technology-enabled property tax and flood determination service
provider to the financial services industry. The company provides
services in the areas of tax certification management and flood
determination to mortgage originators and servicers. Lereta is
owned by Flexpoint Ford and Vestar Capital Partners.
LEXFIT LLC: Case Summary & 19 Unsecured Creditors
-------------------------------------------------
Debtor: LexFit, LLC
PO Box 910179
Lexington, KY 40591-0179
Chapter 11 Petition Date: October 5, 2023
Court: United States Bankruptcy Court
Eastern District of Kentucky
Case No.: 23-51167
Judge: Hon. Gregory R. Schaaf
Debtor's Counsel: Dean A. Langdon, Esq.
DELCOTTO LAW GROUP PLLC
200 North Upper St.
Lexington, KY 40507
Tel: (859) 231-5800
Fax: (859) 281-1179
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Royce G. Pulliam as member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 19 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/7MXF5UQ/LexFit_LLC__kyebke-23-51167__0001.0.pdf?mcid=tGE4TAMA
MACHETE EQUIPMENT: Chris Quinn Named Subchapter V Trustee
---------------------------------------------------------
The U.S. Trustee for Region 7 appointed Chris Quinn as Subchapter V
trustee for Machete Equipment Rental, Inc.
Mr. Quinn will be paid an hourly fee of $400 for his services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Mr. Quinn declared that he is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Chris Quinn
26414 Cottage Cypress Lane
Cypress, TX 77433
Phone: 713-498-8500
Email: chris.quinn2021@outlook.com
About Machete Equipment
Machete Equipment Rental, Inc. filed a petition under Chapter 11,
Subchapter V of the Bankruptcy Code (Bankr. S.D. Texas Case No.
23-33633) on Sept. 21, 2023, with $100,001 to $500,000 in assets
and liabilities.
Judge Jeffrey P. Norman oversees the case.
Susan Tran Adams, Esq., at Tran Singh, LLP represents the Debtor as
legal counsel.
MACHINE TOOL: Court OKs Cash Collateral Access Thru Dec 21
----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Indiana,
Indianapolis Division, authorized Machine Tool Service, LLC to use
cash collateral on an interim basis in accordance with the budget,
through December 21, 2023.
As previously reported by the Troubled Company Reporter, the Debtor
urgently needs working capital to continue maintain the utilities
and store the equipment until a potential court approved sale of
the personal property can be consummated. The use of said funds
will be needed to pay current utilities, to maintain insurance upon
the real and personal property of the Debtor, and to pay, with
further Court approval, any pre-petition priority ad valorem real
estate tax claims in order to avoid any tax sale of the real
estate.
Prior to the Commencement Date, the Debtor's liquidity needs were
met primarily through the daily operation of its business and
various financing options offered by trade vendors, personal cash,
and internet lenders. The Debtor believes First Financial Bank is
the superior, properly perfected, secured creditor having an
interest in substantially all of its personal property assets, but
further believes Kapitus LLC has an interest in cash collateral by
virtue of a UCC-1 financing statement.
The Debtor believes the value of its cash collateral, which
comprises a substantial part of the value of its assets, is greater
than the combined claims of First Financial Bank and Kapitus, and
that all subordinate creditors have no interest in cash collateral.
The only other secured creditor is the former stockholder, Forrest
Perry, who sold his stock to the Debtor shareholder, Samuel G.
Hoar, and holds the first mortgage on the real estate owned by the
corporation as security.
These events constitute an “Event of Default”:
a. Failure to comply with any of the adequate protection or
reporting obligations set forth therein;
b. Failure to comply with any terms of the Interim Order;
c. The Debtor makes any payment not set forth in the Cash
Collateral Budget, except that, as necessary lo maintain the
business operations, the Debtor may exceed the budgeted
expenditures in a particular category only to the extent the Debtor
limits or reduces its expenditures in other categories, so the
resulting effect is that the total expenditures during the budget
period do not exceed 110% of the total expenses outlined in the
Cash Collateral Budget; and/or
d. Dismissal or conversion of this case or appointment of a
Chapter 11 trustee or examiner.
As adequate protection, the First Bank and Kapitus is granted
replacement liens, to the extent the cash collateral suffers a
diminution in value.
In accordance with 11 U.S.C. section 507(b), First Financial Bank
and Kapitus will have allowed super priority administrative
expenses to the extent that the Replacement Liens do not adequately
protect them against the diminution in value of their collateral.
A final hearing on the matter is set for December 21, 2023 at 11:30
a.m.
A copy of the Court's order is available at
https://urlcurt.com/u?l=RCFjLm from PacerMonitor.com.
About Machine Tool Service, LLC
Machine Tool Service, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. S.D. Ind. Case No. 23-80337) on August
24, 2023. In the petition signed by Samuel G. Hoar, its president,
the Debtor disclosed up to $1 million in both assets and
liabilities.
Judge Jeffrey J. Graham oversees the case.
Richard Lorenz, Esq., at Hickam & Lorenz, P.C., represents the
Debtor as legal counsel.
MATADOR RESOURCES: Fitch Affirms 'BB-' LongTerm IDR, Outlook Pos.
-----------------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Ratings
(IDRs) of Matador Resources Company (MTDR or Matador) and MRC
Energy Company (MRC) at 'BB-'. Fitch has also affirmed MRC's
reserve-based lending credit facility (RBL) at 'BB+'/'RR1' and
Matador's senior unsecured notes at 'BB-'/'RR4'. The Rating Outlook
has been revised to Positive from Stable.
The Positive Outlook reflects Fitch's expectation of increasing
production size, improving financial flexibility and leverage
following reduction of the RBL and strong FCF generation throughout
the forecast. Matador's production size and proved reserves are
nearing 'BB' category thresholds and Fitch will look to resolve the
Outlook in the next 12 to 18 months following continued production
growth and reduction of the RBL borrowings.
KEY RATING DRIVERS
Accretive Advance Acquisition: Fitch viewed the Advance Energy
Partners Holdings, LLC (Advance) acquisition favorably as it
increased Matador's production size and total reserves by
approximately 30% in a relatively credit-neutral manner. Management
expects the assets will bring associated cost savings via longer
laterals on multi-well pads, midstream synergies with the company's
Pronto Midstream assets and scale benefits which should improve
rates of return and overall unit economics. The transaction also
adds high quality drilling inventory in primary development zones
already known by Matador and the close proximity of Advance to
existing Matador acreage should also facilitate capital
efficiencies.
Seven-Rig Drilling Program: Fitch believes Matador's seven-rig
drilling program, which includes one rig utilized for the Advance
acreage, will generate high single-digit production growth leading
to pro forma production approaching 140-145Mboepd by YE 2023 and
over 150Mboepd in 2024. Production averaged 131Mboepd in 2Q23 as
the company continues to target its Wolfcamp A and lower Bone
Spring intervals, but has also seen strong well results in the
Avalon and upper Bone Spring across the acreage position. Fitch
expects Matador's production size will reach 'BB' category
thresholds in 2H24 if high single-digit production growth rates are
maintained in the near term.
Strong FCF Generation; Measured Distributions: Fitch forecasts
pre-dividend FCF of over $300 million in both 2023 and 2024 at
Fitch's $75/bbl and $70/bbl oil price assumptions, respectively.
Fitch expects the company will maintain its $0.60/share dividend
with potential for measured increases in the near and medium term.
Fitch does not expect management to initiate a share repurchase
program and believes excess cash will be prioritized toward RBL
reduction and then toward increases to the dividend, additional
investment into the upstream and midstream assets and potential
bolt-on M&A activity.
Near-Term RBL Reduction: Fitch expects the majority of
post-dividend FCF will be allocated toward reduction of the RBL in
the near-term. At June 30th, the company already repaid $140
million of RBL borrowings since the Advance transaction closed in
April. Under its commodity price assumptions, the company should be
able to repay nearly all of the remaining $560 million of
borrowings by YE 2024. Fitch recognizes RBL repayment could be
accelerated if currently strong strip prices continue. Matador's
leverage profile is projected to improve and approach 1.0x at its
mid-cycle $57/bbl oil price following reduction of the RBL.
Supportive Midstream Assets: Matador's acquisition of Pronto
Midstream and its midstream joint venture assets at San Mateo
provide both operational benefits through overall reduced
transportation costs and lower marketing fees in addition to
performance incentives from partner Five Point Energy LLC. The San
Mateo assets offer 460 MMcf/d of gas processing capacity, 445
Mbbl/d of water disposal capacity and oil gathering and
transportation systems, which covers nearly all of Matador's
Delaware acreage. Fitch expects midstream capex will be elevated in
the near term to fund the connection of Pronto assets to San
Mateo's Eddy County, NM assets in addition to cryogenic processing
plant expansion in Lea County.
Weak Hedging Program: Matador's lack of oil and gas production
hedges increases cash flow volatility and exposes the company to
downside pricing pressures. The company is currently hedging a
minimal amount of WAHA natural gas basis volumes for the remainder
of 2023 and aims to maintain upside to the currently strong oil
prices. The lack of hedge coverage is partially offset by the
company's improving financial flexibility via RBL reduction,
sub-1.5x leverage, strong forecast FCF generation and peer-leading
cash netbacks.
DERIVATION SUMMARY
Matador's 2Q23 production averaged 131 Mboepd (58% oil) which is
similar to Permian peers CrownRock L.P (BB-/Stable; 140 Mboepd in
as of 3Q22) and SM Energy Company (BB-/Stable; 154 Mboepd in 2Q23).
Matador remains smaller than peers Civitas Resources, Inc.
(BB/Positive; pro forma production of 270-290 Mboepd) and Permian
Resources, Inc. (BB-/RWP; pro forma production expected at
approximately 300 Mboepd) following their recent M&A transactions.
The company's continued cost reduction efforts and high oil mix
have led to peer-leading Fitch-calculated unhedged netbacks of
$34.3/boe in 2Q23. This compares favorably to SM Energy
($25.7/boe), primarily driven by SM's lower oil cut, and is higher
than standalone Civitas ($29.0/boe) and Permian Resources
($27.6/boe) in 2Q23.
Strong FCF generation in 2023 and into 2024 should support further
reductions of the RBL borrowings and mid-cycle leverage metrics
between 1.0x-1.5x, which is generally consistent with leverage
profiles across the Permian peer group.
KEY ASSUMPTIONS
- WTI oil price of $75/bbl in 2023, $70/bbl in 2024, $65/bbl in
2025, and $60/bbl in 2026, and $57/bbl in the long term;
- Henry Hub natural gas price of $2.80/mcf in 2023, $3.25/mcf in
2024, $3.00/mcf in 2025 and $2.75 in the long term;
- Average production of 127 mboepd in 2023 increasing toward 150
mboepd in 2024 and low- to mid-single-digit growth thereafter;
- Capex of $1.4 billion in 2023, following growth-linked spending
thereafter;
- Prioritization of FCF toward reduction of the RBL;
- Measured increases in the fixed dividend.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Continued progress toward gross debt reduction and production
growth resulting in average daily production approaching
150 Mboepd;
- Maintenance of economic inventory life and continued de-risking
of longer-term unit economics;
- Mid-cycle EBITDA leverage sustained below 2.0x.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Loss of operational momentum resulting in average production
sustained below 100 Mboepd;
- Inability to extend economic inventory life that leads to
expectations for weakened unit economics;
- Material reduction in liquidity;
- Mid-cycle EBITDA leverage sustained above 2.5x.
LIQUIDITY AND DEBT STRUCTURE
Improving Liquidity Profile: As of 2Q23, Matador had $22 million
cash on hand and $645 million of borrowing capacity under its $1.25
billion RBL ($2.25 billion borrowing base) including $45 million of
letters of credit outstanding. The company repaid $140 million of
RBL borrowings since the Advance acquisition close in April. Fitch
expects the company will allocate the majority of post-dividend FCF
to reduction of RBL borrowings with the expectation of full
repayment in 2H24.
The RBL is subject to a semi-annual borrowing base redetermination
and was reaffirmed at $2.25 billion ($1.25 billion elected
commitment) in March 2023. Fitch believes liquidity will improve in
the near term following RBL reduction given Fitch's forecast of
strong FCF generation.
Clear Maturity Schedule: Matador's maturity schedule remains
relatively clear with the RBL and 5.875% notes maturing in 2026 and
the 63875% notes due in 2028. Following repayment of the RBL, Fitch
expects Matador will be opportunistic with open market repurchases
of the notes.
ISSUER PROFILE
Matador Resources Company is an independent exploration and
production (E&P) company primarily focused in the Delaware Basin in
Southwest New Mexico and West Texas.
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
----------- ------ -------- -----
Matador Resources
Company LT IDR BB- Affirmed BB-
senior
unsecured LT BB- Affirmed RR4 BB-
MRC Energy Company LT IDR BB- Affirmed BB-
senior secured LT BB+ Affirmed RR1 BB+
MATCH GROUP: S&P Alters Outlook to Positive, Affirms 'BB' ICR
-------------------------------------------------------------
S&P Global Ratings revised its outlook to positive from stable, and
S&P affirmed all its ratings on Dallas-based Match Group Inc.,
including its 'BB' issuer credit rating, its 'BBB-' issue-level
rating on Match Group's secured term loan with a '1' recovery
rating, and its 'BB' issue-level rating on the company's senior
unsecured notes with a '3' recovery rating.
S&P said, "The positive outlook reflects our expectation that
steady RPP across Match Group's Tinder and non-Tinder brands will
drive organic revenue and EBITDA growth. We expect Match Group will
maintain a prudent financial policy such that it sustains leverage
below 3x in the next 12 months despite macroeconomic headwinds and
its appetite for share repurchases and acquisitions.
"We expect the company will sustain leverage below 3x over the next
12 months due to favorable dating trends and a consistent financial
policy."
Match Group's strong operating performance through the first half
of 2023 was the result of direct revenue growth at Tinder and
Hinge, with contributions from other applications in the portfolio.
RPP increased about 10%, with payers trending 5% lower in the
quarter ended June 30, 2023, due to the company's price
optimization strategy and introduction of weekly subscription
packages. Hinge direct revenue increased 31% through the first half
of the year, which is partially attributable to the application's
further expansion into European markets. The company reported that
it plans to shift marketing spend from other applications toward
Tinder and Hinge in the second half of 2023, and S&P expects
selling and marketing costs to increase as a percentage of revenue
for the next 24 months that could modestly compress margins.
S&P said, "Despite ongoing macroeconomic challenges, we expect
demand to remain strong for the remainder of fiscal 2023 and into
2024. Following steady RPP growth in the first half of the year,
Match Group benefits from secular online dating trends,
international expansion, rollout of new products, and feature
updates. Although we expect S&P Global Ratings-adjusted EBITDA
margins will remain stable in 2023 as cost-saving
initiatives--including headcount reduction in the first
quarter--are offset by higher marketing spend for the year, we
forecast S&P Global Ratings-adjusted EBITDA will increase in the
mid-single-digit percent range with margins stable in the mid-30%
area and S&P Global Ratings-adjusted leverage remaining below 3x
over the next 12-18 months.
"We expect positive industry growth trends in the online dating
industry to continue over the next few years.
"Over the past decade, online dating has become increasingly
popular, with almost one-third of U.S. adults having ever used a
dating site or app according to Pew Research Center. Consumer
preferences for online dating channels and declining marriage rates
represent continued secular growth, which benefits all online
dating channels, including Match Group. In our view, companies that
lead consumers to their apps and convert free users to paid users,
effectively engage users with frequent updates, and increase RPP
through continued innovation and new products are best positioned
to succeed in this space. We believe adoption of online tools for
social interactions, boosted during the COVID-19 pandemic, will
continue the long-term secular trend of acceptance for online
dating and support continued growth in subscribers. While Match
Group's applications compete in the same space, we don't believe
the risk of cannibalization is significant because of the frequency
in which dating app users download multiple dating apps. We expect
the company's total number of payers to increase in the mid-single
digits in 2024 through our forecast to 2027.
"Ongoing macroeconomic challenges and inflation remain a risk to
our base-case forecast.
"We believe a slowdown in economic activity is necessary to cool a
hot U.S. economy with a tight labor market and high inflation. We
think consumer spending will drive the slowdown, with unemployment
drifting up. Although a recession is no longer our base case, the
forecasted slowdown in the second half of 2023 and into 2024
presents risks to consumer discretionary spending and the leisure
sector. Nonetheless, a slowing economy may just slow down growth
rates for a company like Match Group rather than lead to declines
in revenue and profitability, given the recent shift in consumer
spending toward experiences. However, Match Group largely relies on
consumer discretionary spending, so the risk of an overheated U.S.
economy and higher-for-longer rates could increase downside risks
once the economy lands. This risk is partially offset by Match
Group's diversification of dating brands within its portfolio by
targeting different demographic groups. Although we expect the
growth in RPP to outpace the decline in number of payers over the
next 12 months, we believe that consumer demand and addition of new
payers could slow down further if macroeconomic conditions worsen.
"We believe the company will maintain prudent financial policy.
"Match Group has historically used most of its free operating cash
flow (FOCF) for share repurchases, cash distributions, investments,
and acquisitions. We expect these capital allocation priorities
will continue while the company maintains its target leverage of
below 3x. We expect the company to maintain its S&P Global
Ratings-adjusted leverage--which adjusts for capitalized software
development expenses--below 3x as it continues share repurchases.
We also expect that future acquisitions would be funded primarily
with cash and equity. Match Group has a good record of generating
steady free cash flows due to the company's high EBITDA margin and
low working capital and capital expenditure (capex) needs. The
company's free cash flow in 2023 will be higher than the prior year
due to a $441 million litigation payment related to Tinder in 2022.
We expect that in 2023 and 2024, the company's performance will
continue to be healthy, and FOCF generation will exceed $850
million annually, facilitating share repurchases and small
acquisitions to support growth. We are expecting $450 million-$500
million in share repurchases following the company's commitment
after first quarter earnings to return at least half of its FOCF to
investors.
"The positive outlook reflects our expectation that steady RPP
across Match Group's Tinder and non-Tinder brands will drive
organic revenue and EBITDA growth. We expect Match Group will
maintain a prudent financial policy such that it sustains leverage
below 3x in the next 12 months despite macroeconomic headwinds and
its appetite for share repurchases and acquisitions.
"We could revise the outlook to stable if leverage increases above
the 3x area. We could lower the rating if leverage exceeds 4x over
the next 12 months because of lower demand from a change in
consumer preferences amid macroeconomic uncertainty and
intensifying competition. In addition, we could also downgrade
Match Group if, contrary to our expectations, the company
prioritizes a more aggressive financial policy and pursues
significant debt-funded acquisitions or share repurchases rather
than debt reduction.
"We could raise the rating if Match Group maintains its net
leverage below 3x. Additionally, an upgrade would require ongoing
strong performance of Tinder and revenue and EBITDA growth at
non-Tinder brands."
MAVENIR SYSTEMS: $585MM Bank Debt Trades at 22% Discount
--------------------------------------------------------
Participations in a syndicated loan under which Mavenir Systems Inc
is a borrower were trading in the secondary market around 78.4
cents-on-the-dollar during the week ended Friday, October 6, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $585 million facility is a Term loan that is scheduled to
mature on August 18, 2028. About $573.3 million of the loan is
withdrawn and outstanding.
Mavenir Systems, Inc. provides software-based networking solutions.
The Company offers internet protocol based voice, videos,
communication, and messaging services, as well as multimedia
subsystem, evolved packet core, and session border controller.
MIKU INC: Unsecureds to Split $50K in Liquidating Plan
------------------------------------------------------
Ukim, Inc. f/k/a Miku, Inc., filed with the U.S. Bankruptcy Court
for the District of New Jersey a Small Business Plan of Liquidation
dated October 2, 2023.
The Debtor is a manufacturer of a baby monitor capable of tracking
health and sleep patterns, contact-free. The Debtor's product is
unique in that absolutely no wearables, wires or other attachments
are required to extract health and sleep analytics.
On the Petition Date, the Debtor filed Motion And Memorandum Of Law
In Support Of Motion Of Debtor For The Entry Of An Order Approving
And Authorizing Bid Procedures And Form Of Notice In Connection
With The Sale Of The Debtor's Assets (the "Sale Motion") with the
Bankruptcy Court seeking approval of, among other things (A)
auction and bidding procedures (the "Bid Procedures") in connection
with the sale of all or substantially all of its assets free and
clear of all liens, claims, encumbrances and interests (the
"Sale"), (b) entry into an asset purchase agreement with the
Stalking Horse Bidder (the "Stalking Horse Agreement"), and (C)
related relief.
In accordance with the Bid Procedures Order, Qualified Bids were
due by 5:00 p.m. on September 5, 2023 (the "Bid Deadline). No
Qualified Bids were received by the Bid Deadline. As a result, W67
LLC or its designee was deemed the Successful Bidder. On September
15, 2023, the Bankruptcy Court entered the Order Authorizing The
Sale Of Substantially All Of The Debtor's Assets (the "Sale Order")
approving the Sale of the Assets to the Successful Bidder. On the
same day, the Sale closed.
Class 3 consists of General Unsecured Claims. As of this date, the
General Unsecured Claims total approximately $2,575,844.57. This
class of creditors will receive a pro rata share of the $50,000
earmarked for unsecured creditors. The risk is that the $50,000 may
become less if the approximately $12,000 claim of Mr. Melli is
allowed as a Priority Unsecured Claim. This Class is impaired.
Distributions will be made when the Debtor completes the claims
objection process, which should be within 90 days of the entry of
the Confirmation Order. It estimated that this class of creditors
will receive a distribution in the range of 1% to 2%. There exists
the possibility that the aggregate amount of general unsecured
claims could be significantly reduced. To the extent this occurs,
this class of creditors would receive distributions in the
approximate amount of 8%.
Stockholders will receive no distribution under the Plan and shares
will be cancelled upon the entry of the Confirmation Order.
The Debtor shall use the estimated funds on hand upon the Effective
Date of the Plan to make the initial distributions for
Administrative Expenses and the $50,000 received from W67, LLC
earmarked for unsecured creditors to distribute to any allowed
Class 2 claims and any remaining amounts thereafter to the holders
of allowed Class 3 claims on a pro rata basis.
The Plan is a plan of liquidation. Therefore, the Debtor's
financial projections show that the Debtor will not have any future
cash flow and will wind-down operations after complying with its
obligations under this Plan. The final Plan payment is expected to
be paid in or about 90 days after the entry of the Confirmation
Order.
A full-text copy of the Liquidating Plan dated October 2, 2023 is
available at https://urlcurt.com/u?l=JTmlqI from PacerMonitor.com
at no charge.
Debtor's Counsel:
Morris S. Bauer, Esq.
DUANNE MORRIS LLP
One Riverfront Plaza
1037 Raymond Blvd., Suite 1800
Newark, NJ 07102
Tel: 973-424-2000
Fax: 973-424-2001
E-mail: msbauer@duanemorris.com
About Miku, Inc.
Miku, Inc., is engaged in the manufacturing of audio and video
equipment. The Debtor sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. D.N.J. Case No. 23-17005) on August
14, 2023. In the petition signed by Johann Fernando, chief
executive officer, the Debtor disclosed $3,696,093 in assets and
$5,100,016 in liabilities.
Judge Christine M. Gravelle oversees the case.
Morris S. Bauer, Esq., at Duanne Morris LLP, is the Debtor's legal
counsel.
W67 LLC, as DIP Lender, is represented by:
Jeff M. Wolf, Esq.
Ari Newman, Esq.
Greenberg Traurig, LLP
One International Place, Suite 2000
Boston, MA 02110
E-mail: wolfj@gtlaw.com
newmanar@gtlaw.com
MINE HILL ANESTHESIA: Lender Seeks to Prohibit Cash Access
----------------------------------------------------------
Pacific Western Bank asks the U.S. Bankruptcy Court for the
Southern District of Florida to prohibit Mine Hill Anesthesia, LLC
and affiliates from using cash collateral.
PacWest holds a valid and perfected blanket lien and security
interest in Debtor, Mine Hill Surgical Center, LLC's, tangible and
intangible, including all cash collateral, and did not consent to
the use of its cash collateral by the Debtors. PacWest was not
listed in the Debtors' Schedules or Statement of Financial Affairs.
PacWest received no notice of the bankruptcy filing until after the
Debtors defaulted on their SBA loan to PacWest this year and
PacWest discovered the bankruptcy filing through its own due
diligence. Mine Hill never filed a motion for authority to use cash
collateral in its bankruptcy case.
PacWest has attempted to resolve its disputes with the Debtor (and
Echelon Financial, LLC) but has been unsuccessful in doing so.
Prior to the Petition Date, on January 27, 2012, CapitalSource Bank
made a U.S. Small Business Administration loan to non-debtor MDHT,
LLC and Debtor, Mine Hill Surgical Center, LLC in the principal
amount of $1.438 million.
On January 27, 2012, Mine Hill and MDHT, LLC entered into that the
Note wherein the Borrowers promised to pay to Lender the amount of
$1.438 million, interest on unpaid principal balance, and other
amounts required by the Note at an interest rate of 6% for 10 years
and then thereafter, at the interest rate of prime rate plus 2.75%,
adjusted monthly.
On January 27, 2012, the Borrowers entered into a Security
Agreement wherein the Borrowers granted to Lender, a security
interest in the property. The Loan was further secured by a
Mortgage on the property and improvements owned by MDHT, LLC in
Morris County, New Jersey.
On January 27, 2012, the Debtor, Champey Pain Group, LLC signed an
Unconditional Guarantee wherein it unconditionally guaranteed
payment to Lender of all amounts owing under the Note.
On January 27, 2012, Edward Champey, the principal and owner of the
Debtor, signed an Unconditional Guarantee wherein he
unconditionally guaranteed payment to Lender of all amounts owing
under the Note.
On April 7, 2014, CapitalSource Bank merged with and into PacWest
pursuant to the Agreement and Plan of Merger of CapitalSource Bank
and Pacific Western Bank.
On October 1, 2020, Mine Hill and non-debtor MDHT, LLC, as
Borrowers and PacWest, as Lender entered into a Loan Modification
Agreement where the terms and provisions of the Note were modified
as more particularly described therein.
The UCC Financing Statements related to its borrowers and
guarantors, Mine Hill, MDHT, LLC, and CPG, recorded in the State of
New Jersey in January, 2011 and their associated continuations.
On May 16, 2018, Mine Hill, without notice or consent by PacWest or
the SBA, impaired PacWest's Collateral by entering into a Financing
Agreement/Promissory Note/Security Agreement and Personal Guaranty
with Bankers Healthcare Group, LLC. Mine Hill granted BHG a
security interest in all of the right, title and interest in and to
Accounts Receivables, Inventory, Instruments, Equipment,
Intangibles, Accounts, Chattel Paper, Good Will, Specific Property
and All Property of Debtor and all proceeds thereof, impairing
PacWest's Collateral.
On August 14, 2018, without notice to, or consent from PacWest or
the SBA, the Debtors further impaired PacWest's Collateral by
entering into a merchant cash advance agreement with Echelon
Financial, LLC. As set forth in the Debtor's plan, the Debtors'
allowed their relationship with Echelon to deteriorate and Echelon
obtained a default judgement exceeding $2 million. The Debtor's
failed to provide notice to PacWest or the SBA of the lawsuit or
judgment as required by the Loan documents between the parties.
PacWest only became aware of Mine Hill’s and CPG's bankruptcy
filings after the Debtor's went into monetary default on their Loan
with PacWest which prompted PacWest to investigate in or about
April, 2023.
PacWest expected that the parties would be able to come to a
resolution without Court intervention. However, the Debtors, their
principals, and Echelon have failed to propose a meaningful
resolution or take corrective action despite ongoing communications
to attempt to resolve this dispute.
About Mine Hill Anesthesia
Mine Hill Anesthesia, LLC and its affiliates, Mine Hill Surgical
Center, LLC and Champey Pain Group, LLC, filed petitions under
Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. S.D. Fla.
Lead Case No. 22-11577) on Feb. 25, 2022. Tarek Kirk Kiem serves as
Subchapter V trustee.
At the time of filing, Mine Hill listed up to $50,000 in assets and
up to $10 million in liabilities.
Judge Erik P. Kimball oversees the cases.
The Debtors tapped Shraiberg Page, P.A., as bankruptcy counsel and
Nagel Rice, LLP as special counsel.
MOLEKULE GROUP: Seeks $3MM DIP Loan From Bridge Coast et al.
------------------------------------------------------------
Molekule Group, Inc. and Molekule, Inc. ask the U.S. Bankruptcy
Court for the Southern District of Florida, West Palm Beach
Division, for authority to use cash collateral and obtain
postpetition financing.
The Debtors seek to obtain postpetition financing consisting of a
credit facility in the aggregate principal amount of $3 million.
About $1 million of the DIP Facility will be available upon entry
of an interim order.
The funding will come from:
-- Foundry Group Next, L.P.,
-- Armistice Capital Master Fund Ltd.,
-- SVB Innovation Credit Fund VIII, L.P. (SVBC), and
-- Bridge Coast Capital, LLC.
Foundry is Molekule Group's largest shareholder and an affiliate of
Brad Feld, a member of the Debtor's board of directors.
BCC is an affiliate of Amin J. Khoury, another director and the
second-largest shareholder.
Armistice is the third-largest shareholder of Molekule Group.
SVBC holds roughly $15 million of mezzanine debt.
As of May 15, 2023, Foundry owned 21.2%, Khoury owned 12.1%, and
Armistice owned 9.9% of Molekule Group's outstanding shares.
BCC will act as the administrative and collateral agent for the DIP
Lenders.
The DIP facility is due and payable on the effective date of the
Debtor's Plan.
The Debtors are required to comply with these milestones:
1. Filing of the Plan and Disclosure Statement will occur
within 2 business days following the Petition Date;
2. Entry of an Interim DIP and Cash Collateral Order within
five business days after the Petition Date and a Final DIP and Cash
Collateral Order no later than October 25, 2023.
3. Entry of an order approving a disclosure statement for the
Plan will occur within 40 days following the Petition Date;
4. Entry of an order confirming the Plan will occur within 75
days following the Petition Date; and
5. The effective date of the Plan will occur within 90 days
following the Petition Date.
Molekule developed the Molekule 360 Hub to boost B2B sales by
centralizing remote air purifier management. The platform, which
was planned to merge with Aura Smart Air, was launched in July
2023. However, Aura breached the TCA and merger agreement by
failing to pay its cloud computing vendor and depositing the
Molekule 360 Hub source code into escrow. As a result, the platform
no longer functions and Molekule loses the source code to re-launch
the application, preventing growth in B2B sales.
Molekule leased a building in San Francisco, California, from 140
Partners, LP in 2019 for 84 months with an option to extend. Due to
San Francisco's homelessness crisis, Molekule abandoned the SF
Headquarters, and 140 Partners pursued collection, forcing the
Debtors into bankruptcy.
Two entities have filed UCC-1 financing statements that include
cash and accounts in the collateral description:
1. Silicon Valley Bank, a Division of First Citizens Bank &
Trust and SVB Innovation Credit Fund VIII, L.P. have total claims
of approximately $35 million secured by all of Molekule's assets
including accounts receivable and bank accounts. Specifically, SVB
(individually) holds a first-position, pre-petition secured term
loan of approximately $4.130 million. The security agreement which
secures the Senior Loan also secures a charge card facility with an
outstanding pre-petition balance of $333,221. The charge card
facility had a prepetition maximum limit of $900,000. SVB and SVBC
together hold a second-position secured loan of approximately $30
million. The Senior Loan and Mezzanine Loan are secured by liens
perfected by filing UCC-1 financing statements and by control of
the Debtors' deposit accounts held at SVB.
2. Trinicap Funding, LLC (as successor in interest to Trinity
Capital, Inc.) filed a UCC-1 financing statement for each Debtor
that lists all assets as collateral. Trinity financed and leased
certain equipment to Molekule. As to the equipment, Trinity holds a
first-position security interest. After Molekule and AeroClean
merged, the Debtors and Trinity executed a lease joinder which made
Molekule Group a co-obligor.
In the lease joinder, Molekule Group gave a blanket security
interest to Trinity. Additionally, Trinity has subordinated its
security interests in any of Molekule's assets, other than the
Trinity Equipment, to SVB's claims. Trinity holds a third-position
secured claim as to most of the Debtors' assets and a
first-position secured claim as to certain pieces of equipment. As
of the Petition Date, Trinity holds a claim for approximately
$2.228 million.
As adequate protection for the use of cash collateral, the Secured
Parties will receive replacement liens and superpriority
administrative claims to the extent of the diminution of the cash
collateral, in addition to adequate protection payments as outlined
in the DIP Orders.
A copy of the motion is available at https://urlcurt.com/u?l=mXoVbl
from PacerMonitor.com.
About Molekule, Inc.
Molekule, Inc. and Molekule Group, Inc. manufacture air purifiers.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Fla. Lead Case No. 23-18093) on
October 3, 2023. In the petition signed by Ryan Tyler, chief
financial officer, Molekule, Inc. disclosed $11,592,471 in total
assets and $46,952,909 in total liabilities.
Judge Mindy A. Mora oversees the case.
Bradley S. Shraiberg, Esq., at Shraiberg Page, PA, represents the
Debtor as legal counsel.
Counsel to Bridge Coast Capital, LLC as the DIP Agent:
Kyler Burgi, Esq.
Davis Graham & Stubbs LLP
1550 17th Street, Suite 500
Denver, CO 80202
- and -
Donald Kirk, Esq.
Carlton Fields LLP
Corporate Center Three at International Plaza
4221 W. Boy Scout Boulevard, Suite 1000
Tampa, FL 33607
- and -
Alexandra Blye, Esq.
Carlton Fields LLP
CityPlace Tower
525 Okeechobee Boulevard, Suite 1200
West Palm Beach, FL 33401
Counsel to Silicon Valley Bank, a division of First Citizen Bank,
in its capacity as Senior Term Loan Lender:
Alexander Rheaume, Esq.
Morrison & Foerster LLP
200 Clarendon St., Floor 21
Boston, MA 02116
- and -
Benjamin Butterfield, Esq.
Miranda Russell, Esq.
Morrison & Foerster LLP
250 West 55th Street, Floor 20
New York, NY 10019
- and -
Noel Boeke, Esq.
Holland & Knight LLP
100 North Tampa Street Suite 4100
Tampa, FL 33602
Counsel to Trincap Funding, LLC:
Gregory G. Plotko, Esq.
Barnes & Thornburg LLP
390 Madison Avenue, 12th Floor
New York, ny 10017
- and -
Tory Zander, Esq.
Barnes & Thornburg LLP
655 W. Broadway, Suite 1300
San Diego, CA 92101
MOLEKULE INC: Unsecureds Will Get 1.39% of Claims in Joint Plan
---------------------------------------------------------------
Molekule, Inc., and Molekule Group, Inc., filed with the U.S.
Bankruptcy Court for the Southern District of Florida a Joint Plan
of Reorganization dated October 3, 2023.
The Debtors are: (a) Molekule Group, a Delaware corporation which
is a holding company; and (b) Molekule Inc, a Delaware corporation
which is an operating company. Molekule Inc. is a wholly owned
subsidiary of Molekule Group.
Molekule Inc. manufactures air purifiers which utilize a mixture of
HEPA and carbon filtration and photo electrochemical oxidation or a
mixture of HEPA and carbon filtration and UVC sterilization. The
Debtors' principal address is 10455 Riverside Drive, Suite 100,
Palm Beach Gardens, Florida 33410. Molekule Inc. also operates from
a manufacturing facility in Lakeland, Florida.
The Debtors' bankruptcy petitions were made necessary due to
Molekule Inc.'s lease of commercial real property in San Francisco,
California from 140 Partners, L.P. Through the bankruptcy process,
Molekule, Inc. will reject the San Francisco Lease via a motion
with the Court and to have any Allowed Claim resulting from such
lease rejection treated as a General Unsecured Claim.
The Debtors believe that confirmation of the Plan provides the best
opportunity for maximizing recoveries for the Debtors' creditors
and equity interest holders. Through the Plan, the Debtors will be
able to restructure their debt and provide a meaningful
distribution to the holders of Allowed Claims and Allowed Equity
Interests.
Upon Confirmation of the Plan, Molekule Inc. will be substantively
consolidated with Molekule Group, including for the following
purposes: (a) treating assets of the Debtors as being a single
estate of Molekule Group, including Avoidance Actions under chapter
5 of the Code, (b) treating all claims against the Debtors as
against the single estate of Molekule Group, and (c) eliminating
duplicative claims by the same creditor asserted against more than
one estate. Following Confirmation of the Plan, Molekule Group will
be vested in all substantively consolidated estate assets and will
be the Reorganized Debtor. All distributions under the Plan shall
come from the substantively consolidated estate.
Class 5 consists of the unsecured claims of the Debtors' current or
former employees and contractors. On the Effective Date, and except
to the extent that a holder of an allowed Class 5 Claim has been
paid prior to the Effective Date or agrees to different treatment,
in full satisfaction, settlement, release, extinguishment and
discharge of such claims, each holder of an Allowed Unsecured
Priority Wage Claim shall receive payment in full in cash by the
Reorganized Debtor. To the extent any person holds an unsecured
claim that exceeds the statutory cap, such claim shall be treated
as a General Unsecured Claim in Class 8 of the Plan.
Class 6 consists of the unsecured claims for contributions to the
Debtors' employee benefit plans. On the Effective Date, and except
to the extent that a holder of an allowed Class 6 Claim has been
paid prior to the Effective Date or agrees to different treatment,
in full satisfaction, settlement, release, extinguishment and
discharge of such claims, each holder of an Allowed Unsecured
Priority Benefit Plan Contribution Claim shall receive payment in
full in cash by the Reorganized Debtor. To the extent any person
holds an unsecured claim that exceeds the statutory cap, such claim
shall be treated as a General Unsecured Claim in Class 8 of the
Plan.
Class 8 consists of the general unsecured claims creditors,
including all allowed claims arising from the Debtors' rejection of
executory contracts and unexpired leases. In full satisfaction,
settlement, release, extinguishment, and discharge of such claims,
(i) on the Effective Date, each holder of an Allowed General
Unsecured Claim shall receive from the Reorganized Debtor a
one-time Pro Rata Distribution from a total of $150,000; and all
net proceeds received or obtained by the Plan Administrator
resulting from any demand, pursuit, award, or settlement of any
Avoidance Action that is not an Avoidance Action to avoid or
recover any Critical Vendor Payment. The allowed unsecured claims
total $10,825,000. This Class will receive a distribution of 1.39%
of their allowed claims.
Class 10 consists of Allowed Equity Interests. On the Effective
Date, all Allowed Equity Interests in the Debtors shall be deemed
canceled and extinguished, and shall be of no further force and
effect, whether surrendered for cancellation or otherwise, and the
holders of Allowed Equity Interests shall receive no distribution.
In exchange for, and on account of, the New Value Payment in the
form of the full release and satisfaction of the DIP Financing, the
DIP Lender shall receive 63% of the new equity interests in the
Reorganized Debtor. To the extent the Debtors have not drawn upon
the full $5,000,000 in DIP Financing by the Plan's Effective Date,
the DIP Lender shall pay over to the Reorganized Debtor the
remaining unused balance of the DIP Financing as part of the New
Value Payment.
In exchange for, and on account of, the New Value Payment in the
form of the full release and satisfaction of their Allowed SVB
Mezzanine Secured Claims, SVB and SVBC (or their assigns) shall
each receive 18.5% of the new equity interests in the Reorganized
Debtor.
Funds to be used to make cash payments under the Plan shall derive
from the Debtors' cash on hand, the operation of the Reorganized
Debtor's business in the ordinary course prior to and after the
Effective Date, the pursuit of Actions and Avoidance Actions.
A full-text copy of the Disclosure Statement dated October 3, 2023
is available at https://urlcurt.com/u?l=LZGT1r from
PacerMonitor.com at no charge.
Debtors' Counsel:
Bradley S. Shraiberg, Esq.
SHRAIBERG PAGE PA
2385 NW Executive Center Dr., Suite 300
Boca Raton, FL 33431
Tel: 561-443-0800
E-mail: bss@slp.law
About Molekule Inc.
Molekule manufactures air purifiers.
Molekule Inc. and affiliate Molekule Group, Inc., sought Chapter 11
protection (Bankr. S.D. Fla. Lead Case No. 23-18093) on Oct. 3,
2023. In the petition signed by CFO Ryan Tyler, Molekule Inc.
disclosed $11,592,471 in assets and $46,952,909 in liabilities.
Judge Mindy A. Mora oversees the cases.
Bradley S. Shraiberg, Esq., of SHRAIBERG PAGE PA, is the Debtors'
legal counsel.
MOUNTAIN VIEW: Court OKs Cash Collateral Access Thru Oct 31
-----------------------------------------------------------
Mountain View Orchard, Inc. asks the U.S. Bankruptcy Court for the
District of Maryland, Baltimore Division, for authority to use cash
collateral on an interim basis in accordance with the budget,
through October 31, 2023.
The Debtor is permitted to use cash collateral to pay the specific
operating expenses relating to the operation of the Orchard
Property which are set forth in the budget, with a 10% variance.
Yellow Breeches Capital LLC, successor by assignment to First
National Bank of Pennsylvania, successor in interest to Howard
Bank, successor in interest to First Mariner Bank, asserts a
secured claim against the Debtor by way of, inter alia, the
Debtor's obligations under three loans as borrower or guarantor,
and which are respectively secured by the following security
interests.
As of the Petition Date, the Debtor was indebted to the Lender
under a $3.439 million loan and a $480,000 loan to the Debtor, a
$2.540 million loan to Charles & 20 LLC that is guaranteed by the
Debtor, and a $325,000 commercial loan and a $85,000 commercial
loan to Anthony C.Y. Cheng that is guaranteed by the Debtor.
As of the Petition Date, the Debtor was indebted to the Lender
under the Loans in an amount in excess of $3.6 million.
As adequate protection, the Lender is granted a first-priority
post-petition security interest and lien in, to and against (i) all
pre-petition and post-petition proceeds, accounts receivable and
revenues that are created, derived and/or generated from or by the
Debtor's sale or disposition of its Asian pears, inventory, goods,
crops and farm products, (ii) all of the Debtor's Asian pears,
inventory, goods, crops and farm products that are created,
generated and/or grown post-petition at or on the Orchard Property
and all products and proceeds thereof, (iii) the DIP Accounts and
all funds of the Debtor deposited therein, and (iv) all other
assets of the Debtor described in the Loan Documents which are or
have been acquired, generated or received by the Debtor subsequent
to the Petition Date and all products and proceeds thereof.
As additional adequate protection to the Lender for the Debtor's
use of the Lender's cash collateral, the Debtor will make the
following adequate protection payments to the Lender during the
Interim Period: (i) on or before 5 p.m. on September 1, 2023, the
Debtor will deliver an adequate protection payment in the amount of
$10,000 to the Lender, (ii) on or before 5 p.m. on September 20,
2023, the Debtor will deliver an adequate protection payment in the
amount of $10,000 to the Lender, and (iii) on or before 5 p.m. on
October 20, 2023, the Debtor will deliver an adequate protection
payment in the amount of $10,000 to the Lender.
These events constitute an Event of Default:
(a) the Debtor's use of cash collateral for any reason other than
to pay an expense that is specifically set forth in the Budget,
(b) if the Debtor fails to timely deliver any of the Adequate
Protection Payments to the Lender as and when due under the Order,
(c) if the Debtor fails to timely provide the Lender with any of
the Monthly Reporting as required therein,
(d) if the case is converted to a chapter 7 case or if the Debtor
moves to convert the chapter 11 case to a chapter 7 case, or
(v) the Debtor's failure to comply with any provision of the
Order.
A further hearing on the matter is set for November 3, 2023 at 11
a.m.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=onwvxK from PacerMonitor.com.
The Debtor projects $45,000 in total cash receipts and $39,100 in
total cash disbursements for October 2023.
About Mountain View Orchard, Inc.
Mountain View Orchard, Inc. is in the business of fruit and tree
nut farming.
Mountain View Orchard, Inc. filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Case No.
23-15149) on July 23, 2023. The petition was signed by Anthony C.Y.
Cheng as president. At the time of filing, the Debtor estimated
$500,000 to $1 million in assets and $1 million to $10 million in
liabilities.
Judge Nancy V. Alquist oversees the case.
Joseph M. Selba, Esq. at Tydings & Rosenberg LLP represents the
Debtor as counsel.
MOUROUX FAMILY: Amends Unsecured Claims Pay Details
---------------------------------------------------
Mouroux Family Chiropractic, Inc., submitted a Second Amended
Reorganization Plan.
This Plan is a reorganization plan proposed by the Debtor.
When the instant Petition seeking relief under Chapter 11 of the
Bankruptcy Code was filed, the Debtor's business model included
working together with an affiliated corporate medical entity, Whole
Health Medical Center, Inc., to offer one-stop chiropractic and
medical services in the greater San Jose area. Unfortunately, that
business model was not profitable. Patients simply did not seem
comfortable buying medical services out of a chiropractic office
even though those services were being provided by a licensed
medical professional.
Establishing the relationship with the affiliated medical entity,
Whole Health Medical Center, Inc., required a significant amount of
funding from Debtor. Thereafter, it required a significant infusion
of cash from Debtor as, prior to the Petition Date, Whole Health
Medical Center, Inc. did not generate sufficient funds to cover its
monthly financial obligations. As of the Petition Date, Whole
Health Medical Center, Inc. owed Debtor $261,093.16 for Whole
Health Medical Center, Inc. expenses that Debtor had to cover. As
of the Petition Date, Debtor had hoped that in the following months
Whole Health Medical Center, Inc. would become a profitable
affiliate.
While Whole Health Medical Center, Inc. during the pendency of this
bankruptcy case and through August 31, 2023, either broke even or
generated a small profit, the affiliate simply did not generate
enough profit to justify the risk of it continuing in operation
especially in light of the amount of money that it had lost in the
past. While Whole Health Medical Center, Inc., as noted, did
generate some profits since the Petition Date there is no guarantee
that that will continue in the future and considering the amount of
its losses prior to the Petition Date Debtor has decided to
discontinue that prior arrangement and prior business model
effective September 1, 2023. It is Debtor's management position
that the time and effort required to generate the small profits in
Whole Health Medical Center, Inc. would be better spent, and would
generate greater profits, if invested in Debtor.
The Quarterly Payments are a fixed amount. Each Quarterly Payment
will be funded with income from business operations.
Class 2 consists of General Unsecured Creditors. The combined total
of all General Unsecured Claims is $393,836.49. Payments to General
Unsecured Creditors will only commence after Administrative claims
have been paid in full. Debtor projects that the General Unsecured
Creditors will receive $1036 in Quarter 12 and $3378 in Quarters 13
through 20. All General Unsecured Creditor claims are impaired.
There is only one outstanding class of stock, common stock. It is
owned 50% by Dr. Bradley Mouroux and 50% by Dr. Melissa Ko. No
shareholder is entitled to receive any cash payments on account of
their equity interest in the Debtor under the terms of this Plan.
Total Plan Payout. Administrative ($54,500) + General Unsecured
($28,060) = $82,560. If the Debtor's actual disposable income
exceeds projections for a given Quarter or Quarters, or the Debtor
raises additional funds from outside investments, contributions, or
loans, the Debtor, in its sole discretion, may pay the Total Plan
Payout earlier, in whole or in part and without penalty.
A full-text copy of the Second Amended Plan dated October 2, 2023
is available at https://urlcurt.com/u?l=qGMeeF from
PacerMonitor.com at no charge.
Attorney for Mouroux Family Chiropractic:
Steven E. Cowen, Esq.
S. E. COWEN LAW
333 "H" Street, Suite 500
Chula Vista, CA 91910
Telephone: (619) 202-7511
Facsimile: (619) 489-0431
E-mail: Cowen.steve@secowenlaw.com
About Mouroux Family Chiropractic
Mouroux Family Chiropractic, Inc., offers "one-stop" chiropractic
and medical services in the greater San Jose, California area.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Cal. Case No. 23-50186) on Feb. 24,
2023, with $50,001 to $100,000 in assets and $500,001 to $1 million
in liabilities. Judge Stephen L. Johnson oversees the case.
Steven E. Cowen, Esq., at S.E. Cowen Law, is the Debtor's legal
counsel.
Tamar Terzian is the patient care ombudsman appointed in the
Debtor's bankruptcy case.
MV REALTY PBC: Court OKs Interim Cash Collateral Access
-------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Florida,
West Palm Beach Division, authorized MV Realty Holdings, LLC and
affiliates to use cash collateral on an interim basis in accordance
with the budget.
The Debtors require the use of cash collateral to fund payroll,
rent, insurance and other costs related to its business
operations.
As adequate protection for the interests of Goodwood Fund and
Monroe Capital Management Advisors, LLC in the cash collateral, the
Secured Creditors are granted continuing liens as of the Petition
Date on and security interests in all properly of the Debtors of
the same description, type and nature as was subject to the Secured
Creditors' pre-petition liens and security interests with such
Continuing Liens to have the same extent, validity and priority as
existed as of the Petition Date: provided however, that the
Continuing Liens will be at all times subject and junior to the
Administrative Carveout and any Professional Fee Carveout.
As additional adequate protection, the Secured Creditors are
granted valid, binding, enforceable, fully perfected replacement
liens and first priority security interests in the Debtors'
presently owned or hereafter acquired property and assets.
The Continuing Liens and Replacement Liens will be at all times
subject and junior to: (i) all unpaid fees required to be paid to
the Clerk of the Court and to the United States Trustee pursuant to
28 U.S.C. Section 1930 (a)(6) and (ii) any carveout for the benefit
of professionals agreed to by Secured Creditors as part of any
final cash collateral order.
These events constitute an Event of Default:
(i) the failure of Debtors to materially comply with the terms
and provisions of the Interim Order: provided that the Secured
Creditors will notify the Debtors' counsel in writing by telephone
facsimile or e-mail of any noncompliance by Debtors with the terms
and provisions of the Interim Order, and the Debtors will have
three business days from the sending of the notice to cure such
noncompliance;
(ii) any post-petition lien (other than any lien(s) recorded
against the property as of the petition date) is recorded against
the assets of the bankruptcy estate, except any lien granted on
assets of the bankruptcy estate to secure post-petition financing
to which lien the Secured Creditors have consented or which has
been granted pursuant to an order of the Court: or
(iii) the appointment of a trustee or an examiner, or conversion
of the case to a Chapter 7 case.
A final hearing on the matter is set for October 11, 2023 at 2:30
p.m.
A copy of the order is available at https://urlcurt.com/u?l=lvu3nc
from PacerMonitor.com.
About MV Realty PBC, LLC
MV Realty PBC, LLC is a real estate brokerage. The Debtor and
affiliates sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. Lead Case No. 23-17590) on September 22,
2023. In the petition signed by Antony Mitchell, authorized party,
the Debtor disclosed up to $50 million in assets and up to $100
million in liabilities.
Judge Erik P. Kimball oversees the case.
Michael D. Seese, Esq., at Seese, PA, represents the Debtor as
legal counsel.
NABIEKIM ENTERPRISES: Court OKs Cash Collateral Access Thru Dec 31
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of California,
Fresno Division, authorized NabieKim Enterprises, Inc. to use cash
collateral on an interim basis in accordance with the budget, with
a 10% variance, through December 31, 2023.
As previously reported by the Troubled Company Reporter, in 2017,
Calvin and Kaye Kim opened a Korean Fusion restaurant in Fresno,
California. The business struggled to grow, leading to
disagreements over Calvin's financial contributions. Kaye Kim
agreed to buy out Calvin's interest for $500,000. The deal was
negotiated in 2020, with monthly payments of $5,000 for 30 years.
Despite the pandemic, the business faced upheaval. Kaye Kim has
been working full-time to make the business successful, but has not
received a salary since September 2021. The bankruptcy filing is
due to two main reasons: Calvin Kim sued the debtor based on the
buyout agreement and the debtor's $312,000 EIDL loan. The debtor
has been unwilling to negotiate and cannot repay the debt and
Calvin Kim's debt.
The U.S. Small Business Administration is the sole creditor that
appears to have a perfected security interest in the cash
collateral. The security interest was perfected by the filing of a
UCC-1 on June 2, 2020, by the SBA based on the EIDL.
The Court said creditors with secured claims against the cash
collateral are granted replacement liens on the Debtor's
post-petition acquired assets, including but not limited to cash,
accounts, and accounts receivable to the extent such secured
creditor holds a prepetition security interest in such categories
of collateral; and the priority of such replacement liens will be
governed by the priority as they existed as of the petition date.
A further hearing on the matter is set for December 13, 2024 at
9:30 a.m.
A copy of the order is available at https://urlcurt.com/u?l=h6Jf9B
from PacerMonitor.com.
About NabieKim Enterprises
NabieKim Enterprises operates a Korean Fusion restaurant in Fresno,
California. NabieKim filed a petition under Chapter 11, Subchapter
V of the Bankruptcy Code (Bankr. E.D. Calif. Case No. 23-10571) on
March 24, 2023, with $50,000 to $100,000 in assets and $1 million
to $10 million in liabilities. Kaye Kim, chief executive officer
and president of NabieKim, signed the petition.
Judge Jennifer E. Niemann oversees the case.
Peter Fear, Esq., at Fear Waddell, P.C. is the Debtor's legal
counsel.
The United States Trustee has appointed David Sousa as Subchapter V
trustee.
NASHFIT LLC: Investment & Continued Operations to Fund Plan
-----------------------------------------------------------
NashFit LLC, d/b/a Mayweather Fitness + Boxing Studio, filed with
the U.S. Bankruptcy Court for the Eastern District of New York a
Disclosure Statement for Chapter 11 Plan dated October 2, 2023.
The Debtor operates pursuant to a franchise agreement with
Mayweather Boxing + Fitness, from its location in downtown
Nashville, TN.
The Debtor operates from its location pursuant to a lease for the
non-residential real property in which VU2013RRHG, LLC (the
"Landlord") is the Debtor's landlord. The Debtor was bound by the
Cross-Default provision insofar as Ains had defaulted. The Landlord
refused to separate the entities and when the Debtor sought to
address the pre-petition arrears with the Landlord as it related to
the Debtor, the Landlord indicated that the payment of the
pre-petition arrears as to the Debtor would not cure the default
under the Lease. As a result, the Debtor sought the protection of
this Court.
In addition to the issues with the Landlord, the Debtor also found
itself embroiled in litigation with Patch Boys, in connection with
the buildout of the gym. As a result, a judgment was entered
against the Debtor.
Recoveries projected in the Plan shall be from an investment in the
Debtor by a third party and the Debtor's continued operations. The
amounts invested shall be used to cure any pre-petition defaults
under the Debtor's lease for the non-residential real property from
which the Debtor operates its business; the payment of any
outstanding statutory fees due and owing the United States Trustee;
the payment of allowed costs of administration of the case (the
"Administrative Claims"); and a distribution to the holders of
Allowed Claims.
As the Plan proposes a payment of all timely filed allowed claims
in full, the Debtor's equity holders shall retain their interests
in the reorganized Debtor.
Class 1 consists of the Allowed General Unsecured Claims of the
Debtor. A creditor may hold an allowed general unsecured claim by
virtue of the Debtor having scheduled the claim in its bankruptcy
petition and schedules as a claim that is not disputed,
unliquidated or contingent. In such instance, the claim shall be
deemed allowed at the amount scheduled. In the event that a general
unsecured creditor filed a timely proof of claim, and that claim
was not objected to by the Debtor, that claim shall also be deemed
an allowed general unsecured claim. Finally, if a creditor
disagreed with the amount of the claim as scheduled by the Debtor,
that creditor could also have an allowed claim by the filing of a
timely proof of claim which claim was not objected to by the
Debtor.
The Debtor scheduled the following creditors as holding general
unsecured claims as against the Debtor:
* The Patch Boys of the Southeast in the amount of $25,000.00
* VU2013 RRHG LLC (Landlord) in the amount of $46,718.77
* As Patch Boys filed a claim (Claim No. 3) in the amount of
$43,736.71, which claim has not been objected to, it shall be an
allowed claim in the amount of $43,736.71.
* As the Landlord's claim is being paid in connection with the
Debtor's assumption of the Lease, no payments will be provided for
under the Plan. The Debtor notes that there is a significant
dispute between the Landlord and the Debtor as to the Landlord's
right to recover legal fees. This issue will need to be resolved by
an Order of the Bankruptcy Court. The Debtor shall pay to the
Landlord the legal fees either agreed to by and between the parties
or the amounts fixed by an Order of the Bankruptcy Court.
* Claim No. 3 shall be paid in full, without interest upon the
Effective Date of the Plan.
* Uline filed a claim (Claim No. 2) in the amount of $600.44.
Claim No. 2 shall be paid in full, without interest upon the
Effective Date of the Plan.
Class 1 is impaired under the Plan.
Class 2 consists of the Ownership Interest of the Debtor's equity
holders. Because the Debtor proposes to pay all claims in full, the
Debtor's equity holders shall retain their respective interests in
the reorganized Debtor.
Upon the entry of the Confirmation Order, the Debtor shall have
received an investment from a third party which funds shall be
sufficient to pay the cure amount due and owing the Landlord; the
allowed costs of administration; any amounts that may be due and
owing to the United States Trustee and the distributions
contemplated under the Plan.
A full-text copy of the Disclosure Statement dated October 2, 2023
is available at https://urlcurt.com/u?l=dMxVmg from
PacerMonitor.com at no charge.
Attorneys for NashFit LLC:
Fred S. Kantrow, Esq.
The Kantrow Law Group, PLLC
732 Smithtown Bypass, Suite 101
Smithtown, NY 11787
Tel: (516) 703-3672
Email: fkantrow@thekantrowlawgroup.com
About Nashfit LLC
NashFit LLC, doing business as Mayweather Fitness + Boxing Studio,
is a Delaware limited liability company formed on or about April 1,
2021.
The Debtor filed a Chapter 11 bankruptcy petition (Bankr. E.D.N.Y.
Case No. 23-41999) on June 5, 2023, with as much as $1 million in
both assets and liabilities. Judge Nancy Hershey Lord oversees the
case.
The Debtor is represented by Fred S. Kantrow, Esq., at The Kantrow
Law Group, PLLC.
NEP GROUP INC: $240MM Bank Debt Trades at 21% Discount
------------------------------------------------------
Participations in a syndicated loan under which NEP Group Inc is a
borrower were trading in the secondary market around 79.3
cents-on-the-dollar during the week ended Friday, October 6, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $240 million facility is a Term loan that is scheduled to
mature on October 19, 2026. The amount is fully drawn and
outstanding.
NEP Group provides broadcasting services. The Company is a supplier
to broad spectrum of content across both sports and entertainment.
The Company offers outside broadcast, studio production, audio,
lighting and media management services.
NOBLE HEALTH II: Amends Plan to Include Several Secured Claims Pay
------------------------------------------------------------------
Noble Health Real Estate II LLC submitted an Amended Disclosure
Statement for the Amended Plan of Reorganization dated October 3,
2023.
The Plan reflects the Debtor's determined effort to maintain the
economic integrity of its businesses and promote the greatest value
for the benefit of their creditors. Debtor believes that creditors
will receive more value under the Plan than they would receive if
the Debtor was liquidated under Chapter 7 of the Bankruptcy Code
and that the Plan offers prospects for the highest and best
recovery to creditors that can be obtained.
After the Effective Date of the Plan, Debtor anticipates that it
will be owned by Ziva Properties, LLC. However, the ultimate owners
of Ziva Properties may change to the extent necessary to obtain
additional investors who require equity in exchange for their
investments.
Debtor is the owner of real property located primarily in Audrain
County Missouri (the "Real Property"). The remaining property
outside of Mexico Missouri was used for various clinics,
rehabilitation centers and other medical related uses.
On the Effective Date, Debtor as master landlord will enter into a
master lease substantially in the form attached as Exhibit I of the
Real Property with Blessed Health LLC as the master tenant. Blessed
Health is an affiliate of Debtor because Blessed Health is
ultimately owned by Kalman Groner, Gary Greenstein and Zevi
Reisman.
Blessed Health will pay monthly rent to the Debtor of $147,000,
which Debtor believes will be sufficient to pay all of the
obligations due under the Plan as well as pay all other ongoing
expenses of Debtor, including insurance, taxes and maintenance.
Payment of these expenses is a condition of the rent due under the
master lease, and if these expenses are not paid for by the Debtor,
the tenant will have the option under the master lease to pay for
them directly and take a credit on its rent obligation.
Blessed Heath will have sufficient funds to pay the monthly rent
based on subleases entered into by Blessed Health, with (i) a
critical access hospital in Mexico, MO owned and operated by an
affiliate of Blessed Health, (ii) various partnerships between
third-party medical and service providers and an affiliate of
Blessed Health, and (iii) third-party and related party medical and
service providers.
Blessed Health anticipates each of the subtenants will execute a
sublease substantially in the forms attached as Exhibit K. To the
extent that initially Blessed Health is not receiving sufficient
rental income to pay the rent owed on the lease with Debtor, in
exchange for reissuance of the membership interest of Debtor to
Ziva Properties in the Plan, Kalman Groner, Gary Greenstein and
Zevi Reisman will guarantee the first six months' rent due under
the master lease.
Class I consists of the Secured and Unsecured Claim of Central
Bank. Central Bank's Secured Claim shall be $2,150,323 and shall be
amortized over 30 years at the contractual interest rate of 4.90%,
with a monthly payment of $11,412. The outstanding balance of
Central Bank's Secured Claim shall be paid in full by October 1,
2030. On the Effective Date, Debtor shall transfer the properties
listed on Exhibit P to Central Bank. For the Unsecured Claims,
Central Bank shall receive quarterly payments of $4,125 beginning
January 1, 2024, and continuing for 12 consecutive quarters.
Class II consists of the Secured Claim of Audrain County. If
allowed, the Secured Claim of Audrain County shall be paid in 20
quarterly payments of $49,219, with the balance due on the fifth
anniversary of the Petition date.
Class III consists of the Secured Claim of the City of Mexico. This
Claim shall be paid in 20 quarterly payments of $26,241, with the
balance due on the fifth anniversary of the Petition date.
Class IV consists of the Secured Claim of Phil Hagedorn. Phil
Hagedorn's Allowed Secured Claim shall be $2400 paid in 4 quarterly
payments of $600 commencing March 31, 2023.
Like in the prior iteration of the Plan, Unsecured Creditors shall
receive their pro rata share of shall of quarterly payments of
$4,125 beginning January 1, 2024, and continuing for 12 consecutive
quarters.
The Debtor intends the Debtor to continue in business by
reorganizing its operations and debt structure. Debtor intends to
enter into a master lease with Blessed Health LLC, an affiliate of
Debtor. The lease will provide payments from Blessed Health that
are sufficient to make all of the payments due under the Plan and
to pay all other costs associated with the Real Estate, including
taxes, insurance and maintenance.
Debtor estimates that the subleases may not generate sufficient
income to Blessed Health during the first six months of the master
lease. Accordingly, Kalman Groner, Gary Greenstein and Zevi Reisman
have agreed to guarantee the first six months of payments under the
master lease in exchange for the re-issued membership interest in
the Debtor.
A full-text copy of the Amended Disclosure Statement dated October
3, 2023 is available at https://urlcurt.com/u?l=YXXg5I from
PacerMonitor.com at no charge.
Attorney for Debtor:
Ronald S. Weiss, Esq.
Joel Pelofsky, Esq.
Berman, DeLeve, Kuchan & Chapman, LLC
1100 Main, Suite 2850
Kansas City, MO 64105
Phone: (816) 471-5900
Fax: (816) 842-9955
Email: rweiss@bdkc.com
Email: jpelofsky@bdkc.com
About Noble Health Real Estate II
Noble Health Real Estate II, LLC is engaged in activities related
to real estate. The Debtor is based in Fulton, Mo.
Noble Health Real Estate II filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Mo. Case No.
23-20100) on March 3, 2023. In the petition signed by Zev M.
Reisman, general manager and corporate secretary, the Debtor
disclosed up to $50,000 in assets and up to $50 million in
liabilities.
Judge Dennis R. Dow presides over the case.
The Debtor tapped Berman, DeLeve, Kuchan & Chapman, LLC as
bankruptcy counsel and CFGI as restructuring advisor. Joseph Baum,
a partner at CFGI, serves as the Debtor's chief restructuring
officer.
NOBLE HEALTH: Amends Plan to Include Phil Hagedorn Secured Claim
----------------------------------------------------------------
Noble Health Real Estate LLC, submitted an Amended Disclosure
Statement for the Amended Plan of Reorganization dated October 3,
2023.
The Plan reflects the Debtor's determined effort to maintain the
economic integrity of its businesses and promote the greatest value
for the benefit of their creditors. Debtor believes that creditors
will receive more value under the Plan than they would receive if
the Debtor was liquidated under Chapter 7 of the Bankruptcy Code
and that the Plan offers prospects for the highest and best
recovery to creditors that can be obtained.
After the Effective Date of the Plan, Debtor anticipates that it
will be owned by Ziva Properties, LLC. However, the ultimate owners
of Ziva Properties may change to the extent necessary to obtain
additional investors who require equity in exchange for their
investments.
Debtor is the owner of real property located primarily in Fulton
County Missouri (the "Real Property"). The property listed on
Exhibit B that is located in Fulton Missouri was previously used as
part of a hospital complex. The remaining property outside of
Fulton Missouri was used for various clinics, rehabilitation
centers and other medical related uses.
On the Effective Date, Debtor as master landlord will enter into a
master lease substantially in the form attached as Exhibit I of the
Real Property with Blessed Health LLC as the master tenant. Blessed
Health is an affiliate of Debtor because Blessed Health is
ultimately owned by Kalman Groner, Gary Greenstein and Zevi
Reisman.
Blessed Health will pay monthly rent to the Debtor of $52,000,
which Debtor believes will be sufficient to pay all of the
obligations due under the Plan as well as pay all other ongoing
expenses of Debtor, including insurance, taxes and maintenance.
Payment of these expenses is a condition of the rent due under the
master lease, and if these expenses are not paid for by the Debtor,
the tenant will have the option under the master lease to pay for
them directly and take a credit on its rent obligation.
Blessed Health will have sufficient funds to pay the monthly rent
based on subleases entered into by Blessed Health, with (i) a rural
emergency hospital in Fulton, MO owned and operated by an affiliate
of Blessed Health, (ii) various partnerships between third-party
medical and service providers and an affiliate of Blessed Health,
and (iii) third-party and related party medical and service
providers.
Blessed Health Care anticipates each of the subtenants will execute
a sublease substantially in the forms attached as Exhibit K. To the
extent that initially Blessed Health is not receiving sufficient
rental income to pay the rent owed on the lease with Debtor, in
exchange for the reissuance of the membership interest of Debtor to
Ziva Properties in the Plan Kalman Groner, Gary Greenstein and Zevi
Reisman will guarantee the first six months' rent due under the
master lease.
Class I consists of the Secured and Unsecured Claim of Lead Bank.
Lead Bank's Secured Claim shall be $881,447 and shall be amortized
over 30 years at the contractual interest rate of 5.5%, with a
monthly payment of $5,005. The outstanding balance of Lead Bank's
Secured Claim shall be paid in full by October 1, 2030. For the
Unsecured Claims, Lead Bank shall receive quarterly payments of
$2,083 beginning January 1, 2024 and continuing for 12 consecutive
quarters.
Class II consists of the Allowed Secured Claim of Phil Hagedorn.
Phil Hagedorn's Allowed Secured Claim shall be $2400 paid in 4
quarterly payments of $600 commencing March 31, 2023.
Like in the prior iteration of the Plan, Unsecured Creditors shall
receive their pro rata share of shall of quarterly payments of
$2,083 beginning January 1, 2024, and continuing for 12 consecutive
quarters.
The Debtor intends to continue in business by reorganizing its
operations and debt structure. Debtor intends to enter into a
master lease with Blessed Health LLC, an affiliate of Debtor. The
lease will provide payments from Blessed Health that are sufficient
to make all of the payments due under the Plan and to pay all other
costs associated with the Real Estate, including taxes, insurance
and maintenance.
Debtor estimates that the subleases may not generate sufficient
income to Blessed Health during the first six months of the master
lease. Accordingly, Kalman Groner, Gary Greenstein and Zevi Reisman
have agreed to guarantee the first six months of payments under the
master lease in exchange for the re-issued membership interest in
the Debtor.
A full-text copy of the Amended Disclosure Statement dated October
3, 2023 is available at https://urlcurt.com/u?l=fAaNym from
PacerMonitor.com at no charge.
Attorney for Debtor:
Ronald S. Weiss, Esq.
Joel Pelofsky, Esq.
Berman, DeLeve, Kuchan & Chapman, LLC
1100 Main, Suite 2850
Kansas City, MO 64105
Phone: (816) 471-5900
Fax: (816) 842-9955
Email: rweiss@bdkc.com
Email: jpelofsky@bdkc.com
About Noble Health Real Estate
Noble Health Real Estate, LLC, is engaged in activities related to
real estate. It owns a building located at 10 Hospital Drive,
Fulton, Mo., valued at $7.9 million.
Noble Health Real Estate filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Mo. Case No.
23-20051) on Feb. 10, 2023, with $7,900,000 in assets and
$4,869,845 in liabilities. Zev M. Reisman, general manager and
corporate secretary of Noble Health Real Estate, signed the
petition.
The Debtor tapped Ronald S. Weiss, Esq., at Berman, DeLeve, Kuchan
& Chapman, LLC as counsel and Joseph Baum at CFGI as chief
restructuring officer.
NOBLE HOUSE: Court OKs $12MM DIP Loan from Wells Fargo
------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas,
Houston Division, authorized Noble House Home Furnishings, LLC, on
an interim basis, to use cash collateral and obtain postpetition
financing consisting of a senior secured superpriority revolving
credit facility in the aggregate principal amount of up to $12
million in new money advances plus the roll-up of certain
prepetition obligations, pursuant to the terms and conditions of
the Senior Secured Super-Priority Debtor-In-Possession Credit
Agreement by the Debtors and Wells Fargo Bank, National
Association, as administrative agent.
The DIP Facility is due and payable through the earliest to occur
of:
(a) October 31, 2023;
(b) The date of termination of all of the Loan Commitments;
(c) The date on which the Obligations become due and payable
pursuant to the Agreement, whether by acceleration or otherwise;
(d) The effective date of a Plan of Reorganization for the
Debtors;
(e) The date of a sale of all or substantially all of the
Debtors' assets, including, without limitation, under 11 U.S.C.
Section 363 and/or 365;
(f) The first Business Day on which the Interim Order expires
by its terms or is terminated, unless the Final Order has been
entered and become effective prior thereto;
(g) The date the Final Order is vacated, terminated,
rescinded, revoked, declared null and void or otherwise ceases to
be in full force and effect;
(h) The date of a conversion of any of the Chapter 11 Cases to
a case under Chapter 7 of the Bankruptcy Code or any Loan Party
will file a motion or other pleading seeking the conversion of the
Chapter 11 Cases to Chapter 7 of the Bankruptcy Code, unless
otherwise consented to in writing by the Agent; and
(i) The date of dismissal of any of the Chapter 11 Cases,
unless otherwise consented to in writing by the Agent.
The Debtors are required to comply with these milestones:
1. On the Petition Date or within one day thereafter, the
Debtors will have filed the DIP Motion;
2. On the Petition Date or within one day thereafter, the
Debtors will have filed a motion seeking, among other things,
authorization for the Debtors to enter into the Stalking Horse
Purchase Agreement and approval of certain deadlines and hearing
dates in connection with the sale of all or substantially all of
the Debtors' assets;
3. On or before 14 days after the Petition Date, the Debtors
will have obtained an order (in form and substance acceptable to
the DIP Agent) approving the Bid Procedures Motion that, among
other things, authorizes the Debtors to enter into the Stalking
Horse Purchase Agreement and establishes no later than October 18,
2023, as the deadline for the submission of bids for the sale of
all or substantially all of the Debtors' assets;
4. On or before 30 days after the Petition Date, the Debtors
will have obtained the Final Order;
5. On or before October 23, 2023, the Debtors will have, if
necessary, conducted an auction, and selected the winning bid for
the sale of all or substantially all of the Debtors' assets;
6. On or before October 25, 2023, the Debtors will have
obtained an order approving the Winning Bid; and
7. On or before October 31, 2023, the Debtors will have
consummated a sale of all or substantially all of the Debtors'
assets with sufficient cash proceeds on the closing date to cause
the DIP Obligations and the Prepetition ABL Obligations to be Paid
in Full.
It will be an Event of Default if the Debtors fail to comply with
any of the deadlines established in the Bid Procedures Order or if
a notice of termination is received by (or delivered from) the
Debtors in connection with a Stalking Horse Purchase Agreement or
any purchase agreement in connection with the Winning Bid.
The Prepetition ABL Agreement, dated December 3, 2021, provided
financial accommodations to certain Debtors and their affiliates,
with Wells Fargo Bank acting as the administrative agent. The
Prepetition ABL Lenders, along with various lenders, issued letters
of credit for the accounts of the Debtors, as per the Prepetition
ABL Documents and other agreements and documents.
The Prepetition ABL Facility provided the Debtors with up to $110
million in revolver commitments, including letters of credit
obligations. As of the Petition Date, the aggregate principal
amount outstanding was $70.390 million in outstanding revolving
loans and $3.5 million in issued and outstanding letter of credit
obligations. The Facility also included accrued and unpaid
interest, outstanding letters of credit, reimbursement obligations,
fees, expenses, disbursements, treasury, cash management, bank
product and derivative obligations, indemnification obligations,
and guarantee obligations.
As adequate protection for the use of cash collateral, the
Prepetition ABL Agent, for the benefit of itself and the
Prepetition ABL Parties, is granted continuing, valid, binding,
enforceable, and perfected postpetition security interests in and
liens on the DIP Collateral.
As further adequate protection of the interests of the Prepetition
ABL Parties in the Prepetition Collateral and solely to the extent
of any Diminution in Value of such interests in the Prepetition
Collateral, the Prepetition ABL Agent, on behalf of itself and the
Prepetition ABL Parties, is granted as and to the extent provided
by 11 U.S.C. section 507(b) an allowed superpriority administrative
expense claim in each of the Cases and any Successor Cases.
These events constitute an "Event of Default":
(i) The failure of the Debtors to perform, in any respect, any
of the terms, provisions, covenants, or obligations under the
Interim Order, including the failure to comply with the Case
Milestones or the Budget; or
(ii) The occurrence of an "Event of Default" under the Interim
Order or the DIP Agreement, or the failure of the Debtors to
perform, in any respect, any of the terms, provisions, covenants,
or obligations under the Interim Order.
A copy of the Court's final order and the Debtor's budget is
available at https://urlcurt.com/u?l=7etjWY from PacerMonitor.com.
The Debtor projects total disbursements, on a weekly basis, as
follows:
$7,827,602 for October 7, 2023;
$6,789,276 for October 14, 2023;
$5,986,222 for October 21, 2023; and
$6,454,189 for October 28, 2023.
About Noble House Home Furnishing LLC
Noble House Home Furnishing LLC and affiliates are distributors,
manufacturers and retailers of indoor and outdoor home furnishings
with distribution throughout e-commerce channels including partners
such as Amazon, WalMart, Costco, Wayfair, Overstock, Target and
Home Depot, fulfilling direct to consumer orders from its
distribution centers. Family-owned since its founding in 1992,
Noble House and its affiliated entities design, market and sell
products under several brands including Christopher Knight Home,
NobleHouse, LePouf, OkiOki, Best Selling, and GDFStudio. They also
sell through wholesale channels, primarily to the Big Box retailers
like TJMaxx, Home Goods, Marshalls, Ross Stores and others.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 23-90773) on
September 11, 2023. In the petition signed by Gayla Bella, chief
financial officer, the Debtor disclosed up to $500 million in both
assets and liabilities.
Judge Christopher M. Lopez oversees the case.
The Debtors tapped Pachulsk Stang Ziehl & Jones LLP as legal
counsel and Epiq Corporate Restructuring, LLC, as claims and
noticing agent.
Wells Fargo Bank, as DIP Lender, is represented by Marshall
Stoddard, Jr., Esq. at Morgan, Lewis & Bockius LLP.
NOVA CHEMICALS: S&P Downgrades LT ICR to 'BB-', Outlook Negative
----------------------------------------------------------------
S&P Global Ratings lowered its long-term issuer credit rating on
Nova Chemicals Corp. and issue-level rating on the company's
unsecured debt to 'BB-' from 'BB'.
Assuming management addresses the $1.05 billion June 2024 notes
maturity no later than year-end 2023, the negative outlook reflects
the risk of weaker-than-expected economic conditions and potential
that S&P could lower the rating if it does not expect Nova's FFO to
debt to improve above 12% on a sustained basis.
S&P said, "The downgrade reflects the challenging macroeconomic
environment, which we expect will keep Nova's FFO to debt below 20%
over the next 12 months. Nova's EBITDA dropped significantly in the
first half of 2023, declining by a steep 75% compared with the same
period last year. Inventory destocking in late 2022, continued weak
demand amid a backdrop of macroeconomic uncertainty, and
slower-than-anticipated recovery in China have significantly
lowered product prices and compressed margins for producers in the
industry. At the same time, supply has remained steady, with
significant capacity additions in ethylene and polyethylene (PE)
that have come onstream in North America, resulting in market
imbalance.
"We anticipate demand will remain subdued in the second half of
2023 and forecast Nova's full-year EBITDA will trough at about half
of 2022 levels. At these levels, we expect adjusted FFO to debt of
about 12% and adjusted debt to EBITDA of 7x in 2023. We believe
there is potential for margins to recover in 2024 and 2025 assuming
demand improves, capacity additions moderate, and Nova benefits
from the ramp up of its second Advanced SCLAIRTECH (AST2) facility
(950,000 pounds capacity, a 20% increase to current volumes).
Despite the improvement, we do not project adjusted FFO to debt to
improve above 20% until at least 2025, which underpins the rating
action.
"We assume management will address its upcoming maturity before the
end of 2023. The company has material upcoming debt maturities,
with $1.05 billion of notes coming due June 2024. We believe
management will address refinancing by year-end 2023, albeit at
higher coupon given the current interest rate environment. The
4.875% notes are currently trading close to par, with indicative
yields of 7.6%.
"We also note the company has a $1.5 billion credit facility, which
we expect will have close to full availability by year-end,
providing some liquidity cushion to address the required debt
refinancing. Accordingly, our base-case scenario assumes management
will successfully refinance the June 2024 debt maturity before the
end of 2023. However, in our view, the delayed refinancing of the
upcoming debt maturity signals somewhat aggressive financial and
risk management policies from management.
"The rating action also reflects our view that gross debt reduction
is unlikely over our forecast period, with Nova's credit measures
continuing to exhibit volatility. Post-completion of the growth
projects (the Corunna expansion and the AST2 facility) in 2022, we
assume Nova's capital spending will meaningfully decline and
average $500 million-$550 million annually over the next two years,
relative to about $835 million spent in 2022. We expect capital
spending to be largely sustaining and turnaround-related, with a
modest amount of growth spending related to the company's 2030
strategy.
"Management recently announced investment in developing a recycling
facility in Indiana, a step toward achieving 30% recycled content
in PE sales by 2030. Despite the lower spend in 2024, we expect
there may be some cash outlays in 2024 relating to the litigation
claims concerning the jointly owned ethylene cracker with Dow
Chemicals at the Joffre site, which affects our free cash flow
expectation. We believe damages could be awarded to Nova following
the court's assessment for the top-off period (2013-2018) and
redetermination of damages for the base period (2001-2012),
expected sometime in 2024.
"Accordingly, we don't anticipate free cash flow generation until
2025 and believe it is unlikely that the company will repay the
$425 million term loan due December 2024 with cash. In the absence
of meaningful gross debt reduction, we believe Nova will continue
to exhibit substantive volatility as evidenced in recent years,
with FFO to debt declining to 15% in 2022 from 62% in 2021. Given
the company's sensitivity to the inherent volatility in the
petrochemical sector, we will closely monitor how management adapts
its financial policy decisions in the current challenging market
conditions.
"Our business risk assessment of Nova reflects the company's
relatively good market position, scale, and structurally
advantageous cost position; however, it lacks scope and diversity
compared with its larger peers. Nova has a good market position in
the North American ethylene and PE industry, and we believe its
scale has further strengthened following mechanical completion of
the new PE facility in Sarnia, Ont. (950,000 pounds capacity) in
the third quarter of 2023. It also completed the Corunna expansion
in the third quarter of 2022, expanding capacity by 50%.
"In addition, our assessment factors in the company's diverse
feedstock access and cost-advantaged position in North America,
given its access to lower-cost natural gas relative to that of
global peers that use naphtha as an input. We believe the energy
crisis in Europe has further strengthened the company's competitive
advantage. Although we expect margins will weaken in the fourth
quarter and through 2023, we estimate Nova's EBITDA margins on a
weighted-average basis will remain in the top quartile of our
commodity chemicals peer group.
"Partially offsetting these strengths is Nova's relatively limited
product and operational diversity. We believe the company has less
comprehensive scale, scope, and diversity than that of peers such
as Westlake Chemical Corp. and LyondellBasell Industries N.V.,
which are significantly larger and have better product diversity.
"The negative outlook reflects the potential for Nova's cash flow
generation and credit measures to weaken beyond what we consider in
our base case. We expect its credit measures to remain elevated in
2023 but improve in 2024 and beyond as demand recovers.
Specifically, we estimate adjusted FFO to debt of about 12% in
2023, improving to 17% in 2024. Our base case also assumes the
company addresses the $1.05 billion June 2024 notes maturity no
later than year-end 2023.
"Assuming NOVA's strategic importance to its parent company remains
unchanged, thereby maintaining a one-notch uplift in its final
rating, we could, nevertheless, lower the rating over the next 12
months if weak economic conditions persist for a prolonged period
while the company continues to outspend operating cash flows,
limiting improvement in credit measures. In this scenario, we would
expect Nova's weighted-average adjusted FFO to debt to remain below
12% on a sustained basis. We could also lower the rating if the
company cannot address the $1.05 billion June 2024 notes maturity
before year-end 2023.
"We could revise the outlook to stable if we expect Nova's adjusted
FFO to debt to improve in line with our current expectation beyond
2023, specifically the upper end of 12%-20%, and remain there after
factoring in financial policy decisions. We believe this could
occur if demand rebounds materially, supporting product prices, and
management limits discretionary spending well within internal cash
flow generation. In this scenario, we would also expect the company
to successfully refinance its June 2024 debt maturity.
"Environmental factors are a moderately negative consideration in
our credit rating analysis of Nova due to the increasing need for
petrochemical producers to address challenges regarding plastic
pollution and carbon dioxide (CO2) emissions. The company's
absolute emissions decreased 8% from 2018 to 2022, primarily from
lower production, while greenhouse gas intensity increased to 0.69
kilotonnes (kt) in 2022 from 0.66 kt of CO2 emissions in 2018."
The company is taking steps toward a smaller environmental
footprint by engaging in initiatives related to recycled plastics
and improving the recyclability of its plastics, targeting 30% of
PE sales to be derived from recycled content by 2030. However, the
health and environmental impact related to plastic pollution and
inherent volatility in commodity pricing limit any improvement in
the business risk profile.
Governance factors are also a moderately negative consideration and
are weaker relative to the broader industry given the multiple
leadership changes recently, as well as litigation-related payments
(about $1.5 billion) to Dow Chemicals in 2017 and 2019, which
impaired its cash flow metrics.
ORLY EQUITIES: Involuntary Chapter 11 Case Summary
--------------------------------------------------
Alleged Debtor: Orly Equities LLC
224 Hungry Harbor Rd
Valley Stream, NY 11581
Business Description: Orly Equities is a Single Asset Real Estate
debtor (as defined in 11 U.S.C. Section 101
(51B)).
Involuntary Chapter
11 Petition Date: October 6, 2023
Court: United States Bankruptcy Court
Eastern District of New York
Case No.: 23-73714
Judge: Hon. Louis A. Scarcella
Petitioners' Counsel: Filed Pro Se
A full-text copy of the Involuntary Petition is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/XOTMWAA/Orly_Equities_LLC__nyebke-23-73714__0001.0.pdf?mcid=tGE4TAMA
Alleged creditor who signed the petition:
Petitioner Nature of Claim Claim Amount
---------- --------------- ------------
Jean Gerald Bernard Management $18,750
451 Fulton Ave Apt A 631
Hempstead NY 11550
OROVILLE, CA: S&P Places 'B' 2019 Rev. Bonds Rating on Watch Neg.
-----------------------------------------------------------------
S&P Global Ratings placed its 'B' long-term rating on the City of
Oroville, Calif.'s series 2019 revenue bonds, issued for Oroville
Hospital (Oroville), on CreditWatch with negative implications.
"The CreditWatch placement reflects new publicly available
information posted Oct. 4, 2023, from U.S. Bank N.A. confirming
that the violation of the hospital's debt service coverage covenant
on the series 2018 bonds (unrated by S&P Global Ratings) triggered
an event of default and that no waiver for the covenant violation
has been granted," said S&P Global Ratings credit analyst Blake
Fundingsland.
While S&P understands that the 2018 bondholders do not have
acceleration rights, it believes acceleration could be possible
based on the 2019 bond documents. Waiver conversations for the
series 2019 bonds remain ongoing.
At the time of S&P's previous analysis, published Sept. 29, 2023,
it was aware Oroville had a DSC violation (1.15x required under its
continuing covenant agreement and 1.00x required under its master
trust indenture) on its $16.5 million series 2018 bank debt held by
U.S. Bank N.A. (as successor to MUFG Union Bank) and management
indicated discussions were ongoing with bondholders and the bank.
However, the Oct. 4, 2023, disclosure on EMMA of a notice dated
Sept. 15, 2023, indicates that the ongoing default has no cure
period and has not been waived by the bank.
Management indicates it is still working with bondholders and the
bank to receive a waiver for the covenant violations. As of May 31,
2023, the cash-to-debt ratio was at an extremely low 5.9%. As part
of the continuing covenant agreement, Oroville is required to
maintain deposits at U.S. Bank N.A. totaling $5 million, but as of
Sept. 15, 2023, the city had a shortfall of around $3 million.
Oroville has received, and expects to receive, 340B and hospital
quality assurance fee funds that could improve unrestricted
reserves, but this could be partially offset by the deposit
requirements to U.S. Bank N.A.
PALMER DRIVES: Unsecured Claims Under $3K to be Paid in Full
------------------------------------------------------------
Palmer Drives Controls & Systems, Inc., filed with the U.S.
Bankruptcy Court for the District of Colorado a Subchapter V Plan
of Reorganization dated October 2, 2023.
The Debtor, formed in 2011, is a Colorado corporation located in
Englewood, Colorado. The Debtor is a manufacturer of industrial
electronic controls equipment, including control panels, oem
panels, motor starters, system integration and enclosure
modification.
This bankruptcy filing is prompted by a judgment entered in favor
of Autotech Technologies, LP and against the Debtor for breach of
contract, intentional interference with prospective business
relations, and breach of fiduciary duty. Autotech was awarded
$195,900 plus attorneys' fees and cost. Autotech is seeking
$91,518.97 in pre-judgment interest, $32,736.73 in costs, and
$98,039 in legal fees.
Class 4(a) consists of the general unsecured creditors of the
Debtor who hold Allowed Claims of $3,000 or less. Class 4(a) shall
receive payment in full of its Allowed Claim on or before six
months after the Effective Date of the Plan from the monies
deposited into the Unsecured Creditor Account.
Class 4(b) consists of general unsecured creditors of the Debtor
who hold Allowed Claim of greater than $3,000. Class 4(b) shall
receive payment of their Allowed Claims as set forth:
* Any Class 4(b) claimant who holds an Allowed Claim may
reduce its Claim to $3,000 and be treated as a Class 4(a) claimant.
* Holders of Class 5 Allowed Claims shall share on a Pro Rata
basis monies deposited into the Unsecured Creditor Account. Upon
the first full month following the Effective Date of the Plan and
every month until Administrative Claims are paid in full and then
for the remainder of the Term of the Plan the Debtor will every
month in accordance with the terms of this Plan deposit for the
five year term of the Plan: (a) during the first year of the Plan
$26,374; (b) during the second year of the Plan $26,008; (c) during
the third year term of the Plan $28,952; (d) during the fourth year
of the Plan $27,016 and (e) during the fifth year of the Plan
$26,654. At the end of each calendar quarter, the balance of the
Unsecured Creditor Account will be distributed to the holders of
Allowed Administrative Claims on a Pro Rata basis until such time
as all holders of Allowed Administrative Claims have been paid in
full, and then will be distributed to Class 4(b) general unsecured
creditors that hold Allowed Claims on a Pro Rata basis, less the
payment made to Class 4(a). The obligation to make deposits will
terminate at the end of the earlier of: (a) the five-year term of
the Plan or (b) upon satisfaction of Allowed Administrative Claims
and Allowed Claims in Class 4(a) and Class 4(b).
* All funds recovered by the Debtor on account of Avoidance
Actions shall be distributed to Allowed Administrative Claims until
paid in full and then to Class 4(a) until paid in full and then
Class 4(b) claimants holding Allowed Claims on a pro-rata basis,
net of attorneys' fees and costs. Whether or not the Debtor pursues
any Avoidance Actions shall be up to the Debtor and the decision to
pursue such claims shall be discretionary with the Debtor.
Class 5 includes the Interests in the Debtor, which Interests are
unimpaired by the Plan. Upon confirmation of the Plan, all Class 5
Interest holders will retain their ownership Interests in the
Debtor.
On the Effective Date of the Plan, the Debtor will open a separate
interest-bearing deposit account at a federally insured commercial
bank selected by the Debtor. The bank account will be maintained by
the Debtor as the Unsecured Creditor Account into which all
payments made by the Debtor for the benefit of holders of Allowed
Administrative Claims and Class 6 creditors will be made until the
obligations under the Plan are completed.
The funding for the Plan will come from the Debtor's continued
operations. As detailed in the Projections, the Debtor will have
sufficient cash on hand and profits during the term of the Plan to
satisfy its Plan obligations. The Debtor has sufficient cash on
hand to pay Administrative Claims in full on the Effective Date of
the Plan.
Under the Plan it is projected that the Debtor will be paying up to
$1,620,070 under the Plan depending upon the total amount of Claims
asserted against the estate. It is projected for purposes of this
analysis that the total Class 4(a) Allowed Claims will total
$34,818.01. The Plan contemplates that all creditors holding
Allowed Unsecured Claims in Class 4(a) will receive a 100%
distribution. Class 4(b) is projected for purposes of this analysis
to total $1,440,453.16. After the payment of $34,818.01 to Class
4(a) it is projected that there will be $1,440,453.16 will
available for distribution to Class 4(b). Accordingly, it is
projected that under the Plan Class 4(b) will receive a
distribution of 100%.
A full-text copy of the Subchapter V Plan dated October 2, 2023 is
available at https://urlcurt.com/u?l=GcEN8s from PacerMonitor.com
at no charge.
Attorneys for Debtor:
Aaron A. Garber, Esq.
David J. Warner, Esq.
Wadsworth Garber Warner Conrardy, PC
2580 West Main Street, Suite 200
Littleton, CO 80120
Telephone: (303) 296-1999
Facsimile: (303) 296-7600
Email: agarber@wgwc-law.com
dwarner@wgwc-law.com
About Palmer Drives Controls and Systems
Palmer Drives Controls and Systems, Inc., is a nationally
recognized manufacturer of industrial electrical control equipment,
including magnetic motors starters and industrial controls panels.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Colo. Case No. 23-13002) on July 10,
2023. In the petition signed by Lynn Weberg, president, the Debtor
disclosed $3,328,915 in assets and $3,118,969 in liabilities.
Judge Joseph G Rosania, Jr. oversees the case.
Aaron A. Garber, Esq., at Wadsworth Garber Warner Conrardy, P.C.,
is the Debtor's legal counsel.
PANACEA LIFE: To Acquire PUR LIFE Medical Franchise for $1-Mil.
---------------------------------------------------------------
Panacea Life Sciences Holdings, Inc. announced it has entered into
an Asset Purchase Agreement to acquire the PUR LIFE Medical
Franchise, an innovative franchise company providing cutting-edge
pain and prevention solutions as an integrative and synergistic
approach to health and healing. The acquisition of PUR LIFE adds
to Panacea's unique, vertical integration strategy in the natural
health and wellness space as we now control manufacturing,
production, and distribution of products and services into the $3
trillion U.S. healthcare market.
Founded by one of the experts in the franchise industry, Mr. Dan
Olsen, PUR LIFE Medical provides a revolutionary approach to health
and wellness by providing alternative cutting-edge medical
solutions to traditional medicine. PUR LIFE clinics provide
state-of-the-art equipment and solutions to assist customers with
natural, noninvasive procedures for anti-aging, pain management,
weight loss, sleep issues, emotional health, and overall health to
help people live longer, healthier lives. Dan Olsen was
instrumental in the growth and success of the Fantastic Sam's and
Massage Envy franchises, and he believes the PUR LIFE franchise
business could be a similar business. "By combining Panacea's
incredible products with the power of franchising with PUR LIFE
Medical, the synergistic effect is exponential growth in company
value. But more importantly, more people's lives will change for
the better with improved health and longevity," stated Dan Olsen.
"The purchase of these assets and franchises will provide
tremendous value to Panacea shareholders and the lives its
serves."
In 2022, Panacea pivoted its business model from a primary focus on
hemp-derived CBD products into the nutraceutical markets by
expanding its manufacturing operations and adding new brands to the
marketplace. "We have been working very hard to execute our vision
as a leading vertically integrated, alternative remedy health and
wellness provider," states Nick Cavarra, president of Panacea.
"Bringing PUR LIFE and its franchise model into the fold allows us
to offer the highest quality services and natural products to this
explosive market. Consumers are leery of synthetic medicines and
invasive treatments and actively seeking alternative remedies and
therapies that provide health, pain management and longevity to
their lives."
The purchase price for the PUR LIFE Medical franchise is $1 million
in cash plus an additional $1.6 million payable based upon future
metrics and achieving franchise sales goals. The cash is due in
two tranches, $180,000 upon receipt of auditable financials and
back-up and $820,000 on Nov. 10, 2023. This will be financed via
debt and equity. In addition, Mr. Olsen retains 7% of the PUR LIFE
subsidiary in exchange for his continued services to the PLSH
management team.
About Panacea
Panacea Life Sciences Holdings, Inc. formerly known as Exactus Inc.
(OTCQB:EXDI) -- http://www.exactusinc.com-- is a holding company
structured to develop and facilitate manufacturing, research,
product development and distribution in the high-growth, natural
human and animal health & wellness market segment. Its subsidiary,
Panacea Life Sciences, Inc. (PLS) is a woman-founded and led
company dedicated to manufacturing, distribution, research and
production of the highest-quality nutraceutical, cannabinoid,
mushroom, kratom and other natural, plant-based ingredients and
products. PLS operates out of a 51,000 square foot,
state-of-the-art, cGMP facility in Golden Colorado.
Panacea Life reported a net loss of $9.14 million for the year
ended Dec. 31, 2022, compared to a net loss of $4.78 million for
the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had
$19.49 million in total assets, $21.63 million in total
liabilities, and a total stockholders' deficit of $2.14 million.
Lakewood, CO-based BF Borgers CPA PC, the Company's auditor since
2021, issued a "going concern" qualification in its report dated
March 29, 2023, citing that the Company has suffered recurring
losses from operations that raises substantial doubt about its
ability to continue as a going concern.
PANOS FITNESS: Court OKs Interim Cash Collateral Access
-------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of New York
authorized Panos Fitness, LLC to use cash collateral on an interim
basis in accordance with the budget.
The Debtor is permitted to use cash collateral to pay only (i)
reasonable and necessary expenses to be incurred in the ordinary
course in connection with the operation of its business and in
accordance with the 13-week cash flow projection, (ii)
administrative expenses incurred in connection with the Subchapter
V Case, and (iii) other payments as may be authorized by separate
Court order. The Debtor's cumulative cash disbursements will not be
more than 10% of the projected amount set forth in the Cash Flow
Projection.
As adequate protection for the use of cash collateral, Firestone
Financial, LLC will receive, to the extent of any diminution in the
value of its interest in the Prepetition Collateral, perfected
replacement security interests in, and valid, binding, enforceable
and perfected liens or mortgages, on all of the Debtor's
Postpetition Collateral to the same extent of its prepetition
liens.
As additional adequate protection, Firestone will receive monthly
payments in the amount of $2,500 each commencing during the first
week of May 2023.
These events constitute an "Event of Default":
a) The abrogation or modification of the Order either by
appeal or otherwise;
b) The entry of an order appointing a Chapter 11 Trustee or
examiner for Debtor and/or the property of the Debtor;
c) The entry of an order converting the Debtor's Chapter 11
case to a case under Chapter 7 of the Bankruptcy Code; and
d) The Debtor's breach of any of the terms and conditions of
the Order, including by not limited to, any failure to make DCC
Adequate Protection Payments when and as due.
A fifth interim hearing on the matter is set for November 2, 2023
at 11:30 a.m.
A copy of the Court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=rnv8HB from PacerMonitor.com.
The Debtor projects total cash disbursements, on a weekly basis, as
follows:
$1,775 for the week ending October 13, 2023;
$17,053 for the week ending October 20, 2023; and
$15,500 for the week ending October 27, 2023.
About Panos Fitness, LLC
Panos Fitness, LLC operates physical fitness facilities. The Debtor
sought protection under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. N.D.N.Y. Case No. 23-30184) on March 29, 2023. In the
petition signed by Dean S. Panos, managing member, the Debtor
disclosed up to $1 million in assets and up to $10 million in
liabilities.
Judge Wendy A. Kinsella oversees the case.
Stephen A. Donato, Esq., at Bond, Schoeneck & King, PLLC,
represents the Debtor as legal counsel.
PARATEK PHARMACEUTICALS: Suspending Filing of Reports With SEC
--------------------------------------------------------------
Paratek Pharmaceuticals, Inc. filed a Form 15 with the Securities
and Exchange Commission to notify the termination of registration
of its common stock under Section 12(g) of the Securities Exchange
Act of 1934. As a result, the Company is no longer required to
file reports with the SEC under Sections 13 and 15(d) of the
Securities Exchange Act of 1934.
On Sept. 21, 2023, pursuant to an Agreement and Plan of Merger,
dated as of June 9, 2023, by and among Paratek Pharmaceuticals,
Inc., a Delaware corporation, Resistance Acquisition, Inc., a
Delaware corporation ("Parent"), and Resistance Merger Sub, Inc., a
Delaware corporation and a wholly owned subsidiary of Parent
("Merger Sub"), Merger Sub merged with and into the Company, with
the Company surviving the Merger as the surviving corporation and
as a wholly owned subsidiary of Parent.
About Paratek
Headquartered in Boston, MA, Paratek Pharmaceuticals, Inc. --
http://www.paratekpharma.com-- is a commercial-stage
biopharmaceutical company focused on the development and
commercialization of novel life-saving therapies for
life-threatening diseases or other public health threats for
civilian, government and military use.
Boston, Massachusetts-based Ernst & Young LLP, the Company's
auditor since 2016, issued a "going concern" qualification in its
report dated March 16, 2023, citing that the Company has suffered
recurring losses from operations and has stated that substantial
doubt exists about the Company's ability to continue as a going
concern.
PERFORMERS THEATRE: Future Earnings to Fund Plan
------------------------------------------------
Performers Theatre Workshop, Inc., filed with the U.S. Bankruptcy
Court for the District of New Jersey a Plan of Reorganization dated
October 3, 2023.
The Debtor provides several artistic offerings, including acting,
dancing and singing lessons, as well as a professional track
designed to train students for television, film and Broadway
productions.
For approximately 40 years, the Debtor (and its predecessor) has
operated a performing studio school in Essex County New Jersey. The
Debtor is wholly owned by Dean Kravitz, who inherited his interest
in the Debtor from his parents.
The Debtor experienced severe cash flow problems during the
Covid-19 pandemic, and resorted to funding its operations, in part,
through merchant cash advances ("MCAs"). As the pandemic persisted,
the Debtor increasingly found itself entering into MCA transactions
in order to fund payments on previous MCA transactions, an
untenable situation which lead to the commencement of its
bankruptcy case.
Class 2 consists of Allowed General Unsecured Claims. The Debtor
estimates that it may owe approximately $2,950,000 to holders of
claims in this Class, including deficiency claims of allegedly
secured creditors. Pro-rata distributions of any recoveries from
litigation recoveries, to the extent there are funds remaining
following payment of Secured Claims, Administrative Expenses and
Unsecured Priority Claims. This Class is impaired.
There will be no alteration of the rights or property interests of
this Class. Mr. Kravitz will continue to own 100% of the Debtor
following the effective date.
The Plan shall be funded from the future earnings of the Debtor.
Mr. Kravitz, the Debtor's sole shareholder immediately prior to the
effective date, will continue to own 100% of the Debtor after the
effective date.
A full-text copy of the Plan of Reorganization dated October 3,
2023 is available at https://urlcurt.com/u?l=PS0SBv from
PacerMonitor.com at no charge.
Debtor's Counsel:
Douglas J. McGill, Esq.
WEBBER MCGILL LLC
100 E. Hanover Avenue, Suite 401
Cedar Knolls, NJ 07927
Tel: (973) 739-9559
Fax: (973) 739-9575
E-mail: dmcgill@webbermcgill.com
About Performers Theatre Workshop
Performers Theatre Workshop, Inc. provides performing arts
education to students of all ages and abilities.
Performers Theatre sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D.N.J. Case No. 23-15772) on July 5, 2023.
In the petition signed by Dean Kravitz, its president, the Debtor
disclosed $46,207 in assets and $2,645,103 in liabilities.
Judge Vincent F. Papalia oversees the case.
Douglas J. McGill, Esq., at Webber McGill LLC, is the Debtor's
legal counsel.
PLUMBING TECHNOLOGIES: Unsecureds Will Get 25% over 5 Years
-----------------------------------------------------------
Plumbing Technologies, LLC, filed with the U.S. Bankruptcy Court
for the Southern District of New York an Amended Plan of
Reorganization dated October 3, 2023.
Plumbing Technologies ("PlumbTech") was founded in 2014 and
specializes in the design, distribution and manufacturing of toilet
seats. PlumbTech offers a comprehensive toilet seats program for
both professional end users and everyday consumers.
Beginning in the fall of 2019 and continuing with the onset of
Covid-19, the debtor faced a number of issues which greatly
impacted its cash flow. In or about 2017, the debtor entered into a
factoring agreement with SLR Business Credit which provided
financing and eased the cash flow burden slightly. However, the
debtor remained unable to service its capital investment loans and
various vendor obligations.
This subchapter V case under Chapter 11 of the Bankruptcy Code was
filed to provide PlumbTech with an opportunity to satisfy its
secured obligation with SLR Business Credit1 and stabilize its cash
flow for the future.
Class 5 consists of all Allowed Unsecured Claims against the debtor
not entitled to priority treatment. The Class 5 Claims shall be
paid pro rata from the debtor's projected disposable income, on a
quarterly basis, over a period of 5 years without interest. The
claims in Class 5 total the sum of approximately $1,284,295. The
debtor anticipates a distribution to Class 5 claimants of 25%, or a
total of $321,073. This results in quarterly payments to Class 5
claimants of $16,054.
Class 6 consists of the Series I Preferred Stock Equity Security
Holders of the debtor. The members of Class 6 are Apex
International Limited, ElegantHome International Co., Ltd.,
Shuixiang Lian, Ningbo Bofan Sanitary Ware Co., Ltd., Oyamei
Sanitary Co., Limited, Wu Qiu Ping and Yibo Jiang. Pursuant to
Subscription Agreements executed by the members of Class 6, the
original principal investments were converted to equity in 2019.
However, interest on said loans continued to accrue and remained
outstanding as of Petition Date.
Class 7 consists of the Class A and B Common Stock Equity Security
Holders of the debtor. The members of Class 7 are The Ashpole
Revocable Living Trust, Roberta L. Moeller, Mark & Kimber Block,
and Steven Q. Wruck. Pursuant to Loan and Investment Agreements
executed by the members of Class 7, the members of Class 7 invested
funds with the debtor and interest continued to accrue on said
obligations.
The debtor's Chapter 11 Plan will be implemented by revenues
generated and received in the ordinary course and operation of the
debtor's business. In addition, the debtor anticipates the
reduction and downsizing of its operations from two distribution
centers to one. The debtor is in the process of relocating
inventory from Texas to Georgia and will seek to shutter the Texas
distribution center, which will substantially reduce the debtor's
overhead costs. The debtor also plans on an orderly liquidation of
some of its obsolete inventory to aid cash flow in the
implementation of the Plan.
A full-text copy of the Amended Plan dated October 3, 2023 is
available at https://urlcurt.com/u?l=UIZYmB from PacerMonitor.com
at no charge.
Attorneys for the Debtor:
Michelle L. Trier, Esq.
Genova, Malin & Trier LLP
1136 Route 9, Suite 1
Wappingers Falls, NY 12590
Phone: 845-298-1600
Fax: 845-298-1600
About Plumbing Technologies
Plumbing Technologies, LLC, designs, engineers, manufactures,
markets, and sells toilet seats. The company is based in Sparks,
Nev.
Plumbing Technologies filed a petition under Chapter 11, Subchapter
V of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 23-35478) on
June 12, 2023, with $2,169,310 in assets and $2,364,227 in
liabilities. Heidi Sorvino, Esq., at White and Williams, LLP has
been appointed as Subchapter V trustee.
Judge Cecelia G. Morris oversees the case.
The Debtor tapped Michelle L. Trier, Esq., at Genova, Malin and
Trier, LLP as bankruptcy counsel; Amundsen Davis as special
counsel; and RA Hauser & Associates, LLC as controller and
bookkeeper.
PRETIUM PKG: $1.25BB Bank Debt Trades at 25% Discount
-----------------------------------------------------
Participations in a syndicated loan under which Pretium PKG
Holdings Inc is a borrower were trading in the secondary market
around 74.6 cents-on-the-dollar during the week ended Friday,
October 6, 2023, according to Bloomberg's Evaluated Pricing service
data.
The $1.25 billion facility is a Term loan that is scheduled to
mature on October 1, 2028. The amount is fully drawn and
outstanding.
Pretium PKG Holdings, Inc. is a manufacturer of rigid plastic
containers for variety of end markets, including food and beverage,
chemicals, healthcare, wellness and personal care. Pretium PKG
Holdings, Inc. is a portfolio company of Clearlake since January
2020.
PRETIUM PKG: $350MM Bank Debt Trades at 51% Discount
----------------------------------------------------
Participations in a syndicated loan under which Pretium PKG
Holdings Inc is a borrower were trading in the secondary market
around 49.2 cents-on-the-dollar during the week ended Friday,
October 6, 2023, according to Bloomberg's Evaluated Pricing service
data.
The $350 million facility is a Term loan that is scheduled to
mature on October 1, 2029. The amount is fully drawn and
outstanding.
Pretium PKG Holdings, Inc. is a manufacturer of rigid plastic
containers for variety of end markets, including food and beverage,
chemicals, healthcare, wellness and personal care. Pretium PKG
Holdings, Inc. is a portfolio company of Clearlake since January
2020.
PRIME CORE: Amends Unsecured Claims Pay Details
-----------------------------------------------
Prime Core Technologies Inc., et al., submitted a Disclosure
Statement with respect to the Joint Chapter 11 Plan of
Reorganization dated October 2, 2023.
The Debtors are aware that there are risks that neither the Sale
Transaction nor the Reorganization Transaction materialize. The
Debtors believe that it is in the best interests of all
stakeholders to prepare for a scenario where the Sale Transaction
and the Reorganization Transaction cannot be completed.
The Plan contemplates an option for the Debtors to "toggle" to a
Liquidation Transaction if they determine in good faith that the
Liquidation Transaction is in the best interests of the Debtors'
Estates due to complications or inability to implement the Sale
Transaction or the Reorganization Transaction.
The Liquidation Transaction contemplates providing distributions to
creditors from three primary sources: (1) the Debtors' Cash on
hand; (2) the proceeds of liquidating the Debtors' Cryptocurrency
holdings; and (3) the proceeds of certain Claims and Causes of
Action with respect to the Debtors' prepetition operations that the
Plan preserves and monetizes for the benefit of Holders of Claims
of entitled to such litigation proceeds. The Liquidation
Transaction, while hopefully a last resort, will deliver on the
Debtors' goal to distribute significant value to creditors by
providing them with both (a) near term distributions (i.e., cash
and Cryptocurrency proceeds) and (b) additional distributions over
time depending on the results of the litigation to be pursued by
independent fiduciaries.
Class 1B consists of Other Secured Claims. Each Holder of an
Allowed Other Secured Claim shall receive, in full and final
satisfaction of such Allowed Other Secured Claim, at the option of
the applicable Debtor, payment in full in Cash of such Holder's
Allowed Other Secured Claim or such other treatment rendering such
Holder's Allowed Other Secured Claim Unimpaired.
Class 3A consists of Prime Core General Unsecured Claims. Except to
the extent a Holder of an Allowed Prime Core General Unsecured
Claim agrees to a less favorable treatment, in full and final
satisfaction of such Claim, each Holder of an Allowed Prime Core
General Unsecured Claim will receive in exchange for such Allowed
Prime Core General Unsecured Claim its Pro Rata share of, in each
case, as applicable and subject to Article 7.6 of the Plan : (i)
the Cash Allocation attributable to Prime Core; and/or (ii) the
Cryptocurrency Allocation attributable to Prime Core; and (iii) any
distribution from the Creditors' Litigation Trust.
Class 3B consists of Prime Trust General Unsecured Claims. Except
to the extent a Holder of an Allowed Prime Trust General Unsecured
Claim agrees to a less favorable treatment, in full and final
satisfaction of such Claim, each Holder of an Allowed Prime Trust
General Unsecured Claim will receive in exchange for such Allowed
Prime Trust General Unsecured Claim, its Pro Rata share of, in each
case, as applicable and subject to Article 7.6 of the Plan (i) the
Cash Allocation attributable to Prime Trust; or (ii) the
Cryptocurrency Allocation attributable to Prime Trust.; and (iii)
any distribution from the Creditors' Litigation Trust.
Class 3C consists of Prime IRA General Unsecured Claims. Except to
the extent a Holder of an Allowed Prime IRA General Unsecured Claim
agrees to a less favorable treatment, in full and final
satisfaction of such Claim, each Holder of an Allowed Prime IRA
General Unsecured Claim will receive in exchange for such Allowed
Prime IRA General Unsecured Claim, its Pro Rata share of, in each
case, as applicable and subject to Article 7.6 of the Plan (i) the
Cash Allocation attributable to Prime IRA; or (ii) the
Cryptocurrency Allocation attributable to Prime IRA; and (iii) any
distribution from the Creditors' Litigation Trust.
Class 3D consists of Prime Digital General Unsecured Claims. Except
to the extent a Holder of an Allowed Prime Digital General
Unsecured Claim agrees to a less favorable treatment, in full and
final satisfaction of such Claim, each Holder of an Allowed Prime
Digital General Unsecured Claim will receive in exchange for such
Allowed Prime Digital General Unsecured Claim, its Pro Rata share
of, in each case, as applicable and subject to Article 7.6 of the
Plan (i) the Cash Allocation attributable to Prime Digital; or (ii)
the Cryptocurrency Allocation attributable to Prime Digital; and
(iii) any distribution from the Creditors' Litigation Trust.
Class 4 consists of Convenience Claims. Except to the extent a
Holder of an Allowed Convenience Claim agrees to a less favorable
treatment, in full and final satisfaction of such Claim, each
Holder of an Allowed Convenience Claim will receive in exchange for
such Allowed Convenience Claim, Cash in an amount equal to 70.00%
of the amount of such Allowed Convenience Claim to be paid from the
Wind-Down Debtor Assets or the Wind-Down Debtor Assets, as
applicable, attributable to the applicable Debtor.
Class 6 consists of Intercompany Claims. On the Effective Date, all
Intercompany Claims will be, at the option of the Debtors, either
(a) reinstated or (b) converted to equity, otherwise set off,
settled, distributed, contributed, cancelled, or released and shall
not thereafter be subject to any further recharacterization,
subordination or objection, in each case in accordance with the
Restructuring Transactions Memorandum.
Any Assets of a Debtor that are determined by such Debtor or by the
Bankruptcy Court not to be property of such Debtor's estate shall
be (i) transferred, if necessary, to the Wind-Down Debtor; and (ii)
returned to the owner or owners of such Assets in kind, subject to
set-off for (a) any negative Account balances, including for any
ACH chargeback transactions and (b) any applicable withdrawal fees.
For the avoidance of doubt, subject to the outcome of a final
determination by the Debtors or the Bankruptcy Court, as
applicable, (w) any such assets shall not be included as part of
the Cash Allocation or the Cryptocurrency Allocation, (x) any
General Unsecured Claim against a Debtor shall be net of non-estate
assets actually received by the Holder of such General Unsecured
Claim, (y) in no circumstance shall any such assets be transferred
to or become property of the Reorganized Debtors and (z)
distributions made in accordance with Article 7.6 of the Plan shall
only be from Assets, or proceeds of Assets, determined to be
property of the estate.
The Distribution Agent shall fund distributions under the Plan with
the Wind-Down Debtor Assets. The Wind-Down Debtor Assets shall be
used to pay the Wind-Down Debtor Expenses (including the
compensation of the Plan Administrator and any professionals
retained by the Wind-Down Debtor), and to satisfy payment of
Allowed Claims and Interests as set forth in the Plan.
A hearing to consider Confirmation of the Plan and final approval
of the Disclosure Statement will occur on November 10, 2023.
Objections, if any, to Confirmation of the Plan and final approval
of the Disclosure Statement must be filed and served on or before
November 3, 2023, at 4:00 p.m.
November 3, 2023 at 4:00 p.m. is the Voting Deadline.
A full-text copy of the Disclosure Statement dated October 2, 2023
is available at https://urlcurt.com/u?l=It3brZ from
PacerMonitor.com at no charge.
Proposed Counsel to the Debtors:
Maris J. Kandestin, Esq.
MCDERMOTT WILL & EMERY LLP
1000 N. West Street, Suite 1400
Wilmington, DE 19801
Telephone: (302) 485-3900
Facsimile: (302) 351-8711
E-mail: mkandestin@mwe.com
- and -
Gregg Steinman, Esq.
MCDERMOTT WILL & EMERY LLP
333 SE 2nd Avenue, Suite 4500
Miami, FL 33131
Telephone: (305) 358-3500
Facsimile: (305) 347-6500
E-mail: gsteinman@mwe.com
- and -
Darren Azman, Esq.
Joseph B. Evans, Esq.
MCDERMOTT WILL & EMERY LLP
One Vanderbilt Avenue
New York, NY 10017-3852
Telephone: (212) 547-5400
Facsimile: (646) 547-5444
E-mail: dazman@mwe.com
jbevans@mwe.com
- and -
R. Jacob Jumbeck, Esq.
Rebecca E. Trickey, Esq.
MCDERMOTT WILL & EMERY LLP
444 W. Lake Street, Suite 4000
Chicago, IL 60606-0029
Telephone: (312) 372-2000
Facsimile: (312) 984-7700
E-mail: jjumbeck@mwe.com
rtrickey@mwe.com
About Prime Core Technologies
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.
PROJECT ALPHA: S&P Assigns Prelim 'B' Debt Rating, On Watch Pos.
----------------------------------------------------------------
S&P Global Ratings placed all its ratings on business intelligence
software provider Project Alpha Intermediate Holding Inc. (doing
business as [dba] Qlik) on CreditWatch with positive implications.
S&P said, "We also assigned our preliminary 'B' issue-level rating
and preliminary '3' recovery rating to the new revolving credit
facility (RCF) and the first-lien term loan. Once the deal closes,
as expected, we will remove the preliminary rating and assign final
ratings equivalent to the preliminary ratings.
"We will resolve the CreditWatch positive by upgrading the company
by one notch if the debt transaction closes as expected."
Project Alpha announced the acquisition of data transformation
provider Talend in January 2023 and has been working on
implementing synergies over the past few quarters.
S&P expects realized synergies to be earlier and larger than
expected, which, along with continued growth, will help Qlik see
improved credit metrics in 2024.
Qlik also announced it will refinance its capital structure with a
new best-efforts $200 million RCF and $2.4 billion first-lien term
loan.
Due to the best-efforts basis of Project Alpha Intermediate Holding
Inc.'s new $2.4 billion first-lien term loan and $200 million RCF,
S&P Global Ratings placed all of its ratings on Project Alpha on
CreditWatch with positive implications. Once the deal closes, as
expected, S&P Global Ratings expects to upgrade Project Alpha to
'B' from 'B-' and assign a stable outlook because of improved
credit metrics following the Talend acquisition. We will also
assign final ratings equivalent to the preliminary 'B' issue-level
and '3' recovery ratings on the new $2.4 billion first-lien term
loan and $200 million RCF.
S&P said, "Due to the quicker- and larger-than-expected realized
synergies from the Talend acquisition, we expect Qlik to improve
its FFO cash interest coverage and unadjusted FOCF generation over
the next few years.Qlik will move forward with the Talend
acquisition with one capital structure because the new $2.4 billion
first-lien term loan and $200 million revolver will sit at its
borrower name Project Alpha Intermediate. However, Qlik and Talend,
both owned by financial sponsor Thoma Bravo, have been working on
its combined cost-savings strategy since the close of the Talend
acquisition in May 2023, which has allowed it to take significant
cost-savings actions before the debt transaction closes. We believe
Qlik's business integration is going well and quicker than
expected, which will boost EBITDA generation and margins over the
next few years. However, the large cost savings plan will provide
large one-time transaction and integration costs that will hamper
Qlik's FFO cash interest coverage to the low-1x area and low
positive FOCF generation in 2023. We believe that Qlik can take out
those one-time costs without disruptions to either of its
businesses over the next few quarters.
"The last time Qlik made a large acquisition was for data
management solutions company Attunity in 2019. We note that this
current management team was able to execute all its cost savings
and integrate Attunity without disruptions to the business such
that EBITDA and FOCF improved in 2020 and 2021. We also believe
that Qlik will look to keep credit metrics stronger, compared with
other financial sponsor-owned companies, as it has done over the
past few years. Qlik has already implemented a majority of its
large cost-savings plan, mostly around duplicative headcount, for
the combined entity as of the third quarter of 2023. We believe
significant synergies will come out of the cost structure in 2024.
We also believe that large one-time acquisition, integration, and
transaction costs related to the realizing of synergies will also
flow out such that Qlik's EBITDA margins will improve to the
mid-30% area in 2024."
While cash interest expense on the new $2.4 billion first-lien term
loan will remain elevated in 2024 because of the higher rate
environment, due to the significant improvement in the combined
cost structure, we expect Qlik to generate FFO cash interest
coverage in the high-1x area and more than $100 million of
unadjusted FOCF in 2024. Qlik will also have good total liquidity
of approximately $350 million cash on balance sheet and a $200
million undrawn RCF to support the business transition and
cost-savings plan.
S&P said, "Even in a tougher macroeconomic environment, we still
believe Qlik can achieve growth in 2023 and beyond. After the
acquisition of Talend, Qlik has a stronger end-to-end product
portfolio, encompassing data integrations and quality to analytics,
artificial intelligence, and machine learning. While Qlik would
like to upsell or cross-sell Talend's solutions into its large
existing customer base, we note that Talend's data integration and
quality solutions are significantly more expensive than Qlik's BIA
solutions and could be a harder sell as customers continue to
evaluate cash spending carefully, especially large purchases, in
this tougher macroeconomic environment. The addition of the Qlik
and Talend acquisition cost-savings plan could increase the risk of
business disruptions. Qlik has also been transitioning to
subscription revenue, which has hampered its topline because the
increase in subscription revenue was being offset by the decline in
perpetual and maintenance revenue in 2022.
"However, we believe that data continues to be an integral part of
the business decision-making process, which should support Qlik's
end-to-end data integration and analytics product portfolio as data
becomes more robust and complicated. We believe that Talend's data
integration solutions will better enforce and govern the data,
which will allow for more trust in the data being used and produce
better results in the Qlik data analysis. We note that the combined
Qlik now has strong recurring revenue in the mid-90% area, which
should help it somewhat mitigate volatility in a tougher
macroeconomic environment and with potential disruptions to
business operations. We also believe that Qlik's transition to
subscription revenue should stabilize in 2023 as subscription
growth begins to offset the decline in perpetual and maintenance
revenue. We believe that strong growth for Talend's software as a
service revenue and Qlik's subscription revenue will help Qlik
generate top-line growth of between 3% and 6% in 2023 and 2024.
"While this business intelligence and analytics (BIA) market is
highly fragmented, with some extremely large competitors, we
believe Qlik has been able to compete in this market.We note that
Qlik operates in an extremely fragmented and competitive BIA
market, with large competitors such as Microsoft's Power BI,
Salesforce's Tableau, and Google's Looker, which have continued to
grow. Those solutions are usually offered in tandem with those
competitors' core software to provide wide offerings to lock in
customers. There are also other more niche competitors in this
space such as Informatica, Domo, Thoughtspot, and others that
operate in this BIA market.
"However, even in a fragmented and competitive market, Qlik has
continued to perform well against competitors. We believe Qlik is
one of the leaders in this space because it has existed for about
30 years with good organic growth over the past five years. Qlik is
one of the last independent BIA vendors left, which some customers
might want, instead of putting all their data with one large
vendor. Qlik's and Talend's technology continue to be recognized as
leaders by research and advisory company Gartner Inc. in their
respective quadrants.
"We will resolve the CreditWatch positive if the Project Alpha
transaction close, as expected.
"Governance factors are a moderately negative consideration in our
credit rating analysis of the company, as is the case for most
rated entities owned by private-equity sponsors. We believe Project
Alpha Intermediate Holding Inc.'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."
PRR 200: Case Summary & Seven Unsecured Creditors
-------------------------------------------------
Debtor: PRR 200, LLC
200 West Lancaster Avenue
Reading, PA 19607
Business Description: PRR 200 is a Single Asset Real Estate
debtor (as defined in 11 U.S.C. Section
101(51B)).
Chapter 11 Petition Date: October 6, 2023
Court: United States Bankruptcy Court
Eastern District of Pennsylvania
Case No.: 23-13025
Judge: Hon. Patricia M. Mayer
Debtor's Counsel: David B. Smith, Esq.
SMITH KANE HOLMAN, LLC
112 Moores Road
Suite 300
Malvern, PA 19355
Tel: 610-407-7215
Fax: 610-407-7218
Email: dsmith@skhlaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $500,000 to $1 million
The petition was signed by Shloime Horowitz as sole member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's seven unsecured creditors is available for
free at PacerMonitor.com at:
https://www.pacermonitor.com/view/ISZNQSI/PRR_200_LLC__paebke-23-13025__0001.0.pdf?mcid=tGE4TAMA
QUANERGY SYSTEMS: Unsecureds Will Get 8.5% to 10.3% in Plan
-----------------------------------------------------------
Quanergy Systems, Inc., submitted a Disclosure Statement for the
First Amended Chapter 11 Plan dated October 2, 2023.
Founded in 2012 as a private company, the Debtor designed,
developed, and marketed Light Detection and Ranging ("LiDAR")
sensors and 3D perception software solutions.
The Debtor entered chapter 11 with the goal of pursing a value
maximizing sale process that built upon the Debtor's prepetition
marketing efforts. The postpetition sale process allowed the Debtor
to market the Assets free and clear of liabilities and without the
burden of significant operating expenses; this opportunity expanded
the potential buyer universe to parties that were not interested in
acquiring the going concern operations of the Debtor during the
prepetition marketing and sale process.
On February 2, 2023, the Bankruptcy Court entered an Order
authorizing the Sale of substantially all of the Assets to ROLISI,
LLC and on February 3, 2023, the Debtor successfully consummated
the sale, which provided the Debtor with the liquidity necessary to
wind down the Debtor's Estate in an orderly and expeditious
manner.
After several rounds of competitive bidding between Quanergy 3D,
LLC and ROLISI, LLC, the Debtor named ROLISI, LLC as the Successful
Bidder, with a purchase price of $3.15 million. Quanergy 3D, LLC's
bid of $3.275 million was named the Next Highest Bid. The Debtor
determined to select ROLISI, LLC as the Successful Bidder, despite
the cash consideration being lower than the Next-Highest Bid,
because of ROLISI, LLC's ability to provide assurance of closing on
February 3, 2023.
Following the Auction, the Bankruptcy Court authorized and approved
the Sale of substantially all of the Assets to ROLISI, LLC. The
Debtor subsequently filed a revised proposed Sale Order, which the
Bankruptcy Court entered on February 2, 2023. On February 3, 2023,
the Sale closed.
The Plan provides for the Distribution of the Sale proceeds to
Holders of Allowed General Unsecured Claims and Allowed GUC
Settlement Claims as contemplated under the Plan and for the wind
up of the Debtor's corporate affairs. The Plan also provides for
the appointment of a Plan Administrator that will, among other
things, administer and liquidate or otherwise resolve all Assets of
the Debtor, including the Retained Causes of Action.
The following is an overview of certain material terms of the
Plan:
* All Allowed Administrative Claims, Allowed Professional Fee
Claims, Allowed Priority Tax Claims, Allowed Secured Claims, and
Allowed Priority Non-Tax Claims will be paid or otherwise satisfied
in full as required by the Bankruptcy Code and provided for in the
Plan, unless otherwise agreed to by the Holders of such Claims and
the Post-Effective Date Debtor.
* Holders of Allowed General Unsecured Claims will receive
their Pro Rata share of the General Unsecured Claim Distribution,
unless less favorable treatment is otherwise agreed to by the
Holders of such Claims and the Post-Effective Date Debtor.
* Holders of Allowed GUC Settlement Claims will receive their
Pro Rata share of the GUC Settlement Claim Distribution, unless
less favorable treatment is otherwise agreed to by the Holders of
such Claims and the Post-Effective Date Debtor.
* Holders of Subordinated Claims will not be entitled to any
distribution or recovery on account of such Claims.
* As of the Effective Date, all Interests of any kind will be
cancelled, and the Holders thereof will not receive or retain any
property, interest in property or consideration under the Plan on
account of such Interests.
Class 3 consists of General Unsecured Claims. On, or as soon as
reasonably practicable after, the Effective Date, the Holder of an
Allowed General Unsecured Claim shall receive from the Post
Effective Date Debtor, in full satisfaction of such Allowed General
Unsecured Claim, (i) its Pro Rata share of the General Unsecured
Claim Distribution, or (ii) such other less favorable treatment as
to which such Holder and the Post-Effective Date Debtor shall have
agreed upon in writing. Class 3 is Impaired. The allowed unsecured
claims total $12,578,792 to $13,836,671. This Class will receive a
distribution of 8.5% to 10.3% of their allowed claims.
Class 4 consists of GUC Settlement Claims. On, or as soon as
reasonably practicable after, the Effective Date, the Holder of an
Allowed GUC Settlement Claim shall receive from the Post-Effective
Date Debtor, in full satisfaction of such Allowed GUC Settlement
Claim, (i) its Pro Rata share of the GUC Settlement Claim
Distribution, or (ii) such other less favorable treatment as to
which such Holder and the Post-Effective Date Debtor shall have
agreed upon in writing. Class 4 is Impaired.
The Plan provides for the disposition of the Assets and the
Distribution of the proceeds in accordance with the priorities and
requirements of the Bankruptcy Code.
The Plan provides for the appointment of a Plan Administrator as a
means to implement the Plan, and a Plan Oversight Committee to
oversee the Plan Administrator and the administration of the Post
Effective Date Debtor by the Plan Administrator. The Plan
Administrator shall, in consultation with the Plan Oversight
Committee, be empowered to, among other things, administer and
liquidate all Assets, object to and settle Claims and prosecute
Retained Causes of Action in accordance with the Plan. The Plan
also provides for Distributions to Holders of Allowed Claims,
including Administrative Claims, Professional Fee Claims, Priority
Tax Claims, Secured Claims, Priority Non-Tax Claims, General
Unsecured Claims, and Allowed GUC Settlement Claims. In addition,
the Plan cancels all Interests in the Debtor, and provides for the
dissolution and wind-up of the affairs of the Debtor.
A full-text copy of the Disclosure Statement dated October 2, 2023
is available at https://urlcurt.com/u?l=v8awY7 from Stretto, Inc.,
claims agent.
Co-Counsel to the Debtor:
Sean M. Beach, Esq.
Shane M. Reil, Esq.
Catherine C. Lyons, Esq.
Heather P. Smillie, Esq.
YOUNG CONAWAY STARGATT & TAYLOR, LLP
Rodney Square, 1000 N. King Street
Wilmington, DE 19801
Telephone: (302) 571-6600
E-mail: sbeach@ycst.com
sreil@ycst.com
clyons@ycst.com
hsmillie@ycst.com
- and -
Cullen Drescher Speckhart, Esq.
Michael A. Klein, Esq.
Lauren A. Reichardt, Esq.
COOLEY LLP
55 Hudson Yards
New York, NY 10001
Telephone: (212) 479-6000
Facsimile: (212) 479-6275
E-mail: cspeckhart@cooley.com
mklein@cooley.com
lreichardt@cooley.com
About Quanergy Systems
Quanergy Systems, Inc., designs, develops and markets Light
Detection and Ranging (LiDAR) sensors and 3D perception software
solutions that enable intelligent, real-time detection, tracking
and classification of objects such as people and vehicles in
mission-critical markets such as security, smart cities and
industrial automation. The company is based in Sunnyvale, Calif.
Quanergy Systems sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Delaware Case No. 22-11305) on Dec. 13,
2022, with $10 million to $50 million in both assets and
liabilities. Larry Perkins, chief restructuring officer of
Quanergy Systems, signed the petition.
The Debtor tapped Young Conaway Stargatt & Taylor, LLP and Cooley,
LLP as bankruptcy counsels; Seward & Kissel, LLP as special
counsel; SierraConstellation Partners as restructuring advisor; FTI
Consulting, Inc. as financial Advisor; and Raymond James Financial,
Inc. as investment Banker. Bankruptcy Management Solutions, Inc.,
doing business as Stretto, Inc., is the claims, noticing and
solicitation agent.
RESTORATION HARDWARE: S&P Downgrades ICR to 'B+', Outlook Stable
----------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Corte
Madera, Calif.-based luxury home furnishings retailer Restoration
Hardware Inc. (RH) to 'B+' from 'BB-'.
S&P also lowered its rating on RH's secured debt to 'B+' from
'BB-'; the '3' recovery rating is unchanged and indicates its
expectations for meaningful (50%-70%; 50% rounded estimate)
recovery in the event of default.
The stable outlook reflects S&P's view that sales and profitability
will likely stay pressured over the next year amid a challenging
operating environment but the company will remain stronger than
other furnishing peers given its high-end customer base.
S&P said, "We view RH's recent share repurchases as credit
negative. RH repurchased $1.2 billion in shares in their second
quarter (ended July 29, 2023). As a result, we now expect leverage
approaching 5x in fiscal 2023, which is significantly higher than
our previous forecast of leverage in the high-3x area. We believe
this large share repurchase reflects a more aggressive financial
policy.
"We believe RH's credit metrics will be more susceptible to small
changes in profitability and that the company will need to further
deliver on its operating targets and business initiatives to
maintain leverage below 5x in 2023. We are also closely monitoring
the company's ability to sustain strong free operating cash flow
(FOCF), given it generated $200 million in 2022 and $450 million in
2021. We will also be watching how the company manages its
liquidity, including $417 million of cash on hand as of July 29,
2023.
"Weak performance in the first half of the year will continue to
weigh on credit metrics in 2023. RH reported a revenue decline of
19.9% in their second quarter (ended July 29, 2023), primarily due
to lower demand compared to the elevated pandemic-driven demand
seen in the same period in 2022. Still, second quarter results
outperformed the company's prior guidance due to
faster-than-expected deliveries and higher margins resulting from a
shift in advertising costs from the second to third quarter. RH
also raised the lower end of its revenue guidance by $40 million in
September, now expecting a range of $3.04 billion-$3.1 billion for
2023.
"We continue to expect weaker performance in 2023 and forecast a
revenue decline of 14% for the year as the company continues to
face softer consumer demand amid a difficult macroeconomic
environment with higher interest rates and a weak housing economy.
We also expect margins will be pressured from higher discounting,
and we forecast a 350 basis points (bps) decline in gross margins
in 2023. This combined with lower revenues leads us to forecast S&P
Global Ratings-adjusted EBITDA margins declining about 440 bps in
fiscal 2023.
"We expect a modest recovery in 2024 as the housing market
incrementally improves and discretionary demand slowly returns. We
believe that performance may still be strained beyond 2023, but
that as some of the macroeconomic pressures ease RH will be able to
recover some of their profitability and cash flow. We forecast
modest top-line growth, and at least 250 bps of margin improvement.
We expect cash flows in the $50 million-$100 million range in 2023
and 2024, still materially below 2022 levels of $200 million,
reflecting higher interest expense and increased capital
expenditure (capex) of $250 million.
"While its global expansion plan has the potential to drive growth,
it also introduces significant execution risks. RH opened a new
gallery in the United Kingdom this year and expects to open
additional galleries across Europe over the next several years. In
addition, the company is converting legacy galleries to design
galleries at a quicker pace. We believe an unsuccessful rollout of
its galleries internationally could drag down operating performance
and distract management's focus from its core domestic operations.
"The stable outlook reflects our view that, although sales and
profitability will likely stay pressured over the next year amid a
challenging operating environment, the company will sustain
leverage below 5x."
S&P could lower its rating on RH if it expects leverage to approach
5.5x or higher. This could occur if:
-- Operating performance deteriorates beyond S&P's expectation,
leading to lower revenues, earnings, and FOCF relative to its
forecast; or
-- The company pursues share repurchases at a more aggressive pace
than we anticipate.
S&P could raise the rating if:
-- Operating performance stabilizes, and S&P expects at least a
modest recovery in profitability and cash flow generation; and
-- The company maintains sufficient cash on its balance sheet to
preserve financial flexibility while business conditions remain
uncertain, leading to leverage sustained comfortably below 4x.
RIHH LLC: Court OKs Cash Collateral Access on Final Basis
---------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey authorized
RIHH, LLC to use cash collateral on a final basis in accordance
with the budget, with a 20% variance, through October 31, 2023.
Pre-petition creditor Amerisource Bergen Drug Corp. has a valid,
perfected and secured lien and security interest in the Debtor's
assets securing the Debtor's indebtedness in the approximate
amount of $2.4 million as of the Petition Date.
Financial Resources Federal Credit Union, a pre-petition creditor,
was also granted a security interest in cash collateral that is
junior to the interest of ABDC and which interest secures two
SBA-guaranteed loans with an aggregate balance as of the Petition
Date of approximately $3.4 million.
The Debtor requires the use of cash collateral to (a) maintain and
preserve its business assets, (b) continue operation of its
business, including payroll and payroll taxes, insurance expenses
and monthly adequate protection payments to ABDC; and (c) to
purchase replacement supplies, etc. as required to operate.
As adequate protection for use of the cash collateral, ABDC is
granted a replacement perfected security interest under 11 U.S.C.
Section 361(2) in all post-petition assets of the Debtor.
To the extent the adequate protection provided for proves
insufficient to protect ABDC's interest in and to the cash
collateral, ABDC will have a super-priority administrative expense
claim, pursuant to 11 U.S.C. Section 507(b), senior to any and all
claims against the Debtor under 11 U.S.C. Section 507(a), whether
in this proceeding or in any superseding proceeding, subject to
payments due under 28 U.S.C. Section 1930(a)(6). Excluded from this
super-priority administrative claim are any causes of action
arising under Chapter 5 of the Bankruptcy Code.
The liens and security interests granted are automatically deemed
perfected upon entry of the Order without the necessity of ABDC
taking possession, filing financing statements or other documents.
Beginning September 15, 2023, the Debtor will be required to
continue to make its regular monthly payment(s) to ABDC as adequate
protection payments in the amount of approximately $25,000/month,
for the duration of the Order.
Further, as adequate protection for use of the cash collateral,
FRFCU and Value are granted a replacement lien perfected security
interest under 11 U.S.C. section 361(2) in all post-petition assets
of the Debtor.
A copy of the order is available at https://urlcurt.com/u?l=r9LsBw
from PacerMonitor.com.
About RIHH, LLC
RIHH, LLC sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. D. N.J. Case No. 23-17209) on August 21, 2023. In the
petition signed by Fabian A. Herrera, CEO, the Debtor disclosed up
to $500,000 in assets and up to $50 million in liabilities.
Judge John K. Sherwood oversees the case.
E. Richard Dressel, Esq., at Lex Nova Law, LL C, represents the
Debtor as legal counsel.
S&G HOSPITALITY: Wins Cash Collateral Access Thru Nov 30
--------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Ohio,
Eastern Division, authorized S&G Hospitality, Inc., et al. to use
cash collateral on a final basis in accordance with the budget,
with a 10% variance, through November 30, 2023.
The entities with a purported interest in cash collateral are RSS
COMM 2015-PC1 BL, LLC, Small Business Administration, Itria Funding
LLC, and Knight Capital Funding.
On or before the fifth day of each month in the Budget Period, the
Debtors will make a payment to RSS of $75,400 (which consists of
$54,010 towards RSS's obligations, $17,673 to be escrowed for real
estate taxes, $3,717 to be escrowed for property insurance). RSS
will apply each of the Debtors' payments for escrows to the
respective escrowed account, but may allocate payments for RSS'
obligations to interest, principal, special servicing fees, legal
fees and costs due in such manner as RSS deems appropriate in
accordance with its loan documents, provided, however, that any
such internal allocation by the RSS will not bind the Court in
determining the allowed amount or the value of the RSS's
collateral.
As adequate protection for any diminution in the value of the Small
Business Administration's asserted interests in the cash
collateral, the Debtors will also make scheduled nonaccelerated
payments of principal and interest to the Small Business
Administration.
As adequate protection for any diminution in the value of Itria's
asserted interest in the cash collateral, the Debtors will pay
Itria $2,059 per month and Mr. Vasani and the nondebtor entities he
controls will in aggregate make an additional payment of $1,000 to
Itria.
As adequate protection for any post-petition diminution in value of
the interests of RSS, the SBA, and Itria's interests in the
prepetition assets of the Debtors, each entity is granted an
administrative expense claim against the Debtor's estates for the
full amount of such diminution, in accordance with 11 U.S.C.
Section 507(b).
These events constitute an "Event of Default":
(a) the case is either dismissed or converted to a case under
Chapter 7 of the Bankruptcy Code;
(b) a trustee or examiner with expanded powers is appointed in
the Case;
(c) any of the Debtors cease operations of their businesses or
takes any material action for the purpose of effecting such
cessation without the prior written consent of RSS or filing a
Motion with the Court seeking to do so;
(d) the Final Order is reversed, vacated, stayed, amended,
supplemented or otherwise modified in a manner which will
materially and adversely affect the rights of RSS or will
materially and adversely affect the priority of any or all of RSS's
claims, liens or security interests and which is not acceptable to
the RSS;
(e) the Debtors' failure to comply with or perform the terms
and provisions of the Interim Order or any prior interim order
entered in regard to the Motion, in strict adherence to the time
period set forth therein;
(f) any sale or other disposition of Collateral or cash
collateral outside of the ordinary course of business is approved
without the consent of RSS;
(g) any superpriority claim or lien equal or superior in
priority to that granted to the parties being provided Adequate
Protection pursuant to the Interim Order or permitted thereunder
will be granted;
(h) the automatic stay of 11 U.S.C. Section 362 is lifted so
as to allow a party other than the RSS to proceed against any
material asset of the Debtors.
A copy of the order is available at https://urlcurt.com/u?l=QkrzMG
from PacerMonitor.com.
About S&G Hospitality, Inc.
S&G Hospitality, Inc. is part of the traveler accommodation
industry.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Ohio Case No. 23-52859) on August 18,
2023. In the petition signed by Abijit Vasani, president, the
Debtor disclosed up to $10 million in assets and up to $1 million
in liabilities.
Judge Mina Nami Khorrami oversees the case.
David Beck, Esq., at Carpenter Lipps LLP, represents the Debtor as
legal counsel.
SAMSON TOURS: Case Summary & 16 Unsecured Creditors
---------------------------------------------------
Debtor: Samson Tours Inc.
d/b/a Samson Trailways
3745 Zip Industrial Blvd SE
Atlanta, GA 30354
Business Description: Samson Tours provides luxury bus charter
services.
Chapter 11 Petition Date: October 6, 2023
Court: United States Bankruptcy Court
Northern District of Georgia
Case No.: 23-59894
Debtor's Counsel: Ian Falcone, Esq.
THE FALCONE LAW FIRM, PC
363 Lawrence St NE
Marietta, GA 30060-2056
Tel: (770) 426-9359
Email: imf@falconefirm.com
Total Assets: $4,795,908
Total Liabilities: $5,833,867
The petition was signed by John Sambdman as CEO.
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/W7VCLKI/Samson_Tours_Inc__ganbke-23-59894__0001.0.pdf?mcid=tGE4TAMA
SCCW INDUSTRIAL: Creditors to Get Proceeds From Liquidation
-----------------------------------------------------------
SCCW Industrial Services, LLC, filed with the U.S. Bankruptcy Court
for the Eastern District of Texas a Plan of Liquidation dated
October 3, 2023.
The Debtor began its operations in 2010 as an industrial coating
business. It ceased operations in 2016 and has since leased its
remaining real estate to a company named Apache.
The company is owned by Clint West. The Bankruptcy was filed in an
effort to halt foreclosure proceedings by InterFlow Factors
Corporation against property located at 11165 Hwy 124, Beaumont,
Texas.
As the business is no longer operating and the rental income is
insufficient to service the debts of the Company, the Plan being
proposed contemplates liquidating all of the property of the Debtor
and some additional property owned by Clint West individually.
Since the filing of the petition, the Debtor has been able to
actively market the property, and the Debtor and Clint West have
entered into contracts to sell the property.
Class 6 consists of General Unsecured Creditors. To the extent
there are any remaining funds at the closing of the SCCW Real
Estate, those funds will be distributed pro rata to this class. The
amount of claim in this Class total $43,129.09. This Class is
impaired.
The Debtor shall be discharged upon completion of the Chapter 11
plan from all claims and interests to the extent permitted by the
Bankruptcy Code and except as expressly provided in this Plan;
provided, however, nothing herein shall alter or affect the
recourse of any Allowed Secured Claim as otherwise provided under
the treatment of any Allowed Secured Claim in the Plan.
A full-text copy of the Liquidating Plan dated October 3, 2023 is
available at https://urlcurt.com/u?l=W2ntBx from PacerMonitor.com
at no charge.
Attorneys for Debtor:
Tagnia Fontana Clark, Esq.
Maida Clark Law Firm, PC
4320 Calder Avenue
Beaumont, TX 77706
Telephone: (409) 898-8200
Facsimile: (409) 898-8400
Email: docs@maidaclarklaw.com
About SCCW Industrial Services
SCCW Industrial Services, LLC filed a petition under Chapter 11,
Subchapter V of the Bankruptcy Code (Bankr. E.D. Texas Case No.
23-10209) on June 5, 2023, with $768,751 in total assets and
$2,226,840 in total liabilities. Clint T. West, president, signed
the petition.
Judge David R. Jones oversees the case.
Frank J. Maida, Esq., at Maida Clark Law Firm, PC serves as the
Debtor's counsel.
SHOWFIELDS INC: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Showfields Inc.
c/o Showfields NY 2 LLC
187 Kent Avenue, 1st Field
Brooklyn, NY 11249
Chapter 11 Petition Date: October 6, 2023
Court: United States Bankruptcy Court
Eastern District of New York
Case No.: 23-43643
Judge: Hon. Jil Mazer-Marino
Debtor's Counsel: Rachel S. Blumenfeld, Esq.
LAW OFFICE OF RACHEL S. BLUMENFELD PLLC
26 Court Street
Suite 2220
Brooklyn, NY 11242
Tel: 718-858-9600
Email: rachel@blumenfeldbankruptcy.com
Total Assets: $8,117
Total Liabilities: $2,725,810
The petition was signed by Tal Zvi Nathanel as CEO.
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/6DWXX2Y/Showfields_Inc__nyebke-23-43643__0001.0.pdf?mcid=tGE4TAMA
SIGNAL PARENT: $550MM Bank Debt Trades at 17% Discount
------------------------------------------------------
Participations in a syndicated loan under which Signal Parent Inc
is a borrower were trading in the secondary market around 83.3
cents-on-the-dollar during the week ended Friday, October 6, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $550 million facility is a Term loan that is scheduled to
mature on April 1, 2028. About $537.6 million of the loan is
withdrawn and outstanding.
Signal Parent, Inc. provides interior design services.
SIMPLETECH REPAIR: Court OKs Cash Collateral Access on Final Basis
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of California,
Fresno Division, authorized Simpletech Repair LLC to use cash
collateral on a final basis in accordance with the budget, with a
10% variance.
On November 20, 2020, the Debtor executed and delivered to Lyons a
Promissory Note in the original principal amount of $100,000, which
Lyons Note amended and restated the Promissory Note dated as of
June 14, 2019, which amended and restated that certain Promissory
Note dated as of September 25, 2017. As of the Petition Date, Lyons
asserts and the Debtor acknowledges that there is due and owing by
the Debtor to Lyons under the Lyons Note the principal amount of
$100,000 plus applicable interest, fees and other charges.
The Debtor granted a subordinate security interest in the
Prepetition Collateral to Stor RB One Limited, as evidenced by the
UCC1 Financing Statement number 202305220191073.
The Debtor granted a subordinate security interest in certain of
the Prepetition Collateral comprised of the Debtor's accounts and
proceeds thereof to UCC Rep, as evidenced by that certain UCC-1
Financing Statement number 2023 06305925694.
As adequate protection for the Debtor's use of cash collateral, the
Secured Parties are granted replacement and rollover security
interests in and valid, binding, enforceable and perfected liens on
all of the Debtor's Postpetition Collateral to the same extent and
priority of its prepetition liens, subject only to the Carve-Out.
The Debtor will (i) make regular monthly payments of $725 on or
before the 20th day of each month, to be applied first to accrued
and unpaid interest at the regular rate set forth in, and to the
extent due under, the Lyons Credit Documents.
The Rollover Liens will be subject to a "Carve-Out", which term
will mean an amount sufficient to satisfy (i) any quarterly fees
owed to the United States Trustee pursuant to 28 U.S.C. Section
1930(a)(6); (ii) allowed and unpaid professional fees and
disbursements incurred by Maxsen D. Champion as counsel to the
Debtor, which will not exceed $10,000; and (iii) fees of the
Subchapter V trustee as may be approved by the Court.
These events constitute an "Event of Default":
a. the Debtor's material breach of any of the terms or
provisions of the Interim Order, including providing the Adequate
Protection as set forth therein, and the failure of the Debtor to
cure such breach within seven days of receiving notice of same;
e-mail notification sent to the Debtor's counsel will be sufficient
notice of an event of default thereunder;
b. the Debtor making a payment that was not approved by Lyons
through its approval of the Budget (other than a payment which does
not result in the Debtor exceed ing the Permitted Variance) or, for
a payment outside of the Budget, approved by Lyons with its prior
written consent to such payment;
c. any stay, reversal, vacatur or rescission of the terms of
the Interim Order;
d. the Debtor's actual cash disbursements varying from the
approved Budget in excess of the Permitted Variance;
e. the Court entering an order granting relief from the
automatic stay with respect to any asset in which the Debtor's
estate holds an interest;
f. entry of an order by the Court dismissing the Debtor's
Subchapter V Case or converting the Subchapter V Case to a case
under chapter 7 of the Bankruptcy Code;
g. the appointment of a chapter 11 trustee;
h. the Debtor ceases to be a debtor in possession pursuant to
11 U.S.C. Section 1185; or
i. upon expiration of any Budget, Lyons' refusal to approve a
new Budget.
A copy of the order is available at https://urlcurt.com/u?l=cb9aVb
from PacerMonitor.com.
About Simpletech Repair LLCs
Simpletech Repair LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. N.Y. Case No. 23-30542-5-wak) on
August 4, 2023. In the petition signed by Jeffrey VanDusen, sole
and controlling member, the Debtor disclosed up to $500,000 in
assets and up to $1 million in liabilities.
Judge Wendy A. Kinsella oversees the case.
Maxsen D. Champion, Esq. represents the Debtor as legal counsel.
SMG INDUSTRIES: Releases Pro Forma Financials, Stockholder Update
-----------------------------------------------------------------
SMG Industries Inc. reported its pro forma financial results in
connection with its July 7, 2023, acquisition of the Barnhart
family of companies.
On Sept. 15, 2023, the Company amended its Current Report on Form
8-K originally filed with the Securities and Exchange Commission on
July 12, 2023, which amendment included the financial statements
and pro forma financial information required by Item 9.01 of Form
8-K in connection with its recent acquisition of the Barnhart
family of companies that closed July 7, 2023.
As illustrated in the Current Report on Form 8-K/A filed with the
SEC on Sept. 15, 2023, on a pro forma combined basis for fiscal
year 2022, revenues were $152,771,088, gross profit was
$16,770,897, net loss from continuing operations was $5,296,586
(which included non-cash expenses of $13,930,353 in depreciation
and amortization expenses), generating a net loss of $5,156,039
including those non-cash items. In addition, pro forma Adjusted
EBITDA, a non-GAAP measure, for fiscal year 2022 was $15,046,814.
Timothy Barnhart, CFO of SMG said, "Our team is excited about our
future growth prospects and new critical mass in size given the
July 7th closing of the Barnhart family of companies and its added
cash flow. In addition to realizing cost synergies, the Company
has been very busy with internal integration of its business and is
fortunate to have transportation management systems (TMS) and
related infrastructure that are similar and pair well together.
Currently, the team believes this integration, including accounting
and information technology, will be concluded prior to the year-end
2023. We have executed on several of the expense saving
initiatives, including national account buying for fuel and other
expenses." Timothy continued, "The Company's next Quarterly Report
on Form 10-Q for the third quarter 2023 will include the financial
results from the Barnhart acquisition from its effective date of
July 7, 2023, through September 30, 2023, within SMG's consolidated
financial results for the third quarter."
"We have hundreds of customers between the legacy business of SMG
and the Barnhart family of companies that can be cross-referred to
generate growth. Structurally, we have combined the brokerage
business of 5J Logistics Services into the larger Lake Shore
Logistics operations, which has generated positive feedback from
our customers accessing expanded transportation service lines,"
stated Bryan Barnhart, CEO of SMG. Bryan continued, "The Company
has several revenue synergies underway, including cross-fertilizing
customers, introducing additional services lines from the Barnhart
family of companies and SMG/5J companies expanding solutions by
building a "one stop shop," full-service logistics provider for our
customers and delivering seamless logistics solutions spanning the
globe. We continue to enjoy diversification in our end market
customer focus with industrial, oilfield and intermodal benefiting
from additional activity in the market."
About SMG Industries
Headquartered in Houston, Texas, SMG Industries Inc. (OTCQB: SMGI)
-- www.SMGIndustries.com -- is a growth-oriented transportation
services company specializing in the full-service logistics market.
As a family of transportation companies, SMG Industries offers
comprehensive logistics solutions, serving as a single service
provider for shipments of all sizes, both domestically and
internationally.
Houston, Texas-based MaloneBailey, LLP, the Company's auditor since
2017, issued a "going concern" qualification in its report dated
April 17, 2023, stating that the Company has suffered recurring
losses from operations and has a net capital deficiency that raises
substantial doubt about its ability to continue as a going concern.
ST. LUKE'S HOSPITAL: S&P Lowers Revenue Bond LT Rating to 'BB+'
---------------------------------------------------------------
S&P Global Ratings lowered its long-term rating to 'BB+' from
'BBB-' on the Duluth Economic Development Authority, Minn.'s series
2022A, 2022B, and series 2021A revenue bonds, issued for St. Luke's
Hospital of Duluth (St. Luke's). The outlook is stable.
"The rating action reflects our view of St. Luke's deterioration in
unrestricted reserves, weakening already-light balance sheet
metrics to levels no longer commensurate with an investment-grade
rating," said S&P Global Ratings credit analyst Concy Richards.
"The rating action further reflects our view of the hospital's
compressed operating performance, which did not meet our
expectations and, absent recognition of a material 340(b)
settlement, would have shown a two-year trend of meaningful losses
from operations," Ms. Richards added.
S&P said, "The stable outlook reflects our view of reported
quarter-over-quarter improvement in operating performance and our
expectation of further improvement as the turnaround plan is
implemented. The stable outlook also reflects our expectation of
increasing unrestricted reserves as cash flow improves, modest
spending from reserves on capital plans, and the receipt of the
340(b) settlement."
ST. PAUL CONSERVATORY: S&P Cuts Lease Revenue Debt Rating to 'BB-'
------------------------------------------------------------------
S&P Global Ratings lowered its rating to 'BB-' from 'BB' on St.
Paul Housing & Redevelopment Authority, Minn.'s outstanding lease
revenue debt issued for the St. Paul Conservatory for Performing
Artists (SPCPA). The outlook is negative.
"The lowered rating reflects our view of the school's continued
enrollment declines, which pressured its financial performance in
fiscal 2023 and have the potential to cause a debt service coverage
covenant violation," said S&P Global Ratings credit analyst Amber
Schafer. "The negative outlook reflects our view that the school's
weakened financial performance will continue in the near term." Ms.
Schafer added.
The school's next charter renewal is in 2026.
Saint Paul Conservatory for Performing Artists (SPCPA) serves 9th
through 12th-grade students from 40-plus school districts in and
around the Twin Cities metropolitan area. The school's goal is to
focus students on college work that could include a Master of Fine
Arts degree. The school's art programs include dance, theater,
music theater, instrumental music, visual arts, creative writing,
and vocal arts.
Environmental, social, and governance (ESG) credit factors for this
change in credit rating/outlook and/or CreditWatch status:
-- Health and safety
-- Social capital
STADIUMS EXPORT: Case Summary & Three Unsecured Creditors
---------------------------------------------------------
Debtor: Stadiums Export, Inc.
454 Lexington Ave
Iowa City, IA 52246
Chapter 11 Petition Date: October 6, 2023
Court: United States Bankruptcy Court
Northern District of Iowa
Case No.: 23-00798
Debtor's Counsel: Joseph A. Peiffer, Esq.
AG & BUSINESS LEGAL STRATEGIES
PO Box 11425
Cedar Rapids, IA 52410
Tel: 319-363-1641
Fax: 319-200-2059
Email: joe@ablsonline.com
Total Assets: $731,310
Total Liabilities: $2,222,543
The petition was signed by Charles Johnston as president.
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/C5CRR7Q/Stadiums_Export_Inc__ianbke-23-00798__0001.0.pdf?mcid=tGE4TAMA
STAT EMERGENCY: Unsecureds to Split $60K over 3 Years
-----------------------------------------------------
Stat Emergency Medical Services, Inc., filed with the U.S.
Bankruptcy Court for the Eastern District of Michigan a Subchapter
V Plan of Reorganization dated October 3, 2023.
Debtor was a full service medical and non-medical specialty
transportation logistic business with its headquarters is located
at 520 W. Third St. in Flint, Michigan.
The Debtor was founded in 2000 by Marc Lund and former partners
Joseph R. Karlichek and Dominec Foster. Foster sold his interest in
the Debtor on or around 2003 and Karlichek sold his interest in
Debtor in 2022. Stephen M. Lund joined the Debtor in 2002 via a
financial investment.
In late 2022, the Debtor realized that it was not going to be able
to regain profitability and it began shutting down its ambulance
services. The Debtor continues to wind down the portion of the
Debtor's operations that provided ambulance services by continuing
to collect outstanding receivables and insure and clean out
vehicles and equipment for sale.
As of the Petition Date, the Debtor's operations consisted of (i)
servicing the School District Contract, and (ii) winding down its
ambulance operations.
Class IV shall consist of the Allowed Claims of Unsecured
Creditors. The Debtor estimates that the total of all Allowed
Unsecured Claims will equal approximately $985,754.46 (the
"Estimated Claim Pool").
The Debtor shall pay a total of $60,000 (the "Unsecured
Distribution") to Holders of Allowed Class IV Claims over the
three-year life of the Plan. The Debtor shall pay the Unsecured
Distribution in bi-annual installments of $10,000 with the first
installment due on March 1, 2024, and every six months thereafter
until a total of $60,000 has been distributed to Allowed Class VI
Claims. The Debtor is entitled to prepay this amount at any time
without penalty. All payments shall be distributed to Holders of
Allowed Unsecured Claims on a Pro Rata basis.
The Debtor shall fund the Unsecured Distribution with (i) its
Projected Disposable Income which totals $37,432 (ii) the proceeds
available from the liquidation of the STAT Equipment and 503 W.
Third St. and application of the Huron Insurance Proceeds after
payment of Allowed Administrative Expenses (which available
proceeds the Debtor anticipates will total $17,000), and (iii) the
refund of an insurance overpayment due to the Debtor in the amount
of $6,481. This Class is Impaired.
Class V shall consist of Allowed Interests. The Interests of the
Debtor are wholly owned by Stephen Lund and Marc Lund. Stephen Lund
and Marc Lund shall retain their Allowed Interests in the Debtor in
the same percentages as held in the Debtor and subject to the
Debtor's prepetition operating agreement, which is assumed upon the
Confirmation Date.
The Debtor reasonably believes that the liquidation of collateral,
plus Debtor's ongoing operations as contemplated by this Plan shall
be sufficient to fund Debtor's Plan.
The Debtor contemplates that during the life of the Plan (as may be
modified and confirmed), Stephen Lund, the Debtor's president, will
continue to operate the Debtor's business and oversee the Debtor's
liquidation. The current Plan Projections do not include any
compensation for Stephen Lund, however, nothing shall preclude the
Debtor from paying Stephen Lund reasonable market rate compensation
in the future should the Debtor's finances allow.
A full-text copy of the Subchapter V Plan dated October 3, 2023 is
available at https://urlcurt.com/u?l=ErTLRl from PacerMonitor.com
at no charge.
Counsel for Debtor:
Kim K. Hillary, Esq.
Jeffery J. Sattler, Esq.
Schafer and Weiner, PLLC
40950 Woodward Ave., Ste. 100
Bloomfield Hills, MI 48304
Tel: (248) 540-3340
Email: khillary@schaferandweiner.com
jsattler@schaferandweiner.com
About STAT Emergency
STAT Emergency Medical Services, Inc. was a full service medical
and non-medical specialty transportation logistic business with its
headquarters is located at 520 W. Third St. in Flint, Michigan.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. E.D. Mich. Case No. 23-31085) on July 5,
2023, with as much as $50,000 in assets and $1 million to $10
million in liabilities. Charles Mouranie of CMM & Associates has
been appointed as Subchapter V trustee.
Judge Joel D. Applebaum oversees the case.
The Debtor tapped Kim K. Hillary, Esq., at Schafer and Weiner, PLLC
as legal counsel and Wesler & Associates, CPA, PC as accountant.
SUNSET DEBT MERGER: $1.63BB Bank Debt Trades at 16% Discount
------------------------------------------------------------
Participations in a syndicated loan under which Sunset Debt Merger
Sub Inc is a borrower were trading in the secondary market around
83.9 cents-on-the-dollar during the week ended Friday, October 6,
2023, according to Bloomberg's Evaluated Pricing service data.
The $1.63 billion facility is a Term loan that is scheduled to
mature on October 6, 2028. The amount is fully drawn and
outstanding.
SIWF Holdings Inc. (Sunset Debt Merger Sub Inc.) was formed by AEA
Investors LP and British Columbia Investment Management Corporation
to facilitate their acquisition of Springs Window Fashions LLC from
Golden Gate Capital. Springs Window Fashions supplies retailers and
distributors with a line of blinds, shades, specialty treatments
and window hardware.
TEAM HEALTH: $1.59BB Bank Debt Trades at 27% Discount
-----------------------------------------------------
Participations in a syndicated loan under which Team Health
Holdings Inc is a borrower were trading in the secondary market
around 73.3 cents-on-the-dollar during the week ended Friday,
October 6, 2023, according to Bloomberg's Evaluated Pricing service
data.
The $1.59 billion facility is a Term loan that is scheduled to
mature on February 2, 2027. The amount is fully drawn and
outstanding.
Team Health Holdings, Inc. provides physician staffing and
administrative services to hospitals and other healthcare providers
in the U.S.
TEHUM CARE: M2 LoanCo Ups Interim DIP Loan to $8.5MM
----------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas,
Houston Division, authorized Tehum Care Services, Inc. to use cash
collateral and obtain postpetition financing, on an interim basis.
Pursuant to the Court's order, the Interim DIP Loan is increased by
$5.7 million from $2.750 million to $8.5 million, and the DIP
Lenders agree to advance the Third Interim Draw, subject to
compliance with the terms, conditions, and covenants described in
the Approved Budget and the DIP Documents, on or before two
business days after the entry of the Order.
As previously reported by the Troubled Company Reporter, the Debtor
obtained senior secured postpetition financing on a superpriority
basis pursuant to the terms and conditions of the DIP Orders and
Approved Budget and a Senior Secured Superpriority
Debtor-in-Possession Credit Agreement by and among the Debtor, as
borrower and M2 LoanCo, LLC, as the DIP Agent. The loan consisted
of a total of $10 million in commitments through a $2 million
Interim DIP Loan, a $3 million Final DIP Loan and, if needed, a $5
million Additional DIP Loan.
In May 2022, the Debtor effectuated a divisional merger pursuant to
the Texas Business Organizations Code in which assets and
liabilities were allocated between CHS TX, Inc. and the Debtor. As
part of the Divisional Merger, the Debtor entered into and became
the payee under a Funding Agreement dated May 5, 2022, under which
the Debtor is entitled to receive funds up to an agreed aggregate
$15 million cap from to pay the liabilities assumed by the Debtor
as part of the Divisional Merger. Although the Debtor's
professionals are continuing to review the Debtor's books and
records, the Debtor's preliminary analysis suggests that the Debtor
has utilized the available amounts under the Funding Agreement.
The Debtor spent the second half of 2022 attempting to settle and
satisfy its allocated liabilities, but ongoing litigation and
associated costs have made such efforts impractical.
The Debtor will use the proceeds of the DIP Facility to, among
other things, administer the Chapter 11 case and ultimately, wind
down the business, all in accordance with the budget.
The DIP Credit Agreement matures through the earliest to occur of:
(a) September 15, 2023 (or such later date as the
Administrative Agent in its sole discretion may agree in writing
with the Borrower);
(b) Acceleration of the Loan and the termination of the
commitments of the Lenders thereunder pursuant to the Agreement or
the Interim Order;
(c) 30 days after entry of the Interim Order (or such later
date as the Administrative Agent in its sole discretion may agree
in writing with the Borrower) if the Final Order has not been
entered and become a final, non-appealable order on or prior to the
expiration of such 30 day period;
(d) The Plan Effective Date;
(e) The date on which all or substantially all of the
Borrower's assets are sold or otherwise disposed of under section
363 of the Bankruptcy Code; and
(f) The date upon which an order is entered converting or
dismissing the Chapter 11 Case or appointing a chapter 11 trustee
or an examiner with enlarged powers beyond those set forth in 11
U.S.C sections 1104(d) and 1106(a)(3) and (4).
The Debtor is required to comply with these milestones:
(a) No later than five calendar days after the filing of the
DIP Motion, entry of the Interim DIP Order;
(b) No later than 30 calendar days after the entry of the
Interim DIP Order, entry of the Final DIP Order;
(c) Before the end of the Challenge Period, as may be extended
by agreement in writing by the DIP Agent, duly authorized
representatives for each the Debtor and the Committee have agreed
in writing to the key terms of an Acceptable Plan, or such
representatives have agreed (on behalf of the Debtor and the
Committee) to attend mediation with the DIP Secured Parties and
their parents, subsidiaries and affiliates to mediate the terms of
an Acceptable Plan (including the resolution of any disputes raised
prior to the end of such Challenge Period);
(d) No later than July 14, 2023, the Debtor will have filed
the Acceptable Plan;
(e) No later than July 14, 2023, the Debtor will have filed
(i) the Acceptable Disclosure Statement, and (ii) a motion seeking
entry of the Acceptable Disclosure Statement Order;
(f) No later than September 1, 2023, the Court will have
entered the Acceptable Disclosure Statement Order;
(g) No later than September 1, 2023, the Court will have
entered the Acceptable Confirmation Order; and
(h) No later than September 15, 2023, the Plan Effective Date
will have occurred.
A copy of the order is available at https://urlcurt.com/u?l=bxKfwB
from Kurtzman Carson Consultants, LLC, the claims, noticing and
solicitation agent.
About Tehum Care Services
Tehum Care Services Inc., doing business as Corizon Health Services
Inc., is a privately held prison healthcare contractor in the
United States. It is based in Brentwood, Tenn.
Tehum Care Services filed a petition for relief under Chapter 11 of
the Bankruptcy Code (Bankr. S.D. Texas Case No. 23-90086) on Feb.
13, 2023. In the petition filed by Russell A. Perry, as chief
restructuring officer, the Debtor reported assets between $1
million and $10 million and liabilities between $10 million and $50
million.
Judge Christopher M. Lopez oversees the case.
The Debtor tapped Gray Reed & McGraw, LLP as bankruptcy counsel;
Bradley Arant Boult Cummings, LLP as special litigation counsel;
and Ankura Consulting Group, LLC as financial advisor. Russell A.
Perry, senior managing director at Ankura, serves as the Debtor's
chief restructuring officer. Kurtzman Carson Consultants, LLC is
the claims, noticing and solicitation agent.
The U.S. Trustee for Region 7 appointed an official committee to
represent unsecured creditors in the Debtor's Chapter 11 case. The
committee is represented by Stinson, LLP.
THAI KITCHEN: Files Emergency Bid to Use Cash Collateral
--------------------------------------------------------
Thai Kitchen, LLC asks the U.S. Bankruptcy Court for the Northern
District of Texas, Lubbock Division, for authority to use cash
collateral for a period of 24 days.
The Debtor requires the use of cash collateral to pay the normal
day-to-day expenses of the Debtor's operations such as payroll
(including payroll taxes), rent, utilities, purchase inventory,
restaurant expenditures, insurance, and sales taxes.
The United States Small Business Administration asserts a security
interest in the accounts receivable, inventory, equipment, and
other personal property of the Debtor to secure the repayment of an
Economic Injury Disaster Loan in the estimated outstanding balance
of $536,933.
Additionally, the Debtor prior to filing the bankruptcy case
acquired several merchant cash advance loans from several creditors
who likewise assert liens against the Debtor's accounts receivable
and other personal property assets of the Debtor. The Debtor
believes the MCA Lenders are undersecured as the Debtor's assets do
not surpass the amount it owes to the SBA, which holds a first lien
against the Debtor's assets.
As with many food providers, the Debtor was impacted by the
COVID-19 pandemic. To alleviate the financial strains the pandemic
caused on the Debtor, the Debtor had to acquire the EIDL Loan.
Additionally, to keep things afloat, the Debtor took out several
merchant cash advance loans from the MCA Lenders. Ultimately, these
loans and the onerous repayment terms caused for the Debtor to seek
relief under the bankruptcy code.
The Debtor's counsel has conducted a UCC lien search as to the
Debtor. Based on the lien search, the Debtor is not able to
determine the priority of Rapid's, Bitty's, and Velocity's lien
claims because the MCA Lenders do not file UCC-1 Financing
Statements in their name, but instead use an agent to do so.
Nonetheless, the MCA Lenders are behind the SBA, and the Debtor
asserts their claims are general unsecured claims pursuant to 11
U.S.C. Section 506(a).
The Debtor currently has in its possession $2,900 of cash in the
form of cash in tills and deposits in its depository accounts from
sales of food and services to its customers. As of the Petition
Date, the Debtor does not have any outstanding accounts receivable
as the Debtor receives cash or credit card payments for the sales
of its food products and services. As of the Petition Date, Debtor
has $1,500 in food product inventory it uses in its restaurant
business.
As adequate protection, the Debtor proposes to grant the SBA and
the MCA Lenders replacement liens in the inventory of the Debtor of
equal validity, nature, and priority as its pre-petition liens to
protect these lenders from the diminution in value of the
collateral used by the Debtor as part of its operations.
The Debtor also requests that the court set a hearing on the matter
on October 25, 2023 at 1:30 p.m.
A copy of the motion is available at https://urlcurt.com/u?l=VIkZE2
from PacerMonitor.com.
About Thai Kitchen, LLC
Thai Kitchen, LLC operates a Thai food restaurant which provides
customers the opportunity to enjoy and taste authentic Thai cuisine
and the culinary flavors of the Far East in West Texas.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Tex. Case No. 23-50184-11) on October
2, 2023. In the petition signed by Winai Sitthigarana, managing
member, the Debtor disclosed up to $50,000 in assets and up to $1
million in liabilities.
Brad W. Odell, Esq., at Mullin Hoard & Brown, L.L.P., oversees the
case.
TRITEK INT'L: Windom Unsecureds to Recover 11% to 14% in Plan
-------------------------------------------------------------
Tritek International Inc., et al., submitted a Third Amended
Combined Disclosure Statement and Joint Chapter 11 Plan dated
October 2, 2023.
Following the filing of the Debtors' second amended Plan, the
Debtors finalized with the Committee and other creditors the terms
of three additional related settlement agreements, resulting in the
resolution of various existing and potential disputes.
The Debtors agreed to further modify the Plan to incorporate such
settlements. The Debtors believe, in their business judgment, that
each of the settlements discussed below is in the best interests of
the Debtors, their estates, and all parties in interest. Such
settlements will result in the creation of additional value to
Debtors' estates and will avoid the need for the Debtors, the
Liquidating Trust, and/or other parties in interest to incur
significant litigation time and expense.
Committee Settlement: Since the initial filing of the Plan, the
Debtors and the Committee have been engaged in discussions
regarding certain releases set forth in the Plan and have conducted
lengthy discovery and investigations with respect to potential
alleged claims the Committee believed may have existed against
certain of the Debtors' directors and officers. The parties have
agreed to a resolution (such resolution, the "Committee
Settlement") of the potential alleged claims the Committee believes
it could assert against the Debtors' directors and officers.
Pursuant to the Committee Settlement, the Debtors' directors and
officers will fund or cause to be funded (i) an additional $500,000
in cash for the benefit of Holders of Allowed General Unsecured
Claims in Class 4 (such contribution, the "D&O Contribution") and
(ii) up to 5.0% of the combined Allowed Professional Fees (as
defined in the Final DIP Order) of Katten, Dechert, and Debtors'
financial advisor, PricewaterhouseCoopers, solely to the extent
such aggregate Allowed Professional Fees exceed the amounts set
forth in the budget; provided that in no event shall the Debtors'
directors and officers be obligated to fund more than $300,000 in
Allowed Professional Fees." In exchange for the foregoing, the
Committee shall hold in abeyance its existing and potential
objections to the Plan, including with respect to the release and
exculpation provisions contained herein.
Headwaters Settlement: On August 17, 2023, the Debtors filed the
Debtors' Objection to the Proof of Claim of Headwaters Development,
LLC the "Headwaters Claim Objection"), objecting to Claim No. ECN-3
filed by Headwaters Development, LLC ("Headwaters", and such claim,
the "Headwaters Claim"). Pursuant to the Headwaters Claim,
Headwaters asserted a total unsecured claim of $7,389,761.37. In
the Headwaters Claim Objection, the Debtors objected to portions of
the Headwaters Claim related to an alleged breach by the Debtors of
a Development Agreement (as defined in the Headwaters Claim
Objection). On September 13, 2023, Headwaters filed the Motion of
Headwaters Development, LLC Pursuant to Bankruptcy Rule 3018(a) for
Estimation and Temporary Allowance of Claims for Purposes of Voting
to Accept of Reject the Plan (the "Headwaters 3018 Motion").
The Debtors and Headwaters have agreed to resolve the issues set
forth in the Headwaters Claim Objection and the Headwaters 3018
Motion (such resolution, the "Headwaters Settlement"). Pursuant to
the Headwaters Settlement, (i) Headwaters shall be allowed an
administrative claim in the amount of $190,133.35, (ii) Headwaters
shall be deemed to hold an Allowed General Unsecured Claim in the
amount of $7,239,761.37, (iii) the Debtors shall be deemed to have
released Headwaters from any and all Avoidance Actions, (iv) the
Headwaters Claim Objection and the Headwaters 3018 Motion shall be
deemed withdrawn, and (v) Headwaters shall be deemed to have voted
in favor of the Plan and shall not be deemed to have opted out of
the third party releases.
The Committee was involved in the negotiation of and is supportive
of the Headwaters Settlement.
Strobel Settlement: On June 27, 2023, Greg Strobel d/b/a Strobel
Farms ("Strobel") filed a proof of claim in the total amount of
$14,534,577.50 (Claim No. 91-1) (the "Strobel Claim") for alleged
damages owed under a Hog Supply Agreement. Strobel has asserted
that certain portions of the Strobel Claim are subject to statutory
regulations set forth in the Packers and Stockyards Program
administered by the U.S. Department of Agriculture (the "PSA").
Strobel has further asserted that it should be authorized to
collect certain amounts comprising the Strobel Claim from a
Livestock Dealer Bond issued on behalf of the Debtors in accordance
with the PSA in the amount of $1,965,000 (the "PSA Bond").
Although Debtors have not yet filed a formal objection to the
Strobel Claim, Debtors believe that certain portions of the Strobel
Claim may be objectionable and have agreed to resolve their
disputes with Strobel (such resolution, the "Strobel Settlement").
Specifically, pursuant to the Strobel Settlement, (i) in resolution
of the Strobel Claim, (A) Debtors' parent company, Hylife Group
Holdings Ltd., shall pay Strobel $1,000,000 (CAD) in cash, (B)
Strobel shall be authorized to seek payment of $837,158.28 from the
PSA Bond, (C) Patrick Farms shall waive $3.7 million in additional
unsecured claims against Strobel, and (D) Strobel shall waive the
unsecured claim amounts set forth in the Strobel Claim and shall
not be entitled to any distribution to which Holders of Class 4
Allowed General Unsecured Claims are entitled on account of the
Strobel Claim; and (ii) Strobel shall be deemed to have voted in
favor of the Plan and shall not be deemed to have opted out of the
third party releases.
Class 4 consists of General Unsecured Claims of Windom total of
$42,000,000 and will recover 11% to 14% of its claim, Canwin total
of $200,000 and will recover 0% to 100% of its claim, and Tritek
total of $0. Each Holder of a General Unsecured Claim will receive
such Holder's pro rata share of the GUC Distribution Pool;
provided, however, that the proceeds of any Avoidance Actions will
be distributed only to the Holders of General Unsecured Claims of
the Debtor(s) on behalf of whose estate, whether in the name of the
Debtor or any party acting on behalf of the Debtor, the respective
Avoidance Action(s) is asserted.
The Plan will be implemented by, among other things, the
establishment of the Liquidating Trust, the transfer to the
Liquidating Trust of the Liquidating Trust Assets, including,
without limitation, all Cash and Retained Causes of Action, and the
making of Distributions by the Liquidating Trust in accordance with
the Plan and Liquidating Trust Agreement.
A full-text copy of the Third Amended Combined Disclosure Statement
and Plan dated October 2, 2023 is available at
https://urlcurt.com/u?l=LsrxR0 from PacerMonitor.com at no charge.
Counsel to the Debtors:
Jerry L. Hall, Esq.
Michael E. Comerford, Esq.
KATTEN MUCHIN ROSENMAN LLP
50 Rockefeller Plaza
New York, NY 10020
Telephone: (212) 940-8800
Facsimile: (212) 940-8776
E-mail: jerry.hall@katten.com
michael.comerford@katten.com
- and -
Allison E. Yager, Esq.
Kenneth N. Hebeisen, Esq.
KATTEN MUCHIN ROSENMAN LLP
525 W. Monroe Street
Chicago, IL 60661
Telephone: (312) 902-5200
Facsimile: (312) 902-1061
E-mail: allison.yager@katten.com
ken.hebeisen@katten.com
- and -
Jeremy W. Ryan, Esq.
L. Katherine Good, Esq.
R. Stephen McNeill, Esq.
Maria Kotsiras, Esq.
POTTER ANDERSON & CORROON LLP
1313 N. Market Street, 6th Floor
Wilmington, DE 19801
Telephone: (302) 984-6000
Facsimile: (302) 658-1192
E-mail: jryan@potteranderson.com
kgood@potteranderson.com
rmcneill@potteranderson.com
mkotsiras@potteranderson.com
- and -
Yelena E. Archiyan, Esq.
KATTEN MUCHIN ROSENMAN LLP
2121 N. Pearl Street, Suite 1100
Dallas, TX 75201
Telephone: (214) 765-3600
Facsimile: (214) 765-3602
E-mail: yelena.archiyan@katten.com
About Tritek International
Tritek International Inc., HyLife Foods Windom, LLC, Canwin Farms,
LLC are entities that are part of the HyLife vertically integrated
operation for the raising, production and sale of pork products.
The companies' operations involve all aspects and stages of the
pork production process, including the farming and sourcing of
hogs, the packaging of pork at their processing facility, and the
marketing and sale of such products throughout premium domestic and
international end markets, primarily in the United States, Canada,
Japan, Korea, and China.
Tritek International and its affiliates sought Chapter 11
bankruptcy protection (Bankr. D. Del. Lead Case No. 23-10520) on
April 27, 2023. The petitions were signed by Grant Lazaruk, chief
executive officer.
At the time of the filing, Tritek International and HyLife Foods
Windom reported as much as $50,000 in both assets and liabilities
while Canwin Farms reported $1 million to $10 million in both
assets and liabilities.
Judge Thomas M. Horan presides over the Debtors' cases.
The Debtors tapped Katten Muchin Rosenman, LLP and Potter Anderson
& Corroon, LLP as bankruptcy counsel; PricewaterhouseCoopers, LLP
as financial advisor; Intrepid Investment Bankers as investment
banker; and Donlin Recano & Company, Inc. as claims and noticing
agent.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee to represent unsecured creditors in the Debtors' Chapter
11 cases. The committee is represented by the law firms of
Dechert, LLP and Saul Ewing, LLP.
VISTA CLINICAL: Files Emergency Bid to Use Cash Collateral
----------------------------------------------------------
Vista Clinical Diagnostics, LLC asks the U.S. Middle District of
Florida, Orlando Division, for authority to use cash collateral and
provide adequate protection to Lake City Medical Properties, LLC.
The Debtor will use the cash collateral to pay its respective share
of operating expenses.
As of the Petition Date, the Debtor owed approximately $500,000 on
a working capital loan to Lake City Medical Properties, LLC . The
Loan is secured by a lien on substantially all the Debtor's assets,
including accounts receivable, as evidenced by the Florida UCC-1
Financing Form, No. 202302655859. By virtue of its lien, the Lender
may assert a first priority security interest in the Debtor's cash
on hand and funds to be received into its operating accounts during
normal operations.
The Debtor will require the use of approximately $3.7 million of
cash collateral to continue to operate its business for the next
six weeks, and, depending on the month, a greater or lesser amount
will be required for each comparable period thereafter.
As adequate protection for the use of cash collateral, the Debtor
proposes to grant the Lender a replacement lien to the extent of
any diminution in value, with such lien to have the same validity,
extent, and priority as its respective prepetition lien but subject
to a lien in favor of a debtor-in-possession being requested
simultaneously hereto. The Debtor will maintain adequate liquidity
during the Interim Period and asserts all interests on cash
collateral are adequately protected by the replacement lien and the
ongoing value of the business.
A copy of the motion is available at https://urlcurt.com/u?l=nlpolP
from PacerMonitor.com.
About Vista Clinical Diagnostics, LLC
Vista Clinical Diagnostics, LLC is an independent laboratory
offering a complete compendium of clinical laboratory testing
capabilities, including microbiology, PCR molecular biology &
surgical pathology.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Fla. Case No. 23-04109) on October 2,
2023. In the petition signed by Davian S. Santana, president, the
Debtor disclosed up to $10 million in both assets and liabilities.
R.Scott Shuker, Esq., at Shuker & Dorris, PA, represents the Debtor
as legal counsel.
WASTEQUIP LLC: S&P Alters Outlook to Negative, Affirms 'CCC+' ICR
-----------------------------------------------------------------
S&P Global Ratings revised its outlook to negative from positive
and affirmed its 'CCC+' issuer credit rating on Wastequip LLC, a
manufacturer of waste and recycling containment equipment and
solutions. S&P also affirmed its 'CCC+' issue-level ratings on the
company's first-lien credit facilities. The recovery rating remains
'3' (rounded estimate: 50%). S&P affirmed its 'CCC-' issue-level
rating on the company's second-lien term loan, and the recovery
rating remains '6' (rounded estimate: 0%).
S&P said, "The negative outlook on Wastequip reflects our view that
the company faces mounting refinancing risks, and that we could
lower our ratings if we believe the company may not successfully
refinance its capital structure or could encounter a liquidity
crunch.
"Refinancing risk is a key driver of our rating on Wastequip, given
upcoming maturities in 2024 and 2025. The company faces approaching
maturities, with its revolving credit facility due Sept. 20, 2024,
followed closely by its first-lien term loan due March 20, 2025. We
believe the risk of refinancing is heightened amid the prevailing
high interest rate environment and tighter credit conditions.
Additionally, a narrowing window to maturities results in a higher
dependence on good operating performance over the next six to 12
months. Consequently, the longer the company waits, the higher the
risk of completing a successful refinancing.
"We expect the company will continue generating good operating
performance over the next 12 months, with debt leverage in the
low-6x area at year-end 2023 and the mid-5x area at year-end 2024.
In the midst of the pandemic and ensuing supply chain issues,
Wastequip's trucks business was hurt by a sharp decline in chassis
deliveries from original equipment manufacturers (OEMs), resulting
in pent-up demand in the market. In 2023, supply chain challenges
in the industrials sector began easing, driving a gradual recovery
in chassis deliveries, and we expect continued healthy growth in
volumes in the trucks business over the next 12 months. In the
containers and parts and service businesses, we expect modest
growth in volumes supported by recurring replacement cycles of
waste equipment amid continued growth in the U.S. waste stream.
Under our base case forecast, we expect prices of key
inputs--namely steel and resin--will remain near current levels,
and that Wastequip will largely continue to pass through these
lower costs to its customers.
"Liquidity will likely remain tight, as we expect the company to
continue relying on its revolving credit, receivables factoring,
and reverse factoring facilities to fund operating needs. The
company's revolving credit facility, which has a total borrowing
capacity of $45 million, has remained substantially drawn over the
majority of 2023, and we expect it will remain drawn over the next
12 months. Wastequip also has access to lending facilities linked
to its accounts receivable and accounts payable, though we do not
include them in our quantitative assessment of liquidity because we
do not view them as committed sources of funding. Nevertheless, we
estimate these two facilities had effective incremental
availability of approximately $60 million as of July 1, 2023, which
we believe can help fund operations following the maturity of the
revolver, assuming continued favorable business conditions.
"The negative outlook on Wastequip reflects our view that the
company faces mounting refinancing risks leading up to the maturity
of its revolver in September of 2024 and its first-lien term loan
in March 2025 and that we could lower our ratings if we expect the
company will not refinance its capital structure in a timely manner
or if it could face a liquidity crunch."
S&P could lower its ratings on Wastequip if:
-- S&P expects the company will not refinance its capital
structure in the coming quarters, leading to the first-lien term
loan coming due within 12 months; or
-- Operating performance deteriorates and the company's liquidity
declines, leading to heightened repayment risk on the revolving
credit facility; for example, due to weak demand or a surge in
input costs; or
-- The company engages in a distressed exchange or restructuring
that involves lenders receiving less than the original promise.
S&P could revise its outlook to stable or positive if:
-- S&P believes the company will refinance its capital structure
in the coming quarters, ahead of the first-lien term loan coming
due within 12 months; and
-- The company demonstrates healthy S&P Global Ratings-adjusted
EBITDA performance and generates positive S&P Global
Ratings-adjusted free operating cash flow.
S&P could raise its ratings if, in addition to the two factors
above, the company's liquidity improves to adequate, for example,
due to easing working capital needs or an increase in committed
sources of funding.
S&P said, "Governance factors are a moderately negative
consideration in our credit rating analysis of Wastequip LLC, 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.
Environmental and social factors are an overall neutral
consideration. The company provides containment equipment and
solutions to the waste, recycling, and industrial sectors. We
expect the company's operating performance will generally remain
linked to capital spending from waste management companies."
WESTERN GLOBAL: Unsecureds to Recover 3% to 5% in Joint Plan
------------------------------------------------------------
Western Global Airlines, Inc., and its Debtor Affiliates filed with
the U.S. Bankruptcy Court for the District of Delaware a Disclosure
Statement for Joint Chapter 11 Plan of Reorganization dated October
3, 2023.
The Company provides air cargo transportation services to its
customers under aircraft, crew, maintenance, and insurance
contracts ("ACMI Contracts") and full-service charter contracts,
both of which can be long or short term in duration.
The Debtors commenced these Chapter 11 Cases to implement a
comprehensive financial restructuring (the "Restructuring") that,
among other things, delevers the Company's balance sheet and
maximizes value for all of the Debtors' creditors.
As a result of extensive negotiations, on August 7, 2023, the
Debtors executed a restructuring support agreement (the
"Restructuring Support Agreement") with, among others, (i) DKB
Partners LLC, in its capacity as administrative agent and lender
under the Debtors' Credit Agreement, holding 100% of the Debtors'
secured loans issued in accordance with the Credit Agreement, (ii)
holders representing more than 85% of the aggregate principal
amount of outstanding Unsecured Notes, and (iii) the Debtors' DIP
Lenders under the DIP Term Sheet (the entities in the foregoing
clauses (i), (ii) and (iii), collectively, the "Consenting
Creditors").
Under the terms of the Restructuring Support Agreement, the
Consenting Creditors agreed, subject to the terms and conditions of
the Restructuring Support Agreement, to vote in favor of and
support confirmation of a chapter 11 plan embodying the
Restructuring Transactions set forth in the Restructuring Support
Agreement.
The Restructuring is supported by nearly 90% of the Debtors' funded
debt holders and is expected to reduce the Debtors' funded
indebtedness by more than $480 million, enhance the Debtors' long
term growth prospects, and better position the Debtors to continue
providing air cargo transportation services to their customers
worldwide.
The Plan contemplates the consummation of "Restructuring
Transactions" which generally provide for the following treatment
for holders of Claims and Interests:
* Each holder of an Allowed DIP Claim will, on the Effective
Date, in full satisfaction, settlement, release, and discharge of
such Allowed DIP Claim, (i) have its Allowed DIP Claim exchanged,
on a dollar-for-dollar basis, for new first lien secured
convertible notes, which shall be convertible into approximately
58% of New Common Stock on the terms and subject to the conditions
set forth in the New Convertible Notes Indenture (the "New
Convertible Notes"), and also receive cash on account of fees or
other charges payable through the Effective Date, or (ii) receive
such other treatment agreed upon among the Debtors and the holders
of Allowed DIP Claims.
* The holder of the Allowed Credit Facility Claims will
receive, in full and final satisfaction of such Allowed Credit
Facility Claims, 80.4% of the shares of New Common Stock that are
issued and outstanding on the Effective Date, which will be subject
to dilution by the New Common Stock (i) issuable upon exercise of
the New Warrants, (ii) issuable upon conversion of the New
Convertible Notes, and (iii) otherwise issued by Reorganized
Western Global from time to time after the Effective Date in
accordance with the Amended Organizational Documents.
* Each holder of an Allowed Unsecured Notes Claim will receive
on the Effective Date, in full and final satisfaction, settlement,
discharge, and release of such Allowed Unsecured Notes Claims, (i)
if a DIP Buyout has not been consummated prior to the Effective
Date, its Pro Rata share of the New Warrants, or (ii) if a DIP
Buyout has been consummated prior to the Effective Date, its Pro
Rata share of the $17,500,000 Unsecured Notes Cash Pool. The
deadline for DKB Partners to exercise the DIP Buyout was extended
to October 3, 2023, but may be further extended with the consent of
the Funding Group DIP Lenders.
* If the Class of holders of General Unsecured Claims vote to
accept the Plan, each holder of an Allowed General Unsecured Claim
will receive, in full satisfaction, settlement, discharge and
release of, and in exchange for, such Allowed General Unsecured
Claim, its Pro Rata share of the $2,000,000 General Unsecured Cash
Pool. If the Class of holders of General Unsecured Claims vote to
reject the Plan, each General Unsecured Claim will be discharged
without further notice to, approval of or action by any Person or
Entity, and each holder of a General Unsecured Claim shall not
receive any distribution or retain any property on account of its
General Unsecured Claim.
* DKB Partners or an affiliate thereof will invest $11,000,000
in Reorganized Western Global in consideration for 19.6% of the New
Common Stock that is issued and outstanding on the Effective Date,
subject to dilution by, among other things, any New Common Stock
(i) issuable upon exercise of the New Warrants, (ii) issuable upon
conversion of the New Convertible Notes, and (iii) otherwise issued
by Reorganized Western Global after the Effective Date (the "New
Equity Investment").
Class 5 consists of General Unsecured Claims. This Class is
impaired. This Class will receive a distribution of 100% of their
allowed claims (if and only if Class 5 votes to accept the Plan).
* If and only if Class 5 Votes to Accept the Plan: On or as
soon as reasonably practicable after the Effective Date, each
holder of an Allowed General Unsecured Claim shall receive, in full
satisfaction, settlement, discharge and release of, and in exchange
for, such Allowed General Unsecured Claim, its Pro Rata share of
the General Unsecured Cash Pool.
* If and only if Class 5 Votes to Reject the Plan: On the
Effective Date, each Allowed General Unsecured Claim will be
discharged without further notice to, approval of or action by any
Person or Entity, and each holder of an Allowed General Unsecured
Claim shall not receive any distribution or retain any property on
account of its General Unsecured Claim.
On the Effective Date, all Existing Equity Interests will be
cancelled, released, and extinguished and will be of no further
force and effect. No holders of Existing Equity Interests will
receive a distribution under the Plan.
The Reorganized Debtors shall fund distributions under the Plan
with (i) Cash on hand, (ii) proceeds of the New Equity Investment,
and (iii) the issuance of the New Convertible Notes, the New Common
Stock, and the New Warrants.
A full-text copy of the Disclosure Statement dated October 3, 2023
is available at https://urlcurt.com/u?l=X20yhr from
PacerMonitor.com at no charge.
Attorneys for the Debtors:
Gary T. Holtzer, Esq.
Candace M. Arthur, Esq.
Jason H. George, Esq.
WEIL, GOTSHAL & MANGES LLP
767 Fifth Avenue
New York, NY 10153
Telephone: (212) 310-8000
Facsimile: (212) 310-8007
- and -
Mark D. Collins, Esq.
Zachary I. Shapiro, Esq.
Amanda R. Steele, Esq.
RICHARDS, LAYTON & FINGER, P.A.
One Rodney Square
920 North King Street
Wilmington, DE 19801
Telephone: (302) 651-7700
Facsimile: (302) 651-7701
About Western Global Airlines
Western Global Airlines, Inc. provides contracted air cargo
transportation services ranging from ACMI (Aircraft, Crew,
Maintenance, and Insurance) to Full Service, on a global scale. WGA
is a high-tech air cargo platform serving customers in e-commerce,
express, freight forwarding, logistics, nonprofit, and governmental
organizations.
The Debtor and affiliates sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. D. Del. Lead Case No. 23-11093) on
August 7, 2023. In the petition signed by James K. Neff, chief
executive officer, the Debtor disclosed up to $500 million in
assets and up to $1 billion in liabilities.
Judge Karen B. Owens oversees the case.
The Debtors tapped Weil, Gotshal & Manges LLP as general bankruptcy
counsel, Richards, Layton & Finger, P.A., as local bankruptcy
counsel, Evercore Group L.L.C. as investment banker, FTI
Consulting, Inc. as provider of interim management and financial
advisory services. and Stretto, Inc., as claims, noticing, and
solicitation agent.
DKB Partners LLC, as DIP Lender and Prepetition Lender, is
represented by Young Conaway Stargatt & Taylor, LLP.
The Ad Hoc Group of DIP Lenders and Certain Creditors are
represented by Paul, Weiss, Rifkind, Wharton & Garrison, LLP and
Landis Rath & Cobb, LLP.
WEWORK INC: To Withhold $95.2M Interest Payments on Some Notes
--------------------------------------------------------------
WeWork Inc. said in a Form 8-K filed with the Securities and
Exchange Commission that it has elected to withhold aggregate
interest payments of approximately $37.3 million payable in cash
and $57.9 million payable in the form of additional PIK notes.
Wework said, "Entering the grace period is intended to allow
discussions with certain stakeholders in the Company's capital
structure to commence, while also enhancing liquidity as the
Company continues to take action to implement its strategic plan.
As part of this strategic plan, the Company is focused on
rationalizing its real estate footprint and improving its capital
structure."
Below is a list of Notes issued by WeWork Companies LLC and WW
Co-Obligor Inc.:
(i) 15.000% First Lien Senior Secured PIK Notes due 2027;
(ii) 11.000% Second Lien Senior Secured PIK Notes due 2027;
(iii) 11.000% Second Lien Exchangeable Senior Secured PIK Notes
due
2027;
(iv) 12.000% Third Lien Senior Secured PIK Notes due 2027; and
(v) 12.000% Third Lien Exchangeable Senior Secured PIK Notes due
2027.
Under the indentures governing the Notes, the Company has a 30-day
grace period to make the Interest Payments before such non-payment
constitutes an "event of default" with respect to the Notes.
According to the Company, it has the liquidity to make the Interest
Payments, and may in the future decide to do so.
About WeWork Inc.
New York, NY-based WeWork Inc. (NYSE: WE) -- wework.com -- is a
global flexible workspace provider, serving a membership base of
businesses large and small through its network of 779 Systemwide
Locations, including 622 Consolidated Locations as of December
2022.
WeWork reported a net loss of $2.29 billion for the year ended
Dec.31, 2022, a net loss of $4.63 billion for the year ended Dec.
31, 2021, a net loss of $3.83 billion in 2020, and a net loss of
$3.77 billion in 2019. As of Dec. 31, 2022, the Company had
$17.86
billion in total assets, $21.31 billion in total liabilities, and a
total deficit of $3.43 billion.
WW INTERNATIONAL: $945MM Bank Debt Trades at 25% Discount
---------------------------------------------------------
Participations in a syndicated loan under which WW International
Inc is a borrower were trading in the secondary market around 74.9
cents-on-the-dollar during the week ended Friday, October 6, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $945 million facility is a Term loan that is scheduled to
mature on April 13, 2028. About $942.6 million of the loan is
withdrawn and outstanding.
WW International Inc., formerly weight watchers international Inc.,
is a global company headquartered in the US that offers weight
loss.
YH&R CONSTRUCTION: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Debtor: YH&R Construction, LLC
4839 Isaac Ryan
San Antonio, TX 78253
Chapter 11 Petition Date: October 6, 2023
Court: United States Bankruptcy Court
Western District of Texas
Case No.: 23-51383
Debtor's Counsel: James S. Wilkins, Esq.
JAMES S. WILKINS P.C.
1100 NW Loop 410, Ste. 700
San Antonio, TX 78213
Tel: 210-271-9212
Email: jwilkins@stick.net
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Sandor Gonzalez as chief executive
officer.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/FWEZ2JY/YHR_CONSTRUCTION_LLC__txwbke-23-51383__0001.0.pdf?mcid=tGE4TAMA
ZIP TOP: Seeks Cash Collateral Access
-------------------------------------
Zip Top Inc. asks the U.S. Bankruptcy Court for the Western
District of Texas, Austin Division, for authority to use the cash
collateral of of LSQ Funding Group, LLC and Saddle Creek
Corporation to pay expenses of its business operations and the
Chapter 11 case.
LSQ holds a first lien on all of the Debtor's assets and the
proceeds thereof, including its accounts receivable and inventory.
Saddle Creek hold a warehouseman's lien on the Debtor's inventory
stored at Saddle Creek's warehouse facility located at 440 Joe
Tamplin Industrial Blvd., Macon, GA 31217. LSQ is owed
approximately $1.4 million; Saddle Creek approximately $100,000.
The book value of the Collateral is approximately million.
Contained within the million is the Saddle Creek Inventory, which
has a book value of approximately $3.9 million. A search of
Delaware Secretary of State's records found only one UCC-1, which
was filed by LSQ.
As adequate protection, LSQ and Saddle Creek will be granted
replacement security interests in and liens upon all categories of
property of the Debtor and its estate.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=CbHiee from PacerMonitor.com.
The Debtor projects total disbursements, on a weekly basis, as
follows:
$9,170 for the week ending October 6, 2023;
$19,700 for the week ending October 13, 2023;
$3,120 for the week ending October 20, 2023; and
$8,400 for the week ending October 27, 2023.
About Zip Top, Inc.
Zip Top, Inc. manufactures and sells easier to use reusable
containers with a goal to reduce plastic waste. Zip Top
container's patented design is made with a one-piece construction
that makes it extremely durable microwave, dishwasher and freezer
safe.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr W.D. Tex. Case No. 23-10832-smr) on October
2, 2023. In the petition signed by Scott Robertson, chief executive
officer, the Debtor disclosed up to $50 million in both assets and
liabilities.
Frank B Lyon. Esq. represents the Debtor as legal counsel.
[] Kirkland, Foley Co-Chair Nov 29 Distressed Investing Conference
------------------------------------------------------------------
Registration remains open for the 30TH DISTRESSED INVESTING
CONFERENCE presented by Beard Group, Inc. This year's conference
will be held Wed., Nov. 29, in-person at the Harmonie Club in
Manhattan.
The event is being sponsored by:
* Kirkland & Ellis and Foley & Lardner, as conference
co-chairs
* Davis Polk
* Dechert
* Dentons
* DSI
* Locke Lord
* RJReuter
* Skadden
* SSG
* Stein Advisors
* Troutman Pepper
* Wachtell Lipton Rosen & Katz
* Weil Gotshal
Top industry experts gather together to discuss the latest topics
and trends in the distressed investing industry. Now on its 30th
year, this value-packed event features special presentations from
keynote speakers, live panel discussions and networking sessions
with other insolvency professionals.
Visit https://www.distressedinvestingconference.com/ for more
information.
For conference sponsorship and speaking opportunities, contact:
Will Etchison
305-707-7493
Will@BeardGroup.com
[^] BOND PRICING: For the Week from October 2 to 6, 2023
--------------------------------------------------------
Company Ticker Coupon Bid Price Maturity
------- ------ ------ --------- --------
2U Inc TWOU 2.250 60.250 5/1/2025
99 Escrow Issuer Inc NDN 7.500 35.133 1/15/2026
99 Escrow Issuer Inc NDN 7.500 35.149 1/15/2026
99 Escrow Issuer Inc NDN 7.500 35.032 1/15/2026
Acorda Therapeutics Inc ACOR 6.000 65.762 12/1/2024
Air Methods Corp AIRM 8.000 0.576 5/15/2025
Air Methods Corp AIRM 8.000 0.576 5/15/2025
Amyris Inc AMRS 1.500 12.500 11/15/2026
Apollo Commercial Real
Estate Finance Inc ARI 5.375 99.900 10/15/2023
At Home Group Inc HOME 7.125 25.250 7/15/2029
At Home Group Inc HOME 7.125 25.017 7/15/2029
Audacy Capital Corp CBSR 6.750 1.653 3/31/2029
Audacy Capital Corp CBSR 6.500 1.425 5/1/2027
Audacy Capital Corp CBSR 6.750 1.680 3/31/2029
BPZ Resources Inc BPZR 6.500 3.017 3/1/2049
Bed Bath & Beyond Inc BBBY 4.915 0.350 8/1/2034
Brixmor LLC BRX 6.900 9.875 2/15/2028
CNG Holdings Inc CNGHLD 12.500 85.359 6/15/2024
CNG Holdings Inc CNGHLD 12.500 85.359 6/15/2024
CNG Holdings Inc CNGHLD 12.500 85.359 6/15/2024
Citizens Financial Group CFG 6.375 87.520 N/A
Clovis Oncology Inc CLVS 1.250 10.380 5/1/2025
Clovis Oncology Inc CLVS 4.500 8.948 8/1/2024
Clovis Oncology Inc CLVS 4.500 8.618 8/1/2024
Curo Group Holdings Corp CURO 7.500 35.874 8/1/2028
Curo Group Holdings Corp CURO 7.500 23.113 8/1/2028
DIRECTV Holdings
LLC / DIRECTV
Financing Co Inc DTV 6.000 13.662 8/15/2040
DIRECTV Holdings
LLC / DIRECTV
Financing Co Inc DTV 6.350 5.984 3/15/2040
DTE Energy Center LLC DTEENE 7.458 89.023 4/30/2024
Danimer Scientific Inc DNMR 3.250 32.694 12/15/2026
Diamond Sports Group
LLC / Diamond
Sports Finance Co DSPORT 5.375 1.500 8/15/2026
Diamond Sports Group
LLC / Diamond
Sports Finance Co DSPORT 6.625 2.000 8/15/2027
Diamond Sports Group
LLC / Diamond
Sports Finance Co DSPORT 5.375 2.234 8/15/2026
Diamond Sports Group
LLC / Diamond
Sports Finance Co DSPORT 5.375 2.815 8/15/2026
Diamond Sports Group
LLC / Diamond
Sports Finance Co DSPORT 6.625 2.000 8/15/2027
Diamond Sports Group
LLC / Diamond
Sports Finance Co DSPORT 5.375 2.815 8/15/2026
Diamond Sports Group
LLC / Diamond
Sports Finance Co DSPORT 5.375 2.234 8/15/2026
Endo Finance LLC /
Endo Finco Inc ENDP 5.375 5.000 1/15/2023
Endo Finance LLC /
Endo Finco Inc ENDP 5.375 5.000 1/15/2023
Energy Conversion Devices ENER 3.000 0.551 6/15/2013
Envision Healthcare Corp EVHC 8.750 5.125 10/15/2026
Envision Healthcare Corp EVHC 8.750 4.865 10/15/2026
Esperion Therapeutics Inc ESPR 4.000 50.010 11/15/2025
Exela Intermediate LLC
/ Exela Finance Inc EXLINT 11.500 19.500 7/15/2026
Exela Intermediate LLC
/ Exela Finance Inc EXLINT 11.500 17.766 7/15/2026
Federal Home Loan Banks FHLB 4.250 99.832 10/11/2023
Federal Home Loan Banks FHLB 3.720 99.397 10/10/2023
Federal Home Loan Banks FHLB 4.390 99.411 10/13/2023
Federal Home Loan Banks FHLB 4.500 99.412 10/13/2023
Federal Home Loan
Mortgage Corp FHLMC 3.250 99.770 10/12/2023
First Citizens
Bancshares Inc/TX FIRCTZ 6.000 92.701 9/1/2028
First Citizens
Bancshares Inc/TX FIRCTZ 6.000 92.701 9/1/2028
First Republic Bank/CA FRCB 4.375 0.225 8/1/2046
First Republic Bank/CA FRCB 4.625 0.125 2/13/2047
GNC Holdings Inc GNC 1.500 0.474 8/15/2020
Goldman Sachs
Group Inc/The GS 4.665 99.431 10/17/2023
Goodman Networks Inc GOODNT 8.000 1.000 5/31/2022
H-Food Holdings LLC /
Hearthside
Finance Co Inc HEFOSO 8.500 24.394 6/1/2026
H-Food Holdings LLC /
Hearthside
Finance Co Inc HEFOSO 8.500 24.548 6/1/2026
Hallmark Financial
Services Inc HALL 6.250 17.964 8/15/2029
Inseego Corp INSG 3.250 40.250 5/1/2025
Invacare Corp IVC 5.000 83.125 11/15/2024
Invacare Corp IVC 4.250 2.273 3/15/2026
JPMorgan Chase Bank NA JPM 2.000 79.666 9/10/2031
JPMorgan Chase
Financial Co LLC JPM 4.000 98.313 10/23/2023
Liberty Interactive LLC LINTA 8.250 25.726 2/1/2030
Liberty Interactive LLC LINTA 8.500 24.851 7/15/2029
MBIA Insurance Corp MBI 16.830 4.250 1/15/2033
MBIA Insurance Corp MBI 16.928 2.869 1/15/2033
Macy's Retail
Holdings LLC M 7.875 90.870 3/1/2030
Macy's Retail
Holdings LLC M 7.875 90.870 3/1/2030
Mashantucket Western
Pequot Tribe MASHTU 7.350 41.250 7/1/2026
Morgan Stanley MS 1.800 66.960 8/27/2036
NCR Corp NCR 6.125 102.330 9/1/2029
NOA Bancorp Inc NOABAN 6.700 91.328 11/1/2028
NOA Bancorp Inc NOABAN 6.700 91.328 11/1/2028
National Rural
Utilities Cooperative
Finance Corp NRUC 3.000 86.580 1/15/2024
National Rural
Utilities Cooperative
Finance Corp NRUC 3.050 99.041 10/15/2023
National Rural
Utilities Cooperative
Finance Corp NRUC 3.150 86.769 1/15/2024
National Rural
Utilities Cooperative
Finance Corp NRUC 3.050 86.745 1/15/2024
National Rural
Utilities Cooperative
Finance Corp NRUC 3.000 93.196 11/15/2023
National Rural
Utilities Cooperative
Finance Corp NRUC 3.400 89.476 12/15/2023
New York Community
Bancorp Inc NYCB 5.900 92.183 11/6/2028
OMX Timber Finance
Investments II LLC OMX 5.540 0.850 1/29/2020
Party City Holdings Inc PRTY 8.750 15.125 2/15/2026
Party City Holdings Inc PRTY 8.750 15.000 2/15/2026
Party City Holdings Inc PRTY 10.821 11.005 7/15/2025
Party City Holdings Inc PRTY 6.625 0.857 8/1/2026
Party City Holdings Inc PRTY 6.625 0.857 8/1/2026
Party City Holdings Inc PRTY 10.821 11.005 7/15/2025
PeoplesBancorp MHC PEOPBC 5.375 91.331 11/15/2028
PeoplesBancorp MHC PEOPBC 5.375 91.331 11/15/2028
PepsiCo Inc PEP 0.400 99.837 10/7/2023
Polar US Borrower LLC /
Schenectady
International Group Inc SIGRP 6.750 49.450 5/15/2026
Polar US Borrower LLC /
Schenectady
International Group Inc SIGRP 6.750 49.495 5/15/2026
Porch Group Inc PRCH 0.750 26.975 9/15/2026
Protective Life
Global Funding PL 0.631 99.731 10/13/2023
Protective Life
Global Funding PL 0.631 99.970 10/13/2023
Radiology Partners Inc RADPAR 9.250 38.871 2/1/2028
Radiology Partners Inc RADPAR 9.250 38.718 2/1/2028
Renco Metals Inc RENCO 11.500 24.875 7/1/2003
Rite Aid Corp RAD 7.700 6.636 2/15/2027
Rite Aid Corp RAD 7.500 60.515 7/1/2025
Rite Aid Corp RAD 6.875 8.430 12/15/2028
Rite Aid Corp RAD 7.500 60.066 7/1/2025
Rite Aid Corp RAD 6.875 8.430 12/15/2028
RumbleON Inc RMBL 6.750 44.921 1/1/2025
SBL Holdings Inc SECBEN 7.000 60.875 N/A
SBL Holdings Inc SECBEN 7.000 61.500 N/A
SVB Financial Group SIVB 3.500 65.875 1/29/2025
SVB Financial Group SIVB 4.000 4.125 N/A
SVB Financial Group SIVB 4.250 3.625 N/A
SVB Financial Group SIVB 4.100 2.500 N/A
SVB Financial Group SIVB 4.700 2.500 N/A
Shift Technologies Inc SFT 4.750 9.825 5/15/2026
Signature Bank/New York NY SBNY 4.000 3.000 10/15/2030
Signature Bank/New York NY SBNY 4.125 2.720 11/1/2029
Synovus Financial Corp SNV 5.900 89.411 2/7/2029
Talen Energy Supply LLC TLN 10.500 34.750 1/15/2026
Talen Energy Supply LLC TLN 6.500 35.317 6/1/2025
Talen Energy Supply LLC TLN 10.500 34.750 1/15/2026
Talen Energy Supply LLC TLN 6.500 28.500 9/15/2024
Talen Energy Supply LLC TLN 7.000 28.500 10/15/2027
Talen Energy Supply LLC TLN 6.500 28.500 9/15/2024
Talen Energy Supply LLC TLN 10.500 34.750 1/15/2026
TerraVia Holdings Inc TVIA 5.000 4.644 10/1/2019
Tricida Inc TCDA 3.500 10.358 5/15/2027
US Renal Care Inc USRENA 10.625 43.000 7/15/2027
US Renal Care Inc USRENA 10.625 39.950 7/15/2027
UpHealth Inc UPH 6.250 24.500 6/15/2026
Veritone Inc VERI 1.750 35.250 11/15/2026
Virgin Galactic Holdings SPCE 2.500 38.344 2/1/2027
WeWork Cos Inc WEWORK 7.875 15.500 5/1/2025
WeWork Cos Inc WEWORK 7.875 5.068 5/1/2025
WeWork Cos LLC WEWORK 11.000 12.000 8/15/2027
WeWork Cos LLC WEWORK 12.000 7.956 8/15/2027
WeWork Cos LLC /
WW Co-Obligor Inc WEWORK 5.000 11.375 7/10/2025
WeWork Cos LLC /
WW Co-Obligor Inc WEWORK 5.000 11.250 7/10/2025
Wesco Aircraft Holdings WAIR 9.000 9.500 11/15/2026
Wesco Aircraft Holdings WAIR 8.500 4.031 11/15/2024
Wesco Aircraft Holdings WAIR 13.125 2.653 11/15/2027
Wesco Aircraft Holdings WAIR 8.500 4.031 11/15/2024
Wesco Aircraft Holdings WAIR 13.125 2.653 11/15/2027
Wesco Aircraft Holdings WAIR 9.000 9.527 11/15/2026
*********
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
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Peter A.
Chapman at 215-945-7000.
*** End of Transmission ***