/raid1/www/Hosts/bankrupt/TCR_Public/231012.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Thursday, October 12, 2023, Vol. 27, No. 284
Headlines
100 CHRISTOPHER: Court OKs Interim Cash Collateral Access
1461 CHAPIN STREET: Case Summary & Three Unsecured Creditors
1INMM CAPITAL: Investors Settle With Confidential Party
540 WEST: Wins $700,000 DIP Loan from Ray New York
717 ARMORY: Seeks Cash Collateral Access
AEMETIS INC: Unit Closes $53 Million Sale of IRA Tax Credits
AETIUS COMPANIES: Court OKs Interim Cash Collateral Access
AGNI PET SERVICES: Aussie Pet Mobile Hits Chapter 11 Bankruptcy
AKOUSTIS TECHNOLOGIES: CEO Shealy's Employment Deal Amended
AMADEUS TRUST: Wins Cash Collateral Access Thru Oct 31
ARCHBISHOP OF BALTIMORE: Court OKs interim Cash Collateral Access
ARCIMOTO INC: Fails to Make Series D Stock Dividend Payment
ARISGLOBAL HOLDINGS: S&P Alters Outlook to Stable, Affirms 'B-' ICR
AVON PRODUCTS: S&P Affirms 'BB-' Long-Term ICR, Outlook Stable
BARRETTS MINERALS: Court OKs $30MM DIP Loan from JMP Capital
BLACKBERRY LTD: Dattels Steps Down From Board of Directors
BLACKBERRY LTD: Mulls Spinoff of IoT and Cybersecurity Units
BLACKBERRY LTD: Posts $42 Million Net Loss in FY2024 2nd Quarter
CABALLERO SAND: Files Emergency Bid to Use Cash Collateral
CANO HEALTH: Announces Plan for Reverse Stock Split
CANOO INC: All Four Proposals Passed at Special Meeting
CAPSTONE GREEN ENERGY: $30 Million Chapter 11 Financing Approved
CAPSTONE GREEN: AIGH Capital Discloses 9.8% Ownership Stake
CHALLENGER BRASS: Court OKs Deal on Cash Collateral Access
CHINAH USA: Court OKs Interim Cash Collateral Access
CIVITAS RESOURCES: Moody's Rates New $1BB Sr. Unsecured Notes 'B1'
CIVITAS RESOURCES: S&P Rates New $1BB Senior Notes Due 2030 'BB-'
COMMSCOPE HOLDING: Mulls Selling Assets to Address $9-Bil. Debt
CPV SHORE: Moody's Downgrades Rating on Senior Secured Loans to B1
CURITEC LLC: Wins Cash Collateral Access Thru Jan 2024
DARJEN INC: Seeks Cash Collateral Access
DAWG'S SPORTS: Court OKs Cash Collateral Access on Final Basis
DEADWORDS BREWING: Files Emergency Bid to Use Cash Collateral
DIMITRI VLAHAKIS: Pledged Interests Up for Sale on October 26
DIOCESE OF SAN FRANCISCO: UST Wants Tougher Chapter 11 Fees Cap
DOYLESTOWN HOSPITAL: Moody's Affirms 'B3' Rating on Revenue Bond
EKSO BIONICS: Falls Short of Nasdaq Listing Requirement
EKSO BIONICS: Parker-Hannifin Pays $700,000 over Warranty Release
ENCORE CAPITAL: Moody's Rates EUR100MM Sr. Secured Debt 'Ba2'
ENVISION HEALTHCARE: Bankruptcy Court Confirms Reorganization Plan
EXELA TECHNOLOGIES: CFO Quits; Interim Replacement Named
FR-AM TWO: Voluntary Chapter 11 Case Summary
FRONTLINE MACHINING: Case Summary & 20 Top Unsecured Creditors
FTX GROUP: Auditor Sued by SEC for Independence Rules Violation
GARCIA GRAIN: Court OKs $800,000 DIP Loan from GrainChain
GETTYSBURG RENTAL: Wins Interim Cash Collateral Access
GREENWAVE TECHNOLOGY: Falls Short of Nasdaq Bid Price Requirement
GRUPO HIMA: Court OKs $7MM DIP Loan from Alter Domus
H2O COMMERCIAL: Files Emergency Bid to Use Cash Collateral
HAWK LOGISTICS: Files Emergency Bid to Use Cash Collateral
INSPIREMD INC: Craig Shore Resumes as CFO, Secretary and Treasurer
INSPIREMD INC: Issues Stock Inducement Grant to Executive
IYS VENTURES: Court OKs Cash Collateral Access Thru Nov 10
JAGUAR HEALTH: Enters Into Amendments to Royalty Interests
JIREH FITNESS: Wins Interim Cash Collateral Access
JLM COUTURE: Court OKs Cash Collateral Access Thru Oct 31
JUICE ROLL UPZ: Case Summary & 14 Unsecured Creditors
KAH HOSPICE: S&P Affirms 'B' ICR on Heartland Acquisition
KINGDOM CONCEPTS: Court OKs Interim Cash Collateral Access
KNS MOTEL: Seeks Cash Collateral Access Thru Dec 31
KOACH ENTERPRISE: Court OKs Interim Cash Collateral Access
LTI HOLDINGS: S&P Alters Outlook to Negative, Affirms 'B-' ICR
MACARTHUR COURT: Involuntary Chapter 11 Case Summary
METCALF ANTIQUE: Court OKs Interim Cash Collateral Access
MMEX RESOURCES: Transfer Agent Quits, Cites Ongoing Litigation
MULLEN AUTOMOTIVE: Receives Add'l. Noncompliance Notice From Nasdaq
NORTH VILLAGE: Wins Cash Collateral Access Thru Dec 31
NOVA CHEMICALS: Moody's Alters Outlook on 'Ba2' CFR to Negative
ORGANIC NAILS: Seeks Cash Collateral Access Thru Mar 2024
PAYNE'S ENVIRONMENTAL: Case Summary & 20 Top Unsecured Creditors
PB MICHIGAN: May Use $35,000 of Cash Collateral
PERFORMANCE RESULTS: Court OKs Cash Collateral Access Thru Dec 31
PJ TRANS: Court OKs Cash Collateral Access Thru Nov 14
PLATFORM II LAWNDALE: Wins Cash Collateral Access Thru Oct 31
POLK AZ: Court OKs Interim Cash Collateral Access
PRETIUM PKG: Moody's Lowers Rating on First Lien Term Loan to Caa2
PROCARE PROPERTY: Files Emergency Bid to Use Cash Collateral
RECEPTION MEZZANINE: Fitch Lowers LongTerm IDR to 'B', Outlook Neg.
REGIONAL HOUSING: No Decline in Patient Care at Columbus Facility
REGIONAL HOUSING: No Decline in Patient Care at Gainesville
REGIONAL HOUSING: No Decline in Patient Care at Gardens of Rome
REGIONAL HOUSING: No Decline in Patient Care at Landings of Douglas
REGIONAL HOUSING: No Decline in Patient Care at Savannah
REGIONAL HOUSING: No Decline in Patient Care at Social Circle
ROLL: BICYCLE: Court OKs Cash Collateral Access on Final Basis
SANDY HOOK INVESTMENTS: Files Emergency Bid to Use Cash Collateral
SANUWAVE HEALTH: Registers 96.7M Common Shares for Resale
SEVEN KITCHEN: Court OKs Interim Cash Collateral Access
SIGNIA LTD: Wins Cash Collateral Access Thru Nov 9
SILGAN HOLDINGS: Moody's Affirms 'Ba2' CFR, Outlook Positive
SMILEDIRECTCLUB INC: Seeks Chapter 11 Bankruptcy Protection
SONIDA SENIOR: Agrees With Fannie Mae to Extend Mortgage Maturities
SPI ENERGY: Selling Majority Stake in Phoenix Motor to CEO
SPIRIT AIRLINES: S&P Alters Outlook to Negative, Affirms 'B' ICR
SPRINGFIELD MEDICAL: Wins Cash Collateral Access Thru Jan 2024
SUGAR CREEK: Court OKs Cash Collateral Access on Final Basis
THAI KITCHEN: Court OKs Interim Cash Collateral Access
TROIKA MEDIA: Extends Waiver Deal With Blue Torch
TWILIGHT HAVEN: Wins Cash Collateral Access Thru Nov 15
URBAN ONE: Faces Possible Delisting from NASDAQ
VECTOR ESCAPES: Court OKs Cash Collateral Access on Final Basis
VECTOR UTILITIES: Court OKs Cash Collateral Access on Final Basis
VENUS CONCEPT: Reaches Debt Restructuring Agreement With Lenders
VERDE BUILDING: Voluntary Chapter 11 Case Summary
WIPE-OUT LOGISTICS: Court OKs Interim Cash Collateral Access
XEROX HOLDINGS: Moody's Alters Outlook on 'Ba2' CFR to Negative
[*] Richard Bergin Joins Charles River as VP-Finance Practice
[*] SDNY Judge Beckerman Leads Panel at DI Conference on Nov. 29
[^] Recent Small-Dollar & Individual Chapter 11 Filings
*********
100 CHRISTOPHER: Court OKs Interim Cash Collateral Access
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The U.S. Bankruptcy Court for the Southern District of New York
authorized 100 Christopher Street Propco LLC to use cash collateral
on an interim basis in accordance with the budget.
The Debtor requires the use of cash collateral to pay for ordinary
expenses such as payroll, supplies, utilities, taxes, insurance,
and maintenance for the Property located at Christopher Street, New
York City. The Property is an apartment building with two ground
floor commercial spaces. Based on a recent sale contract, the
Debtor estimates that the Property value is $30 million.
The Property is encumbered by a first mortgage held by Santander
Bank, N.A. in the original principal amount of $22.1 million. As of
the Petition Date, the Mortgagee's Claim is approximately $19.8
million. New York City Lien Claims total about $76,953.
In addition to the Mortgagee's claim, the Debtor is aware of
general unsecured claims of about $311,765.
As adequate protection, the Lender is granted valid, binding
continuing, enforceable, fully perfected security interest and lien
in the amount of its Diminution Claim upon the Mortgaged Property,
the Collateral Property and all tangible and intangible pre- and
post-petition property of the Debtor.
Subject to the Carve-Out, the Lender is granted an allowed
superpriority administrative expense claim in the Chapter 11 case,
as and to the extent provided by 11 U.S.C. Sections 503(b) and
507(b).
The Carve-Out means of (i) all fees required to be paid to the
Clerk of the Court and to the U.S. Trustee under 28 U.S.C Section
1930(a) together with any interest thereon pursuant to 31 U.S.C.
Section 3717; (ii) reasonable fees and expenses incurred by a
chapter 7 trustee in an amount not to exceed $15,000; and (iii)
upon the occurrence of the Termination Date, allowed professional
fees and expenses of attorneys and financial advisors employed by
the Debtor and the official committee(s) of creditors if any,
pursuant to Sections 327 and 1103 of the Bankruptcy Code to be
recovered from the Adequate Protection Liens in an amount not in
excess of $25,000 for the Debtor's professionals and $25,000 for
the Committee professionals, inclusive of any unpaid Escrowed Fees
to the extent allowed by the Bankruptcy Court.
A final hearing on the matter is set for October 18, 2023 at 3
p.m.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=SbSECs from PacerMonitor.com.
The Debtor projects total operating expenses, on a monthly basis,
as follows:
$80,792 for October 2023;
$80,792 for November 2023; and
$80,792 for December 2023.
About 100 Christopher Street Propco LLC
100 Christopher Street Propco LLC is a Single Asset Real Estate
debtor (as defined in 11 U.S.C. Section 101(51B)). The Debtor is
the owner of real property located at 100 Christopher Street, New
York, valued at $30.02 million.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. N.Y. Case No. 23-11542) on September
27, 2023. In the petition signed by Patrick McCann, vice president,
the Debtor disclosed up to $30,020,000 in assets and $20,188,718 in
total liabilities.
Judge Philip Bentley oversees the case.
Mark Frankel, Esq., at Backenroth Frankel & Krinsky, LLP,
represents the Debtor as legal counsel.
1461 CHAPIN STREET: Case Summary & Three Unsecured Creditors
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Debtor: 1461 Chapin Street NW LLC
1461 Chapin Street NW
Washington DC 20009
Business Description: 1461 Chapin Street is a Single Asset Real
Estate debtor (as defined in 11 U.S.C.
Section 101(51B)).
Chapter 11 Petition Date: October 11, 2023
Court: United States Bankruptcy Court
District of Maryland
Case No.: 23-17320
Judge: Hon. Lori S Simpson
Debtor's Counsel: Lawrence Tucker, Esq.
TUCKER NONG & ASSOCIATES, PLLC
1451 Rockville Pike, Suite 250
Rockville, MD 20852
Phone: 240-888-4176
Email: ltucker@tuckerlawpllc.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
A copy of the Debtor's list of three unsecured creditors is
available for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/MAQR6TY/1461_Chapin_Street_NW_LLC__mdbke-23-17320__0002.0.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/PY576FA/1461_Chapin_Street_NW_LLC__mdbke-23-17320__0001.0.pdf?mcid=tGE4TAMA
1INMM CAPITAL: Investors Settle With Confidential Party
-------------------------------------------------------
Michele Vives, the court-appointed receiver for 1inMM Capital LLC
as well as assets that are attributable to investor or client funds
or that were fraudulently transferred by 1inMM or Zachary J.
Horwitz, and certain plaintiffs who invested in 1inMM have reached
an agreement to settle all claims asserted or that could have been
asserted against a professional services firm whose identity the
Receiver has agreed to keep confidential ("Settling Party") as to
any acts or omissions arising out of, in connection with or
relating in any way to the 1inMM Ponzi Scheme, the services
provided by the Settling Party and all threatened claims against
the Settling Party in exchange for payment to the estate
("settlement").
As part of the settlement, the receiver has asked the Court to
permanently bar and enjoin any person or entity from commencing or
continuing any legal proceeding against Settling Party asserting
any legal or equitable claim arising out of, in connection with or
relating in any way to , the 1inMM Ponzi Scheme.
All 1inMM claims will be channeled into a receivership claims
process the Court will establish by separate order.
Complete copies of the settlement agreement, the proposed bar order
and other documents pertaining to the settlement are available on
the receiver's website at https://www.1inMMreceivership.com/
Interested parties may submit written questions or objections to
the settlement to the receiver by sending an email to
1inMM@douglaswilson.com by no later than 4:00 p.m. PDT on Nov. 6,
2023, though disclosure of certain information will require entry
into non-disclosure agreement.
1inMM Capital LLC is a California limited liability company formed
in September 2013. Its principal place of business is Zachary J.
Horwitz's home in Los Angeles, California.
540 WEST: Wins $700,000 DIP Loan from Ray New York
--------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
540 West 21st Street Holdings LLC to use cash collateral and obtain
postpetition financing.
The Debtor is permitted to borrow an initial principal amount of
$700,000 from Ray New York, LLC.
The DIP Loan proceeds will be made available to the Debtor as a
debtor-in-possession multi-draw term loan facility, as follows:
1. First Draw: Upon entry of the Interim DIP Order in form and
substance satisfactory to the DIP Lender in its sole discretion,
the DIP Lender will advance the lesser of the amount approved by
the Interim Order and $100,000 to the Debtor.
2. Second Draw: Upon entry of the Final DIP Order in form and
substance satisfactory to the DIP Lender in its sole discretion,
the DIP Lender will advance to the Debtor an additional amount up
to the amount approved by the Final Order less the Interim
Advance.
In no event will the sum of the Interim Advance and Final Advance
exceed the initial principal amount of $700,000.
The Debtor will have the option to request additional funding up to
$250,000 in amounts and upon terms and conditions set forth herein,
subject to the receipt of a revised or incremental Budget for the
amount and use of the Incremental Funding proceeds, which
incremental funding will be approved by the DIP Lender in its sole
discretion.
The DIP Loan is due and payable through the earliest of:
1. November 30, 2023;
2. The date of the closing of a sale of all or substantially
all of the Collateral pursuant to the terms of the Purchase and
Sale Contract dated as of June 13, 2023, between the Debtor and
550W21 Owner LLC described in the Restructuring Support Agreement
dated as of June 26, 2023, between the Debtor and its subsidiaries
and affiliates and the DIP Lender;
3. The effective date of the Chapter 11 plan of reorganization
described in the RSA, and confirmed pursuant to an order entered by
the Bankruptcy Court; and
4. The occurrence and continuation of an Event of Default.
Prior to the Petition Date, the Debtor obtained a $20 million loan
from Bank Hapoalim B.M. On May 9, 2022, Ray New York, LLC, with SL
Green Realty Corp. acting as servicer, purchased the original loan
and agreed to provide additional financing of up to $80.450
million. The Prepetition Credit Documents, including the Amended
and Restated Loan Agreement, Amended and Restated Second
Consolidated Amended and Restated Promissory Note, and Pledge and
Security Agreement, are valid, binding, and enforceable against the
parties.
The Debtor's obligations under the Prepetition Credit Documents are
secured by first priority liens in favor of the Prepetition Lenders
in all collateral, including the Debtor's property, accounts, and
contract rights. These liens are valid, binding, perfected, duly
recorded, and enforceable, and are not subject to any challenge by
any person or entity.
As adequate protection, the Secured Lender is granted an additional
and replacement valid, binding, enforceable, non-avoidable, and
automatically perfected, nunc pro tunc to the Petition Date,
postpetition security interest in and liens on on the DIP
Collateral, which will be subordinate only to the DIP Liens and the
Carve Out.
The Secured Lender is further granted an allowed superpriority
administrative expense claim for the diminution in the value of the
Prepetition Collateral. The claims will be junior only to the DIP
Superpriority Claims and the Carve-Out.
The Carve-Out means the sum of (i) all fees required to be paid to
the Clerk of the Bankruptcy Court and to the Office of the U.S.
Trustee, and (ii) up to $410,000 of allowed and unpaid fees and
expenses of professionals retained by Bankruptcy Court order.
The events that constitute an "Event of Default" include:
(1) The occurrence of any Event of Default as defined in the
Prepetition Credit Agreement;
(2) The failure by the Debtor to obtain Court approval of the
Final Order on or before October 17, 2023;
(3) The filing by the Debtor of any pleading seeking to vacate
or modify the Interim Order or the Final Order over the objection
of the DIP Lender;
(4) The failure by the Debtor to make any required payments or
comply with any deadline set forth therein;
(5) The filing by the Debtor of (or supporting any other party
in the filing of) any pleading seeking entry of a Court order
granting any superpriority claim or lien that is senior to or pari
passu with those granted to the DIP Lender thereunder; and
(6) The granting of any superpriority claim or lien senior or
pari passu with those granted to the DIP Lender thereunder; and
(7) The use or application of proceeds in a manner not
provided for in the Budget, subject to the Permitted Variance.
A final hearing on the matter is set for October 17, 2023 at 10:30
a.m.
A copy of the order is available at https://urlcurt.com/u?l=S1dcdm
from PacerMonitor.com.
About 540 West
Headquartered in New York, 540 West 21st Street Holdings LLC is a
real estate holding company formed specifically to facilitate the
financing and construction of a mixed-use development.
540 West sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. D. Del Lead Case No. 23-11053) on Aug. 2, 2023. In the
petition signed by Noam Teltch as authorized signatory, the Debtor
disclosed up to $95,842,716 in assets and $256,664,374 in
liabilities.
The Hon. Mary F. Walrath oversees the case.
The Debtors tapped Bryan Cave Leighton Paisner LLP as lead counsel,
Chipman Brown Cicero & Cole, LLP as Delaware counsel, Tomer Jacob
as chief restructuring officer, and Bankruptcy Management
Solutions, Inc. dba Stretto as claims agent.
Ray New York, LLC, as DIP Lender, is represented by Jennifer
Rodburg, Esq., at Fried, Frank, Harris, Shriver & Jacobson LLP.
717 ARMORY: Seeks Cash Collateral Access
----------------------------------------
717 Armory, LLC asks the U.S. Bankruptcy Court for the Middle
District of Pennsylvania for authority to use cash collateral for
the payment of utilities, insurance, payroll and other operating
expenses.
MMG Investments IV, LLC is believed to hold a first priority
security interest in the real property of the Debtor and all
personal property of the Debtor, including accounts, inventory,
equipment and cash. MMG acquired such loan through an assignment
from First Commonwealth Bank.
The U.S. Small Business Administration is believed to hold a second
priority security interest in all of the personal property of the
Debtor, including accounts, inventory, equipment and cash.
Sports South LLC is believed to hold a third priority security
interest in most of the personal property of the Debtor, including,
inventory, equipment and possibly vehicles. Sports South is a
vendor of the Debtor.
The Debtor is indebted to the Lenders as follows:
a. MMG in the approximate amount of approximately $4.035 million;
b. SBA in the approximate amount of $3.6 million; and
c. Sports South in the approximate amount of $0.
In order to provide adequate protection to the Lenders, the Debtor
proposes to provide the Lenders with replacement liens in
post-Petition Cash Collateral, and all other assets in which the
Lenders have a pre-Petition security interest and lien, only to the
extent that the Lenders are secured in pre-Petition Cash
Collateral. The replacement lien will only be effective to the
extent there is a diminution in the amount of cash collateral
postPetition. To the extent that such replacement liens are
insufficient and the Lenders have a shortfall resulting any
diminution resulting from the Debtor's use of cash collateral and
all other categories of assets upon which the Lenders have
pre-Petition liens, and to the extent the Lenders are secured in
cash collateral, the Lenders will be granted administrative claims
superior in priority to all other administrative claims except for
claims of professionals in this case and fees owed to the Office of
the U.S. Trustee.
A copy of the motion is available at https://urlcurt.com/u?l=gy1BDE
from PacerMonitor.com.
About 717 Armory, LLC
717 Armory, LLC is a limited liability company engaged in the sale
and use training of firearms and operations of a gun and archery
range.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Pa. Case No. 23-02284) on October 4,
2023. In the petition signed by Patrick R. Connaghan, member, the
Debtor disclosed up to $10 million.
Robert E. Chernicoff, Esq., at Cunningham, Chernicoff & Warshawsky,
PC, represents the Debtor as legal counsel.
AEMETIS INC: Unit Closes $53 Million Sale of IRA Tax Credits
------------------------------------------------------------
Aemetis, Inc. closed the sale of $53 million of Inflation Reduction
Act (IRA) investment tax credits generated by its subsidiary
Aemetis Biogas LLC to a corporate purchaser on Sept. 29, 2023.
This sale is the company's first IRA tax credit transaction. The
Section 48 investment tax credits were generated from biogas
projects built by Aemetis Biogas, including six dairy digesters, a
biogas pipeline and a renewable natural gas (RNG) production
facility.
The Inflation Reduction Act was signed into law in August 2022, and
provides for the issuance of transferable federal income tax
credits for certain renewable fuel projects and products.
"We believe that this $53 million tax credit sale is the largest
IRA tax credit transaction in the dairy biogas industry,
demonstrating the transferability of tax credits under the federal
Inflation Reduction Act and the ability of renewable fuels projects
to generate funding from IRA tax credits to support investments,"
stated Eric McAfee, Chairman and CEO of Aemetis. "The Aemetis Five
Year Plan is expected to qualify for more than $800 million of IRA
investment and production tax credits during the next four years to
support our biogas projects, CO2 re-use by our ethanol plant, the
construction of our sustainable aviation fuel plant and CO2
sequestration."
Aemetis Biogas is building anaerobic digesters at California
dairies to capture biomethane from animal waste. Aemetis has seven
operating digesters and is actively growing with an additional five
digesters under construction and a total of the 37 dairies under
contract to supply animal waste. After removal of contaminants and
pressurization of gas at the dairy, a biogas pipeline connects the
dairies to a centralized facility located at the Aemetis Keyes
ethanol plant where the biogas is upgraded into below zero carbon
intensity RNG. The RNG is injected into PG&E's natural gas
pipeline for delivery to transportation fuel customers in
California.
Aemetis is also building its own RNG fueling station at the Keyes
ethanol plant to fuel trucks with locally produced renewable
natural gas that provides a 90% reduction in emissions compared to
petroleum diesel fuel.
Approximately 25% of the methane emissions in California are
emitted from dairy waste lagoons. When fully built, the Aemetis
biogas project plans to capture methane from the waste produced by
more than 150,000 cows at dairy farms in California, producing
1,650,000 MMBtu of renewable natural gas from captured dairy
methane each year. The project is designed to reduce greenhouse
gas emissions equivalent to an estimated 6.8 million metric tonnes
of carbon dioxide over ten years, equal to removing the emissions
from approximately 150,000 cars per year.
About Aemetis
Headquartered in Cupertino, California, Aemetis, Inc. --
http://www.aemetis.com-- is an international renewable natural
gas, renewable fuels and byproducts company focused on the
acquisition, development and commercialization of innovative
technologies that replace traditional petroleum-based products. The
Company operates in two reportable geographic segments: "North
America" and "India."
Aemetis reported a net loss of $107.76 million for the year ended
Dec. 31, 2022, compared to a net loss of $47.15 million for the
year ended Dec. 31, 2021. As of March 31, 2023, the Company had
$210.38 million in total assets, $103.63 million in total current
liabilities, $329.17 million in total long-term liabilities, and a
total stockholders' deficit of $222.42 million.
"As a result of negative capital, negative market conditions
resulting in prolonged idling of the Keyes Plant, negative
operating results, and collateralization of substantially all of
the company assets, the Company has been reliant on its senior
secured lender to provide additional funding and has been required
to remit substantially all excess cash from operations to the
senior secured lender. In order to meet its obligations during the
next twelve months, the Company will need to either refinance the
Company's debt or receive the continued cooperation of its senior
lender. This dependence on the senior lender raises substantial
doubt about the Company's ability to continue as a going concern"
the Company said in its Form 10-Q for the period ended June 30,
2023, filed with the Securities and Exchange Commission.
AETIUS COMPANIES: Court OKs Interim Cash Collateral Access
----------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of North
Carolina, Charlotte Division, authorized Aetius Companies, LLC and
affiliates to use cash collateral on an interim basis to pay only
those expenses which must be incurred prior to October 11, 2023 at
5:00 p.m.
HomeTrust Bank is the current holder of the HomeTrust Note and
related loan documents. The U.S. Small Business Administration is
the current holder of the SBA Note and related loan documents.
As adequate protection for the Debtors' interim use of cash
collateral, HomeTrust and the SBA will (i) maintain their
prepetition liens in all of their prepetition collateral, including
any proceeds therefore, to the same extent, validity, and priority
as existed prepetition, and (ii) be granted valid, enforceable,
perfected and continuing replacement security interests in, and
liens upon, all postpetition accounts receivable of the Debtors, to
the same extent, validity, and priority as such liens and
encumbrances attached to the Debtors' accounts receivable
prepetition, for all cash collateral actually expended during the
duration of the interim order.
Beginning on August 10, 2023 and continuing on the 10th day of each
month thereafter, the Debtors will make monthly adequate protection
payments in the total amount of $35,000 per month to HomeTrust.
A copy of the court's order is available at
https://urlcurt.com/u?l=U78SnT from PacerMonitor.com.
About Aetius Companies, LLC
Aetius Companies, LLC and affiliates operate a restaurant chain.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. N.C. Lead Case No. 23-30470) on July
19, 2023.
In the petition signed by Mark Cote, president, the Debtor
disclosed up to $50 million in both assets and liabilities.
Judge Craig Whitley oversees the case.
Robert A. Cox, Jr., Esq., at Hamilton Stephens Steele + Martin,
PLLC, represents the Debtor as legal counsel.
AGNI PET SERVICES: Aussie Pet Mobile Hits Chapter 11 Bankruptcy
---------------------------------------------------------------
Agni Pet Services Inc. filed for Chapter 11 protection in the
Southern District of California. According to court filing, the
Debtor reports between $500,000 and $1 million in debt owed to 1
and 49 creditors. The petition states funds will be available to
unsecured creditors.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated
for
October 24, 2023, at 1:00 PM.
About Agni Pet Services Inc.
Agni Pet Services Inc., doing business as Aussie Pet Mobile
Southern California, is a quality pet grooming service that offers
an exceptional full service grooming experience for your pets in a
stress free environment in full comfort and safety right in your
driveway.
Agni Pet Services Inc. sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Cal. Case No. 23-02813) on September
19, 2023. In the petition filed by Kripalini Raguram, the Debtor
reports estimated assets and liabilities between $500,000 and $1
million.
Honorable Bankruptcy Judge Christopher B Latham oversees the case.
The Debtor is represented by:
Deepalie Milie Joshi, Esq.
Joshi Law Group
888 Prospect Street, Suite 200
La Jolla, CA 92037
AKOUSTIS TECHNOLOGIES: CEO Shealy's Employment Deal Amended
-----------------------------------------------------------
Akoustis Technologies, Inc. disclosed in a Form 8-K Report filed
with the Securities and Exchange Commission that on September 26,
2023, the Company entered into a Second Amendment to the Employment
Agreement, dated as of June 15, 2015, and amended as of September
6, 2017, with the Company's Chief Executive Officer, Jeffrey B.
Shealy.
Pursuant to the terms of the Amendment:
(i) Dr. Shealy's base salary is set at $550,000;
(ii) Dr. Shealy's target annual bonus is set at 100% of his
base salary (with maximum bonus potential under the Company's
annual incentive bonus plan for the fiscal year ending June 30,
2024, of 145% of his base salary);
(iii) Dr. Shealy will be eligible to receive a supplemental
discretionary bonus for the fiscal year ending June 30, 2024 of up
to 50% of his base salary based on such factors and payable at such
time as the Company's Board of Directors may determine in its sole
discretion;
(iv) Dr. Shealy's equity incentive awards for fiscal year 2024
will consist of 80,000 restricted stock units and 120,000
performance-based restricted stock units with market value
appreciation conditions, each under the Company's 2018 Stock
Incentive Plan;
(v) Dr. Shealy is eligible to earn a cash retention bonus of
$200,000 if he remains employed with the Company through the
earlier of June 30, 2024 and the date of a change of control of the
Company; and
(vi) for purposes of calculating the amount of severance
payable in the event of a termination before June 30, 2024, Dr.
Shealy's base salary will be assumed to be $750,000.
About Akoustis Technologies
Headquartered in Huntersville, N.C., Akoustis Technologies, Inc. is
focused on developing, designing, and manufacturing innovative RF
filter products for the mobile wireless device industry, including
for products such as smartphones and tablets, cellular
infrastructure equipment, and WiFi premise equipment.
Akoustis reported a net loss of $59.19 million for the year ended
June 30, 2022, a net loss of $44.15 million for the year ended June
30, 2021, a net loss of $36.14 million for the year ended June 30,
2020, and a net loss of $29.25 million for the year ended June 30,
2019. As of Dec. 31, 2022, the Company had $132.26 million in
total assets, $53.18 million in total liabilities, and $79.08
million in total stockholders' equity.
In its Quarterly Report for the three months ended Dec. 31, 2022,
Akoustis said, "The Company has incurred losses and negative cash
flow from operations since inception. Our operations thus far have
been funded primarily with sales of equity and debt securities, as
well as contract research and government grants, foundry services
and engineering services. We expect our operating expenditures to
continue to increase to support future growth of our manufacturing
capabilities and expansion of our product offerings, as well as an
increase in research and development and headcount costs to support
this growth. We believe we currently have sufficient resources to
fund operations and planned investments for at least the next
twelve months."
AMADEUS TRUST: Wins Cash Collateral Access Thru Oct 31
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The U.S. Bankruptcy Court for the Central District of California,
Los Angeles, Division, authorized the Amadeus Trust Under
Declaration of Trust of January 24, 2000 to use cash collateral on
an interim basis in accordance with the budget, through October 31,
2023.
As previously reported by the Troubled Company Reporter, the
Debtor's sole asset is the Property located at 3800 Wailea Alanui
Drive, Apt./Unit E201, Kihei, Hawaii 96753 (and potentially the
rental income it generates). The Debtor estimates that the current
fair market value of the Property is between $9 to $10 million. The
Property has two large master bedrooms and a third large bedroom,
three and a half baths, a large lanai with built-in barbecue, a
private elevator for privacy and ease of access; multi-zone central
air conditioning and ceiling fans; and a European kitchen with
state-of-the art appliances located in a lush 10.74-acre retreat.
In recent years, the Property has been managed and leased by the
Association of Apartment Owners of Wailea Beach Villas.
It is undisputed that U.S. Bank Trust, N.A., as trustee for LSF9
Master Participation Trust, and the AOAO, each have a cash
collateral security interest in all rental proceeds generated by
the Property. It is further undisputed that the Bank's lien on cash
collateral is senior in priority to the lien of the AOAO. The Bank
and the AOAO are the only parties known to hold interests in the
Debtor's cash.
As adequate protection, the Secured Creditors will be granted
replacement liens on the ongoing gross rental proceeds generated by
the Property to the same extent, validity, and priority as the
Secured Creditors' current liens against the Property under
applicable nonbankruptcy law.
A continued hearing on the matter is set for October 31, 2023 at
1p.m.
A copy of the order is available at https://urlcurt.com/u?l=VHy9Ff
from PacerMonitor.com.
About Amadeus Trust Under Declaration
of Trust of January 24, 2000
The Amadeus Trust under Declaration of Trust of January 24, 2000
filed its voluntary petition for Chapter 11 protection (Bankr. C.D.
Calif. Case No. 23-13086) on May 18, 2023, with as much as $1
million to $10 million in both assets and liabilities. Gerald
Goldstein, as trustee, signed the petition.
Judge Neil W. Bason oversees the case.
Jeffrey I. Golden, Esq., Golden Goodrich, LLP serves as the
Debtor's legal counsel.
ARCHBISHOP OF BALTIMORE: Court OKs interim Cash Collateral Access
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Maryland authorized
Roman Catholic Archbishop of Baltimore to use cash collateral on an
interim basis in accordance with the budget.
The authority will expire if a final order is not entered by
November 18, 2023.
As previously reported by the Troubled Company Reporter, the Debtor
requires the use of cash collateral to provide compensation for
unresolved claims of survivors of abuse and preserve the ability of
the Debtor to continue providing essential ministries and services
within the Archdiocese of Baltimore.
Pursuant to a variety of lending transactions, certain financial
instruments, and Treasury Management Services Agreement, the Debtor
is indebted to PNC Bank, National Association, which indebtedness
is secured by, among other things, the Debtor's deposit and
investment accounts maintained at PNC.
Pursuant to the Indenture of Trust dated as of June 1, 2007,
Maryland Health and Higher Educational Facilities Authority issued
$24.165 million in the aggregate principal amount of its Maryland
Health and Higher Educational Facilities Authority Revenue Bonds,
Archdiocese of Baltimore Schools Issue, Series 2007, the proceeds
of which were loaned by the Issuer to the Debtor pursuant to a
certain Loan Agreement, dated as of June 1, 2007, by and between
the Issuer and Debtor, in order to finance and refinance the costs
of certain non-collegiate educational projects.
As of the Petition Date, the aggregate principal amount outstanding
under the Bond Loan Agreement was approximately $21.675 million,
plus accrued interest and other fees due and owing under the Bond
Loan Agreement and PNC is the sole holder of the Bonds.
Pursuant to the Third Amended and Restated Letter Agreement -- Term
Loan dated as of May 16, 2014 by and between PNC and the Debtor,
PNC provided a term loan facility in the aggregate principal amount
of $14.7 million.
As of the Petition Date, the aggregate principal amount outstanding
under the PNC Loan Agreement was approximately $4.1 million, plus
accrued interest and other fees due and owing under the PNC Loan
Agreement.
In addition to the PNC Obligations, the Debtor is obligated as a
guarantor in connection with the Guaranty and Suretyship Agreement,
dated as of May 20, 2016, pursuant to which the Debtor guaranteed
all obligations of Church of the Nativity of Our Lord Jesus Christ
Roman Catholic Congregation, Incorporated, including, without
limitation, a Standby and Commercial Letter of Credit.
The Debtor is also obligated under certain swap agreements with
PNC.
As of September 25, 2023, the mark-to-market value of the Swap
Obligations is approximately $856,000 that would be owing by the
Debtor. In addition, if the Swap Agreements were terminated, the
Debtor would incur significant increased interest expense in
connection with the Bond Obligations and PNC Obligations.
The court ruled that as adequate protection, PNC will be granted
replacement security interests in and liens on the Debtor's
postpetition property.
PNC will be granted an an allowed superpriority administrative
expense claim as provided for in 11 U.S.C. Section 507(b). The
507(b) Claims will have priority over any and all administrative
expenses, adequate protection claims and other claims against the
Debtor.
A final hearing on the matter is set for November 6, 2023 at 10
a.m.
A copy of the order is available at https://urlcurt.com/u?l=4yeArO
from PacerMonitor.com.
About Roman Catholic Archbishop of Baltimore
Roman Catholic Archbishop of Baltimore is a non-profit religious
institution that maintains its principal place of business at 320
Cathedral Street, Baltimore, Maryland 21201. Consistent with Canon
Law and Maryland law, the RCAB holds property, including real
property, as a corporation sole for the purposes of erecting
churches, parsonages, burial grounds, or schools according to the
discipline and government of the Roman Catholic Church, with all
such property to be used only for such purposes.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Md. Case No. 23-16969) on September 29,
2023. In the petition signed by William E. Lori, archbishop, the
Debtor disclosed up to $500 million in assets and up to $1 billion
in liabilities.
Judge Michelle M. Harner oversees the case.
YVS LAW, LLC and HOLLAND & KNIGHT LLP represent the Debtor as legal
counsel.
KEEGAN LINSCOTT & ASSOCIATES, PC is the financial and restructuring
advisor and EPIQ CORPORATE RESTRUCTURING LLC is the claims,
noticing, and balloting agent.
ARCIMOTO INC: Fails to Make Series D Stock Dividend Payment
-----------------------------------------------------------
Arcimoto, Inc. disclosed in a Form 8-K filed with the Securities
and Exchange Commission that it failed to make its required
dividend payment on its Series D 8% Convertible Preferred Stock.
Under the terms of the Series D Stock, the dividend rate increased
due to such failure from 8% to 15%.
About Arcimoto, Inc.
Based in Eugene, Oregon, Arcimoto, Inc. -- http://arcimoto.com--
designs and manufactures electric vehicles. Built on the
revolutionary three-wheel Arcimoto Platform, its vehicles are
purpose-built for daily driving, local delivery, and emergency
response, all at a fraction of the cost and environmental impact of
traditional gas-powered vehicles.
Arcimoto reported a net loss of $62.88 million in 2022 following a
net loss of $47.56 million in 2021.
Portland, Oregon-based Deloitte & Touche LLP, the Company's auditor
since 2022, issued a "going concern" qualification in its report
dated April 14, 2023, citing that the Company has incurred
significant losses and does not have sufficient cash on hand to
meet its obligations as they come due, which raises substantial
doubt about its ability to continue as a going concern.
ARISGLOBAL HOLDINGS: S&P Alters Outlook to Stable, Affirms 'B-' ICR
-------------------------------------------------------------------
S&P Global Ratings revised our outlook on ArisGlobal Holdings LLC
(ArisGlobal) to stable from positive and affirmed its 'B-' issuer
credit rating on the company.
S&P said, "At the same time, we affirmed our 'B-' issue-level
ratings on the company's senior secured first-lien term loan and
revolver and 'CCC' issue-level rating on its senior secured
second-lien debt.
"The stable outlook reflects our expectation that profitability
will significantly improve over the next 12 months, but leverage
will remain above 7x and free operating cash flow (FOCF) will be
roughly breakeven.
AG Parent Holdings LLC, the parent company of ArisGlobal Holdings
LLC (ArisGlobal), a niche company specializing in pharmacovigilance
reporting services (about 80% of revenue), significantly
underperformed our expectation for profitability and leverage in
2022 and the first half of 2023 due to a challenging labor market
and high one-time costs.
"ArisGlobal underperformed our profitability expectations in 2022,
continuing to pace below in the first half of 2023. In 2022, the
company's revenue grew at a pace of 17% compared with our
expectation of 20%. However, it experienced a severe decline in
EBITDA owing to an unexpected increase in hosting costs further
exacerbated by increased headcount due to lower-than-expected
attrition rate and salary inflation resulting in an EBITDA margin
of only 9.1% in 2022 compared with our expectation of 27.8%, and
leverage spiked to 21.2x. While the revenue growth continued at a
pace of 13% in the first half of 2023, the company experienced
ongoing margin pressures due to one-time severance costs related to
headcount reduction and continued higher-than-expected research and
development (R&D) investments resulting in a subdued reported
EBITDA in the first half of 2023 compared with the same period last
year. We now expect leverage to remain elevated at 8.8x in 2023
compared with our previous expectation of leverage declining well
below 7x.
"Significant cost reductions will lead to profitability
improvements beginning in the second half of 2023. We expect the
second half of 2023 to be an improvement over the previous year as
some of the one-time costs incurred in 2022 roll off and the
company begins to achieve synergies associated with the Amplexor
and CorrIT (SPORify) acquisitions. We expect the previously
elevated R&D investments to wind down in the second half of the
year and the company to derive the benefits of lower salary
expenses resulting from the headcount reduction completed in August
2022 and Q3-2023. We also anticipate an increase in implementation
of its new software as a service (SaaS) solution, an acceleration
in bookings resulting from new offerings, and optimized sales
efforts. We expect these efforts will improve its EBITDA margin to
18.6% in 2023.
"Financial sponsor owners could erode credit measures in the
pursuit of debt-funded acquisitions. While the company's leverage
spiked in 2022, our base-case scenario contemplates leverage
returning toward 7x by the end of 2024. That said, ArisGlobal's
financial sponsor owners could pursue a more aggressive financial
policy than contemplated in our base case, particularly as
acquisition multiples become more attractive. The company pursued
two acquisitions in the second quarter of 2023, but funded these
acquisitions with equity provided by its sponsor. As the company's
leverage declines and interest rates stabilize or decline, we
believe it is likely that it could potentially fund future
acquisitions with debt.
"ArisGlobal remains vulnerable to intensifying competition and
changes to the regulatory environment. We believe ArisGlobal's
revenue growth and expanding customer base reflect the superiority
of its pharmacovigilance reporting services. However, Oracle Corp.,
the company's primary competitor in this business, and Veeva
Systems Inc. (not rated), a leader in the clinical space, have
greater financial resources available than ArisGlobal. We believe
high switching costs constrain ArisGlobal's expansion but also
protect the market share gains it has already secured. We view an
intensification of competition in the safety segment as the
greatest risk to the company's performance. As cloud-based
platforms mature, we believe switching costs will decline and
price-based competition may intensify. In addition, operational
challenges that damage the business's reputation regarding quality
or security could disrupt the business. Although unlikely within
the next several quarters, regulatory changes that simplify safety
reporting requirements (e.g., the international harmonization of
data requirements) could reverse the trend toward outsourcing these
services or intensify pricing pressures.
"The company operates in a niche industry and its multi-tenant
LifeSphere software platform competes with those of much larger
companies with greater financial resources and a broader array of
products and services. The company generates most of its revenue
from the safety segment (about 75% of 2022 revenue). The company
specializes in a narrower segment than most rated peers. We view an
intensification of competition in the safety segment as the
greatest risk to the company's performance. Similarly, a
cybersecurity incident that erodes trust in the software vendor
could significantly hurt customer retention. We view ArisGlobal's
regulatory, clinical, and medical affairs segments as more
vulnerable to competition given the more fragmented competitive
landscapes in those industries.
"The stable outlook reflects our expectation that profitability
will significantly improve over the next 12 months, but leverage
will remain above 7x and FOCF will be roughly breakeven.
"We could lower our ratings on the company within the next 12
months if we believe the company will be unable to consistently
generate positive FOCF and its capital structure will become
unsustainable over time."
This could occur if:
-- The company's revenue growth stagnates or declines due to
client losses and competitive pressures; or
-- Persistent elevated costs result in an EBITDA margin that
remains below 15%-16%.
Although unlikely, S&P could raise its rating on ArisGlobal within
the next 12 months if:
-- S&P expects it to achieve and maintain adjusted leverage of
below 7x;
-- Sustain annual FOCF generation (excluding net working capital
sources of cash) in excess of 3% of its debt; and
-- S&P would also need greater visibility around EBITDA margin
stability and financial policy.
S&P said, "Governance factors are a moderately negative
consideration in our credit rating analysis. Our assessment of the
company's financial risk profile as highly leveraged reflects
corporate decision-making that prioritizes the interests of the
controlling owners, in line with our view of the majority of rated
entities owned by private-equity sponsors. Our assessment also
reflects the generally finite holding periods and a focus on
maximizing shareholder returns."
AVON PRODUCTS: S&P Affirms 'BB-' Long-Term ICR, Outlook Stable
--------------------------------------------------------------
S&P Global Ratings affirmed its 'BB-' long-term issuer credit
rating on Avon Products Inc. S&P also affirmed its 'BB-' rating on
its senior unsecured debt that has a remaining amount of about $20
million. At the same time, S&P withdrew Avon's 'b' stand-alone
credit profile (SACP).
S&P said, "The stable outlook reflects that of Avon's parent
company, Natura. We usually rate highly strategic subsidiaries one
notch below the rating on the group. We also expect business
integration to continue such that the subsidiaries Avon and Natura
Cosmeticos S.A. are operating as business units of the group.
"In our view, Natura & Co Holding S.A (Natura: BB/Stable/--;
brAAA/Stable/--) continues to integrate the business and provide
financial support to Avon Products Inc. (Avon), indicated by its
recent repurchase of $191 million of Avon's 2043 bonds.
"As a result, we now view Avon's group status to Natura as highly
strategic, from our previous view of strategically important."
Natura continues to demonstrate that Avon is part of the group's
long-term strategic view. The parent is making concentrated efforts
to integrate operations, especially in Latin America, where the two
companies historically have been competitors. Natura is already
integrating systems and consultants in Peru and Colombia, and S&P
thinks it could do the same in its largest operations such as
Argentina, Brazil, and Mexico in the next few quarters. S&P expects
that in the future, Avon will operate as a business unit integral
to the group.
In addition, following a capital injection in the form of a
follow-on during the pandemic and the repurchase of Avon's 2023
bonds, Natura recently announced its repurchase of Avon's 2043
bonds, which it will fund by the expected cash inflow from the sale
of its subsidiary Aesop at Natura's level. Natura has completed
$191 million of debt repurchase, with only about $20 million of
debt remaining outstanding at Avon.
BARRETTS MINERALS: Court OKs $30MM DIP Loan from JMP Capital
------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas,
Houston Division, authorized Barretts Minerals Inc. and affiliates
to use cash collateral and obtain senior secured superpriority
financing, on an interim basis.
The Debtors are permitted to obtain postpetition financing on a
superpriority senior secured basis in the form of a non-amortizing
superpriority senior secured term loan facility in an aggregate
principal amount of up to $30 million. About $15 million of the
committed amount will be made available upon entry of the Interim
Order.
Barretts Ventures Texas LLC acts as guarantor and JMB Capital
Partners Lending, LLC is the Lender.
The DIP facility is due and payable on the earliest of:
i. July 1, 2024;
ii. 100 days after the Petition Date, unless the Bankruptcy
Court has approved the Debtors' entry into a stalking horse
purchase agreement reasonably acceptable to the DIP Lender or a
sale order providing for Payment in Full of the DIP Obligations;
provided, that, a SHPA will be reasonably acceptable to the DIP
Lender if it, alone or with one or more related transactions, (i)
provides for the Payment in Full of the DIP Obligations, (ii) the
purchaser has demonstrated the financial wherewithal to consummate
the transaction(s), and (iii) the closing shall occur on or prior
to the maturity date of the DIP Facility;
iii. the effective date of any chapter 11 plan of reorganization
with respect to the Borrower;
iv. the consummation of any sale or other disposition of all or
substantially all of the assets of the Borrower pursuant to 11
U.S.C. section 363;
v. the date of the acceleration of the DIP Loans and the
termination of the DIP Commitments following the occurrence and
during the continuation of an Event of Default in accordance with
the DIP Documents;
vi. dismissal of the Chapter 11 Cases or conversion of the
Chapter 11 Cases into cases under chapter 7 of the Bankruptcy Code;
and
vii. 45 days after the Petition Date (or such later date as
agreed to by the DIP Lender), unless the Final Order has been
entered by the Bankruptcy Court on or prior to such date.
The DIP Loans will bear interest at a per annum rate equal to 14%
payable in cash on the first day of each month in arrears.
The Debtors have an immediate and critical need to obtain the DIP
Facility and use cash collateral in order to, among other things,
(i) permit the orderly continuation and operation of their
businesses, (ii) maintain business relationships with customers,
vendors, and suppliers, (iii) provide working capital for their
businesses, (iv) pay the expenses of the Chapter 11 Cases, and (v)
for general corporate purposes, in each case, in accordance with
and subject to the terms and conditions of the Interim Order and
the DIP Documents.
The events that constitute an "Event of Default" include:
i. payment, non-compliance with covenants set forth in the DIP
Documents, judgements in excess of specified amounts, impairment of
security interest in the DIP Collateral and other customary
defaults, subject to any applicable grace and/or cure periods to be
agreed for nonpayment defaults only and as are customary for
transactions of this nature;
ii. the entry of the Final Order will have not occurred within
45 days after the Petition Date;
iii. the dismissal of any of the Chapter 11 Cases or the
conversion of any of the Chapter 11 Cases to cases under chapter 7
of the Bankruptcy Code;
iv. non-compliance, subject to any applicable grace and/or cure
periods, by any Loan Party with the terms of the Interim Order or
the Final Order; and
v. the entry of an order staying, reversing, vacating or
otherwise modifying the Interim Order or the Final Order, in each
case without the prior written consent of the DIP Lender.
A final hearing on the matter is set for November 8 at 9:30 a.m.
A copy of the order is available at https://urlcurt.com/u?l=LRZ7ji
from PacerMonitor.com.
About Barretts Minerals Inc.
Barretts Minerals Inc. current operations are focused on the
mining, beneficiating, processing, and sale of industrial talc.
BMI historically supplied a relatively minor percentage of its
sales into cosmetic applications. BMI's talc is sold to
distributors and third-party manufacturers for use in such parties'
products, which are then incorporated into downstream products
eventually sold to consumers.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 23-90794) on
October 2, 2023. In the petition signed by David J. Gordon, chief
restructuring officer, the Debtor disclosed up to $100 million in
assets and up to $50 million in liabilities.
Judge David R. Jones oversees the case.
The Debtors tapped Porter Hedges LLP and Latham& Watkins LLP as
legal counsel, M3 Partners, LP as financial advisor, Jefferies LLC
as investment banker, and Stretto, Inc. as claims, noticing, and
solicitation agent and administrative advisor.
BLACKBERRY LTD: Dattels Steps Down From Board of Directors
----------------------------------------------------------
BLACKBERRY LTD: Dattels Steps Down From Board of Directors
BlackBerry Limited disclosed in a Form 8-K Report filed with the
Securities and Exchange Commission that Timothy Dattels has
notified the Company of his intention to resign from its Board of
Directors, effective Sept. 28, 2023.
Dattels served on the Board since 2012 and his decision to resign
was not the result of any disagreement with the Company on matters
related to its strategy, operations, policies, or practices.
About BlackBerry
Headquartered in Waterloo, Ontario, BlackBerry Limited (NYSE: BB;
TSX: BB) provides intelligent security software and services to
enterprises and governments around the world.
At Aug. 31, 2023, the Company had $1.613 billion in total assets
against $784 million in total liabilities.
In September 2023, Egan-Jones Ratings Company maintained its 'CCC'
foreign currency and local currency senior unsecured ratings on
debt issued by BlackBerry Limited.
BLACKBERRY LTD: Mulls Spinoff of IoT and Cybersecurity Units
------------------------------------------------------------
BlackBerry Limited issued an update on the Company's previously
announced review of its portfolio of businesses that the Board of
Directors commenced on May 1, 2023, dubbed the "Project Imperium."
The Board, together with its advisors, Morgan Stanley and Perella
Weinberg Partners, has been evaluating a comprehensive range of
strategic alternatives to drive enhanced shareholder value,
including a possible separation of businesses and a range of
potential sale structures. Based on input from the current process
and with the support of management, the Board has determined that
separating the IoT and Cybersecurity business units into two
independently operated entities is the optimal strategic direction
for BlackBerry.
The chief objective of the separation is to pursue a subsidiary
initial public offering for the IoT business, the market leader for
high-performance, safety-critical foundational software in
automotive and other verticals, with a launch targeted in the first
half of the next fiscal year. BlackBerry believes a separately
traded IoT subsidiary will enable shareholders to more clearly
evaluate the performance and future potential of BlackBerry's
principal businesses on a standalone basis, while allowing each
business to pursue its own distinct strategy and capital allocation
policy.
Project Imperium objectives will continue to be pursued as the
company launches activities to separate its principal businesses.
"The Board and management believe that separating our principal
businesses will improve our ability to create value for all our
stakeholders," said John Chen, Executive Chair & CEO, BlackBerry.
"Both the IoT and Cyber businesses have leading technology and
talent and address large and growing market opportunities. This new
proposed structure will further increase both their operational
agility and ability to focus on delivering exceptional solutions to
their customers."
About BlackBerry
Headquartered in Waterloo, Ontario, BlackBerry Limited (NYSE: BB;
TSX: BB) provides intelligent security software and services to
enterprises and governments around the world.
At Aug. 31, 2023, the Company had $1.613 billion in total assets
against $784 million in total liabilities.
In September 2023, Egan-Jones Ratings Company maintained its 'CCC'
foreign currency and local currency senior unsecured ratings on
debt issued by BlackBerry Limited.
BLACKBERRY LTD: Posts $42 Million Net Loss in FY2024 2nd Quarter
----------------------------------------------------------------
BlackBerry Limited has released its financial results for the
second quarter of fiscal year 2024, which ended Aug. 31, 2023,
posting a net loss of $42 million on total revenues of $132
million. BlackBerry posted a net loss of $11 million on total
revenues of $373 million for the same period ended Aug. 31, 2022.
"Our IoT business continues to win new designs and add royalty
backlog at a strong rate, illustrating how well-positioned this
business is in the medium to long term. We expect a strong finish
for IoT revenue this fiscal year, with the fourth quarter
forecasted to be the strongest ever. Further, we are excited by the
response from beta customers to our next generation QNX(R) Software
Development Platform 8.0, and its potential to enable embedded
Generative AI applications," said John Chen, BlackBerry's Executive
Chair & CEO. "We also expect a strong second half for revenue in
our Cyber business, with a pipeline of deals that include large,
mainly perpetual government opportunities that can deliver
meaningful in-year revenue. Therefore, we are reiterating our
full-year Cyber revenue outlook."
BlackBerry's Second Quarter Fiscal 2024 Financial Highlights:
* Total company non-GAAP gross margin was 65% and GAAP gross
margin was 64%.
* IoT revenue was $49 million, a 9% sequential increase; IoT
gross margin was 84%, increasing by 400 basis points sequentially.
* Cybersecurity revenue was $79 million, with gross margin of
54%.
* Cybersecurity ARR was $279 million.
* Cybersecurity billings were $74 million.
* Licensing and Other revenue was $4 million.
* Non-GAAP operating loss was $28 million and GAAP operating
loss was $47 million.
* Total cash, cash equivalents, short-term and long-term
investments decreased by $59 million to $519 million.
A full-text copy of the Company's statement is available at
https://tinyurl.com/36snz8kk
About BlackBerry
Headquartered in Waterloo, Ontario, BlackBerry Limited (NYSE: BB;
TSX: BB) provides intelligent security software and services to
enterprises and governments around the world.
At Aug. 31, 2023, the Company had $1.613 billion in total assets
against $784 million in total liabilities.
In September 2023, Egan-Jones Ratings Company maintained its 'CCC'
foreign currency and local currency senior unsecured ratings on
debt issued by BlackBerry Limited.
CABALLERO SAND: Files Emergency Bid to Use Cash Collateral
----------------------------------------------------------
Caballero Sand & Gravel, Inc. asks the U.S. Bankruptcy Court for
the Northern District of Texas, Fort Worth Division, for authority
to use cash collateral and provide adequate protection.
The Debtor requires the use of cash collateral to make payroll and
to pay other immediate expenses.
Creditors, Forward Financial and the U.S. Small Business
Administration have asserted a lien claim to certain assets of the
Debtor, including inventory and accounts receivable.
An emergency exists in that the entire chance of the Debtor's
reorganizing depends on the Debtor's ability to immediately obtain
use the alleged Collateral of Secured Creditors to continue
operations of the company while effectuating a plan of
reorganization.
The Debtor is willing to provide Secured Creditors with replacement
liens pursuant to 11 U.S.C. section 552 in accordance with their
existing priority without making any determination at this time as
to the validity or priority of the claims asserted by the Secured
Creditors.
A copy of the Debtor's motion is available at
https://urlcurt.com/u?l=FhAGI4 from PacerMonitor.com.
About Caballero Sand & Gravel, Inc.
Caballero Sand & Gravel, Inc. sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. N.D. Tex. Case No. 23-43032) on
October 4, 2023. In the petition signed by Jose Caballero,
president, the Debtor disclosed up to $50,000 in assets and up to
$10 million in liabilities.
Judge Mark X. Mullin oversees the case.
Eric A. Liepins, Esq. represents the Debtor as legal counsel.
CANO HEALTH: Announces Plan for Reverse Stock Split
---------------------------------------------------
Cano Health, Inc. has filed a preliminary proxy statement with the
Securities and Exchange Commission regarding a special
stockholders' meeting to authorize the Company's Board of Directors
to effect a reverse stock split of the Company's Class A and Class
B common stock at a ratio of 1-for-60, with the Board having the
right to adjust such ratio down to 1-for-5 and up to 1-for-100.
The Board will determine the final split ratio after stockholder
approval and would retain the authority to abandon the Reverse
Stock Split at any time or to delay or postpone it.
The Reverse Stock Split would not affect any stockholder's
percentage ownership interests or proportionate voting power,
except to the extent that it results in a stockholder receiving
cash in lieu of fractional shares.
The Company believes the Reverse Stock Split will enable it to
regain compliance with the price criteria of Section 802.01C of the
NYSE Listed Company Manual, as well as to allow the Company's
Common Stock to be more attractive to a broader range of
investors.
At the special stockholders' meeting, the proposed Reverse Stock
Split requires the affirmative vote of a majority of the voting
power of the outstanding shares of Common Stock, voting as a single
class. ITC Rumba, LLC, Cano Health's largest stockholder with
approximately 30% of the voting power of the Company's Class A and
Class B common stock as of Sept. 30, 2023, has reaffirmed to the
Company its intent to vote in favor of the Reverse Stock Split.
Also, certain current and former members of management and the
Board, acting in their respective roles as individual stockholders,
who together hold approximately 20% of the combined voting power,
are expected to sign a voting agreement as a demonstration of their
support of the Reverse Stock Split.
Stockholders may obtain a free copy of the preliminary proxy
statement and other documents that the Company files with the SEC
at the SEC's website at www.sec.gov or on the Company's Investor
Relations website at investors.canohealth.com/ir. The Company will
file with the SEC and distribute to its stockholders a definitive
proxy statement regarding the special stockholders' meeting and the
Reverse stock split proposal. The Company plans to issue another
press release when the definitive proxy statement is filed and upon
completion of the Reverse Stock Split.
Completion of the proposed Reverse Stock Split is subject to market
and other customary conditions, including obtaining stockholder
approval. However, there are no assurances that the Reverse Stock
Split will be completed, that it will result in an increased per
share price or achieve its other intended effects. The Board
reserves the right to elect not to proceed with the Reverse Stock
Split if it determines that implementing it is no longer in the
best interests of the Company and its stockholders.
About Cano Health
Cano Health, Inc. (NYSE: CANO) -- canohealth.com -- is a primary
care-centric, technology-powered healthcare delivery and population
health management platform. Founded in 2009, with its headquarters
in Miami, Florida, Cano Health is transforming healthcare by
delivering primary care that measurably improves the health,
wellness, and quality of life of its patients and the communities
it serves through its primary care medical centers and supporting
affiliated providers.
Cano Health reported a net loss of $428.39 million in 2022, a net
loss of $116.74 million in 2021, a net loss of $71.06 million in
2020, and a net loss of $19.78 million in 2019.
Cano Health announced that on Sept. 5, 2023, it was notified by
NYSE Regulation Inc. that it is not in compliance with Section
802.01C of the NYSE Listed Company Manual because the average
closing stock price of a share of the Company's Class A common
stock was less than $1.00 per share over a consecutive 30
trading-day period.
* * *
As reported by the TCR on Aug. 17, 2023, S&P Global Ratings lowered
its issuer credit rating on Medicare Advantage-focused primary care
service provider Cano Health Inc. to 'CCC-' from 'B-'. S&P said,
"We based our negative outlook on our expectation for continued
weak operating performance and cash flow deficits. Given the
company's current liquidity position, we believe there is
heightened risk of a near-term default such as a bankruptcy filing,
debt restructuring, or missed interest payment."
CANOO INC: All Four Proposals Passed at Special Meeting
-------------------------------------------------------
Canoo Inc. held a special meeting during which the stockholders:
(1) approved an amendment to Paragraph A of Article IV of the
Company's Second Amended and Restated Certificate of Incorporation
to increase the Company's number of shares of authorized common
stock, par value $0.0001 per share, from 1,000,000,000 shares to
2,000,000,000 shares and the corresponding increase in the total
number of authorized share of capital stock the Company may issue
from 1,010,000,000 to 2,010,000,000 shares;
(2) approved, pursuant to Nasdaq Marketplace Rule 5635, the
issuance of shares of the Company's common stock (i) upon the
conversion of certain convertible debentures that have been issued
to YA II PN, Ltd. pursuant to (a) the Securities Purchase Agreement
entered into with Yorkville on April 24, 2023, (b) the Securities
Purchase Agreement entered into with Yorkville on June 30, 2023,
and (c) the Securities Purchase Agreement entered into with
Yorkville on Aug. 2, 2023, (ii) upon the exercise of warrants
issued pursuant to the June SPA and the August SPA, and (iii) if
Yorkville chooses to exercise one or both options to purchase
additional convertible debentures and warrants under the June SPA
and the August SPA, respectively, pursuant to the conversion of
such convertible debentures and/or upon the exercise of such
warrants that may be issued upon exercise of one or both options,
in excess of 20% of the number of shares outstanding on April 24,
2023;
(3) approved an amendment to the Pre-Paid Advance Agreement with
Yorkville to lower the minimum price at which shares may be sold by
the Company from $0.50 per share to $0.10 per share; and
(4) approved a proposal to adjourn the Special Meeting to a
later date or dates, if necessary or appropriate, to permit further
solicitation and vote of proxies in the event that there are
insufficient votes for, or otherwise in connection with, one or
more of the other proposals to be voted on at the Special Meeting.
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 is developing a
technology platform that it believes will enable the Company to
rapidly innovate and bring new products, addressing multiple use
cases, to market faster than its competition and at lower cost.
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.
CAPSTONE GREEN ENERGY: $30 Million Chapter 11 Financing Approved
----------------------------------------------------------------
Rick Archer of Law360 reports that a Delaware bankruptcy judge on
Friday, September 30, 2023, gave generator manufacturer Capstone
Green Energy initial approval to tap into $30 million in Chapter 11
financing as it seeks approval for its prepackaged reorganization
plan by the beginning of November 2023.
About Capstone Green
Headquartered in Van Nuys, California, Capstone Green Energy
Corporation -- http://www.capstonegreenenergy.com/-- is a provider
of customized microgrid solutions, on-site resilient green Energy
as a Service (EaaS) solutions, and on-site energy technology
systems focused on helping customers around the globe meet their
environmental, energy savings, and resiliency goals.
On Sept. 28, 2023, Capstone Green Energy Corporation and two
affiliated debtors each filed a voluntary petition for relief under
Chapter 11 of the United States Bankruptcy Code (Bankr. D. Del.
Lead Case No. 23-11634).
The cases are pending before the Honorable Laurie Selber
Silverstein.
Katten Muchin Rosenman LLP is serving as legal counsel, and Riveron
LLP is serving as financial advisor to the Company. Kroll is the
claims agent.
Cleary Gottlieb Steen & Hamilton LLP is serving as legal counsel to
the Consenting Lender.
CAPSTONE GREEN: AIGH Capital Discloses 9.8% Ownership Stake
-----------------------------------------------------------
AIGH Capital Management, LLC, and its affiliates filed a Schedule
13G Report with the Securities and Exchange Commission to disclose
its ownership of Capstone Green Energy Corporation's common stock.
The AIGH Capital Management LLC entities beneficially own an
aggregate amount of 1,800,000 shares, equivalent to 9.8% of
Capstone Green Energy's common stock as of Sept. 28, 2023.
A full-text copy of the Schedule 13G Report is available at
https://tinyurl.com/255p2e4c
AIGH Capital Management LLC and Co. may be reached at:
Orin Hirschman
Managing Member, AIGH Capital Management, LLC
President, AIGH LLC
6006 Berkeley Avenue
Baltimore, MD 21209
About Capstone Green Energy Corporation
Capstone Green Energy Corporation builds microturbine energy
systems and battery storage systems that allow customers to produce
power on-site in parallel with the electric grid or stand-alone
when no utility grid is available. Capstone Green offers
microturbines designed for commercial, oil and gas, and other
industrial applications.
Capstone Green Energy and its affiliated entities sought protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead
Case No. 23-11634) on September 28, 2023. In the petition signed by
John Juric, chief financial officer, Capstone Green Energy
disclosed $104,000,000 in total assets and $111,000,000 in total
debt.
Judge Laurie Selber Silverstein oversees the cases.
Katten Muchin Rosenman LLP represents the Debtors as legal counsel,
Young Conaway Stargatt & Tayloor LLP as co-counsel, Riveron RTS,
LLC as financial advisor, and Kroll Restructuring Administration
LLC as claims, noticing & solicitation agent and administrative
advisor.
CHALLENGER BRASS: Court OKs Deal on Cash Collateral Access
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Puerto Rico
authorized Challenger Brass & Copper Co., Inc. to use cash
collateral on an interim basis in accordance with its agreement
with Banco Popular de Puerto Rico, through November 27, 2023.
As previously reported, BPPR consents to the Debtor's limited use
of the cash collateral to satisfy certain operating and other
expenses solely under and pursuant to the terms of the Stipulation
and the adequate protection provided therein.
After some negotiations, the Debtor and BPPR have agreed to enter
into the Stipulation, to allow the Debtor to use the cash
collateral, on an interim basis, so that the Parties can explore
the possibility of a potential consensual resolution during this
period and preserve the going concern value of the Debtor.
Prior to the Petition Date, the Debtor and BPPR entered into
several credit facilities. Specifically, on May 24, 2019, the
Debtor and BPPR entered into a Credit Agreement, pursuant to which
BPPR provided to the Debtor a revolving line of credit in the
aggregate principal amount of $2 million to finance the Debtor's
accounts receivable and to satisfy a previous line of credit.
The First Loan is evidenced by a Note dated May 24, 2019, executed
by the Debtor in favor of BPPR in the principal amount of $2
million.
On March 19, 2021, the Debtor and BPPR entered into a Credit
Agreement, pursuant to which BPPR made available to the Debtor a
non-revolving line of credit in the aggregated principal amount of
$600,000 to finance the acquisition of raw material.
The Second Loan is evidenced by a Note dated March 19, 2021,
executed by the Debtor and Guarantors in the principal amount of
$600,000.
To secure the payment and performance of the Debtor under the
Loans, the Debtor and the Guarantors granted to BPPR a first
priority lien and security interest on the real properties, as well
as personal guarantees of the Guarantors, pursuant to certain
agreements, instruments, and other documents.
As a result, in an attempt to consensually resolve such defaults,
on October 28, 2022, the Debtor, Guarantors, and BPPR executed a
Forbearance Agreement, pursuant to which the Debtor and Guarantors
agreed to certain actions to remedy the outstanding events of
default.
As part of the Forbearance Agreement, the Debtor and Guarantors
executed a Consent Judgment in favor of BPPR.
The Debtor and the Guarantors failed to comply with their
obligations under the Forbearance Agreement. As a result, on May 4,
2023, BPPR issued a notice of events of default to the Debtor and
the Guarantors.
Since the Debtor and Guarantor failed to remedy the outstanding
events of default, on June 14, 2023, BPPR filed the Consent
Judgment in the Puerto Rico Court, Bayamon Part, Banco Popular de
Puerto Rico v. Challenger Brass & Copper Co., Inc., et al, Civil
No. BY2023CV03279, and requested that the local court issue the
corresponding judgment allowing BPPR to foreclose over its
Collateral.
As part of the Collateral granted to BPPR, the Debtor pledged all
cash collateral to BPPR.
Specifically, on May 24, 2019, the Debtor executed a Security
Agreement, Pledge and Assignment with BPPR.
BPPR duly perfected its security interest over the First Cash
Collateral by filing a UCC Financing Statement on May 29, 2019,
covering all of the First Cash Collateral granted under the First
Security Agreement.
Similarly, on March 19, 2021, the Debtor executed a Security
Agreement, Pledge and Assignment with BPPR.
The Second Security Agreement provides that the Debtor is granting
and pledging to BPPR as collateral for the Second Loan, among other
assets, all of the Debtor's Accounts, Accounts Receivable, Contract
Collateral, Inventory, Deposit and Collection and Account
Collateral and all Proceeds.
BPPR duly perfected its security interest over the Debtor's Second
Cash Collateral by filing a UCC Financing Statement on March 26,
2021, covering all of the Second Cash Collateral granted under the
Second Security Agreement.
Further, as evidenced by the UCC search report, BPPR holds a first
priority lien over the cash collateral.
After the Petition Date, on June 28, 2023, BPPR sent a letter to
the Debtor stating that it did not consent to the use of its cash
collateral until and unless an agreement was reached regarding its
use, or the Bankruptcy Court ordered otherwise.
A copy of the order is available at https://urlcurt.com/u?l=YICN31
from PacerMonitor.com.
About Challenger Brass & Copper Co Inc.
Challenger Brass & Copper Co Inc. is engaged in the manufacturing
and commercialization of copper, brass, bronze, stainless steels,
and aluminum. The company is based in Toa Baja, P.R.
Challenger Brass & Copper filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. D.P.R. Case No.
23-01917) on June 23, 2023. The petition was signed by Abimael
Padilla Negron as authorized representative of the Debtor. At the
time of filing, the Debtor reported $1,031,500 in assets and
$2,540,722 in liabilities.
Judge Edward A. Godoy presides over the case.
Jesus Enrique Batista Sanchez, Esq. at The Batista Law Group, PSC
represents the Debtor as counsel.
CHINAH USA: Court OKs Interim Cash Collateral Access
----------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
authorized Chinah USA LLC and affiliates to use cash collateral on
an interim basis in accordance with the budget, with a 10%
variance.
Ten secured note holders have extended credit to the Debtors and
assert a lien on the cash collateral of all the Debtors' assets.
The U.S. Small Business Administration and JP Morgan Chase also
assert liens senior to the Secured Note Holders against Chi Na
Jersey City's assets.
The Debtors represent that the holders of 2023 Secured Notes have
duly perfected senior security interests, except with respect to
Chi Na Jersey City in which they hold a subordinate security
interest, in all of the Debtors' personal property, including the
proceeds thereof, by virtue of the liens granted to them under the
2023 Security Agreements and the filing of a UCC-1 Financing
Statements evidencing such interests.
As of the Filing Date, the Debtors assert that they were indebted
to the holders of the 2023 Secured Notes in the aggregate
approximate amount of $106,000.
The Debtors represent that the U.S Small Business Administration
has a duly perfected subordinate security interest in all of the
Chi Na Jersey City's personal property, including the proceeds
thereof, by virtue of a note and security agreement, entered into
by Chi Na Jersey City on May 13, 2020, and the filing of a UCC-1
Financing Statement evidencing such interest.
The Debtors have represented that they believe, in 2019, Chi Na
Jersey City entered into two secured loans with JP Morgan Chase.
Chase asserts a lien on all of Chi Na Jersey City's assets as
indicated in three UCC-1 financing statements with the New Jersey
Secretary of State. Chi Na Jersey City is presently investigating
the Chase Loans and liens asserted in connection therewith.
As adequate protection, the Secured Creditors are granted
replacement liens in their pre-petition and post-petition assets
and proceeds, including cash Collateral, to protect them from
Collateral Diminution. These replacement liens will be granted to
the extent that the Secured Creditors had a valid security interest
in the pre-petition assets on the Petition Date, and the order of
priority, nature, and validity will remain the same as of the
Filing Date.
As additional adequate protection for the use of cash collateral
Chi Na Jersey City, Chi Na Jersey City will pay to the SBA and
Chase monthly debt service payments, as provided for in the
underlying loan documents, at the contract (non-default) rate of
interest.
The Replacement Liens and security interests granted are
automatically deemed perfected upon entry of the Order without the
necessity of the Secured Creditors having to take possession, file
financing statements, mortgages or other typical security
documents.
The Debtors' authorization to use cash collateral will immediately
terminate without further Order on the earlier of: (a) October 26,
2023, at 5 p.m.; (b) the entry of an order granting any party
relief from the automatic stay; (c) the entry of an order
dismissing the Chapter 11 proceedings or converting these
proceedings to a case under Chapter 7 of the Bankruptcy Code; (d)
the entry of an order confirming a plan(s) of reorganization; or
(e) the entry of an order by which this Order is reversed, revoked,
stayed, rescinded, modified or amended.
A final hearing on the matter is set for October 26 at 10 a.m.
A copy of the court's order is available at
https://urlcurt.com/u?l=c6MMuH from PacerMonitor.com.
About Chinah USA LLC
Chinah USA LLC operates a full-service restaurant business
specializing in Chinese food. The Debtor sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. N.Y. Case No.
23-11157) on July 24, 2023. In the petition signed by Hegel Hei,
chief executive officer, the Debtor disclosed up to $50,000 in
assets and up to $10 million in liabilities.
Judge David S. Jones oversees the case.
Erica Aisner, Esq., at Kirby Aisner and Curley LLP, represents the
Debtor as legal counsel.
CIVITAS RESOURCES: Moody's Rates New $1BB Sr. Unsecured Notes 'B1'
------------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to Civitas
Resources, Inc.'s proposed $1 billion of senior unsecured notes due
2030. Civitas' other ratings remain unchanged, including the Ba3
Corporate Family Rating, the B1 senior unsecured notes ratings and
the SGL-2 speculative grade liquidity rating ("SGL"). The outlook
remains positive.
Civitas plans to use net proceeds from its proposed bond offering
to partially fund its acquisition of Vencer Energy, which is owned
by Vitol. The bonds are expected to have a mandatory redemption
requirement at par if the acquisition does not close by a specified
date.
"Civitas' latest acquisition of assets in the Permian Basin will
further enhance the company's scale and diversification across
basins," commented Jonathan Teitel, a Moody's Senior Analyst. "How
much equity is used to fund the transaction is an important part of
limiting the effect on the company's leverage profile."
RATINGS RATIONALE
Civitas' new and existing senior unsecured notes are rated B1,
which is one notch below the Ba3 CFR, reflecting their effective
subordination to the senior secured RBL revolving credit facility.
The acquisition of Vencer Energy will enhance the company's
position in the Permian Basin, adding about 62 Mboe/d of current
production (about 50% oil). This acquisition follows soon after
Civitas closed on its acquisitions in August 2023 of certain assets
in the Permian Basin from Hibernia Energy and Tap Rock Resources,
LLC. The prior transactions provided benefits of increasing scale
and asset diversification offset by the substantial amount of debt
incurred to achieve this. The latest acquisition further increases
Civitas' scale and share of production in the Permian Basin
relative to the DJ Basin, but another sizable acquisition in
upcycle commodity price conditions entails inherent valuation and
execution risks. The ultimate proportion of equity funding will be
important to limiting the increase in leverage metrics and
balancing the valuation risks of the acquisition between
shareholders and creditors.
Civitas will acquire the assets, which are located in the Midland
Basin of West Texas within the broader Permian Basin, for
approximately $2.1 billion from Vencer Energy, which is owned by
Vitol. Consideration includes about 7.3 million shares of stock
(valued at about $560 million based on Civitas' closing stock price
on October 3) and $1.55 billion of cash, of which $1 billion will
be due at closing. The remaining $550 million will be due in
January 2025. Civitas has the option to accelerate the deferred
cash payment to the closing of the acquisition, which would reduce
the total purchase price to $2.05 billion. The company expects to
close the acquisition in January 2024.
Civitas has stated its intention to reduce leverage and Moody's
expects that the company will use free cash flow to reduce debt
through 2024 while returning cash to shareholders in a balanced
manner that retains a strong balance sheet and preserves liquidity.
Civitas has a fixed dividend and targets distributing 50% of free
cash flow (before changes in working capital and after the base
dividend) to shareholders. The company has a long-term net leverage
target of 0.75x. Providing liquidity and funding support are
Civitas' intent to sell about $300 million of non-core assets by
mid-2024.
Civitas' SGL-2 Speculative Grade Liquidity rating reflects Moody's
expectation for Civitas to maintain good liquidity through 2024. As
of August 2, 2023 (when the prior acquisitions closed), the company
had $750 million of borrowings outstanding on its revolver and $12
million in letters of credit. Civitas' revolver has $1.85 billion
of elected commitments and a borrowing base of $3 billion. The
revolver matures in 2028 but the maturity springs 180 days ahead of
any earlier debt maturities, so it would spring ahead of the senior
notes due October 2026 if they remain outstanding at that time. The
revolver's financial covenants include a maximum net leverage ratio
and a minimum current ratio. Moody's expects the company to
maintain compliance with these covenants through 2024.
The positive outlook continues to reflect the benefits to Civitas
from increased scale and diversification expected from the
acquisitions of assets in the Permian Basin while maintaining
supportive credit metrics. However, the company has added a
substantial amount of debt to achieve this enlarged scale and
diversification. Successive large acquisitions bring execution and
valuation risks. Demonstrating the ability to integrate these
assets and deliver organic production growth at competitive costs
and returns on investment is integral to delivering the potential
improvement in Civitas' credit profile.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Factors that could lead to an upgrade include successful
integration and operations of the acquired assets; consistent
positive free cash flow and debt reduction while organically
growing production levels and replacing reserves at competitive
costs; retained cash flow (RCF) to debt sustained above 40%; and
maintenance of solid liquidity and conservative financial
policies.
Factors that could lead to a downgrade include a meaningful decline
in production; RCF/debt below 25%; weakening liquidity; or
regulatory developments adverse to the company.
Civitas, headquartered in Denver, Colorado, is a publicly traded
independent exploration and production company operating in the DJ
Basin and in the Permian Basin.
The principal methodology used in this rating was Independent
Exploration and Production published in December 2022.
CIVITAS RESOURCES: S&P Rates New $1BB Senior Notes Due 2030 'BB-'
-----------------------------------------------------------------
S&P Global Ratings assigned its 'BB-' issue-level rating and '3'
recovery rating to Civitas Resources Inc.'s proposed $1 billion
senior notes due 2030. The '3' recovery rating indicates S&P's
expectation for meaningful (50%-70%; rounded estimate: 65%)
recovery to creditors in the event of a payment default. S&P
expects the company will use proceeds from these notes, along with
equity issued directly to the seller, to finance its acquisition of
assets owned by Vencer Energy LLC.
S&P believes Civitas' proposed acquisition of the Vencer assets
will expand its presence in the Permian Basin without materially
affecting its overall scale.
ISSUE RATINGS--RECOVERY ANALYSIS
Key analytical factors
-- The '3' recovery rating is in line with S&P's '3' recovery
rating on the company's existing senior unsecured debt. S&P caps
its recovery rating on Civitas' unsecured debt at '3' to account
for the potential issuance of priority or pari passu debt on the
path to a hypothetical default.
-- S&P's simulated default scenario assumes a payment default in
2027 amid sustained low commodity prices, which is consistent with
conditions of past defaults in this sector.
-- S&P based its valuation for Civitas' reserves on a
company-provided PV-10 report, pro forma the proposed acquisition,
using its recovery price deck assumptions of $50 per barrel for
West Texas Intermediate crude oil and $2.50 per million Btus for
Henry Hub natural gas.
-- S&P assumes borrowings under the senior secured reserve-based
loan facility are fully drawn up to its elected commitment amount
of $1.85 billion at default.
Simulated default assumptions
-- Simulated year of default: 2027
-- Jurisdiction (Rank A): The company is headquartered in the U.S.
and its revenue/assets are located domestically.
-- Net enterprise value (EV): Adjusted to account for
restructuring administrative costs (estimated at 5% of the gross
EV).
Simplified waterfall
-- Net EV (after 5% administrative costs): $7.2 billion
-- Secured first-lien debt: $1.9 billion
--Recovery expectations: Not applicable
-- Total value available to unsecured claims: $5.3 billion
-- Unsecured debt: $4.3 billion
--Recovery expectations: 50%-70% (rounded estimate: 65%)
Note: All debt amounts include six months of prepetition interest.
COMMSCOPE HOLDING: Mulls Selling Assets to Address $9-Bil. Debt
---------------------------------------------------------------
Reshmi Basu of Bloomberg News reports that telecommunications
infrastructure company CommScope Holding Co. is exploring divesting
its Ruckus Wireless business as well as its access network
solutions business and using the proceeds to pay down debt,
according to people with knowledge of the matter.
The businesses together could generate $4 billion, the people said,
and CommScope is working with financial advisers to assess its
options. The company has over $9 billion in long-term debt, with
around half of its obligations coming due in 2025 and 2026.
About Commscope Holding Co.
Commscope Holding Co. operates as a holding company. The Company,
through its subsidiaries, provides end-to-end solutions connecting
technology and wireless and wired networks. CommScope Holding
serves customers worldwide.
CPV SHORE: Moody's Downgrades Rating on Senior Secured Loans to B1
------------------------------------------------------------------
Moody's Investors Service downgraded CPV Shore Holdings, LLC ("CPV
Shore" or the "Project") senior secured credit facilities to B1
from Ba3, affecting approximately $362 million of outstanding
senior secured term loan and a $120 million revolving credit
facility. The rating outlook is maintained at negative.
RATINGS RATIONALE
The rating action reflects continued weak power and capacity market
trends impacting CPV Shore's cash flows which has resulted in
lower-than-expected credit metrics. The Project is exposed to weak
power market fundamentals within PJM Interconnection, L.L.C.'s
("PJM", Aa2 Stable) EMAAC capacity zone following the expiration of
the Project's initial heat rate call option (HRCO) in 2021, which
had provided a degree of cash flow stability and downside
protection during the Project's early years of operation. The
Project's 2023 and 2024 cash flows are also expected to be
negatively affected by the full impact of lower PJM Base Residual
Auction (BRA) capacity prices for the EMAAC region. Specifically,
PJM EMAAC capacity prices have declined to $98 MW-day for the
2022/2023 delivery year, and further declined to $49 MW-day based
on the 2023/2024 delivery year capacity auction results, though
there is a slight improvement in capacity prices to $55 MW-day for
the 2024/2025 delivery period. These capacity prices are
significantly below expectations when CPV Shore was financed in
2018 with the initial debt load. Furthermore, while 2022 was a
robust year from an energy margin perspective given relatively high
spark spreads realized during most of the year, these higher spark
spreads have not been replicated during much of 2023. The
Project's EBITDA has also been adversely impacted by higher than
anticipated carbon emission costs associated with the Northeast
Regional Greenhouse Gas Initiative (RGGI) which New Jersey joined
in 2020.
The Project's term loan balance stood at approximately $368 million
at the end of FY 2022, and was paid down to approximately $362
million by the end of the 3rd quarter of 2023. The Project's term
loan balance is currently at approximately 85% of the initially
issued face amount, relative to Moody's original expectation of
achieving a 74% level by the end of 2022. The lower-than-expected
debt paydown increases the amounts to be refinanced at the 2025
Term Loan B maturity date.
That said, these weaknesses are offset by the Project's competitive
operating profile with a heat rate demonstrating levels
consistently at or below 6,900 Btu/kWh and as reflected in plant
availability and dispatch levels, with average annual availability
exceeding 90% and the plant achieving an average annual capacity
factor of approximately 65% to 70%. The Project has highly
efficient combined-cycle generating technology and its location in
the capacity constrained EMAAC region of PJM positions it to
benefit from tightening capacity resources within the region over
the long run, particularly considering significant off-shore wind
power generation that is expected in New Jersey in the coming
years, which will have lower capacity value. While capacity prices
in EMAAC zone have historically cleared at a premium relative to
the PJM RTO clearing prices during the past several auctions,
Moody's expect this divergence to broaden given the significant
barriers to entry for new thermal units in New Jersey. The likely
increase in intermittency in its generation stack from additional
wind generation should also have a greater impact on power price
volatility from which the plant is positioned to benefit. The
rating also considers the Project's near-term hedge positions that
should lock in spark spreads and buffer its energy margins during
the upcoming peak winter months.
The rating also recognizes certain proactive measures taken by the
Project's owners and asset manager to preserve cash ahead of the
sizable capital outlays for its major maintenance triple overhaul
that occurred during the Spring of 2023. Additionally, the Project
made certain strategic purchases of RGGI related CO2 credits
associated with its hedges. While this use of cash limited the
Project's ability to repay its term debt during 2022, it
nonetheless enabled the Project to build a liquidity buffer for the
major maintenance outage related expenses in 2023.
The Project has adequate overall liquidity, supported by its $120
million revolving credit facility with a $25 million sublimit fully
available for working capital purposes, and $110 million of the
facility available for posting letters of credit in support of
collateral posting requirements including for hedging purposes.
The revolving credit facility matures in December 2023. The rating
action incorporates Moody's expectation that the current lenders
will extend the revolver prior to its maturity date. The rating
further reflects Moody's expectation that the Project will remain
in compliance with its financial covenants. Any signs of liquidity
duress or covenant non-compliance would place further downward
pressure on the rating.
RATING OUTLOOK
CPV Shore's negative outlook reflects the expectation for further
weakening of its cash flow and credit metrics in FY 2023, and
likely into FY 2024, owing to the continued impact of deteriorating
PJM BRA capacity pricing for EMAAC and a greater reliance on the
wholesale power market impacting its energy margins.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to an upgrade:
In view of the negative rating outlook, the rating currently has
limited prospects for an upgrade. The rating could stabilize should
the Project repay greater debt than expected enabling it to realize
financial metrics in line with the high B rating category including
debt-to-EBITDA of around 6.0x on a sustained basis.
Factors that could lead to a downgrade:
-- The rating could be downgraded if CPV Shore faces further
deteriorating power market pricing conditions during the latter
half of 2023 and going into 2024 or face operational performance
issues resulting in even a further deterioration of its credit
metrics, such that the Project's DSCR remains below 1.2x and/or the
debt-to-EBITDA ratio exceeds 8x on a sustained basis.
-- Should the maturing revolving credit facility not be extended
or is delayed.
-- Any signs of non-compliance with the financial covenants under
the Project's credit agreement.
PROFILE
CPV Shore owns Woodbridge Energy Center, a 725 MW combined cycle
electricity generating facility located in Woodbridge Township in
Middlesex County, New Jersey. CPV Shore is owned by affiliates of
CPV Power Holdings, LP, Toyota Tsusho Corporation, Osaka Gas Co.,
Ltd., and John Hancock Life Insurance Company.
The principal methodology used in these ratings was Power
Generation Projects published in June 2023.
CURITEC LLC: Wins Cash Collateral Access Thru Jan 2024
------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas,
Houston Division, authorized Curitec, LLC to use cash collateral on
an interim basis in accordance with its agreement with RGH
Enterprises, Inc., a wholly owned subsidiary of Cardinal Health,
Inc., through January 19, 2024.
Prior to the Petition Date, the Parties entered into one or more
agreements pursuant to which RGH provided medical supplies to the
Debtor for sale to the Debtor's customers.
Pursuant to one or more of the Agreements, RGH claims an interest
in the Debtor's cash collateral.
On April 27, 2022, RGH filed a UCC-1 Financing Statement, which
purported to perfect a security interest in the assets described
thereon, including all accounts and accounts receivable.
Following the Petition Date, the Parties have worked together in
good faith and at arm's-length to reach a consensual resolution
regarding the use of cash collateral.
Any interest of RGH in cash collateral is adequately protected by
virtue of the Debtor's use of cash collateral pursuant to the
Order.
As additional adequate protection for the post-petition use by the
Debtor of cash collateral in which RGH holds a valid and
enforceable interest, and to the extent of any diminution in RGH's
interests in the Debtor's cash collateral, RGH will be granted
security interests in and liens on the Debtor's post-petition
property and the proceeds thereof, with the same validity,
enforceability, and priority that it held in the Debtor's
prepetition property. Replacement Liens will only be granted in
property of the same type as any prepetition collateral of RGH to
the extent of any diminution in value, and will not extend to any
unencumbered assets.
In the event of a failure of adequate protection, RGH will have a
claim to the extent provided for under 11 U.S.C. section 507(b) and
the RGH Adequate Protection Claim will, if allowed, be granted in
pari passu status with any allowed claim of the Centers for
Medicare and Medicaid Services under section 507(b), pursuant to a
Stipulation and Agreed Order Regarding Suspension of Medicare
Payments to the Debtor by the United States Department of Health
and Human Services. Payment of any RGH Adequate Protection Claim
will be subordinate to the Carve Out.
The Carve Out includes (i) all money and property subject to a
valid and perfected lien; (ii) all ordinary course expenses owed or
owing to administrative creditors, including employees but other
than professional fees, in the amounts described in the Budget; and
(iii) amounts required to be paid, if any, to the Clerk of the
Court and to the Office of the U.S. Trustee pursuant to 28 U.S.C.
section 1930(a).
The final hearing on the matter is set for January 2, 2024.
A copy of the order is available at https://urlcurt.com/u?l=sK0BK9
from PacerMonitor.com.
About Curitec LLC
Curitec LLC -- https://curitec.com/ -- is a Medicare accredited
Part B provider of durable medical supplies (DMEPOS). Its services
include the delivery of advanced wound care products as well as
ostomy, urological, and tracheostomy supplies to long term care
facilities and hospice.
Curitec LLC filed a petition for relief under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Tex. Case No. 23-90108) on March 3,
2023. In the petition filed by Nicholas Percival as manager and
chief operating officer, the Debtor reported assets and liabilities
between $1 million and $10 million each.
The case is overseen by the Honorable Bankruptcy Judge Christopher
M. Lopez.
The Debtor is represented by Casey William Doherty, Jr, Esq., and
Samuel R. Maizel, Esq., at Dentons US LLP.
DARJEN INC: Seeks Cash Collateral Access
----------------------------------------
Darjen, Inc. asks the U.S. Bankruptcy Court for the Southern
District of Florida, West Palm Beach Division, for authority to use
cash collateral in accordance with the budget.
Clover Advantage Group and Titan Asset Purchasing hold security
interests in all of the Debtor's assets.
The estimated value of the cash collateral at the time of the
filing of the case was approximately $42,000.
The Debtor had issues with obtaining product. The Debtor borrowed
funds to keep its operations going. It now has a supplier who is
able to provide product regularly. The Debtor is generating
substantial income post-petition.
Currently, the Debtor expects to generate approximately $80,000 per
month in gross sales. The necessary expenses are approximately
$48,935.
As adequate protection, the Debtor proposes to pay $500 per month
to Clover and $1,500 per month to Titan Asset.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=vyRZLG from PacerMonitor.com.
The Debtor projects $80,000 in total sales and $478,935 in total
operating expenses.
About Darjen, Inc.
Darjen, Inc. owns and operates a compound pharmacy. The Debtor
sought protection under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. W.D. S.D. Fla. Case No. 23-17470-MAM) on September 18,
2023. In the petition signed by Michelle Notartomaso, president,
the Debtor disclosed up $50,000 in assets and up to $1 million in
liabilities.
Brian K. McMahon, Esq., at Brian K. McMahon, PA, represents the
Debtor as legal counsel.
DAWG'S SPORTS: Court OKs Cash Collateral Access on Final Basis
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Pennsylvania
authorized Dawg's Sports Bar & Grill, LLC to use cash collateral on
a final basis in accordance with the budget, with a 10% variance.
NFS Leasing, Inc. is a secured creditor herein and has allowed
claims as of the Petition Date in the amount of $266,602.
The court said the pre-petition liens of any creditor, including
NFS, with an interest in cash collateral will continue
post-petition as replacement liens, but said liens will not be
greater post-petition than the value of their lien at the inception
of the Chapter 11 case.
The Debtor will make adequate protection payments to NFS in the
amount of $6,947 per month with the first payment due on or before
September 20, 2023 and subsequent monthly payments being due on or
before the 20th of each following month and said payments will
continue until further Order of the Court.
The Debtor's use of NFS's cash collateral is further conditioned
upon a) the Debtor filing a plan of reorganization by not later
than November 30, 2023. The Debtor's failure to file a plan of
reorganization on or before the Plan Date will be a default of the
Order and NFS will have the right but not the obligation to declare
such default and exercise its remedies.
A copy of the order is available at https://urlcurt.com/u?l=IwI8pv
from PacerMonitor.com.
About Dawg's Sports Bar & Grill, LLC
Dawg's Sports Bar & Grill, LLC sought protection for relief under
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Pa. Case No.
23-21874) on Sep. 1, 2023, listing $50,001 to $100,000 in assets
and $500,001 to $1 million in liabilities.
Judge Gregory L. Taddonio oversees the case.
Christopher M. Frye, Esq. at Steidl & Steinberg represents the
Debtor as counsel.
DEADWORDS BREWING: Files Emergency Bid to Use Cash Collateral
-------------------------------------------------------------
Deadwords Brewing Company, 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 Celtic Bank
Corporation and Toast Capital, LLC, as loan servicer for WebBank.
The Debtor requires the use of cash collateral to fund ordinary
business operations and necessary expenses in accordance with the
cash budget.
Prior to the Petition Date, the Debtor obtained financing from
Celtic and Toast, which obligations are purportedly secured by a
lien on the Debtor's cash and/or cash equivalents. Celtic may
assert a first priority security interest in the Debtor's cash and
cash equivalents by virtue of a UCC-1 Financing Statement filed
with the State of Florida on November 27, 2020.
In addition, there may be other parties that assert their interest
in the Debtor's cash equivalents, including Toast, which interests
are inferior to Celtic.
The cash collateral the Debtor seeks to use is comprised of cash on
hand and funds to be received during normal operations which may be
encumbered by the liens of Celtic and Toast.
As adequate protection for the use of cash collateral, the Debtor
proposes to grant Celtic and Toast replacement liens on its
post-petition cash collateral to the same extent, priority, and
validity as their pre-petition lien(s), to the extent its use of
cash collateral results in a decrease in value of their interest in
the cash collateral. As demonstrated by the Budget, the Debtor will
continue to operate on a positive cash flow basis during the
interim eight-week period. As such, 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 cash
collateral.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=mkjXGN from PacerMonitor.com.
The Debtor projects total expenses, on a weekly basis, as follows:
$17,863 for the week of October 16, 2023;
$15,763 for the week of October 23, 2023; and
$28,809 for the week of October 30, 2023.
About Deadwords Brewing Company LLC
Deadwords Brewing Company LLC is a craft brewpub operating in the
Parramore District of Downtown Orlando.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Fla. Case No. 23-04117) on October 2,
2023. In the petition signed by James D. Satterfield, managing
member, the Debtor disclosed up to $1 million in assets and up to
$10 million in liabilities.
Daniel A. Velasquez, Esq., at Latham Luna Eden & Beaudine LLP,
represents the Debtor as legal counsel.
DIMITRI VLAHAKIS: Pledged Interests Up for Sale on October 26
-------------------------------------------------------------
In accordance with applicable provisions of the Uniform Commercial
Code as enacted in New York, by virtue of certain events of default
under certain pledged and security agreement dated as of Oct. 21,
2020 ("pledge agreements"), executed and delivered by Dimitri
Vlahakis and Zenova Vlahakis ("pledgor"), and in accordance with
its rights as holder of the security, Maguire Bay Ridge LLC
("secured party"), by virtue of possession of the certain share
certificates held in accordance with Article 8 of the Uniform
Commercial Code of the State of New York, and by virtue of the
certain UCC-1 Filing Statement made in favor of the Secured Party,
all in accordance with Article 9 of the Code, Secured Party will
offer for sale, at public auction, (i) all of pledgor's respective
right, title, and interest inn and to the following: (i) 181 79th
Realty LLC, 901 73rd Street LLC, 7506 Fifth Avenue LLC ("pledged
entities"), and (ii) certain related rights and property.
The Secured Party's understanding is that the principal assets of
the pledged entities is that certain fee interest in the premise
located at 1818 79th Street, Brooklyn, New York 11214, 901 73rd
Street, Brooklyn, New York 11228, and 7506 Fifth Avenue, Brooklyn,
New York 11209 ("property").
Mannion Auctions LLC, under the direction of Matthew D. Mannion,
will conduct a public sale consisting of the collateral vial online
bidding on Oct. 26, 2023, at 2:30 p.m., in satisfaction of an
indebtedness in the approximate amount of $13,485,396.83 including
principal, interest on principal, and reasonable fees and costs,
plus default interest through Oct. 26, 2023, 2023 subject to open
charges and all additional costs, fees and disbursements permitted
by law. The Secured Party reserves the right to credit bid.
Online bidding will be made available via Zoom Meeting: Meeting
link:
https://us06web.zoom.us/j/89833826812?pwd=ejd0bkFNYm9aclo1RWhldlJVaFVvZz09,
Meeting ID: 898 3382 6812, Passcode: 485874. One Tap Mobile:
+16465588656,,89833826812#,,,,*485874# US (New York)
+16469313860,,89833826812#,,,,*485874# US Dial by your location: +
1 646 931 3860 US.
Interested parties who intend to bid on the collateral must contact
DJ Johnston at B6 Real Estate Advisors, 355 Lexington Avenue, 3rd
Floor, New York, New York 10016, (646) 933-2619,
djohnston@b6realestate.com, to receive the terms and conditions of
sale and bidding instructions by Oct. 24, 2023 by 4:00 p.m. Upon
Execution of a standard confidentiality and non-disclosure
agreement, additional documentation and information will be
available. Interested parties who do not contact Johnston and
qualify prior to the sale will not be permitted to enter bid.
DIOCESE OF SAN FRANCISCO: UST Wants Tougher Chapter 11 Fees Cap
---------------------------------------------------------------
Alex Wittenberg of Law360 reports that the U.S. Trustee's Office
asked a California bankruptcy judge to reject professional fee
procedures proposed by the Roman Catholic Diocese of San Francisco,
calling the $180,000 monthly fee cap excessive and the disclosures
inadequate.
About San Francisco Archdiocese
The Roman Catholic Archbishop of San Francisco, Archdiocese of San
Francisco, is a tax exempt religious organisation. The Archdiocese
of San Francisco is a Latin Church ecclesiastical territory or
diocese of the Catholic Church in the northern California region of
the United States. The Archdiocese of San Francisco was erected on
July 29, 1853, by Pope Pius IX and its cathedral is the Cathedral
of Saint Mary of the Assumption.
The Archdiocese sought relief under Chapter 11 of the Bankruptcy
Code (Bankr. N.D. Cal. Case No. 23-30564) on Aug. 21, 2023. In the
petition filed by Fr. Patrick Summerhays as vicar general and
moderator of the Curia, the Archdiocese reported $100 million to
$500 million in assets and liabilities.
The Hon. Dennis Montali oversees the case.
The Debtor tapped Feldserstein Fitzgerald Willoughby as counsel.
DOYLESTOWN HOSPITAL: Moody's Affirms 'B3' Rating on Revenue Bond
----------------------------------------------------------------
Moody's Investors Service has affirmed Doylestown Hospital's B3
revenue bond rating. The outlook has been revised to stable from
negative. There will be approximately $170 million of debt
outstanding.
RATINGS RATIONALE
The affirmation of the B3 assumes Doylestown's ongoing clearance to
its financial covenants given negotiation of lower thresholds with
step up provisions through calendar 2024.The affirmation also
reflects the sale of its long term care facility which will lower
operating losses going forward and also provided an infusion of
cash that allowed for the repayment of a portion of debt. Moreover,
management has implemented performance improvement initiatives and
engaged consultants which will continue to drive month over month
rebuild of operating performance. That said, operating cash flow
(OCF) will remain very weak and liquidity will remain a key credit
challenge as a result. Moody's continue to view the hospital's
leading market position, including collaboration with other
community and academic health systems, in a favorable service area
of Bucks County as a credit strength, however, competition is
increasing with larger providers in the surrounding areas.
Doylestown also benefits from low exposure to Medicaid, which
reduces its reliance on governmental payors.
RATING OUTLOOK
The revision of the outlook to stable acknowledges clearance to
financial covenants and improvement in cash and cash flow which
will be sustained.
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS
-- Increased headroom to financial covenants
-- Consistent and sustainable improvement in OCF margins to at
least 5%
-- An improvement in cash on hand to 100 days and cash to debt to
approximately 80%
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS
-- Decreased headroom to financial covenants
-- Inability to maintain current levels of operating performance
of roughly 2% OCF margin
-- A decline in cash on hand to below 75 days
LEGAL SECURITY
The bonds are secured by a lien and security interest in Doylestown
Hospital's Pledged Revenues, a mortgage on the Hospital's acute
care facility, and as it relates to the Series 2013A, Series 2016A
Bonds and Series 2019A and 2019B Bonds revenues of the Foundation
pursuant to the guaranty agreement. However, in the case of the
Series 2013B Bonds, the Foundation has been joined as a co-obligor
along with Doylestown Hospital. Regardless, all outstanding debt is
secured on parity.
Doylestown has cleared all financial covenants for June 30, 2023.
The system has also worked with its lender to amend covenants,
including: 1) an amendment to eliminate the covenant test
measurement date of December 31, 2022, which demonstrates debt
compliance; 2) a second amendment beginning with the measurement
date of March 31, 2023 that waived the March 31, 2023 days cash on
hand covenant and adjusts financial covenants downward through
December 31, 2024.
The most restrictive financial covenants are under the bond
purchase and bank covenants agreement related to the Series 2013B
bonds (not rated) and include lender required maintenance of a
minimum cash on hand measured against the obligated group
semi-annually as follows: 60 days for June 30, 2023, 75 days for
December 31, 2023 and June 30, 2024, 90 days for December 31, 2024
and 100 days thereafter. In addition, the bank introduced a new
covenant requirement to maintain cash on hand at the system level
(measured semi-annually) of 60 days through June 30, 2024 and 75
days thereafter. The obligated group must also maintain 1.1x debt
service coverage measured quarterly on a trailing four quarter
basis which steps up to 1.35x beginning June 30, 2024. The
obligated group must also maintain less than 65% debt to
capitalization (measured semiannually). Covenants under the loan
agreement and bond indenture include maintenance of a minimum 1.1x
annual debt service coverage measured annually.
Failure to meet financial covenants could trigger an event of
default (EOD) and potential immediate acceleration if the lender
directs the Trustee to accelerate the bonds. Should that occur, the
Trustee would have the option, due to the EOD under the Trust
Agreement, to accelerate Doylestown's publicly issued Bonds, and
would be forced to accelerate if at least 25% of public bondholders
requested it. There is no cure period under the bank documents.
Under the loan agreement, which governs Doylestown's rated debt, a
violation of a financial covenant would only constitute an EOD if
the EOD cannot be corrected within a 30-day period following notice
to the Hospital and if it's not corrected during the 30-day cure
period, the hospital fails to institute corrective action until the
EOD is corrected.
PROFILE
With total annual revenue of approximately $416 million (for the
entire system) as of FYE 2023, Doylestown Hospital operates
community focused healthcare facilities serving patients in the
northern suburban communities of Philadelphia, including Bucks and
Montgomery counties in Pennsylvania and the town of Lambertville in
New Jersey.
METHODOLOGY
The principal methodology used in these ratings was Not-For-Profit
Healthcare published in December 2018.
EKSO BIONICS: Falls Short of Nasdaq Listing Requirement
-------------------------------------------------------
Ekso Bionics Holdings, Inc. disclosed in a Form 8-K Report filed
with the Securities and Exchange Commission that on September 29,
2023, the Company disclosed that it received a written notice from
the Nasdaq Listing Qualifications staff of The Nasdaq Stock Market
LLC indicating that, for the last 30 consecutive business days, the
minimum bid price of the Company's common stock had been below the
$1.00 per share minimum requirement for continued listing on the
Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2).
In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company
has been provided an initial period of 180 calendar days, or until
March 27, 2024, to regain compliance with the Minimum Bid Price
Requirement.
The Notice states that the Nasdaq staff will provide written
notification that the Company has achieved compliance with Rule
5550(a)(2) if, at any time before March 27, 2024, the closing bid
price of the Company's common stock is $1.00 per share or more for
a minimum of ten consecutive business days. The Notice has no
immediate effect on the listing or trading of the Company's common
stock.
In the event the Company does not regain compliance with the
Minimum Bid Price Requirement by March 27, 2024, the Company may be
eligible for additional time to regain compliance. 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 Minimum Bid Price Requirement. The Company will also 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. If the Company meets these requirements, the
Company will be granted an additional 180 calendar days to regain
compliance. If the Company does not qualify for or fails to regain
compliance during the second compliance period, then the Nasdaq
staff will provide written notification to the Company that its
common stock will be subject to delisting. The Company would then
be entitled to appeal that determination to a Nasdaq hearings
panel.
The Company intends to actively monitor the closing bid price of
its common stock and may, if appropriate, consider available
options to regain compliance with the Minimum Bid Price
Requirement.
There can be no assurance that the Company will regain compliance
with the Minimum Bid Price Requirement during the 180-day
compliance period ending March 27, 2024, secure an extension of the
compliance period beyond March 27, 2024, or maintain compliance
with any other Nasdaq listing requirements.
About Ekso Bionics
Ekso Bionics Holdings, Inc. -- https://www.eksobionics.com -- is a
developer of exoskeleton solutions that amplify human potential by
supporting or enhancing strength, endurance, and mobility across
medical and industrial applications. Founded in 2005, the Company
continues to build upon its industry-leading expertise to design
some of the most cutting-edge, innovative wearable robots available
on the market.
Ekso Bionics reported a net loss of $15.08 million in 2022, a net
loss of $9.76 million in 2021, a net loss of $15.83 million in
2020, a net loss of $12.13 million in 2019, and a net loss of
$26.99 million in 2018. As of March 31, 2023, the Company had
$37.10 million in total assets, $15.82 million in total
liabilities, and $21.28 million in total stockholders' equity.
As of March 31, 2023, the Company had an accumulated deficit of
$228,336,000. Largely as a result of significant research and
development activities related to the development of the Company's
advanced technology and commercialization of such technology into
its medical device business, the Company has incurred significant
operating losses and negative cash flows from operations since
inception. In the three months ended March 31, 2023, the Company
used $4,214,000 of cash in its operations. Cash on hand as of March
31, 2023 was $16,277,000.
Notes payable, net, borrowings under the Company's secured term
loan agreement with Pacific Western Bank have a liquidity covenant
requiring minimum cash on hand equivalent to the current
outstanding principal balance. As of March 31, 2023, $2,000,000 of
cash must remain as restricted. After considering cash
restrictions, effective unrestricted cash as of March 31, 2023 is
approximately $14,277,000.
"Our expectation to generate operating losses and negative
operating cash flows in the future and the need for additional
funding to support our planned operations raise substantial doubt
regarding our ability to continue as a going concern," the Company
said. Management intends to raise funds through one or more
financings. However, due to several factors, including those
outside management's control, there can be no assurance that the
Company will be able to complete those financings on acceptable
terms or in amounts sufficient to continue operating the business
under the operating plan. "If we are unable to complete sufficient
additional financings, management's plans include delaying or
abandoning certain product development projects, cost reduction
efforts for our products, and refocused sales efforts to accelerate
revenue growth above historical results. We have concluded the
likelihood that our plan to successfully reduce expenses to align
with our available cash is probable. Accordingly, we believe our
plan will be sufficient to alleviate substantial doubt for a period
of at least 12 months...."
EKSO BIONICS: Parker-Hannifin Pays $700,000 over Warranty Release
-----------------------------------------------------------------
Ekso Bionics Holdings, Inc. disclosed in a Form 8-K Report filed
with the Securities and Exchange Commission that the Company
entered into a Warranty Claim Lump Summary Agreement with
Parker-Hannifin Corporation. Under the terms of the agreement,
among other things, Parker-Hannifin paid the Company $700,000 for
the release of Parker-Hannifin's obligation to reimburse the
Company for its costs and expenses associated with certain product
warranty obligations. This payment was made under an Asset Purchase
Agreement between the Company and Parker-Hannifin.
About Ekso Bionics
Ekso Bionics Holdings, Inc. -- https://www.eksobionics.com -- is a
developer of exoskeleton solutions that amplify human potential by
supporting or enhancing strength, endurance, and mobility across
medical and industrial applications. Founded in 2005, the Company
continues to build upon its industry-leading expertise to design
some of the most cutting-edge, innovative wearable robots available
on the market.
Ekso Bionics reported a net loss of $15.08 million in 2022, a net
loss of $9.76 million in 2021, a net loss of $15.83 million in
2020, a net loss of $12.13 million in 2019, and a net loss of
$26.99 million in 2018. As of March 31, 2023, the Company had
$37.10 million in total assets, $15.82 million in total
liabilities, and $21.28 million in total stockholders' equity.
As of March 31, 2023, the Company had an accumulated deficit of
$228,336,000. Largely as a result of significant research and
development activities related to the development of the Company's
advanced technology and commercialization of such technology into
its medical device business, the Company has incurred significant
operating losses and negative cash flows from operations since
inception. In the three months ended March 31, 2023, the Company
used $4,214,000 of cash in its operations. Cash on hand as of March
31, 2023 was $16,277,000.
Notes payable, net, borrowings under the Company's secured term
loan agreement with Pacific Western Bank have a liquidity covenant
requiring minimum cash on hand equivalent to the current
outstanding principal balance. As of March 31, 2023, $2,000,000 of
cash must remain as restricted. After considering cash
restrictions, effective unrestricted cash as of March 31, 2023 is
approximately $14,277,000.
"Our expectation to generate operating losses and negative
operating cash flows in the future and the need for additional
funding to support our planned operations raise substantial doubt
regarding our ability to continue as a going concern," the Company
said. Management intends to raise funds through one or more
financings. However, due to several factors, including those
outside management's control, there can be no assurance that the
Company will be able to complete those financings on acceptable
terms or in amounts sufficient to continue operating the business
under the operating plan. "If we are unable to complete sufficient
additional financings, management's plans include delaying or
abandoning certain product development projects, cost reduction
efforts for our products, and refocused sales efforts to accelerate
revenue growth above historical results. We have concluded the
likelihood that our plan to successfully reduce expenses to align
with our available cash is probable. Accordingly, we believe our
plan will be sufficient to alleviate substantial doubt for a period
of at least 12 months...."
ENCORE CAPITAL: Moody's Rates EUR100MM Sr. Secured Debt 'Ba2'
-------------------------------------------------------------
Moody's Investors Service has assigned a Ba2 backed senior secured
debt rating to Encore Capital Group, Inc.'s EUR100 million tap
issuance and affirmed the Ba2 debt ratings on the existing backed
senior secured notes. Other ratings and the outlook of the group
are unaffected by this rating action
RATINGS RATIONALE
The EUR100 million tap issuance will be fungible with the existing
EUR415 million Ba2 rated backed senior secured Floating Rate Notes
due 2028 and will be pari-passu with Encore's other outstanding
backed senior secured debt which includes EUR350 million and GBP300
million Senior Secured Notes due 2025 and 2026, respectively, and
GBP250 million Senior Secured Notes due 2028. The entire proceeds
of the new issuance will be used to pay down the Revolving Credit
Facility due 2027, which had a credit limit of $1.18 billion and an
outstanding amount of $851million as of June 2023. The incremental
issuance and the existing backed senior secured notes are
subordinated to the Revolving Credit Facility and the Private
Placement Notes due 2024.
The increase in the amount of the backed senior secured debt as a
result of the new issuance does not result in a material change in
expected loss of the existing rated debt, according to the
priorities of claims and asset coverage within the proposed
liability structure. Furthermore, the issuance will not impact
Encore's leverage due to the use of the proceeds to pay down an
equivalent amount of the revolving credit facility. Moody's expects
Encore's Debt/EBITDA leverage to remain elevated as portfolio
purchases are financed by increased levels of debt. However, as
revenues and collections grow, Moody's expects leverage to reduce
and remain within the company's maximum leverage guidance of 3x and
for interest coverage to improve from current levels.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade or downgrade of Encore's CFR would lead to a similar
upward or downward change in the backed senior secured debt
ratings. Further, the backed senior secured debt ratings could be
upgraded with changes to the liability structure that decreased the
amount of debt considered senior to the notes or increased the
amount of debt considered junior to the notes. The debt rating
could be downgraded if the amount of debt considered senior to the
notes increases.
PRINCIPAL METHODOLOGY
The principal methodology used in this rating was Finance Companies
Methodology published in November 2019.
ENVISION HEALTHCARE: Bankruptcy Court Confirms Reorganization Plan
------------------------------------------------------------------
Envision Healthcare Corporation on Oct. 11, 2023, disclosed that
the U.S. Bankruptcy Court for the Southern District of Texas,
Houston Division has confirmed its Plans of Reorganization (the
"Confirmed Plans").
Under the terms of the Confirmed Plans, which were approved at a
hearing on October 11, 2023, Envision will eliminate 70 percent of
its prepetition funded debt. Importantly, the Confirmed Plans
ensure that Envision and AMSURG will remain strong partners to
their valued clinicians, physician partners, clients, vendors and
suppliers following the reorganization.
"I am pleased to have reached an agreement with our key
stakeholders and look forward to emerging from Chapter 11 in the
coming weeks," said Envision Healthcare CEO Jim Rechtin. "The
Confirmed Plans allow Envision to emerge from the process in a
strong position to navigate the current healthcare environment and
take advantage of future opportunities to grow while continuing to
deliver high quality care to patients when they need it most. On
behalf of our leadership team, I give my deepest gratitude to our
clinicians, teammates, hospital partners, vendors and creditors for
working through this process."
Upon emergence in the coming weeks, Envision Healthcare and AMSURG
will be separated into two stand-alone entities with separate
leadership teams and owner groups. "I appreciate the collaboration
with Envision leaders that has brought us to this point," said
AMSURG President Jeff Snodgrass. "We have built strong momentum as
an organization that will propel our path to growth. I look forward
to AMSURG's next chapter and am grateful for the efforts of our
teams, centers and physician partners that drive our success."
The organization anticipates finalizing definitive transaction
documents to consummate the Confirmed Plans over the coming weeks,
subject to customary closing procedures and conditions. Envision
anticipates emergence from Chapter 11 proceedings by the end of
October 2023.
Advisors
Kirkland & Ellis LLP is acting as legal counsel, Alvarez & Marsal
LLC is acting as financial advisor, and PJT Partners LP is acting
as investment banker to the organization in connection with the
restructuring.
About Envision Healthcare Corporation
Envision Healthcare Corporation -- http://www.EnvisionHealth.com/
-- is a national medical group that delivers physician and advanced
practice provider services, primarily in the areas of emergency and
hospitalist medicine, anesthesiology, radiology, teleradiology and
neonatology. As a leader in ambulatory surgical care, AMSURG holds
ownership in more than 250 surgery centers in 41 states and the
District of Columbia, with medical specialties ranging from
gastroenterology to ophthalmology and orthopedics. In total, the
medical group offers a differentiated suite of clinical solutions
on a national scale with a local understanding of communities,
creating value for health systems, payers, providers and patients.
On May 15, 2023, Envision and affiliates filed voluntary petitions
for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D.
Texas Lead Case No. 23-90342). Envision reported $1 billion to $10
billion in both assets and liabilities.
Judge Christopher M. Lopez oversees the cases.
The Debtors tapped Kirkland & Ellis, LLP and Kirkland & Ellis
International, LLP as bankruptcy counsels; Jackson Walker, LLP as
conflict counsel and co-counsel with Kirkland & Ellis; Alvarez &
Marsal North America, LLC as restructuring advisor; PJT Partners,
LP as investment banker; and KPMG, LLP as tax consultant. Kroll
Restructuring Administration, 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 Debtors' Chapter 11 cases.
The committee tapped White & Case, LLP as legal counsel and Force
Ten Partners, LLC as financial advisor.
EXELA TECHNOLOGIES: CFO Quits; Interim Replacement Named
--------------------------------------------------------
Shrikant Sortur notified Exela Technologies, Inc. of his
resignation as chief financial officer of the Company effective
Oct. 2, 2023.
Mr. Sortur's resignation was for personal reasons and was not a
result of any disagreement on any matter relating to the Company's
operations, policies or procedures, according to a Form 8-K filed
by the Company with the Securities and Exchange Commission. Mr.
Sortur has agreed to act as a consultant to the Company to assist
with the transition of his duties.
On Oct. 2, 2023, Matthew Brown, the president of the Company's
subsidiary, ETI-MNA, LLC, was appointed as the Company's interim
chief financial officer. Mr. Brown, age 37, has managed all
aspects of the various transactions and integrations that built the
Company. Mr. Brown has served in increasing roles of responsibility
in the corporate and business strategy departments since the
Company's 2017 business combination, including as Global Head of
Business Strategy from 2017 to 2022, and President of ETI-MNA, the
Company's portfolio manager, since 2022. Prior to Exela, Mr. Brown
served as senior vice president for HandsOn Global Management, LLC,
which he joined in 2007. Mr. Brown earned his Bachelor of Science
in Electrical Engineering from the University of California, San
Diego, where he graduated Summa Cum Laude.
At this time, any compensation adjustments in connection with Mr.
Brown's appointment as the Company's interim chief financial
officer have not been determined. The Company will disclose any
compensation adjustment made in connection with this appointment as
required.
About Exela Technologies LLC
Headquartered in Irving, Texas, Exela Technologies --
www.exelatech.com -- is a global provider of transaction processing
solutions, enterprise information management, document management
and digital business process services.
Exela reported a net loss of $415.58 million in 2022, a net loss of
$142.39 million in 2021, and a net loss of $178.53 million in 2020.
As of Dec. 31, 2022, the Company had $721.91 million in total
assets, $1.53 billion in total liabilities, and a total
stockholders' deficit of $807.59 million.
Detroit, Michigan-based KPMG LLP, the Company's auditor since 2013,
issued a "going concern" qualification in its report dated April 3,
2023, citing that the Company has a history of net losses, net
operating cash outflows, working capital deficits, significant cash
payments for interest on long-term debt, and significant current
maturities of long-term debt that raise substantial doubt about its
ability to continue as a going concern.
* * *
As reported by the TCR on Aug. 24, 2023, S&P Global Ratings raised
its issuer credit rating on Exela Technologies Inc. to 'CCC' from
'SD' (selective default). S&P said, "Despite improving revenue
trends and cost savings, we forecast limited liquidity cushion in
January and July of 2024.
FR-AM TWO: Voluntary Chapter 11 Case Summary
--------------------------------------------
Four affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
FR-AM Two LLC 23-73775
64 West End Road
East Hampton, NY 11937
432 FF&E Mezz LLC 23-73776
64 West End Road
East Hampton, NY 11937
432 FF&E LLC 23-73777
64 West End Road
East Hampton, NY 11937
FR-AM One LLC 23-73778
64 West End Road
East Hampton, NY 11937
Business Description: FR-AM Two and 432 Mezz are stock holding
companies, holding the 100% membership
interests in FR-AM One and 432 FF&E LLC (432
Owner). In turn, FR-AM One, along with 432
Owner, together own three luxury apartments
in the building at 432 Park Avenue, New
York, NY identified as units 78B and 28H
(owned by FR-AM One) and 78A (owned by 432
Owner).
Chapter 11 Petition Date: October 11, 2023
Court: United States Bankruptcy Court
Eastern District of New York
Judge: Hon. Robert E. Grossman
Debtors' Counsel: Kevin Nash, Esq.
GOLDBERG WEPRIN FINKEL GOLDSTEIN LLP
125 Park Ave
New York, NY 10017-5690
Email: knash@gwfglaw.com
Each Debtor's
Estimated Assets: $50 million to $100 million
Each Debtor's
Estimated Liabilities: $50 million to $100 million
The petitions were signed by Harry Macklowe as manager.
The Debtors failed to include in the petitions lists of their 20
largest unsecured creditors.
Full-text copies of the petitions are available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/RRLSNQA/FR-AM_Two_LLC__nyebke-23-73775__0001.0.pdf?mcid=tGE4TAMA
https://www.pacermonitor.com/view/R4YRN4I/432_FFE_Mezz_LLC__nyebke-23-73776__0001.0.pdf?mcid=tGE4TAMA
https://www.pacermonitor.com/view/RY6ED5I/432_FFE_LLC__nyebke-23-73777__0001.0.pdf?mcid=tGE4TAMA
https://www.pacermonitor.com/view/QRTEVGI/FR-AM_One_LLC__nyebke-23-73778__0001.0.pdf?mcid=tGE4TAMA
FRONTLINE MACHINING: Case Summary & 20 Top Unsecured Creditors
--------------------------------------------------------------
Debtor: Frontline Machining, LLC
14040 Meridian Parkway
Riverside, CA 92518
Business Description: Frontline Machining is a machine shop
located in Riverside CA specializing in
difficult materials and complex parts in the
space, medical, and defense industries.
Chapter 11 Petition Date: October 11, 2023
Court: United States Bankruptcy Court
Central District of California
Case No.: 23-14710
Debtor's Counsel: Andrew Bisom, Esq.
LAW OFFICE OF ANDREW S. BISOM
300 Spectrum Center Drive, Ste. 1575
Irvine, CA 92618
Tel: (714) 643-8900
Email: abisom@bisomlaw.com
Total Assets: $111,500
Total Liabilities: $2,599,063
The petition was signed by Charles Jones as managing member.
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/2VNN3UA/Frontline_Machining_LLC__cacbke-23-14710__0001.0.pdf?mcid=tGE4TAMA
FTX GROUP: Auditor Sued by SEC for Independence Rules Violation
---------------------------------------------------------------
Katryna Perera of Law360 reports that the U.S. Securities and
Exchange Commission filed a lawsuit Friday, September 29, 2023, in
Florida federal court against an accounting firm that audited FTX
prior to the cryptocurrency exchange's high-profile bankruptcy,
accusing it of conducting several audits, examinations and reviews
between 2017 and 2020 that failed to comply with auditor
independence rules.
About FTX Group
FTX is the world's second-largest cryptocurrency firm. FTX is a
cryptocurrency exchange built by traders, for traders. FTX offers
innovative products including industry-first derivatives, options,
volatility products and leveraged tokens.
Then CEO and co-founder Sam Bankman-Fried said Nov. 10, 2022, that
FTX paused customer withdrawals after it was hit with roughly $5
billion worth of withdrawal requests.
Faced with liquidity issues, FTX on Nov. 9 struck a deal to sell
itself to its giant rival Binance, but Binance walked away from the
deal amid reports on FTX regarding mishandled customer funds and
alleged US agency investigations.
At 4:30 a.m. on Nov. 11, Bankman-Fried ultimately agreed to step
aside, and restructuring vet John J. Ray III was quickly named new
CEO.
FTX Trading Ltd (d/b/a FTX.com), West Realm Shires Services Inc.
(d/b/a FTX US), Alameda Research Ltd. and certain affiliated
companies then commenced Chapter 11 proceedings (Bankr. D. Del.
Lead Case No. 22-11068) on an emergency basis on Nov. 11, 2022.
Additional entities sought Chapter 11 protection on Nov. 14, 2022.
FTX Trading and its affiliates each listed $10 billion to $50
million in assets and liabilities, making FTX the biggest
bankruptcy filer in the US this year.
According to Reuters, SBF shared a document with investors on Nov.
10, 2022, showing FTX had $13.86 billion in liabilities and $14.6
billion in assets. However, only $900 million of those assets were
liquid, leading to the cash crunch that ended with the company
filing for bankruptcy.
The Hon. John T. Dorsey is the case judge.
The Debtors tapped Sullivan & Cromwell, LLP as bankruptcy counsel;
Landis Rath & Cobb, LLP as local counsel; and Alvarez & Marsal
North America, LLC as financial advisor. Kroll is the claims agent,
maintaining the page
https://cases.ra.kroll.com/FTX/Home-Index
The Official Committee of Unsecured Creditors tapped Paul Hastings
as counsel, FTI Consulting, Inc., as financial advisor, and
Jefferies LLC as the investment banker. Young Conaway Stargatt &
Taylor LLP is the Committee's Delaware and conflicts counsel.
Montgomery McCracken Walker & Rhoads LLP, led by partners Gregory
T. Donilon, Edward L. Schnitzer, and David M. Banker, is
representing Sam Bankman-Fried in the Chapter 11 cases.
White-collar crime specialist Mark S. Cohen has reportedly been
hired to represent SBF in litigation. Lawyers at Paul Weiss
previously represented SBF but later renounced representing the
entrepreneur due to a conflict of interest.
GARCIA GRAIN: Court OKs $800,000 DIP Loan from GrainChain
---------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas,
McAllen Division, authorized Garcia Grain Trading Corp. to use cash
collateral and obtain postpetition financing, on an interim basis.
GrainChain, Inc. has agreed to extend a $800,000 credit facility to
the Debtor for the purchase of bean inventory via a factoring
agreement.
The loan is conditioned on Vantage Bank Texas releasing its liens
to GrainChain's satisfaction, in a form acceptable to Vantage, as
to the bean inventory, bean related receivables, and proceeds
derived from the sale of beans upon the Debtor's payment of
$400,000 out of the PACA Reserve Account and an additional $225,000
from its Bean Enterprise Account for a total sum of $625,000,
The Debtor has been purchasing black beans from Stony Ridge Food,
Inc. in accordance with pre-petition supply contracts and timely
payments, as per the protocol established by the Court's prior
order. The Debtor has also used cash collateral from pre-petition
bean receivables, the sale of bean inventory, and above the PACA
Reserve Account minimum to protect Vantage Bank Texas. However, the
Court Order's restrictions have hampered the Debtor's ability to
meet demand for beans from customers in Mexico. The Debtor seeks
relief by buying out existing liens of Vantage against the bean
enterprise for $625,000, including specific terms for the treatment
of liens the bank holds against various tracts of real estate held
as collateral.
The Debtor filed a motion for authority to accept executionary
contracts for the purchase and sale of edible beans and sunflower
seeds. The Court granted the motion and granted the Debtor
authority to assume bean supply contracts with Stony Ridge. The
order required the Debtor to keep $400,000 in the PACA Reserve
Account and pay for beans within 5 days of the invoice date. The
Order allowed Vantage to issue a Notice of Default, and file it
with the Court, requesting the lifting of the automatic stay if the
total of the cash consisting of the PACA Reserve Account, the
balance in the Bean Enterprise Account plus the value of domestic
inventory fell below the total sum of $1 million.
Vantage agreed to accept $625,000 in exchange for release of
replacement liens and security interests against bean inventory,
accounts receivable, and proceeds. It must convey real property
assets free of liens and encumbrances in exchange for
extinguishment and release of claims against the estate. Vantage
also agreed to transfer claims against surety bonds required by the
Texas Department of Agriculture and issued by Harco National
Insurance Company total the penal sum of $2.5 million for the
payment of $400,000.
Vantage has filed an $8.789 million proof of claim in the case. The
bank has agreed to accept a release of its secured and unsecured
claims against the estate in exchange for the transfer or
foreclosure of the bank's lien on real estate having a total
estimated value of $6.3 million plus payment of an additional
$1.025 million in cash for a total release price of $7.325 million.
If this transaction is approved, Vantage will waive its unsecured
deficiency claim in the amount of $1.464 million.
Any amounts received by Vantage in excess of the Debtor's estimated
net proceeds from the sale of the Pitts Property, the Santa Rosa
Facility, or Donna/Val Verde Grain Facilities, and any lease
payments received prior to sale of those real properties, will be
retained by Vantage and will not decrease the amount of the cash
payment to Vantage of $1.025 million. If any monies received by
Vantage from the sale of the Pitts Property, the Santa Rosa
Facility, or Donna/Val Verde Grain Facilities is less than the
Debtor's estimated net proceeds from the sale of the real
properties, Vantage will not seek or claim any further monies from
the Debtor other than the cash payment to Vantage of $1.025
million.
A copy of the order is available at https://urlcurt.com/u?l=vNT2mc
from PacerMonitor.com.
About Garcia Grain Trading Corp.
Based in Donna, Texas, Garcia Grain Trading Corp.'s line of
business includes buying and marketing grain, dry beans, soybeans,
and inedible beans.
Garcia Grain Trading sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Texas Case No. 23-70028) on Feb. 17,
2023, with $10 million to $50 million in both assets and
liabilities. Octavio Garcia, chief executive officer and president,
signed the petition.
Judge Eduardo V. Rodriguez oversees the case.
David R. Langston, Esq., at Mullin Hoard & Brown, LLP represents
the Debtor as legal counsel.
The U.S. Trustee for Region 7 appointed an official committee to
represent unsecured creditors in the Debtor's Chapter 11 case.
Jordan & Ortiz, P.C. serves as the committee's legal counsel.
GETTYSBURG RENTAL: Wins Interim Cash Collateral Access
------------------------------------------------------
The U.S Bankruptcy Court for the Middle District of Pennsylvania
authorized Gettysburg Rental and Outdoor Power Equipment, LLC to
continue using cash collateral on an interim basis in accordance
with the budget.
Red Iron Acceptance, LLC, M&T Bank, Wells Fargo Commercial
Distribution Finance, LLC f/k/a/ GE Commercial Distribution Finance
Corporation, United States Small Business Administration, CAN
Capital, Inc., On Deck Capital, Inc., Surfside Capital, d/b/a
BizFund, LLC, E Advance Services, East Hudson Capital d/b/a Global
Funding Experts, and Forward Financing, LLC are granted replacement
liens in the Debtor's post-petition cash collateral consisting of
receivables, cash, and the proceeds thereof, and in all assets of
the Debtor to which the Lenders have liens and security interests
pre-petition, to the extent such liens exist and in such priority
as exists pre-petition, to the extent there is a diminution in
value of the Lenders' post-petition cash collateral position. The
liens will be perfected and effective without any further
recordation action.
In the event that post-petition cash collateral is insufficient to
provide an amount equal to such diminution, then the Lenders will
have super priority status pursuant to 11 U.S.C. Section 364(c)(1)
and have an administrative claims having priority over all other
administrative claims, including those set forth in 11 U.S.C.
Sections 503(b) or 507(a) except for amounts owed for fees to
professionals in the case and fees to the U.S. Trustee's Office,
which fees will be pari passu with the Lenders' administrative
claims.
The Debtor is authorized and directed to immediately turn over to
Wells Fargo any and all proceeds from the sale of any Financed
Inventory received on and after September 14, 2023. Wells Fargo
reserves it rights as to any and all proceeds from the sale of any
Financed Inventory received by the Debtor at any time prior to
September 14, 2023, and the Debtor does not dispute that Wells
Fargo is entitled to such proceeds.
With respect to inventory financed by Red Iron, the following
provisions provide additional adequate protection to Red Iron:
-- As adequate protection for the interests of Red Iron, the Debtor
will hold in trust for the benefit of Red Iron all proceeds for any
unit of Red Iron Financed Inventory.
-- The Debtor will maintain insurance coverage for the Red Iron
Inventory in accordance with the obligations under the loan and
security documents with Red Iron.
-- The Debtor is permitted to make adequate protection payments to
M&T Bank in the amount of $4,000 per month on account of the
following three secured loans: 4654-18 (SBA Term Loan), 4654-42
(Term Loan), 4654-59 (Line of Credit), without prejudice to M&T
Bank's right to seek different or other adequate protection in any
subsequent cash collateral order.
A final hearing on the matter is set for November 14, 2023 at 9:30
a.m.
A copy of the court's order is available at
https://urlcurt.com/u?l=8ex3E4 from PacerMonitor.com.
About Gettysburg Rental and Outdoor Power Equipment, LLC
Gettysburg Rental and Outdoor Power Equipment, LLC sought
protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr.
M.D. Pa. Case No. 1:23-bk-02095-HWV) on September 14, 2023. In the
petition signed by Gary DeCroes, member, the Debtor disclosed up
to $1 million in both assets and liabilities.
Judge Henry W. Van Eck oversees the case.
Brent C. Diefenderfer, Esq., at CGA Law Firm, represents the Debtor
as legal counsel.
GREENWAVE TECHNOLOGY: Falls Short of Nasdaq Bid Price Requirement
-----------------------------------------------------------------
Greenwave Technology Solutions, Inc. disclosed in a Form 8-K filed
with the Securities and Exchange Commission that on Oct. 3, 2023,
it received a letter from The Nasdaq Stock Market LLC indicating
that, for the last 30 consecutive business days, the bid price for
the Company's common stock had closed below the minimum $1.00 per
share requirement for continued listing on The Nasdaq Capital
Market under Nasdaq Listing Rule 5550(a)(2).
In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company
has been provided an initial period of 180 calendar days, or until
Nov. 13, 2023, to regain compliance. The letter states that the
Nasdaq staff will provide written notification that the Company has
achieved compliance with Rule 5550(a)(2) if at any time before Nov.
13, 2023, the bid price of the Company's common stock closes at
$1.00 per share or more for a minimum of 10 consecutive business
days. The Nasdaq Staff Deficiency Letter has no immediate effect
on the listing or trading of the Company's common stock.
The Company intends to monitor the bid price of its common stock
and consider available options if its common stock does not trade
at a level likely to result in the Company regaining compliance
with Nasdaq's minimum bid price rule by April 1, 2024.
If the Company does not regain compliance with Rule 5550(a)(2) by
April 1, 2024, 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 bid price
requirement, and would need to provide written notice of its
intention to cure the deficiency during the second compliance
period, for example, by effecting a reverse stock split, if
necessary. However, if it appears to the Nasdaq staff that the
Company will not be able to cure the deficiency, or if the Company
is otherwise not eligible, Nasdaq would notify the Company that its
securities would be subject to delisting. In the event of such a
notification, the Company may appeal the Nasdaq staff's
determination to delist its securities. There can be no assurance
that the Company will be eligible for the additional 180 calendar
day compliance period, if applicable, or that the Nasdaq staff
would grant the Company's request for continued listing subsequent
to any delisting notification.
About Greenwave
Headquartered in Chesapeake, VA, Greenwave Technology Solutions,
Inc. -- https://www.greenwavetechnologysolutions.com -- through its
wholly owned subsidiary Empire Services, Inc. is an operator of
metal recycling facilities in Virginia and North Carolina. At
these facilities, Empire collects, classifies, and processes raw
scrap metal (ferrous and nonferrous) for recycling.
New York, NY-based RBSM LLP, the Company's auditor since 2017,
issued a "going concern" qualification in its report dated March
31, 2023, citing that the Company has an accumulated deficit, and
expects future losses that raise substantial doubt about the
Company's ability to continue as a going concern.
GRUPO HIMA: Court OKs $7MM DIP Loan from Alter Domus
----------------------------------------------------
The U.S. Bankruptcy Court for the District of Puerto Rico
authorized Grupo HIMA San Pablo, Inc. and affiliates to use cash
collateral and obtain postpetition financing, on an interim basis.
The Debtor is permitted to obtain senior secured postpetition
financing on a superpriority basis in the aggregate principal
amount of $7 million, pursuant to the terms and conditions of the
Debtor-in-Possession Credit Agreement, by and among the Debtors,
Alter Domus (US) LLC, as administrative agent and collateral
agent.
The DIP facility is due and payable through the earliest of (i) the
date that is six months following the closing date, (ii) the
effective date and the date of the substantial consummation of a
plan of reorganization that has been confirmed by Bankruptcy Court
order, (iii) the date the Bankruptcy Court orders the conversion of
the bankruptcy case of any of the Loan Parties to a Chapter 7
liquidation, (iv) the acceleration of the Loans or termination of
the Commitments under the Facility, including as a result of the
occurrence of an Event of Default, and (v) the date of consummation
of one or more sales that, in the aggregate, constitutes a sale of
all or substantially all of the DIP Collateral.
The Debtors are required to consummate a Company Sale no later than
160 days after the Petition Date.
Pursuant to the First Lien Credit Agreement, dated as of January
29, 2013, with Alter Domus (US) LLC, as administrative agent and
collateral agent, the Prepetition First Lien Lenders made available
to the Co-Borrowers, (a) Term Loans in an aggregate principal
amount not in excess of $149 million, and (b) Revolving Loans in an
aggregate principal amount at any time outstanding not in excess of
$14 million, all of which are ratified.
As of the Petition Date, the Loan Parties owed not less than $162
million in principal outstanding under the Prepetition First Lien
Loan, including $25.372 million of superpriority loans.
Pursuant to a Second Lien Credit Agreement, dated as of January 29,
2013, with Wilmington Trust, National Association as administrative
agent and collateral agent, the Prepetition Second Lien Lenders
made available to the Co-Borrowers a term loan in the principal
amount of $86 million. Each of the Guarantors provided an
unconditional joint and several guaranty of the Prepetition Second
Lien Obligations arising under the Prepetition Second Lien Loan
Documents.
As of the Petition Date, the Loan Parties owed not less than (i)
$86 million in principal outstanding under the Prepetition Second
Lien Loan plus (ii) accrued and unpaid interest with respect
thereto, fees, costs, and expenses, and all other Obligations under
the Prepetition Second Lien Loan Documents.
The Court ruled that the Prepetition First Lien Obligations of each
DIP Lender will be rolled up, and converted into DIP Obligations by
means of a "cashless roll" by each such DIP Lender on a 4:1 basis
based on (i) the amount of DIP Loans actually funded into the DIP
Funding Account (and on such day as the DIP Loans are actually
funded into the DIP Funding Account) plus (ii) the Commitment Fee
due and payable to such DIP Lender under the Closing Date Fee
Letter. For the avoidance of doubt, the amount of the DIP Roll-Up
Loans will be $30.8 million.
To the extent of any diminution in the value of the Prepetition
Secured Parties' respective interests in their collateral
(including cash collateral) from the Petition Date arising from the
use, sale, or lease of such collateral or the imposition of the
automatic stay, the Prepetition Secured Party is granted (i) senior
replacement liens in all assets of the Debtors, which replacement
Liens will be senior to any prepetition statutory liens in favor of
Centro de Recaudacion de Ingresos Municipales and (ii) to the
extent the Replacement Liens do not provide sufficient protection
of the Prepetition Secured Parties' interests, a superpriority
claim against the Debtors pursuant to 11 U.S.C. section 507(b), in
each case, subject to the priorities set forth in the Intercreditor
Agreement dated January 31, 2013. The Replacement Liens will be
deemed duly valid and perfected upon entry of this Order without
the need for further action by any party or further Court Order.
A copy of the order is available at https://urlcurt.com/u?l=karEYQ
from PacerMonitor.com.
About Grupo HIMA San Pablo, Inc.
Grupo HIMA San Pablo, Inc. serves as a diversified healthcare
services holding company pursuant to a corporate reorganization of
several businesses related by common ownership. Through its
subsidiaries and affiliates, the Company primarily owns and
operates hospital facilities and other healthcare related
businesses. As of August 2023, the HIMA GROUP operates four
hospitals, with over 1,200 licensed beds, including an Oncological
Hospital, a multi-specialty physician practice management company,
Home Care Service (including infusion therapies and wound care), a
free-standing Ambulatory Center and a 16-Ambulance Service
Company.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D.P.R. Case No. 23-02510) on August 15,
2023. In the petition signed by Armando J. Rodriguez-Benitez, chief
executive officer, the Debtor disclosed up to $1 billion in assets
and up to $500 million in liabilities.
Judge Enrique S. Lamoutte Inclan oversees the case.
Wigberto Lugo Mender, Esq., at Lugo Mender Group, LLC, represents
the Debtor as legal counsel.
H2O COMMERCIAL: Files Emergency Bid to Use Cash Collateral
----------------------------------------------------------
H2O Commercial Cleaning, LLC asks the U.S. Bankruptcy Court for the
District of Kansas for authority to use cash collateral until
February 28, 2024 or until the Plan of reorganization is confirmed,
whichever is sooner.
The Debtor requires the use of cash collateral to pay normal and
necessary expenses.
At the time of filing, the Debtor had bank account balances of
approximately $10,000 and minimal personal property.
The Debtor has experienced cash flow hardships associated with
various short term loans and owner financing.
The Debtor's secured creditor is American Funding Solutions.
The Debtor proposes, effective as of the Petition Date, that the
Creditor is granted replacement security interests in, and liens
on, all post-Petition Date acquired property of the Debtor and the
Debtor's bankruptcy estate that is the same type of property that
the specific creditor holds a pre-petition interest, lien or
security interest to the extent of the validity and priority of
such interests, liens, or security interests, if any. The amount of
each of the Replacement Liens will be up to the amount of any
diminution of each of the Creditors' respective collateral
positions from the Petition Date. The priority of the Replacement
Liens will be in the same priority as each of the creditor's
pre-petition interests, liens, and security interests in similar
property.
The Debtor further proposes paying the American Funding Solutions
the monthly sum of $1,000 beginning November 28, 2023, and
continuing the 28th day of the month thereafter for its adequate
protection payment.
A copy of the motion is available at https://urlcurt.com/u?l=PjJYrX
from PacerMonitor.com.
About H2O Commercial Cleaning, LLC
H2O Commercial Cleaning, LLC is a locally-owned, Kansas City-based
commercial construction, and commercial window cleaning company.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Kan. Case No. 23-21182) on October 4,
2023. In the petition signed by Nicholas A. Verdi, president, the
Debtor disclosed $58,675 in assets and $1,055,619 in liabilities.
Colin Gotham, Esq., at Evans & Mullinx, PA, represents the Debtor
as legal counsel.
HAWK LOGISTICS: Files Emergency Bid to Use Cash Collateral
----------------------------------------------------------
Hawk Logistics, LLC asks the U.S. Bankruptcy Court for the U.S.
Bankruptcy Court for the Southern District of Florida, Miami
Division, for authority to, among other things, use cash collateral
and continue to sell accounts post-petition and incur credit.
The Debtor seeks to use cash collateral consisting of Purchase
Price advances paid to the Debtor by secured creditor, Triumph
Financial Services LLC f/k/a Advance Business Capital LLC d/b/a
Triumph Business Capital, for operating expenses in accordance with
the budget.
On September 30, 2021, Triumph, as purchaser, and Debtor, as
seller, entered into a Factoring and Security Agreement which
entitled Triumph to, among other things, purchase the Debtor's
Accounts arising from the Debtor's performance of surface freight
transportation provided to its customers.
The Debtor and Triumph operated under the Factoring Agreement prior
to the Petition Date. As of the Petition Date, the Debtor's
contingent monetary obligations owed to Triumph, under the
Factoring Agreement were in the aggregate amount of $1.304
million.
The Debtor contemplates that it will offer to sell Accounts to
Triumph up to the maximum aggregate amount of $3 million; however
Triumph will have sole and exclusive discretion whether and which
Accounts it may purchase from the Debtor, and to make Purchase
Price Advances or over- advances in excess of the amounts
contemplated in the revenue projections in the Debtor's pro forma
Budget, without any adverse or prejudicial consequences to
Triumph's rights under the Factoring Agreement.
As of the Petition Date, the Debtor had cash collateral in the
total amount of $78,400.
During the pandemic, the Debtor entered into agreements with the
U.S. Small Business Association (SBA) and Commercial Credit Group,
Inc. (CCG) to borrow funds under the Economic Injury Disaster Loan
program. The EIDL loan had a principal balance of approximately
$168,462. The Debtor also entered into two loan agreements with CCG
for the purchase of commercial trucks. CCG recorded various UCC-1
financing statements with the North Carolina Secretary of State,
and the principal balances of the CCG loans were approximately
$616,646 and $582,882, respectively. Since the Purchased Accounts
were sold to Triumph, the SBA and CCG interests are not perfected
in cash collateral and are not entitled to adequate protection.
As adequate protection for the use of cash collateral, Triumph will
be granted a first priority security interest and liens in all of
the Debtor's assets acquired or arising on or after the
commencement of the bankruptcy case. Moreover, to the extent any
other prepetition creditor of the Debtor holds a valid,
enforceable, unavoidable, perfected prepetition claim secured by
the Collateral, as adequate protection will receive a post-petition
replacement lien on the Debtor's post-petition assets, junior in
priority to the liens and security interests granted to Triumph.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=3iJg9G from PacerMonitor.com.
The Debtor projects total disbursements, on a weekly basis, as
follows:
$209,790 for the week ended October 15, 2023;
$217,998 for the week ended October 22, 2023; and
$222,075 for the week ended October 29, 2023.
About Hawk Logistics LLC
Hawk Logistics LLC is part of the general freight trucking
industry.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Fla. Case No. 23-18059) on October 2,
2023. In the petition signed by Osmel Guzman, CFO, the Debtor
disclosed up to $10 million in both assets and liabilities.
Judge Laurel M. Isicoff oversees the case.
Eric J. Silver, Esq., at Stearns Weaver Miller Weissler Alhadeff &
Stitterson, PA, represents the Debtor as legal counsel.
INSPIREMD INC: Craig Shore Resumes as CFO, Secretary and Treasurer
------------------------------------------------------------------
Craig Shore was reappointed as the chief financial officer,
secretary and treasurer of InspireMD, Inc., on Oct. 5, 2023. In
connection with Mr. Shore's reappointment, Mr. Amir Kohen, the
Company's interim CFO, secretary and treasurer, will resume his
role as the Company's vice president of Finance and Human
Resources, effective as of the date of Mr. Shore's reappointment.
About InspireMD
Headquartered in Tel Aviv, Israel, InspireMD, Inc. --
http://www.inspiremd.com-- is a medical device company focusing on
the development and commercialization of its proprietary MicroNet
stent platform technology for the treatment of complex vascular and
coronary disease. A stent is an expandable "scaffold-like" device,
usually constructed of a metallic material, that is inserted into
an artery to expand the inside passage and improve blood flow. Its
MicroNet, a micron mesh sleeve, is wrapped over a stent to provide
embolic protection in stenting procedures.
InspireMD reported a net loss of $18.49 million for the year ended
Dec. 31, 2022, compared to a net loss of $14.92 million for the
year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had
$24.65 million in total assets, $7.26 million in total
liabilities,
and $17.39 million in total equity.
Tel-Aviv, Israel-based Kesselman&Kesselman, the Company's auditor
since 2010, issued a "going concern" qualification in its report
dated March 30, 2023, citing that the Company has suffered
recurring losses from operations and cash outflows from operating
activities that raise substantial doubt about its ability to
continue as a going concern.
INSPIREMD INC: Issues Stock Inducement Grant to Executive
---------------------------------------------------------
InspireMD, Inc. filed a Form S-8 registration statement with the
Securities and Exchange Commission for the purpose of registering
139,740 shares of restricted stock and 46,580 shares of common
stock issuable pursuant to stock option awards granted to Patrick
Verta on Oct. 2, 2023 to induce him to accept employment as the
executive vice president of Clinical and Medical Affairs of the
Company.
The Inducement Grant is generally subject to the terms and
conditions of the Company's Plan but are not charged to the Plan's
share reserve. As such, the Inducement Grant is part of a separate
plan that has not been approved by stockholders. The Inducement
Grant was granted as an inducement material to Mr. Verta entering
into employment with the Company in accordance with the
"inducement" grant exception under Nasdaq Listing Rule 5635(c)(4).
The Inducement Grant is unvested and unexercisable as of Oct. 6,
2023 (the date of this Registration Statement).
A full-text copy of the prospectus is available for free at:
https://www.sec.gov/Archives/edgar/data/1433607/000149315223036459/forms-8.htm
About InspireMD
Headquartered in Tel Aviv, Israel, InspireMD, Inc. --
http://www.inspiremd.com-- is a medical device company focusing on
the development and commercialization of its proprietary MicroNet
stent platform technology for the treatment of complex vascular and
coronary disease. A stent is an expandable "scaffold-like" device,
usually constructed of a metallic material, that is inserted into
an artery to expand the inside passage and improve blood flow. Its
MicroNet, a micron mesh sleeve, is wrapped over a stent to provide
embolic protection in stenting procedures.
InspireMD reported a net loss of $18.49 million for the year ended
Dec. 31, 2022, compared to a net loss of $14.92 million for the
year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had
$24.65 million in total assets, $7.26 million in total liabilities,
and $17.39 million in total equity.
Tel-Aviv, Israel-based Kesselman&Kesselman, the Company's auditor
since 2010, issued a "going concern" qualification in its report
dated March 30, 2023, citing that the Company has suffered
recurring losses from operations and cash outflows from operating
activities that raise substantial doubt about its ability to
continue as a going concern.
IYS VENTURES: Court OKs Cash Collateral Access Thru Nov 10
----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois,
Eastern Division, granted IYS Ventures, LLC authority to use cash
collateral, on an interim basis through November 10, 2023.
As previously reported by the Troubled Company Reporter, the Debtor
seeks cash collateral access to fund the payment of rent and
gasoline and the various management companies which pay the
necessary expenses associated with the operation of its business.
These creditors may assert a security interest in and to the
Collateral: Byzfunder NY LLC, Fox Capital Group, Inc., Itria
Ventures, Samson Funding, and The Huntington National Bank.
Investigation into the priority and security of the Lien Claimants
is ongoing, however, the following represents the approximate claim
and basis for the secured liens:
a. Byzfunder may assert a security interest in the Collateral
pursuant to a Revenue Purchase Agreement and Security Agreement
dated October 25, 2022. Byzfunder's scheduled claim is in the
amount of $153,986.
b. Fox may assert a security interest in the Collateral
pursuant to a Future Receivables Sale and Purchase Agreement dated
November 23, 2022. Fox's scheduled claim is in the amount of
$444,005.
c. Itria asserts a security interest in the Collateral
pursuant to an agreement. Itria's scheduled claim is in the amount
of $1,492,109, which is disputed in part by the Debtor.
d. Samson may assert a security interest in the Collateral by
virtue of multiple Revenue Purchase Agreement and Security
Agreement dated, inter alia, April 8, 2022, November 21, 2022,
December 2, 2022, December 23, 2022, and March 2, 2023. Samson's
scheduled claim is in the amount of $4,091,514.
e. Huntington asserts a security interest in the Collateral by
virtue of an Order on Motion for Prejudgment Attachment dated March
16, 2023, in the case more commonly known as The Huntington
National Bank v. IYS Ventures, LLC, et al., Case No. 23- CV-01368
pending in the United States District Court for the Northern
District of Illinois.
The court ruled that as partial adequate protection to the Lien
Claimants and any other entity claiming a security interest in the
Collateral, for the use of collateral, which includes the Debtor's
equipment, fixtures, inventory, accounts, instruments, chattel
paper, general intangibles, now owned and hereafter acquired
together with all replacements, accessions, proceeds and products
and all proceeds of the Collateral, including cash and cash
equivalent pursuant to the terms of the interim Cash Collateral
Order, the Lien Claimants are granted and will have replacement
liens in and to the Collateral which will have the same validity,
perfection, and enforceability as the pre petition liens held by
the Lien Claimants without any further action by the Debtor or the
Lien Claimants and without executing or recording any financing
statements, security agreements, or other documents.
A continued hearing on the matter is set for November 1, 2023 at
10:30 a.m.
A copy of the court's order is available at
https://urlcurt.com/u?l=HG3sj9 from PacerMonitor.com.
About IYS Ventures
IYS Ventures LLC leases, owns and operates gas stations located in
Illinois, Minnesota, Michigan, Indiana, Ohio, South Dakota,
Virginia, Wisconsin, and Louisiana.
The Debtor filed a petition for relief under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ill. Case No. 23-06782) on May 23,
2023. In the petition filed by Muwafak Rizek, as manager and
member, the Debtor reported assets between $1 million and $10
million and liabilities between $10 million and $50 million.
Honorable Bankruptcy Judge David D. Cleary oversees the case.
The Debtor is represented by Gregory K Stern, Esq. at Gregory K.
Stern, P.C., represents the Debtor as legal counsel.
JAGUAR HEALTH: Enters Into Amendments to Royalty Interests
----------------------------------------------------------
Jaguar Health, Inc. disclosed in a Form 8-K filed with the
Securities and Exchange Commission that it entered into amendments
to:
(i) the royalty interest in the original principal amount of $12
million with Iliad Research and Trading, L.P., as amended;
(ii) the royalty interest in the original principal amount of $12
million with Uptown Capital, LLC (f/k/a Irving Park Capital, LLC),
as amended; and
(iii) the royalty interest in the original principal amount of $12
million with Streeterville Capital, LLC.
Pursuant to the Amendments, beginning on Jan. 1, 2026, the monthly
Royalty Payment under each of the Royalty Interests shall be the
greater of (a) $750,000.00, and (b) the actual Royalty Payment
amount the respective Investor is entitled to for such month
pursuant to the terms of such Royalty Interest. In addition,
pursuant to an additional amendment to the August 2022 Royalty
Interest with Streeterville, the Company is prohibited from making
prepayments of the Royalty Repayment Amount under the August 2022
Royalty Interest.
As a material consideration for Investors' agreement to enter into
the Royalty Interest Global Amendments, the Company agreed to issue
to (i) Iliad warrants to purchase up to 232,500 shares of the
Company's common stock, par value $0.0001 per share, (ii) Uptown
warrants to purchase up to 262,500 shares of the Common Stock, and
(iii) Streeterville warrants to purchase up to 255,000 shares of
the Common Stock, at an exercise price of $0.37 per share.
The Warrants may be exercisable for cash or on a cashless basis at
any time and from time to time during the period commencing on
Sept. 29, 2023, and ending on the five-year anniversary of the
Issuance Date.
Exchange Transaction
On Sept. 29, 2023, the Company entered into a privately negotiated
exchange agreement with Uptown, pursuant to which the Company
issued an aggregate of 118 shares of the Company's newly authorized
Series I Convertible Preferred Stock to Uptown, at an effective
exchange price per share equal to the market price (defined as the
Minimum Price under Nasdaq Listing Rule 5635(d)) as of the date of
the Exchange Agreement, in exchange for a $1,500,000.00 reduction
in the outstanding balance of the December 2020 Royalty Interest.
Subject to the terms of the Series I Preferred Stock, each share of
Series I Preferred Stock is convertible into shares of the
Company's Common Stock.
About Jaguar Health
Jaguar Health, Inc. -- http://www.jaguar.health-- is a commercial
stage pharmaceuticals company focused on developing novel,
sustainably derived gastrointestinal products on a global basis.
The Company's wholly owned subsidiary, Napo Pharmaceuticals, Inc.,
focuses on developing and commercializing proprietary human
gastrointestinal pharmaceuticals for the global marketplace from
plants used traditionally in rainforest areas. Its Mytesi
(crofelemer) product is approved by the U.S. FDA for the
symptomatic relief of noninfectious diarrhea in adults with
HIV/AIDS on antiretroviral therapy.
Jaguar Health reported a net loss of $48.39 million for the year
ended Dec. 31, 2022, compared to a net loss of $52.60 million for
the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had
$47.45 million in total assets, $48.81 million in total
liabilities, and a total stockholders' deficit of $1.35 million.
Larkspur, California-based RBSM, LLP, the Company's auditor since
2021, issued a "going concern" qualification in its report dated
March 24, 2023, citing that the Company has an accumulated deficit,
recurring losses, and expects continuing future losses. These
conditions raise substantial doubt about the Company's ability to
continue as a going concern.
JIREH FITNESS: Wins Interim Cash Collateral Access
--------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Florida,
West Palm Beach Division, authorized Jireh Fitness Solutions Corp.
d/b/a Retrofitness Wellington to use cash collateral on an interim
basis in accordance with the budget, with a 10% variance.
The Secured creditor, Gulf Coast Bank & Trust, will have a
replacement lien on cash used by the Debtor and all other assets
which comprise of its secured claim to the same extent, validity
and priority that existed prior to the commencement of the case.
Gulf Coast Bank & Trust, does not waive its right to seek further
adequate protection at a later date, and reserves all objections,
rights and remedies as to the Motion, and otherwise.
A second interim hearing on the matter is set for January 3, 2024
at 1:30 p.m.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=cQPPF5 from PacerMonitor.com.
The Debtor projects $78,000 in total income and $75,100 in total
expenses.
About Jireh Fitness Solutions Corp
Jireh Fitness Solutions Corp operates a Class A Gym and Fitness
facility in Wellington, Florida and has been in operation since
June 2022. In addition to the cardio and weight operations of the
gym, the Debtor has tanning, muscular rejuvenation services and
massage chairs. The facility includes full bathroom (change room,
lockers and showers) for its members.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (S.D. Fla. Case No. 23-17407) on September 15,
2023. In the petition signed by Eduardo P. Jurado, president, the
Debtor disclosed up to $10 million in both assets and liabilities.
Judge Erik P. Kimball oversees the case.
Thomas L. Abrams, Esq., at Gamberg & Abrams, represents the Debtor
as legal counsel.
JLM COUTURE: Court OKs Cash Collateral Access Thru Oct 31
---------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
KLM Couture, Inc. to use cash collateral on an interim basis in
accordance with the budget, with a 5% variance, through October 31,
2023.
Prior to the Petition Date, Debtor took out a loan from the U.S.
Small Business Administration and granted the SBA security
interests in the Debtor's assets. As of the Petition Date, the
Debtor owes the SBA the approximate amount of $150,000.
As adequate protection, SBA is granted valid, binding, enforceable,
non-avoidable and perfected first priority replacement liens and
security interests in and on (a) the Prepetition Collateral and (b)
all other of the Debtor's now owned and hereafter acquired real and
personal property.
The Debtor will grant to the SBA, up to an amount equal to the
Collateral Diminution: (i) the Post-Petition Liens in and on (a)
the Prepetition Collateral and (b) the Post-Petition Collateral,
senior to any other security interests or liens, subject only to
(x) the Prepetition Liens, (y) perfected and enforceable
pre-petition liens which are senior to the Prepetition Liens as of
the Petition Date; and (ii) an allowed superpriority administrative
expense claim with priority over all other administrative expense
claims in the case.
A final hearing on the matter is set for October 30, 2023 at 1
p.m.
A copy of the order is available at https://urlcurt.com/u?l=lyNkR1
from PacerMonitor.com.
About JLM Couture, Inc.
JLM Couture, Inc. is engaged in bridal design and manufacturing
business. JLM Couture operates twelve collections, nine of which
are bridal lines, one bridesmaid line and one flower girl line.
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
CEO, the Debtor disclosed $2,850,196 in assets and $2,115,305 in
liabilities.
Judge Kate Stickles oversees the case.
Kevin S. Mann, Esq., at Cross & Simon, LLC, represents the Debtor
as legal counsel.
JUICE ROLL UPZ: Case Summary & 14 Unsecured Creditors
-----------------------------------------------------
Debtor: Juice Roll Upz, Inc.
1303 W Valencia Dr. #305
Fullerton, CA 92833
Business Description: Juice Roll Upz is a manufacturer of e-
liquids and vape juices.
Chapter 11 Petition Date: October 10, 2023
Court: United States Bankruptcy Court
Central District of California
Case No.: 23-12077
Judge: Hon. Theodor Albert
Debtor's Counsel: Anerio Ventura Altman, Esq.
LAKE FOREST BANKRUPTCY
P.O. Box 515381
Los Angeles, CA 90051
Tel: (949) 218-2002
Email: avaesq@lakeforestbkoffice.com
Total Assets: $497,964
Total Liabilities: $3,103,919
The petition was signed by Joshua Tongco as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 14 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/ZZWR4RY/Juice_Roll_Upz_Inc__cacbke-23-12077__0001.0.pdf?mcid=tGE4TAMA
KAH HOSPICE: S&P Affirms 'B' ICR on Heartland Acquisition
---------------------------------------------------------
S&P Global Ratings affirmed its 'B' issuer credit rating on KAH
Hospice Co. Inc. (d/b/a Gentiva) and its 'B' issue-level rating on
its first-lien term loan and revolver. The '3' recovery rating is
unchanged, indicating S&P's expectation for meaningful (50%-70%;
rounded estimate 60%) recovery prospects in the event of a default.
At the same time, S&P affirmed its 'CCC+' issue-level rating on the
company's second-lien term loan. The '6' recovery rating is
unchanged, indicating its expectation for negligible (0%-10%;
rounded estimate: 0%) recovery prospects in the event of a
default.
S&P said, "The stable outlook reflects our expectation that
Gentiva's decent scale and strong referral sources will enable it
to increase its organic revenue by the mid-single-digit percent
area annually, maintain relatively stable EBITDA margins, and
generate meaningful free cash flow. That said, we expect the tight
labor market will constrain the company's margins and lead it to
sustain S&P Global Ratings-adjusted leverage of more than 5x."
On Feb. 27, 2023, KAH Hospice Co. Inc. (d/b/a Gentiva) signed a
definitive agreement to acquire Heartland hospice and home care
agencies from ProMedica (a not-for-profit health system). The
company will fund the $650 million acquisition (including expenses)
with a $500 million incremental first-lien term loan and a $190
million cash equity contribution from private-equity sponsor
Clayton, Dubilier, & Rice (CD&R). Pro forma for the transaction,
CD&R will own 65% of the combined entity and Humana will own 35%
(compared to 60%/40% previously).
S&P said, "Although the proposed transaction will modestly increase
Gentiva's leverage to about 8.1x in 2023, up from our prior
expectation of 7.1x (given that it will only receive a partial year
EBITDA contribution in 2023), we expect its leverage will decline
to about 6.2x in 2024 as it realizes a full year of revenue from
Heartland and benefits from improved economies of scale and cost
synergies. Heartland is a national provider of hospice (95% of
revenue) and home care services (5%) that generates about $600
million of annual revenue. It operates in 23 states with an ADC of
about 9,000. The acquisition will expand Gentiva's footprint and
make it the largest hospice provider in the U.S. We estimate this
will equate to market share of about 10% in the very fragmented and
commodity-like market. We believe the company's margins will also
benefit from improved economies of scale and greater purchasing
power than its smaller peers.
"We believe Gentiva's staffing model and sales team are modest
competitive advantages, as evidenced by the high-single-digit
percent increase in its revenue in 2022. The company's staffing
investments in 2021 helped it reduce its nursing turnover to about
30% in 2022, from 42% in 2020, which supported a 7% expansion in
its ADC in 2022. This strong momentum continued in the first half
of 2023. We believe Gentiva's focus on hospice will support an
improved operating performance and increased revenue at Heartland.
This contrasts with ProMedica's primary focus on acute care, which
we believe may have contributed to Heartland's staffing issues,
loss of referral sources, and ADC declines over the last few
years.
"We believe Gentiva 's good track record of integrating
acquisitions (Odyssey Hospice in 2010, Harden Healthcare in 2013,
and CURO Health Services in 2018) and track record of ADC expansion
after those acquisitions partially mitigates its integration risk.
In addition, both Gentiva and Heartland already have similar
clinical compliance quality and the same operating and workflow
systems. We expect the company will realize procurement synergies
and cost savings in pharmacy, durable medical equipment, and
medical supplies, given management's plan to migrate Heartland onto
its vendor contracts, as well as cost savings from eliminating
duplicate roles in finance, information technology (IT), revenue
cycle, and administration.
"Our 'B' rating on Gentiva reflects its decent scale in the highly
fragmented and commodity-like market for hospice and home care
services, as well as its reliance on government payors for nearly
all of its revenue.The hospice and home care industry is
characterized by largely undifferentiated and commodity-like
services, low barriers to entry, and a generally challenging labor
market, with annual turnover of about 25%-30%. Gentiva will become
the largest hospice services providers in the U.S. with about $2.5
billion of revenue, though it will have market share of only about
10%. The company's peers include FC Compassus LLC, BW Homecare
Holdings LLC, Pluto Acquisition I Inc. (doing business as
AccentCare), and Amedisys (not rated). Gentiva is focused primarily
on hospice services (about 84% of expected revenue in 2023) and we
view its business mix as relatively concentrated, which we view as
a weakness relative to most of its other rated peers. Gentiva also
provides unskilled personal home care services.
"Although hospice services are cost efficient for government payors
and desired by many eligible patients, we view the potential for
adverse changes to government reimbursement as a key risk. This is
because of Gentiva 's high reliance on government payors (88%
Medicare, 11% Medicaid) and the government's ability to
unilaterally reduce or introduce adverse changes to reimbursement,
particularly given chronic budget pressures. The company derives
the rest of its revenue from commercial payors and others. Still,
the company's reimbursement rates have been favorable recently with
the Centers for Medicare and Medicaid Services (CMS) increasing
Medicare rates by 2.1% in fiscal-year 2022, 3.8% in fiscal-year
2023, and 3.1% in fiscal-year 2024 (ending Sept. 30, 2024).
"We expect Gentiva 's leverage will exceed 5x, with modest free
operating cash flow (FOCF) generation supporting FOCF to debt of
about 1.5% in 2023 (given only a partial year EBITDA contribution
from Heartland) and 3.0% in 2024. We expect the company will remain
highly leveraged over the next several years as it pursues
acquisitions, given its ownership by a financial sponsor, which we
expect will prioritize mergers, acquisitions, and shareholder
returns over debt reduction.
"The stable outlook reflects our expectation that Gentiva's decent
scale and strong referral sources will enable it to increase its
organic revenue by the mid-single-digit percent area annually,
maintain relatively stable EBITDA margins, and generate meaningful
free cash flow. That said, we expect the tight labor market will
constrain the company's margins and lead it to sustain S&P Global
Ratings-adjusted leverage of more than 5x."
S&P could lower its rating on Gentiva if:
-- It faces integration challenges and does not realize its
expected synergies from the Heartland acquisition; or
-- The company experiences reimbursement pressures, operational
disruptions--such as the loss of referral partners—or a
larger-than-expected increase in labor costs, that reduce its FOCF
to debt below 3% or increase its leverage above 8x for an extended
period.
Though unlikely given its sponsor ownership, S&P could raise its
rating on Gentiva if S&P expects it will reduce its S&P Global
Ratings-adjusted leverage below 5x and maintain it at that level on
a sustained basis.
KINGDOM CONCEPTS: Court OKs Interim Cash Collateral Access
----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas,
Dallas Division, authorized Kingdom Concepts, LLC to use cash
collateral on an interim basis in accordance with the budget, with
a 10% variance.
The Debtor has an immediate need to use the cash collateral of
Quick Funding Group and Spot On, the Debtor's secured creditors
claiming liens on the Debtor's personal property including cash and
accounts.
As adequate protection, the Secured Lenders are granted replacement
liens and security interests, in accordance with U.S.C. Sections
361, 363, 364(c)(2), 364(e), and 552, co-extensive with their
pre-petition liens.
The replacement liens are automatically perfected without the need
for filing of a UCC-1 financing statement with the Secretary of
State's Office or any other such act of perfection.
A hearing on the matter is set for November 2 at 10:30 a.m.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=ZGrws7 from PacerMonitor.com.
The Debtor projects $220,000 in gross revenue and $214,350 in total
expenses for one month.
About Kingdom Concepts, LLC
Kingdom Concepts, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Tex. Case No. 23-31895-swe11) on
August 31, 2023. In the petition signed by Cedric Brown, manager,
the Debtor disclosed up to $500,000 in both assets and
liabilities.
Joyce W. Lindauer, Esq., at Joyce W. Lindauer Attorney, PLLC,
represents the Debtor as legal counsel.
KNS MOTEL: Seeks Cash Collateral Access Thru Dec 31
---------------------------------------------------
KNS Motel, Inc. asks the U.S. Bankruptcy Court for the Southern
District of Indiana, New Albany Division, for entry of an order
authorizing the use of cash collateral in accordance with its
agreement with First Chatham Bank.
The Debtor requires the use of cash collateral to meet expenses as
they come due.
The Bank claims an interest in cash collateral as evidenced by its
security agreement and UCC-1 financing statements on file in the
Indiana Secretary of State's Office. The Debtor is unaware of any
other entities that may claim an interest in cash collateral.
The Debtor seeks authority to use cash collateral on an interim
basis and to set a final hearing for continued cash use. In the
absence of objections, the Debtor seeks permission to use cash
collateral on a final basis through and including December 13,
2023.
In consideration for the use of cash collateral, the Debtor
proposes to grant replacement liens upon future receipts and all
assets of the Debtor to the Cash Collateral Creditor.
A copy of the motion is available at https://urlcurt.com/u?l=tvbd1v
from PacerMonitor.com.
First Chatham Bank, as lender, is represented by:
Bryan J. Sisto, Esq.
Frost Brown Todd LLP
400 W. Market Street, Suite 2300
Louisville, KY 40202
Tel: (502) 589-5400
Fax: (502) 581-1087
Email bsisto@fbtlaw.com
About KNS Motel
KNS Motel, Inc. operates in the traveler accommodation industry. It
owns in fee simple interest a real property located at 619 N. Shore
Drive, Jeffersonville, Ind., valued at $6.1 million.
KNS Motel filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. S.D. Ind. Case No. 23-90897) on Sept. 13,
2023, with $6,193,078 in assets and $5,006,679 in liabilities.
Indravadan Patel, president, signed the petition.
Judge Andrea K. Mccord oversees the case.
Michael W. McClain, Esq., at Goldberg Simpson, LLC represents the
Debtor as legal counsel.
KOACH ENTERPRISE: Court OKs Interim Cash Collateral Access
----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Florida,
Miami Division, authorized Koach Enterprise Land, Inc. to use cash
collateral on an interim basis in accordance with the budget.
As previously reported by the Troubled Company Reporter, the Debtor
requires the use of cash collateral to acquire goods and services
necessary for their day-to-day operations. The Debtor also seeks to
use $8,000 of cash collateral to pay a commitment fee to borrow
$800,000 which will enable debtor to refinance its secured debt and
emerge from Chapter 11.
The Lenders are Ettenheim, Ivler and Elmont who have a $820,357
debt encumbering the property valued at $2 million.
The court ruled that ss adequate protection for the use of cash
collateral, the Lenders are granted a replacement lien on the all
post-petition property of the Debtor that is of the same nature and
type as Lender's pre-petition collateral.
A copy of the court's order is available at
https://urlcurt.com/u?l=yWqlnC from PacerMonitor.com.
About Koach Enterprise Land, Inc.
Koach Enterprise Land, Inc. sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. S.D. Fla. Case No. 23-16438) on
August 15, 2023. In the petition signed by Eliahu Abukasis,
president, the Debtor disclosed up to $10 million in both assets
and liabilities.
Judge Corali Lopez-Castro oversees the case.
Joel Aresty, Esq., at Joel M. Aresty PA represents the Debtor as
legal counsel.
LTI HOLDINGS: S&P Alters Outlook to Negative, Affirms 'B-' ICR
--------------------------------------------------------------
S&P Global Ratings revised its outlook on LTI Holdings Inc. to
negative from stable. S&P also affirmed its 'B-' issuer credit
rating on the company, its 'B-' issue-level rating on its
first-lien term loans, and its 'CCC+' rating on the company's
second-lien term loan. The respective '4' and '5' recovery ratings
are unchanged.
The negative outlook reflects S&P's view that LTI's leverage could
remain elevated over the next 12 months.
Elevated interest rates continue to hurt demand and weaken LTI's
credit metrics. Rising interest rates have reduced household
purchasing power and curbed discretionary spending and continued to
weigh on performance. LTI's recreational vehicle (RV),
semiconductor, consumer electronics, and industrial segments have
performed the weakest. S&P expects declines in these segments to
outweigh growth in eMobility, medical, and aerospace and defense in
2023, as well as the full-year contribution from the 2022
acquisition of Sensata's thermal testing business, which also has
performed weaker than we anticipated.
S&P said, "With our expectations of higher-for-longer interest
rates, we expect softness in LTI's more rate-sensitive end markets
to continue into 2024. While most of LTI's overall term loan
balance doesn't mature until September 2025, the springing nature
of the revolving credit facility will force it to come due in June
2025 and current in June 2024. We expect the company to wait a few
more quarters to try to improve credit metrics before it begins to
address its capital structure and upcoming maturities. However, the
longer LTI waits to refinance its capital structure, the greater
the risk that conditions in the capital markets will weaken
further.
"EBITDA margins have underperformed our expectations. LTI merged
four manufacturing sites into its new Juarez, Mexico, site but with
cost overruns and a longer-than-expected completion time. In
addition, declines in the higher-margin RV and semiconductor
segments have also hindered profitability, materially reducing S&P
Global Ratings-adjusted EBITDA margins more than we anticipated.
While we expect that second-quarter 2023 results will be the trough
from a cost perspective, we expect ramp-up costs to continue to
weigh on margins, then improving over the next 12 months as the
project winds down. Additionally, while it has taken longer than
anticipated, we expect certain EBITDA add-backs from its previous
acquisitions to roll off, improving 2024 margins. As a result, we
forecast 2023 S&P Global Ratings-adjusted EBITDA margin in the
mid-15% area, compared with the mid-15% area in 2022, with plant
consolidation costs and product mix outweighing price increases and
cost-cutting measures. In our view, such profitability will
translate into S&P Global Ratings-adjusted debt to EBITDA above 10x
in 2023.
"LTI's liquidity remains adequate despite interest rate pressure.
Despite a capital structure that remains partially unhedged, we
believe LTI's cash on hand and remaining availability on its
revolver support its liquidity position. That said, we believe the
rise in interest expense, increased costs from its plant
consolidation, and recent margin erosion will lead to a S&P Global
Ratings-adjusted funds from operations (FFO) deficit. With similar
capital expenditure (capex) to 2022 and our expectations for a
partial unwinding of working capital, we expect minimal FOCF
generation in 2023. Like many capital goods companies that we rate,
LTI's significant working capital headwind in 2022 resulted in
negative FOCF. While working capital has started to unwind through
the first half of 2023, it has not offset the year-over-year
decline in FFO. Still, we expect the company will maintain adequate
cushion under its covenants during the next 12 months.
"The negative outlook reflects our view that LTI's leverage could
remain elevated over the next 12 months."
S&P could lower the ratings on LTI if:
-- Weak profitability and negative cash flow generation persists,
causing leverage to remain high relative to similarly rated peers
with limited prospects for improvement; or
-- The company generates significantly negative FOCF; or
-- Liquidity weakens materially or the company cannot address the
springing maturity of its revolver.
S&P could revise the outlook on LTI to stable if the company:
-- Improves leverage significantly; and
-- Addresses the springing maturity of its revolver.
S&P said, "Governance factors are a moderately negative
consideration in our credit rating analysis of LTI Holdings Inc.,
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."
MACARTHUR COURT: Involuntary Chapter 11 Case Summary
----------------------------------------------------
Alleged Debtor: MacArthur Court Acquisition Corp.
4695 MacArthur Court, 11th Floor
Newport Beach CA 92660-0000
Involuntary Chapter
11 Petition Date: October 11, 2023
Court: United States Bankruptcy Court
Central District of California
Case No.: 23-12086
Petitioners' Counsel: Garrick A. Hollander, Esq.
WINTHROP GOLUBOW HOLLANDER, LLP
1301 Dove Street, Suite 500
Newport Beach CA 92660-0000
Tel: 949-720-4100
A full-text copy of the Involuntary Petition is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/HKB5WPI/MacArthur_Court_Acquisition_Corp__cacbke-23-12086__0001.0.pdf?mcid=tGE4TAMA
Alleged creditors who signed the petition:
Petitioner Nature of Claim Claim Amount
Nguyen Family Trust, Promissory Note $400,000
Dated Feb 03, 1999
5529 E. Kings Crown Rd
Orange CA 92859-0000
Affiliated Partners, IPA Promissory Note $9,000,000
555 E. Pacific Coast Hwy Suite 102
Long Beach CA 90806-0000
Penta A Management, Inc. Promissory Note $2,000,000
555 East Pacific Coast Hwy
Suite 102
Long Beach CA 90806-0000
Victor Thai Promissory Note $100,000
16067 Francisquito Ave
La Puente CA 91744-0000
Streamline Premier Services, Inc. Promissory Note $100,000
16067 Francisquito Ave.
La Puente CA 91744-0000
Roatchhada and Cindy LP Promissory Note $2,105,000
11618 Jerry Street
Cerritos CA 90703-0000
Marvin Urbina and/or Blanca Urbina Promissory Note $500,000
3986 Swarthmore Ct
Claremont CA 91711-0000
Khengher Chiang Promissory Note $60,000
11533 215th Street
Lakewood CA 90715-0000
Johnny H. Khiev and Crystal M. Promissory Note $60,000
Khiev
11851 Ringwood Ave
Norwalk CA 90650-0000
METCALF ANTIQUE: Court OKs Interim Cash Collateral Access
---------------------------------------------------------
The U.S. Bankruptcy Court for the District of Kansas authorized
Metcalf Antique Mall, LLC to use cash collateral on an interim
basis in accordance with the budget.
The Debtor is indebted to Kansas Department of Revenue, who asserts
a security interest in and liens upon the Debtor's assets. The
Debtor's rents constitute cash collateral as defined in 11 U.S.C.
Section 363(a).
Kansas Department of Revenue claims a secured interest in cash
collateral of the Debtor by virtue of Liens filed on various
dates.
The Debtor is directed to make adequate protection payment to
Kansas Department o Revenue of $2,000 per month beginning November
28, 2023 and the 28th each month until further Order of the Court.
Effective as of the Petition Date, Kansas Department of Revenue is
granted replacement security interests in, and liens on, all
post-Petition Date acquired property of the Debtor and the Debtor's
bankruptcy estate that is the same type of property that Kansas
Department of Revenue holds a pre-petition interest, lien or
security interest to the extent of the validity and priority of
such interests, liens, or security interests, if any.
Any Replacement Lien granted will be effective and perfected upon
the date of entry of the Interim Order without necessity for the
execution or recordation of filings of deeds of trust, mortgages,
security agreements, control agreements, pledge agreements,
financing statements, or similar documents, or the possession or
control by Kansas Department of Revenue of, or over, any property
subject to the Replacement Liens.
To the extent that the Replacement Liens prove inadequate to
protect Kansas Department of Revenue from a demonstrated diminution
in value of Collateral positions from the Petition Date, Kansas
Department of Revenue is granted an administrative expense claim
under 11 U.S.C. section 503(b) with priority in payment under 11
U.S.C. 507(b).
A telephonic hearing on the matter is set for November 16, 2023 at
1:46 p.m.
A copy of the order is available at https://urlcurt.com/u?l=DMx4pX
from PacerMonitor.com.
About Metcalf Antique Mall, LLC
Metcalf Antique Mall, LLC operates an Antique Mall. The Debtor
sought protection under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. D. Kan. Case No. 23-21127) on September 25, 2023.
In the petition signed by Andrew T. Rowland, owner, the Debtor
disclosed up to $50,000 in assets and up to $500,000 in
liabilities.
Colin Gotham, Esq., at Evans & Mullinix, P.A., represents the
Debtor as legal counsel.
MMEX RESOURCES: Transfer Agent Quits, Cites Ongoing Litigation
--------------------------------------------------------------
MMEX Resources Corporation disclosed in a Form 8-K filed with the
Securities and Exchange Commission that Transhare, the transfer
agent for MMEX's common stock, has provided notice of its
resignation as transfer agent, citing the Company's ongoing
litigation with Sabby Volatility Master Fund, Ltd. regarding, among
other matters, issuances and transfers of its common stock.
MMEX said, "To the extent that the Company is unable to find a
replacement transfer agent on a timely basis, holders of our common
stock will experience difficulty in effecting transferring record
ownership of their shares and holders of our convertible securities
and warrants will experience difficulty in obtaining newly issued
shares of Common Stock."
About MMEX Resources Corporation
Headquartered in Fort Stockton, Texas, MMEX Resources Corporation
was formed as a Nevada corporation in 2005. It is focused on the
development, financing, construction and operation of clean fuels
infrastructure projects powered by renewable energy.
Houston, TX-based M&K CPAS, PLLC, the Company's auditor since 2013,
issued a "going concern" qualification in its report dated July 17,
2023, citing that the company suffered a net loss for the year
ended April 30, 2023 and had a working capital deficit and a
stockholders' deficit as of April 30, 2022, which raises
substantial doubt about its ability to continue as a going concern.
MULLEN AUTOMOTIVE: Receives Add'l. Noncompliance Notice From Nasdaq
-------------------------------------------------------------------
Mullen Automotive Inc. disclosed in a Form 8-K filed with the
Securities and Exchange Commission that on Oct. 3, 2023, the
Company received an additional written notice from the Listing
Qualifications Department of The Nasdaq Stock Market LLC indicating
that the Staff had concluded that the Company did not hold an
annual meeting in the fiscal year ended Sept. 30, 2023, that met
the Nasdaq annual meeting standard, as set forth in Nasdaq Listing
Rule 5620(a).
While the Company held an annual meeting on Aug. 3, 2023 and the
proposals that were approved at the meeting including the election
of directors are, and remain, valid, the Staff determined that such
meeting did not satisfy the Annual Meeting Rule since the Company
did not afford stockholders the opportunity to discuss Company
affairs with management at the meeting as required under Nasdaq
Listing Rule IM-5620. The Company will present its plan to
demonstrate compliance with the Annual Meeting Rule at the
previously scheduled Bid Price Rule hearing and the Panel will
consider this matter in their decision regarding the Company's
continued listing on The Nasdaq Capital Market.
On Sept. 6, 2023, Mullen Automotive received written notice from
Nasdaq indicating that the Company did not meet the Staff's Sept.
5, 2023, deadline to regain compliance with Nasdaq Listing Rule
5550(a)(2) due to the Company's failure to maintain a minimum bid
price of $1.00 per share for a minimum of ten consecutive business
days prior to the expiration of the previously granted Nasdaq grace
period (pursuant to the Nasdaq Listing Rules, Nasdaq has the
discretion to monitor a company for as long as twenty business days
prior to deeming a company in compliance with the Bid Price Rule).
On Sept. 6, 2023, the Company requested a hearing before a Nasdaq
Hearings Panel at which it may request a further extension of time
and present its plan to regain compliance with the Bid Price Rule.
The requested hearing stays any delisting or suspension action
pending the issuance of the Panel decision and the expiration of
any additional extension period granted by the Panel following the
hearing.
About Mullen
Mullen Automotive Inc., f/k/a Net Element Inc., is a Southern
California-based automotive company building the next generation of
electric vehicles that will be manufactured in two Company-owned
United States-based assembly plants. Mullen's EV development
portfolio includes the Mullen FIVE EV Crossover, Mullen Commercial
Class 1 and 3 EVs and Bollinger Motors, which features both the B1
and B2 electric SUV trucks and Class 4-6 commercial offerings.
Mullen reported a net loss of $740 million for the year ended Sept.
30, 2022, compared to a net loss of $44 million for the year ended
Sept. 30, 2021. For the nine months ended June 30, 2023, Mullen
reported a net loss of $806 million, up from a net loss of $485
million for the same period in 2022.
Fort Lauderdale, Florida-based Daszkal Bolton LLP, the Company's
auditor since 2020, issued a "going concern" qualification in its
report dated Jan. 13, 2023, citing that the Company has sustained
net losses, has indebtedness in default, and has a deficiency in
working capital of approximately $36 million at Sept. 30, 2022,
which raise substantial doubt about its ability to continue as a
going concern.
NORTH VILLAGE: Wins Cash Collateral Access Thru Dec 31
------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
authorized North Village Snow Management Corp. d/b/a North Village
Group to continue using cash collateral on an interim basis in
accordance with prior interim order through December 31, 2023.
As previously reported by the Troubled Company Reporter, in return
for the Debtor's continued interim use of cash collateral, the U.S.
Small Business Administration was granted the following adequate
protection for its purported secured interests in property of the
Debtor:
1. The Debtor will permit the SBA to inspect, upon reasonable
notice, within reasonable hours, the Debtor's books and records;
2. The Debtor will maintain and pay premiums for insurance to
cover all of its assets from fire, theft, and water damage;
3. The Debtor will, upon reasonable request, make available
to the SBA evidence of that which constitutes its collateral or
proceeds;
4. The Debtor will properly maintain its assets in good
repair and properly manage its business; and
5. The SBA will be granted valid, perfected, enforceable
security interests in and to the Debtor's post-petition assets,
including all proceeds and products which are now or hereafter
become property of this estate, to the extent and priority of its
alleged pre-petition liens, if valid, but only to the extent of any
diminution in the value of such assets during the period from the
commencement of the Debtor's Chapter 11 case.
A further hearing on the matter is set for December 19 at 10 a.m.
A copy of the order is available at https://urlcurt.com/u?l=wh781x
from PacerMonitor.com.
About North Village Snow Management Corp.
North Village Snow Management Corp. offers basement waterproofing
services and snow management services for commercial and
residential customers.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ill. Case No. 23-09789) on July 27,
2023.
Judge Janet S. Baer oversees the case.
David K. Welch, Esq., at Burke, Warren, Mackay & Serritella, P.C.,
represents the Debtor as legal counsel.
NOVA CHEMICALS: Moody's Alters Outlook on 'Ba2' CFR to Negative
---------------------------------------------------------------
Moody's Investors Service affirmed NOVA Chemicals Corporation's Ba2
corporate family rating, Ba2-PD probability of default rating and
Ba3 senior unsecured notes rating. The outlook was changed to
negative from stable.
"The negative outlook reflects heightened credit risks due to the
tightening of NOVA's liquidity during a period of industry
underperformance, soft macro conditions and multiple operational
setbacks," said Whitney Leavens, Moody's analyst.
RATINGS RATIONALE
NOVA's Ba2 CFR reflects its: (1) large scale within the ethylene
and polyethylene markets; (2) competitive manufacturing assets in
North America with access to cost-advantaged ethane; and (3) strong
ownership profile with a history of flexible dividend payments and
track record of liquidity support. The rating is constrained by :
(1) high exposure to inherent cyclicality of prices and input costs
leading to volatile margins and cash flows given limited product
and geographic diversity; (2) high financial leverage (over 10x at
Q2-23), with debt to EBITDA still close to 5x in 2024 under Moody's
forecast; (3) lack of forward integration at Geismar which limits
profitability; and (4) weak liquidity driven by near-term
refinancing and a potential litigation payment to Dow Chemical
Company (Dow, Baa1 stable).
While NOVA's shareholder has a track record of providing liquidity
support and flexibility on dividend payments, tight liquidity
management and the prioritization of distributions over debt
reduction elevates governance risks and weakens the company's
credit profile. The delay in addressing refinancing needs has the
potential to make NOVA more dependent on its owners for support and
last-minute funding from capital markets. Moody's does not view the
current approach to liquidity management as characteristic of a
Ba-level rating.
NOVA has weak liquidity. As of Q2-23, sources total about $1.3
billion compared to uses of $1.48 billion through year end 2024.
Sources include about $85 million in cash and equivalents as of
Q2-23, availability of $1.05 billion under the $1.5 billion
revolving credit facility (availability based on permitted net
secured debt ratio no greater than 3.5x consolidated LTM cash flow)
due April 2026 and Moody's forecast for about $160 million in free
cash flow through year end 2024. Moody's expects improving cash
flows into 2024 to ease restrictions on availability under the
revolver. NOVA also has access to two accounts receivable
securitization facilities, with $188 million drawn as of Q2-23
under the program consisting of $100 million expiring December 2025
and $175 expiring January 2026. Uses of cash include $1.05 billion
in senior unsecured notes due June 2024 and a $425 secured million
term loan due December 2024. While the range of potential outcomes
is wide, the company may also potentially be subject to additional
litigation charges requiring payments to Dow. Moody's expects NOVA
to remain in compliance with its financial covenants. The company
has some flexibility to raise alternate liquidity through asset
sales.
NOVA Chemicals' senior unsecured debt is rated Ba3, one notch below
the Ba2 CFR, reflecting subordination to the $1.5 billion secured
revolving credit facility due April 2026 and $425 million term loan
due December 2024.
The negative outlook reflects NOVA's tight liquidity profile during
a period of industry underperformance and operational setbacks
combined with high leverage and Moody's outlook for soft
macroeconomic conditions in 2024.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be downgraded if liquidity weakens or Moody's
believes refinancing risks have increased, if debt to EBITDA is
likely to be sustained above 5.5x, or the company generates
sustained negative free cash flow.
The ratings could be upgraded if NOVA sustains debt to EBITDA under
3.5x and successfully executes on the full ramp-up of AST2. An
upgrade would also require a more conservative financial policy and
proactive management of refinancing needs.
NOVA Chemicals Corporation is privately-owned by Mubadala
Investment Company, and is a Calgary, Alberta-headquartered
producer of ethylene and polyethylene products.
The principal methodology used in these ratings was Chemicals
published in June 2022.
ORGANIC NAILS: Seeks Cash Collateral Access Thru Mar 2024
---------------------------------------------------------
Organic Nails KS LLC asks the U.S. Bankruptcy Court for the
District of Kansas for authority to use cash collateral and provide
adequate protection.
The Debtor seeks (i) an interim Order of the Court authorizing it
to use cash collateral for payment of the normal and necessary
expenses of its business, pending an evidentiary hearing, if
necessary, if an Objection to the Motion is filed, and (ii) a
further Order of the Court authorizing the Debtor's continued use
of cash collateral through March 31, 2024, or until the Plan of
Reorganization is Confirmed, whichever is sooner, and reserving to
Debtor the right to seek a further extension of such Order.
At the time of the filing, Debtor had bank account balance of
approximately $20,000 and a fluctuating inventory and equipment
amount as detailed in Schedule B of the Bankruptcy Petition.
The creditors that have a claim to the Cash Collateral include
Rapid Finance LLC and Mulligan Funding LLC.
Rapid Finance LLC asserts a perfected security interest in all
inventory, accounts, and equipment of the Debtor's business, while
Mulligan Funding LLC asserts a perfected security interest in all
accounts, chattel paper, goods, inventory, equipment, instruments,
reserves, reserve accounts , investment properties, documents,
general intangibles of the Debtor's business.
The Debtor proposes, effective as of the Petition Date, that each
of the Creditors is granted replacement security interests in, and
liens on, all post-Petition Date acquired property of the Debtor
and the Debtor's bankruptcy estate that is the same type of
property that the specific Creditor holds a pre-petition interest,
lien or security interest to the extent of the validity and
priority of such interests, liens, or security interests, if any.
The amount of each of the Replacement Liens will be up to the
amount of any diminution of each of the Creditors' respective
collateral positions from the Petition Date. The priority of the
Replacement Liens will be in the same priority as each of the
Creditors pre-petition interests, liens and security interests in
similar property.
The Debtor further proposes paying Mulligan Funding the monthly sum
of $1,900 beginning December 1, 2023 and continuing the 1st of each
month as adequate protection payments.
The Debtor further proposes paying Rapid Finance the monthly sum of
$800 beginning December 1, 2023 and continuing the 1st of each
month as adequate protection payments until further Order of the
Court or Chapter 11 Plan Confirmation.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=LuJRv6 from PacerMonitor.com.
The Debtor projects total expenses, on a monthly basis, as
follows:
$211,0378 for October 2023;
$211,0378 for November 2023; and
$227,806 for December 2023.
About Organic Nails KS LLC
Organic Nails KS LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Kan. Case No. 23-21172) on October 2,
2023. In the petition filed by Allen Hiranhphom, owner, the Debtor
disclosed up to $100,000 in assets and up to $500,000 in
liabilities.
Nancy Leah Skinner, Esq., at Skinner Law, LLC, represents the
Debtor as legal counsel.
PAYNE'S ENVIRONMENTAL: Case Summary & 20 Top Unsecured Creditors
----------------------------------------------------------------
Debtor: Payne's Environmental Services, LLC
5617 Causeway Blvd.
Tampa, FL 33619
Business Description: The Debtor offers a variety of tree services
to residential and commercial customers. It
offers tree trimming, tree removal, and
stump grinding and removal services.
Chapter 11 Petition Date: October 11, 2023
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 23-04522
Debtor's Counsel: Buddy D. Ford, Esq.
BUDDY D. FORD, P.A.
9301 West Hillsborough Avenue
Tampa, FL 33615-3008
Tel: (813) 877-4669
Fax: (813) 877-5543
Email: All@tampaesq.com
Total Assets: $4,294,839
Total Liabilities: $4,785,378
The petition was signed by Terry Payne as manager.
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/QUOE6BA/Paynes_Environmental_Services__flmbke-23-04522__0001.0.pdf?mcid=tGE4TAMA
PB MICHIGAN: May Use $35,000 of Cash Collateral
-----------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Michigan,
Southern Division, authorized PB Michigan, LLC to use $35,000 of
cash collateral to pay immediate operating expenses for the 30 days
following the Petition Date.
As adequate protection for the use of cash collateral, Pendulum
Finance, the U.S. Small Business Administration, and any other
secured creditors that may claim an interest in the cash collateral
are granted replacement liens, with the same priority that each
said secured creditor had pre-petition, in all types and
descriptions of collateral that were secured by the applicable
pre-petition loan documents.
A final hearing on the matter is set for October 27, 2023 at 1
p.m.
A copy of the order is available at https://urlcurt.com/u?l=x0uwZW
from PacerMonitor.com.
About PB Michigan, LLC
PB Michigan, LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. Mich. Case No. 23-48504) on September
28, 2023. In the petition signed by Allison LeMay, member/manager,
the Debtor disclosed up to $50,000 in assets and up to $10 million
in liabilities.
Judge Lisa S. Gretchko oversees the case.
Mark H. Shapiro, Esq., at Steinberg Shapiro & Clark, represents the
Debtor as legal counsel.
PERFORMANCE RESULTS: Court OKs Cash Collateral Access Thru Dec 31
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Ohio,
Eastern Division, authorized Performance Results Plus, Inc. to use
cash collateral on a final basis in accordance with the budget,
December 31, 2023.
The Debtor requires the use of cash collateral to pay present
operating expenses.
The Debtor represents that The Huntington National Bank have or may
claim to have security interests in the Debtor's cash collateral.
The Debtor's initial pre-petition secured lender was HNB. On
November 19, 2020, the Debtor, through the U.S. Small Business
Administration, entered into a business loan agreement with HNB for
a loan in the principal amount of $2.217 million. On the same date,
the Debtor entered into a line of credit with HNB in the principal
amount of $250,000.
The Debtor acknowledges that on September 11, 2023, HNB refunded to
the Debtor amounts set off by HNB from the Debtor's checking
account on August 8, 2023, within 90 days prior to the Petition
Date, in the amount of $25,579.
The Debtor will reduce the salary of Martha Adkins and will cap the
salary of Michael Adkins such that each will receive no more than
$5,346 per bi-weekly pay period (approximately $139,000 annually)
until confirmation of a plan of reorganization.
The security interests of HNB, if any, in cash collateral are
continued and re-granted in the same amount and to the same extent,
validity and priority as existed immediately prior to the Petition
Date, and HNB will not be required to take any other action to
perfect the lien(s) re-granted to them thereunder.
HNB is not granted liens or security interests in any avoidance
actions that may be pursued pursuant to the Bankruptcy Code or
other applicable law or in the proceeds from any avoidance action.
A Termination Event will be deemed to have occurred five business
days after written notice sent by HNB to the Debtor, its counsel,
the Subchapter V Trustee, and the U.S. Trustee of the occurrence of
any of the following:
(i) the payment or incurrence by the Debtor of any material
expense of a type not set forth in the Budget;
(ii) the payment of any expenses that would cause the aggregate
expenditures under the Budget for any monthly period to exceed the
amount set forth in the Budget for such month by 10%. Any budgeted
expenditures not paid in a particular budget period may be carried
forward into a subsequent budget period. Expenditures, other than
legal or other professional fees, may be paid in an earlier period
in the reasonable discretion of the Debtor, in which event, the
Budget will be deemed amended to move the expenditure into the
month of the actual expenditure for the purpose of calculating
rolling monthly variances set forth above. The Debtor will provide
a written explanation in reasonable detail explaining the amount of
and the reason for the prepayment or delay in payment;
(iii) the failure of the Debtor to pay, within 10 days of the
applicable due date, all undisputed administrative expenses in full
in accordance with their terms as provided for in the Budget except
for any expenses under U.S.C. sections 503(b)(9) and/or 546(c);
(iv) the failure of the Debtor to timely pay all fees due
under 28 U.S.C. section 1930; and
(v) the failure of the Debtor to comply with, keep, observe
or perform any of its agreements or undertakings under the Interim
Order.
The Debtor's authority to use cash collateral will automatically
and immediately terminate without any further action by HNB or the
Court and a Termination Event will occur without prior notice upon
the occurrence of any of the following:
(i) the Debtor's Chapter 11 case is dismissed or converted to
a case under Chapter 7 of the Bankruptcy Code;
(ii) the earlier of (y) the date of the entry of an order of
the Court appointing an examiner with enlarged powers (beyond those
set forth in Sections 1104(c) and 1106(a)(3) and (4) of the
Bankruptcy Code) for the Debtor; or (z) the date the Debtor files a
motion, application or other pleading consenting to or acquiescing
in any such appointment; or
(iii) the Court suspends the Debtor's Chapter 11 Case under 11
U.S.C. section 305;
(iv) the Order is reversed, vacated, stayed, amended,
supplemented or modified in a manner which materially and adversely
affects the rights of HNB.
A copy of the order is available at https://urlcurt.com/u?l=NvQCpM
from PacerMonitor.com.
About Performance Results Plus, Inc.
Performance Results Plus, Inc. owns and operates a hydraulic
machine shop. The Debtor sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. S.D. Ohio Case No. 23-52960) on August
28, 2023. In the petition signed by Michael L. Adkins, president,
the Debtor disclosed $3,219,882 in assets and $3,128,718 in
liabilities.
Judge Kathryn Preston oversees the case.
John W. Kennedy, Esq., at Strip Hoppers Leithart McGrath & Terlecky
Co., LPA, represents the Debtor as legal counsel.
PJ TRANS: Court OKs Cash Collateral Access Thru Nov 14
------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois,
Eastern Division, authorized PJ Trans, Inc. to use cash collateral
on an interim basis through November 14, 2023, in accordance with
the budget and the August 8, 2023 Order.
As previously reported by the Troubled Company Reporter, before the
Petition Date, on January 27, 2015, the Debtor entered into a
Factoring Agreement with RTS Financial Service, Inc. Pursuant to
the Pre-Petition Factoring Agreement, the Debtor routinely sold its
accounts receivable from a portion of its business to RTS.
To secure the obligations under the Pre-Petition Factoring
Agreement, the Debtor granted RTS a security interest in all of the
Debtor's assets including but not limited to all accounts and all
proceeds and monies due on accounts, which includes cash
collateral.
This security interest was properly perfected and constituted a
first-priority lien on the Pre-Petition Collateral.
The Debtor filed for bankruptcy without finalizing agreements for
post-petition arrangements, cash collateral usage, or
debtor-in-possession financing. However, in order to prevent
disruption to the Debtor's business, RTS provided factoring
services based on the terms of the Pre-Petition Factoring
Agreement. This included purchasing $101,104 of the Debtor's
accounts receivable on July 21, 2023, advancing $74,000 from the
Debtor's reserve account on July 26, and purchasing an additional
$101,499 of accounts receivable on July 28, 2023. The Debtor has
agreed to repay the $74,000 advance from the reserve account
through weekly payments from post-petition purchases by August 11,
2023. The Debtor is also allowed to offset pre or post-petition
receivables from post-petition factoring services according to the
terms of the Pre-Petition Factoring Agreement and Post-Petition
Factoring Agreement.
RTS was willing to continue the factoring arrangement post-petition
on the terms outlined in the Motion and in the terms of the
Factoring Agreement dated July 26, 2023.
Under the terms of the Pre-Petition Factoring Agreement and the
Post-Petition Factoring Agreement, RTS was granted an ownership
interest in the purchased accounts and a security interest in the
collateral set out in Section 4.1 of the factoring agreement.
The Debtor has not identified any other creditors that appear to
hold a security interest in the cash collateral.
The Debtor wished to implement the Post-Petition Factoring
Agreement with RTS on a post-petition basis, retroactive to the
Petition Date. If the Factoring Agreement is approved by the Court,
the Debtor will sell its accounts to RTS, and the funds obtained
from the sale of such accounts will be used to fund the ongoing
expenses of the Debtor's bankruptcy estate.
The purchases and advances by RTS and proceeds from non-factored
accounts constitute cash collateral of RTS as defined in 11 U.S.C.
Section 363(a). The proceeds of the accounts are used by the Debtor
to operate, including to pay the Debtor's payroll, insurance,
utilities, operating costs, and material acquisitions.
As adequate protection for the use of cash collateral, RTS was
granted: (i) first-ranked, priority liens on the on all
Pre-Petition Collateral, which Replacement Liens will be subject
and subordinate in priority only to those valid and perfected
liens, if any, that existed as of the Petition Date that are
superior in rank to valid and perfected liens that secure the
pre-petition obligations to RTS; and (b) status as a super-priority
administrative claim pursuant to 11 U.S.C. Section 364(c)(1), with
priority over any and all administrative expenses of the kind
specified in 11 U.S.C. Sections 503(b) or 507(b) with the exception
of (i) U.S. Trustee fees, and (ii) professional fees allowed and
payable under 11 U.S.C. Sections 330, 331, and 503.
A hearing on the matter is set for November 14 at 1:30 p.m.
A copy of the order is available at https://urlcurt.com/u?l=RmDkno
from PacerMonitor.com.
About PJ Trans, Inc.
PJ Trans, Inc. is a trucking company and has filed the case to
reorganize its debts and obligations in order to prevent the
liquidation and closure of its business.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ill. Case No. 23-09390) on July 20,
2023. In the petition signed by Marcin Pogorzelski, president, the
Debtor disclosed up to $50,000 in both assets and liabilities.
Judge Janet S. Baer oversees the case.
Saulius Modestas, Esq., at Modestas Law Offices, P.C., represents
the Debtor as legal counsel.
PLATFORM II LAWNDALE: Wins Cash Collateral Access Thru Oct 31
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois,
astern Division, authorized Platform II Lawndale LLC to use cash
collateral on an interim basis in accordance with the budget,
through October 31, 2023.
As previously reported by the Troubled Company Reporter, GreenLake
Real Estate Fund, LLC purports to hold a first priority lien and
security interest in the Debtor's property, and the Debtor's cash
and cash receipts received from the leasing of storage units,
through a security interest and assignment of rents granted by the
Debtor under an Open-End Mortgage, Security Agreement, Assignment
of Rents and Leases and Fixture Filing dated May 18, 2018, and
recorded with the Cook County Recorder of Deeds on May 22, 2018.
The assets secure the repayment of a promissory note dated May 18,
2018, in the original principal sum of $6.250 million.
As adequate protection, Greenlake was granted a replacement lien on
the Debtor's rents, accounts and accounts receivables. As further
adequate protection for Greenlake's interests in the Pre-Petition
Collateral, and consistent with 11 U.S.C. Section 552, the Debtor
grants Greenlake a replacement lien on the Debtor's rents,
accounts, and accounts receivables derived from the Property, which
are of the same type or nature as the Pre-Petition Collateral,
coming into existence or acquired by the Debtor respecting the
Property on or after the Petition Date.
The Post-Petition Liens granted to Greenlake under the terms of the
Order will be valid and perfected as of the date of the Order,
without the need for the execution or filing of any further
document or instrument otherwise required to be executed or filed
under applicable non-bankruptcy law.
A continued hearing on the matter is set for October 25 at 11:30
a.m.
A copy of the Court's order is available at
https://urlcurt.com/u?l=NpM3cE from PacerMonitor.com.
About Platform II Lawndale LLC
Platform II Lawndale LLC is an Illinois limited liability company
that owns a self-storage facility at 1750 North Lawndale Avenue in
Chicago's West Logan Square neighborhood. The Debtor sought
protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr.
N.D. Ill. Case No. 22-07668) on July 11, 2022. In the petition
signed by Scott Krone, manager, the Debtor disclosed up to $50
million in both assets and liabilities.
Judge Deborah L. Thorne oversees the case.
Gregory J. Jordan, Esq., at Jordan & Zito LLC is the Debtor's
counsel.
POLK AZ: Court OKs Interim Cash Collateral Access
-------------------------------------------------
The U.S. Bankruptcy Court for the District of Arizona authorized
Christopher Simpson, the Chapter 11 Trustee of Polk AZ, to use cash
collateral on an interim basis in accordance with the budget, with
a 10% variance.
As previously reported by the Troubled Company Reporter, the Debtor
requires the use of cash collateral to continue its operations.
The Debtor owns and maintains property, including accounts
receivable currently collectable necessary for operation of its
business. The Property is located at 411 North 21st Place/2148 East
Polk Street, Phoenix, AZ. The Property is a 32-unit apartment
complex. Id. The Debtor's Property is now in aggregate worth
approximately $3.6 million.
The Property's value is currently stable. However, it will rise to
approximately $5.9 million in value upon the repair and
reconstruction of two fire damaged units in a five-unit building
that cannot be currently leased.
As of the Petition Date, the Debtor owes approximately $1.8 million
of secured debt on the Property to Haymarket Insurance Co.
The court ruled that as adequate protection for the use of its
cash collateral, Haymarket will continue to have replacement liens
against the Estate's post-petition accounts receivable and the
proceeds thereof, to the same extent, validity, and priority as any
lien held by Haymarket, only to the extent that its cash collateral
is used by the Estate and subject to the carveouts as set forth in
the Carve Out Order.
Haymarket reaffirms that it will forbear from receiving any
adequate protection payments. Haymarket retains its lien and
interest in cash collateral.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=zu68MK from PacerMonitor.com.
The Debtor projects total expenses, on a monthly basis, as
follows:
$5,126 for October 2023;
$5,426 for November 2023; and
$5,176 for December 2023.
About Polk AZ LLC
Polk AZ LLC sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Ariz. Case No. 21-07693) on Oct. 13, 2021. Jean
Gonzvar, designated representative, signed the petition.
Judge Eddward P. Ballinger, Jr. oversees the case. Engelman Berger,
PC, serves as the Debtor's counsel.
Haymarket Insurance Company, as lender, is represented by Patrick
F. Keery, Esq., at Kerry McCue.
PRETIUM PKG: Moody's Lowers Rating on First Lien Term Loan to Caa2
------------------------------------------------------------------
Moody's Investors Service downgraded Pretium PKG Holdings, Inc.'s
first lien senior secured term loan to Caa2 from B3. Pretium's Caa1
corporate family rating, Caa1-PD probability of default rating, and
Caa3 rated second lien senior secured term loan are unchanged. The
stable rating outlook is also unchanged.
The rating action reflects Pretium's announcement that it had
reached an agreement with a majority of its first lien lenders to
exchange their existing debt to a new second-out super senior first
lien term loan at a discounted price of 93.6%. Concurrently,
Pretium launched the new first-out super senior first lien term
loan that will be the most senior tranche in the new debt capital
structure. The company has the option to pay a portion of
pay-in-kind interest on the new super senior term loans.
"Moody's consider this up-tiering transaction a distressed exchange
and a limited default (LD) because any existing first lien term
loans that are not exchanged will remain in place with a
subordinated position relative to the new super senior loans," said
Motoki Yanase, VP - Senior Credit Officer at Moody's.
Following the closing of the exchange offer, Moody's would append
the /LD designation to Pretium's probability of default rating.
Moody's will remove the "/LD" designation from the company's PDR in
approximately three business days after appending.
Upon closing of the transaction, Moody's will reassess Pretium's
CFR and outlook, incorporating the improvement in liquidity and the
company's business prospect for the next two to three years.
Despite expected improvement in liquidity and lower cash interest
after the proposed transaction, potential for upward rating action
is limited given no improvement in gross leverage. Leverage for the
twelve months that ended June 2023 stood high at about 17x,
including Moody's standard adjustments.
RATINGS RATIONALE
Pretium's credit profile reflects the company's weak credit
metrics, with high leverage after its acquisition of Alpha
Packaging in 2021. The profile also considers the company's
aggressive financial policy as evidenced by elevated debt load,
history of acquisition-driven growth and a dividend
recapitalization in 2020 within the first year of private equity
ownership. The credit profile further reflects historically
negative free cash flow (FCF) generation during the period of the
acquisition-driven build-out of its current diversified product
portfolio and its exposure to a high interest expense cost burden.
These credit weaknesses are counterbalanced with Pretium's credit
strengths, including diverse end-markets, including nutrition &
wellness, food & specialty beverage, and personal care, which
combined account for roughly two-thirds of sales. Almost all of
Pretium's business is under contract with resin pass-throughs,
which also helps it maintain its margins.
The stable outlook reflects the potential improvement in Pretium's
quarterly sales and high profitability the company has maintained.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Moody's could upgrade the rating if the company's sales volume
recovers growth and improves its credit metrics. Specifically, an
upgrade could occur if debt/EBITDA trends below 8x and
EBITDA/interest improves above 1.5x, along with consistently
positive free cash flow generation.
Moody's could downgrade the rating if the company fails to improve
sales volume and cash flow generation. Specifically, Moody's could
downgrade the rating if EBITDA/Interest falls below 1x, liquidity
profile deteriorates, or restructuring risk continues, resulting in
a reduced recovery prospects for creditors or a default.
Headquartered in St. Louis, Missouri, 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. has been a
portfolio company of Clearlake since January 2020.
The principal methodology used in this rating was Packaging
Manufacturers: Metal, Glass and Plastic Containers published in
December 2021.
PROCARE PROPERTY: Files Emergency Bid to Use Cash Collateral
------------------------------------------------------------
Procare Property Management LLC asks the U.S. Bankruptcy Court for
the Western District of Texas, San Antonio Division, for authority
to use the cash collateral of the Quarters at Petaluma LLC and Faye
Servicing to sustain its ongoing operations.
The Debtor requires the continued use of cash collateral to make
payments on, among other things, insurance, payroll, payroll
expenses, utility charges, and the costs of supplies used in the
operation of the business.
At the time of the Debtor's bankruptcy filing, the Debtor had two
creditors which may hold a security interest in the Debtor's cash
collateral.
More specifically, the Quarters at Petaluma LLC has an Assignment
of Rents in all of the Debtor's rent payments from two Real
properties located at 225 S. Pine St, San Antonio. The amount of
the debt owed by Debtor to the Quarters at Petaluma LLC is
approximately $879,393. Additionally, Faye Servicing has an
Assignment of Rents for the Debtor's real property located at 1118
Wyoming St. San Antonio Texas and 1110 S. Olive St. San Antonio,
Texas. The amount of the debt owed by Debtor to Faye Servicing is
approximately $437,500.
At the time of the Debtor's bankruptcy filing, the balance of
Debtor’s bank account was approximately $15,000.
The Debtor would show that both the Quarters at Petaluma LLC and
Faye Servicing are adequately protected by its respective
pre-petition liens on the collateral.
The Debtor proposes to provide adequate protection to Quarters at
Petaluma LLC and Faye Servicing to the extent required by this
Court, in the form of the following:
a. Replacement liens on all post-petition rents acquired by the
Debtor since the filing of the petition generated by the use of
cash collateral; and
b. The Debtor will remain current on all of its tax obligations,
including but not limited to deposit of employee withholding for
income, Social Security taxes and hospital insurance (Medicare) and
employer's contribution for Social Security taxes and deposit
excise tax, if applicable. The Debtor will file all present and
future returns as they become due.
A copy of the motion is available at https://urlcurt.com/u?l=RWYBo5
from PacerMonitor.com.
About Procare Property Management LLC
Procare Property Management LLC sought protection under Chapter 11
of the U.S. Bankruptcy Code (Bankr. W.D. Tex. Case No. 23-51301) on
September 28, 2023. In the petition signed by James Rivera,
manager, the Debtor disclosed up to $10 million in both assets and
liabilities.
Morris E. "Trey" White III, Esq., at Villa & White LLP, represents
the Debtor as legal counsel.
RECEPTION MEZZANINE: Fitch Lowers LongTerm IDR to 'B', Outlook Neg.
-------------------------------------------------------------------
Fitch Ratings has downgraded Reception Mezzanine Holdings, LLC's
and Reception Purchaser, LLC Long-Term Issuer Default Rating (IDR)
to 'B' from 'B+' and the senior secured revolver and term loan to
'B+'/'RR3' from 'BB-'/'RR3'. The Rating Outlook is Negative.
The actions reflect near-term deterioration in credit metrics that
remain weaker than previously expected over the medium term. The
forecast results from weaker intermodal and freight markets with
limited visibility to recovery in the next few years. Fitch also
considers cash funded M&A during the downturn that reduced
liquidity and financial flexibility.
FCF will fluctuate around lowly positive to negative through 2025
while coverage metrics remain in the low-to-mid 1.0x. Leverage will
be elevated, peaking around 8.0x in FY2023 before moderating toward
6.0x. Fitch believes liquidity will remain manageable given cash
and revolver availability and long-dated maturities, however;
capital allocation decisions could pressure liquidity. The ratings
also consider STG's good market position with a scaled and
integrated network in a price-competitive market.
Fitch would consider downgrading STG's ratings in the next 12-24
months if Fitch's expects that the generation and preservation of
financial flexibility will struggle to recover.
KEY RATING DRIVERS
Freight Downturn Challenges Performance: Intermodal and broader
freight market conditions have been weaker than anticipated,
leading to declines in pricing and challenges realizing full
intermodal capacity utilization. Fitch expects EBITDA margin to
contract to around 6.0% from nearly 12% on a PF 2022 basis. While
STG is asset-light and a large portion of its costs are linked to
volumes, it has contracted shipping rates with third party
transporters, namely rail operators, that introduce margin risk
when intermodal market rates decline.
Fitch expects intermodal conditions and STG's performance to
stabilize sequentially in in Q4, before a modest full year
improvement in FY2024. Q3 2023 intermodal industry data leads Fitch
to believe that intermodal volumes are running below pre-pandemic
levels while spot rates have largely returned to these prior
levels, indicating headroom for recovery. However, economic
conditions remain a risk to STG's performance in the near term.
Longer-term fundamentals such as truck-to-rail conversions,
improving rail service levels, and the potential for an
increasingly sustainability focused-shipper base still indicate
growing demand levels.
Weaker Financial Flexibility: Fitch expects FCF generation and
interest coverage metrics to deteriorate in FY2023 and remain weak
through FY2025. FCF generation in 2023 is supported by a large
working capital benefit, but the impact is likely to be temporary,
leading to negative FCF in FY2024 before returning to about
break-even levels in FY2025. Both EBITDAR fixed charge coverage and
EBITDA coverage are declining to around 1.0x in FY2023 but are
expected to improve to around 1.3x and 1.6x, respectively by
FY2025. This level is toward the low-end of 'B' category
transportation credits.
Fitch believes liquidity will remain manageable for the rating
level despite expectations of mildly negative FCF. STG had $182
million of liquidity at Q2 2023, a level that Fitch views as
comfortably above minimum liquidity requirements. The ratings
incorporate the assumption that STG prioritizes maintaining a solid
liquidity profile while market conditions remain weak over
shareholder returns or aggressive acquisitive capital deployment
options.
EBITDA Leverage Peaks around 8.0x: EBITDA leverage is expected to
peak at about 8.0x in FY2023 before both EBITDA leverage and
EBITDAR leverage settle around the low- 6.0x by FY2025. The
estimate, which does not assume proactive debt repayment, is
elevated for the 'B' rating. It appears that STG still maintains
comfortable headroom under its financial covenant set at 7.0x net
leverage, as defined by the credit agreement.
Decent Market Position: Fitch estimates that STG occupies a top
three market position as an intermodal and drayage service provider
with coverage at eight of 10 major U.S. ports and numerous inland
distribution locations. Its position is supported by its ability to
offer end-to-end solutions for shippers, network of third-party
transport and established relationships insulates its position. The
drayage, brokerage and logistics markets in which STG operates
remain competitive and likely constrain EBITDA margins to the
low-double digits or below.
Intermodal Cyclicality: The intermodal industry is cyclical,
reflecting high exposure to consumer and industrial markets that
can weigh on volumes and yields. Fitch believes the industry has
limited pricing power, given the reliance on third party
transporters and the availability of the substitutive trucking
industry. Intermodal pricing reflects broader trucking conditions
given the substitutive nature of rail intermodal and truckload
shipping.
DERIVATION SUMMARY
The transportation and logistics markets in which STG competes are
highly fragmented, though there are a number of large-scale players
including J.B. Hunt (not rated; NR), Hub Group (NR), CH Robinson
(NR) and GXO Logistics (BBB/Stable). However, many of STG's large
competitors have a variety of services that extend beyond directly
related intermodal shipments or rail brokerage. Like many of its
peers, STG is susceptible to the cyclicality of freight markets,
which is driven by both demand conditions as well as supply-side
capacity considerations that can affect profitability.
STG's EBITDAR and EBITDA interest coverage are expected to range in
the low-to-mid 1.0x over the next few years while EBITDAR and
EBITDA leverage peak around 8.0x before moderating to around 6.0x.
Comparatively, Garda World Security Corporation's (GW; B+/Negative)
ratings reflects the expectation that EBITDA leverage remains above
6.5x, peaking in the low-to-mid 7.0x in FY2024, and EBITDA interest
coverage in the low-to-mid 2.0x over the next few years. The
expectations reflect GW's acquisitive posture despite solid
operating performance. GW's ratings also consider its relatively
stable operating profile, supported by the steady demand for
security and cash management services.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within the Rating Case for the Issuer:
- Revenue of about $1.66 billion in FY2023 represents an
approximate 19% decline from 2022 on a pro forma basis for the
XPO Intermodal acquisition. Operating conditions stabilize in
late 2023 before a moderate recovery drives mid-single digit
organic revenue over the subsequent two years;
- EBITDA margin declines to about 6% in FY 2023 from 12% in PF
2022. Profitability returns to 7-8% over the next few years
with cost reduction actions and market improvement;
- Capex remains around $15 million;
- Working capital is temporarily a benefit to FCF in FY2023;
- SOFR in the 4%-5% range through the forecast;
- STG prioritizes managing liquidity and financial flexibility
over M&A or shareholder capital allocation options.
RECOVERY ANALYSIS
The recovery analysis assumes that STG would be reorganized as a
going concern in bankruptcy rather than liquidated. Fitch has
assumed a 10% administrative claim.
Fitch estimates STG's GC EBITDA at $140 million. The GC EBITDA
estimate reflects Fitch's view of a sustainable,
post-reorganization EBITDA level upon which Fitch bases the
enterprise valuation. This estimate reflects a potential weakening
of the economy leading to disruption in the intermodal logistics
market and/or the loss of several significant customers. It also
reflects corrective measures taken in the reorganization to offset
the adverse conditions that triggered default such as cost cutting,
contract repricing and industry recovery.
Fitch assumes STG would receive a GC recovery multiple of 4.0x in
this scenario. This multiple is applied to the GC EBITDA to
calculate a post-reorganization enterprise value (EV). Ultimately
STG's 4.0x multiple is driven by the company's size and scale and
by comparable EV valuations among logistics providers. It also
considers the 6.25x multiple underpinning the March 2022 XPOI
acquisition.
Fitch's recovery scenario assumes STG's $60 million revolver is
fully drawn. These assumptions result in a 'BB-' rating and an
'RR3' Recovery Rating for the senior secured debt.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Sustained EBITDAR fixed-charge coverage above 2.0x and/or EBITDA
interest coverage above 2.5x;
- Sustained EBITDAR leverage below 5.0x and/or EBITDA leverage
below 4.5x;
- A structural recovery in end markets that improves financial
flexibility and reduces liquidity and refinance risk.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Weakened liquidity position as indicated by extended
non-seasonal borrowings on the revolver or material depletion
in cash balances;
- Sustained EBITDAR fixed charge coverage below 1.5x and/or
EBITDA interest coverage below 2.0x;
- Sustained EBITDAR leverage above 5.8x and/or EBITDA leverage
5.3x;
- Continued M&A or other capital allocation actions that
deteriorate financial flexibility and heightens liquidity
and refinance risk.
The Rating Outlook could be stabilized if Fitch expects that
operating improvements will support coverage and leverage metrics
comfortably within stated sensitivities.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: As of June. 30, 2023, STG had $122 million of
cash and full availability under the $60 million revolving credit
facility. STG's term loan amortizes at $8 million per year. The
revolver matures first in 2027, followed by the term loan in 2028.
Lease Treatment: Fitch capitalizes operating lease costs at 8.0x,
consistent with its treatment for real estate assets under lease.
For finance leases, Fitch utilizes the reported liability since
these leases are predominately for intermodal containers, which all
carry discounted purchase options at the end of their 4-5 year
lease term.
ISSUER PROFILE
STG is a provider of integrated, port-to-door containerized
logistic services including drayage, transloading, warehousing,
fulfilment, rail brokerage and final-mile solutions. It serves the
continental U.S. including major ports.
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
----------- ------ -------- -----
Reception Mezzanine
Holdings, LLC LT IDR B Downgrade B+
Reception Purchaser, LLC LT IDR B Downgrade B+
senior secured LT B+ Downgrade RR3 BB-
REGIONAL HOUSING: No Decline in Patient Care at Columbus Facility
-----------------------------------------------------------------
Melanie McNeil, Esq., the patient care ombudsman, filed with the
U.S. Bankruptcy Court for the Northern District of Georgia her 12th
report regarding the quality of patient care provided at The
Landings of Columbus, which is operated by RHCSC Columbus AL
Holdings LLC, an affiliate of Regional Housing & Community Services
Corp.
Regional Housing & Community Services is the governing body for six
personal care homes, including The Landings of Columbus in Georgia.
The report was filed after an ombudsman representative for the
Office of the State Long-Term Care Ombudsman visited the facility
on September 7. The ombudsman representative did not receive any
complaints from residents during this visit.
Residents expressed no concerns addressing issues or problems with
facility staff or management. Residents state that staff respond
when called and address their requests and preferences. Residents
appeared comfortable engaging with staff.
The ombudsman representative received no concerns about food
supplies and medications. The facility is clean and decorated
seasonally with no odors and that the residents' rooms were tidy
and odorless but with signs that the facility is an older building,
the ombudsman representative observed.
The patient care ombudsman is not aware of any significant change
in facility conditions or decline in resident care for this
personal care home since the last visit.
A copy of the 12th ombudsman report is available for free at
https://urlcurt.com/u?l=Pk8Wcj from PacerMonitor.com.
About Regional Housing & Community Services
Regional Housing & Community Services Corp. and its affiliates
filed a voluntary petition for relief under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ga. Lead Case No. 21-41034) on Aug.
26, 2021. At the time of the filing, Regional Housing & Community
Services listed as much as $100,000 in both assets and
liabilities.
Judge Paul W. Bonapfel oversees the cases.
The Debtors tapped Scroggins & Williamson, P.C. as legal counsel;
GGG Partners, LLC as interim management services provider; and SLIB
II, Inc., doing business as Senior Living Investment Brokerage, as
investment banker. Kurtzman Carson Consultants, LLC is the claims,
noticing and balloting agent.
Greenberg Traurig, LLP serves as counsel for indenture trustee, UMB
Bank, N.A.
Melanie S. McNeil, Esq., at Melanie S. McNeil is the patient care
ombudsman appointed in the Debtors' cases.
REGIONAL HOUSING: No Decline in Patient Care at Gainesville
-----------------------------------------------------------
Melanie McNeil, Esq., the patient care ombudsman, filed with the
U.S. Bankruptcy Court for the Northern District of Georgia her 12th
report regarding the quality of patient care provided at The
Landings of Gainesville, which is operated by RHCSC Gainesville AL
Holdings LLC, an affiliate of Regional Housing & Community Services
Corp.
Regional Housing & Community Services is the governing body for six
personal care homes, including The Landings of Gainesville in
Georgia.
In her 12th ombudsman report, Ms. McNeil noted no decline in
resident care at The Landings of Gainesville since the last visit.
The report was filed after an ombudsman representative for the
Office of the State Long-Term Care Ombudsman visited the facility
on September 13. The ombudsman representative visited with eleven
residents, the person in charge, housekeeping, and direct care
staff. Residents report they are satisfied with the care. The
resident mentioned that the facility is small, so they get
personalized care, but the residents struggle with making friends
and socializing because there are not many residents to talk to who
are alert and oriented.
The ombudsman representative observed that the home appeared
cleaner and brighter than in past visits. The dining room tables
and common areas were tastefully and seasonably decorated. The
outside appears relatively more groomed than in the past.
The ombudsman representative did not receive any complaints. The
quality of care appeared to be good. The ombudsman representative
did not note any decline in resident care since the last visit.
A copy of the 12th ombudsman report is available for free at
https://urlcurt.com/u?l=9nfxEk from PacerMonitor.com.
About Regional Housing & Community Services
Regional Housing & Community Services Corp. and its affiliates
filed a voluntary petition for relief under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ga. Lead Case No. 21-41034) on Aug.
26, 2021. At the time of the filing, Regional Housing & Community
Services listed as much as $100,000 in both assets and
liabilities.
Judge Paul W. Bonapfel oversees the cases.
The Debtors tapped Scroggins & Williamson, P.C. as legal counsel;
GGG Partners, LLC as interim management services provider; and SLIB
II, Inc., doing business as Senior Living Investment Brokerage, as
investment banker. Kurtzman Carson Consultants, LLC is the claims,
noticing and balloting agent.
Greenberg Traurig, LLP serves as counsel for indenture trustee, UMB
Bank, N.A.
Melanie S. McNeil, Esq., at Melanie S. McNeil is the patient care
ombudsman appointed in the Debtors' cases.
REGIONAL HOUSING: No Decline in Patient Care at Gardens of Rome
---------------------------------------------------------------
Melanie McNeil, Esq., the patient care ombudsman, filed with the
U.S. Bankruptcy Court for the Northern District of Georgia her 12th
report regarding the quality of patient care provided at The
Gardens of Rome, which is operated by RHCSC Rome AL Holdings LLC,
an affiliate of Regional Housing & Community Services Corp.
Regional Housing & Community Services is the governing body for six
personal care homes, including The Gardens of Rome in Georgia.
The report was filed after an ombudsman representative for the
Office of the State Long-Term Care Ombudsman visited The Gardens of
Rome facility on September 15. The ombudsman representative did not
receive any complaints on this visit. The ombudsman representative
reported that residents were very pleased with the care they
receive, they appeared happy and content.
Residents reported they can talk freely with any of the staff about
their concerns and the staff handle them appropriately. Residents
were clean and well groomed. Staff interacted well with the
residents. The facility appeared to have adequate food and
supplies. Medications were properly locked in a closet.
The patient care ombudsman is not aware of any significant change
in facility conditions or decline in resident care for this
personal care home since the last visit.
A copy of the 12th ombudsman report is available for free at
https://urlcurt.com/u?l=zJD4JI from PacerMonitor.com.
About Regional Housing & Community Services
Regional Housing & Community Services Corp. and its affiliates
filed a voluntary petition for relief under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ga. Lead Case No. 21-41034) on Aug.
26, 2021. At the time of the filing, Regional Housing & Community
Services listed as much as $100,000 in both assets and
liabilities.
Judge Paul W. Bonapfel oversees the cases.
The Debtors tapped Scroggins & Williamson, P.C. as legal counsel;
GGG Partners, LLC as interim management services provider; and SLIB
II, Inc., doing business as Senior Living Investment Brokerage, as
investment banker. Kurtzman Carson Consultants, LLC is the claims,
noticing and balloting agent.
Greenberg Traurig, LLP serves as counsel for indenture trustee, UMB
Bank, N.A. Melanie S. McNeil, Esq., at Melanie S. McNeil is the
patient care ombudsman appointed in the Debtors' cases.
REGIONAL HOUSING: No Decline in Patient Care at Landings of Douglas
-------------------------------------------------------------------
Melanie McNeil, Esq., the patient care ombudsman, filed with the
U.S. Bankruptcy Court for the Northern District of Georgia her 12th
report regarding the quality of patient care provided at The
Landings of Douglas, which is operated by RHCSC Douglas AL
Holdings, LLC, an affiliate of Regional Housing & Community
Services Corp.
Regional Housing & Community Services is the governing body for six
personal care homes, including The Landings of Douglas in Georgia.
The report was filed after an ombudsman representative for the
Office of the State Long-Term Care Ombudsman visited The Landings
of Douglas facility on September 19.
The ombudsman representative noted that the director was very
responsive. The ombudsman representative observed staff acting with
kindness making afternoon tea for one resident and heating some
soup at the request of another resident. The facility was clean and
nicely decorated. Supplies appeared adequate.
The patient care ombudsman reports no decline in resident care
since the last visit.
A copy of the 12th ombudsman report is available for free at
https://urlcurt.com/u?l=3CAdos from PacerMonitor.com.
About Regional Housing & Community Services
Regional Housing & Community Services Corp. and its affiliates
filed a voluntary petition for relief under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ga. Lead Case No. 21-41034) on Aug.
26, 2021. At the time of the filing, Regional Housing & Community
Services listed as much as $100,000 in both assets and
liabilities.
Judge Paul W. Bonapfel oversees the cases.
The Debtors tapped Scroggins & Williamson, P.C. as legal counsel;
GGG Partners, LLC as interim management services provider; and SLIB
II, Inc., doing business as Senior Living Investment Brokerage, as
investment banker. Kurtzman Carson Consultants, LLC is the claims,
noticing and balloting agent.
Greenberg Traurig, LLP serves as counsel for indenture trustee, UMB
Bank, N.A.
Melanie S. McNeil, Esq., at Melanie S. McNeil is the patient care
ombudsman appointed in the Debtors' cases.
REGIONAL HOUSING: No Decline in Patient Care at Savannah
--------------------------------------------------------
Melanie McNeil, Esq., the patient care ombudsman, filed with the
U.S. Bankruptcy Court for the Northern District of Georgia her 12th
report regarding the quality of patient care provided at The
Gardens of Savannah, which is operated by RHCSC Savannah AL
Holdings LLC, an affiliate of Regional Housing & Community Services
Corp.
Regional Housing & Community Services is the governing body for six
personal care homes, including The Gardens of Savannah in Georgia.
The report was filed after an ombudsman representative for the
Office of the State Long-Term Care Ombudsman visited the Gardens of
Savannah on September 20. Residents were happy with the care and
caregivers; facility appeared clean; and med cart was staffed,
according to the ombudsman representative.
The patient care ombudsman is not aware of any significant change
in facility conditions or decline in resident care for this
personal care home since the last visit.
A copy of the 12th ombudsman report is available for free at
https://urlcurt.com/u?l=0pS4fz from PacerMonitor.com.
The ombudsman may be reached at:
Melanie S. McNeil, Esq.
2 Peachtree Street NW, 33rd Floor
Atlanta, GA 30303
Telephone: 404-657-5327(O)
404-416-0211 (Cell)
Facsimile: 404-463-8384
Email: Melanie.McNeil@osltco.ga.gov
About Regional Housing & Community Services
Regional Housing & Community Services Corp. and its affiliates
filed a voluntary petition for relief under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ga. Lead Case No. 21-41034) on Aug.
26, 2021. At the time of the filing, Regional Housing & Community
Services listed as much as $100,000 in both assets and
liabilities.
Judge Paul W. Bonapfel oversees the cases.
The Debtors tapped Scroggins & Williamson, P.C. as legal counsel;
GGG Partners, LLC as interim management services provider; and SLIB
II, Inc., doing business as Senior Living Investment Brokerage, as
investment banker. Kurtzman Carson Consultants, LLC is the claims,
noticing and balloting agent.
Greenberg Traurig, LLP serves as counsel for indenture trustee, UMB
Bank, N.A.
Melanie S. McNeil, Esq., at Melanie S. McNeil is the patient care
ombudsman appointed in the Debtors' cases.
REGIONAL HOUSING: No Decline in Patient Care at Social Circle
-------------------------------------------------------------
Melanie McNeil, Esq., the patient care ombudsman, filed with the
U.S. Bankruptcy Court for the Northern District of Georgia her 12th
report regarding the quality of patient care provided at The
Gardens of Social Circle, which is operated by RHCSC Social Circle
AL Holdings LLC, an affiliate of Regional Housing & Community
Services Corp.
Regional Housing & Community Services is the governing body for six
personal care homes, including The Gardens of Social Circle.
The report was filed after an ombudsman representative for the
Office of the State Long-Term Care Ombudsman visited the facility
on August 16. The ombudsman representative did not receive any
complaints.
The ombudsman representative met with five residents in Building I.
The residents had no concerns. Residents stated everything is going
well, staff are being helpful, and they receive medication on
time.
The ombudsman representative visited Building III and spoke with
seven residents who said that everything was going well and that
staff was good to them. Residents were dressed and groomed. The
residents appeared to be happy, laughing, and very chatty with
ombudsman representative during the visit. The ombudsman
representative observed residents sitting in the family room.
The patient care ombudsman reported no decline in resident care
since the last visit. The residents stated to the ombudsman
representative that they like the staff and the facility, which is
clean and tidy.
A copy of the 12th ombudsman report is available for free at
https://urlcurt.com/u?l=yCLFGV from PacerMonitor.com.
About Regional Housing & Community Services
Regional Housing & Community Services Corp. and its affiliates
filed a voluntary petition for relief under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ga. Lead Case No. 21-41034) on Aug.
26, 2021. At the time of the filing, Regional Housing & Community
Services listed as much as $100,000 in both assets and
liabilities.
Judge Paul W. Bonapfel oversees the cases.
The Debtors tapped Scroggins & Williamson, P.C. as legal counsel;
GGG Partners, LLC as interim management services provider; and SLIB
II, Inc., doing business as Senior Living Investment Brokerage, as
investment banker. Kurtzman Carson Consultants, LLC is the claims,
noticing and balloting agent.
Greenberg Traurig, LLP serves as counsel for indenture trustee, UMB
Bank, N.A.
Melanie S. McNeil, Esq., at Melanie S. McNeil is the patient care
ombudsman appointed in the Debtors' cases.
ROLL: BICYCLE: Court OKs Cash Collateral Access on Final Basis
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Ohio, Eastern
Division, authorized roll: Bicycle Company, LLC to use cash
collateral on a final basis in accordance with the budget until the
earlier of (a) December 2, 2023 or such other date if Cash
Collateral usage is extended under the terms of the Final Order; or
(b) the termination of the Final Order.
The Debtor requires the use of cash collateral to fund their
operations.
Fifth Third Bank, National Association is the first lienholder. The
Other Lien Claimants are Glick.biz, LLC, Friedl Bohm and Tucker
Bohm.
As previously reported by the Troubled Company Reporter, the
obligations owed by the Debtors arise out of the Debtors' two debt
facilities with Fifth Third consists of: (i) a term loan facility
in the original principal amount of $950,000, dated November 30,
2021, and having an interest rate of 4.18% per annum, and (ii) a
revolving line of credit facility in the original principal amount
of $500,000, dated January 5, 2022, and having a monthly interest
rate of 0.230% in excess of the prime rate (which is presently
8.5%). As of the Petition Date, the outstanding balances on the
Fifth Third Term Loan and the Fifth Third LOC Loan were $747,384
and $496,077, respectively.
In 2016 and 2017, Bicycle entered into a series of agreements with
three parties: Friedl Bohm, Tucker Bohm and Glick.biz, LLC, whereby
each of the Investor Noteholders lent varying sums of monies to
roll: Bicycle under separate secured credit facilities which were
evidenced by a series of promissory notes issued in 2016 and 2017.
To secure the obligations of roll: Bicycle under the Original
Notes, roll: Bicycle executed and delivered to the Investor
Noteholders a Note Purchase and Security Agreement dated October
13, 2016 and a Note Purchase and Security Agreement dated October
26, 2017. Pursuant to the Purchase Agreements and to secure its
obligations under the Original Notes, roll: Bicycle granted the
Investment Noteholders a security interest in virtually all assets
of Bicycle.
As of the Petition Date, the amounts owed to each of the Investor
Noteholders by roll: Bicycle are: $76,402 to T. Bohm, $152,079 to
F. Bohm, and $152,079 to Glick.
These events constitute an "Event of Default":
a. the payment by the Debtors of any expense of a type not set
forth in the Budget without the written consent of Fifth Third;
b. the payment of any expenses that would cause the aggregate
expenditures under the Budget for any monthly period to exceed the
amount set forth in the Budget for such month by 10% absent the
written consent of Fifth Third. Any budgeted expenditures not paid
in a particular budget period may be carried forward into a
subsequent budget period. Expenditures, other than legal or other
professional fees, may be paid in an earlier period in the
reasonable discretion of the Debtors, in which event, the Budget
shall be deemed amended to move the expenditure into the month of
the actual expenditure for the purpose of calculating rolling
monthly variances;
c. the failure of the Debtors to pay, within five business days of
the applicable due date, all undisputed administrative expenses in
full in accordance with their terms as provided for in the Budget
except for any expenses under 11 US.C. sections 503(b)(9) and/or
546(c);
d. the failure of the Debtors to timely pay all fees due under 28
U.S.C. section 1930 (not including UST fees, which are inapplicable
in a subchapter V case); and
e. the failure of the Debtors to comply with, keep, observe, or
perform any of their agreements or undertakings under the Final
Order.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=Pp2bpY from PacerMonitor.com.
The Debtor projects ending cash balance, on a weekly basis, as
follows:
$212,954 for the week ending October 14, 2023;
$180,887 for the week ending October 21, 2023; and
193,590 for the week ending October 28, 2023.
About roll: Bicycle Company, LLC
roll: Bicycle Company, LLC sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. S.D. Ohio Case No. 2:23-bk-53016)
n August 31, 2023. In the petition signed by Stuart Hunter, chief
executive officer, the Debtor disclosed up to $10 million in both
assets and liabilities.
Judge John E. Hoffman, Jr. oversees the case.
James A. Coutinho, Esq., at Allen Stovall Neuman & Ashton LLP,
represents the Debtor as legal counsel.
SANDY HOOK INVESTMENTS: Files Emergency Bid to Use Cash Collateral
------------------------------------------------------------------
Sandy Hook Investments, LLC asks the U.S. Bankruptcy Court for the
Southern District of Florida, Fort Lauderdale Division, for
authority to use cash collateral to pay Lenders in accordance with
the budget, with a 10% variance.
At the time of the filing of the Motion, there were four individual
mortgages including a provision for Assignment of Leases and Rents
at Section 1.3, encumbering Debtor’s properties, specifically as
follows:
a. 7614 NW 68th Way, Tamarac, FL 33321: Mortgage in favor of
Velocity Commercial Capital, LLC dated August 31, 2021, and
recorded on September 7, 2021, having Instrument Number 117563658,
in the Official Records of Broward County, Florida;
b. 7515 NW 41st Street, Coral Springs, FL 33065: Mortgage in favor
of Velocity Commercial Capital, LLC dated August 31, 2021, and
recorded on September 7, 2021, having Instrument Number 117563702,
in the Official Records of Broward County, Florida;
c. 433 NW Desoto Street, Lake City, FL 32055: Mortgage in favor of
Velocity Commercial Capital, LLC dated August 31, 2021, and
recorded on September 8, 2021, having Instrument Number
202112018026, at Book 1446, Page 1897, in the Official Records of
Columbia County, Florida;
d. 6600 Saint Jude Drive, Fairburn, GA 30213: Deed to Secure Debt,
Security Agreement and Assignment of Rents and Leases in favor of
Velocity Commercial Capital, LLC dated December 22, 2021, and
recorded on December 28, 2021 at Deed Book 65042, Page 24, in the
Fulton County, Georgia records.
All of the properties are rented and generate approximately $12,300
a month in rental income.
A copy of the motion is available at https://urlcurt.com/u?l=XnM8fA
from PacerMonitor.com.
About Sandy Hook Investments, LLC
Sandy Hook Investments, LLC owns four real properties in Florida
having a total value of $1.05 million.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Fla. Case No. 23-18071) on October 2,
2023. In the petition signed by Cecelia Gail Ramos, managing
member, the Debtor disclosed $1,071,009 in assets and $804,000 in
liabilities.
Judge Peter D. Russin oversees the case.
Adam I. Skolnik, Esq., at Law Office of Adam I. Skolnik, PA,
represents the Debtor as legal counsel.
SANUWAVE HEALTH: Registers 96.7M Common Shares for Resale
---------------------------------------------------------
SANUWAVE Health, Inc. filed Amendment No. 1 to its Form S-1 to
disclose the possible resale or other disposition, from time to
time, of up to 96,687,519 shares of the Company's common stock, par
value $0.001 per share, by selling stockholders.
According to the Company's prospectus, the shares consist of:
(1) 30,694,450 shares of Common Stock issuable upon the
exercise of certain Common Stock Purchase Warrants with an exercise
price of $0.067 per share of Common Stock
(2) 30,694,450 shares of Common Stock issuable upon the
exercise of certain Common Stock Purchase Warrants with an exercise
price of $0.04 per share of Common Stock, and;
(3) 35,298,619 shares of Common Stock issuable upon the
conversion of certain Future Advance Convertible Promissory Notes.
The shares offered may be sold by the selling stockholders from
time to time in the over-the-counter market or any other national
securities exchange or automated interdealer quotation system on
which the Company's Common Stock is then listed or quoted. This may
be done through negotiated transactions or otherwise at market
prices prevailing at the time of sale or at negotiated prices.
According to the Company, all net proceeds from the sale of the
shares of Common Stock covered by the prospectus will go to the
selling stockholders.
"We will receive none of the proceeds from the sale of the shares
of Common Stock covered by this prospectus by the selling
stockholders. We may receive proceeds upon the exercise of
outstanding Warrants for shares of Common Stock covered by this
prospectus if the Warrants are exercised for cash. We are only
paying expenses relating to the registration of the shares of
Common Stock with the Securities and Exchange Commission, but all
selling and other expenses incurred by the selling stockholders
will be borne by them," the Company said.
The selling stockholders are:
-- Berkeley Greenwood;
-- Blackwell Partners LLC - Series A;
-- Christopher Davis;
-- Clive Caunter;
-- Dirk Horn;
-- Ian Miller;
-- Londer Securities SA;
-- Manchester Explorer, L.P.;
-- Robert Gambi;
-- Solas Capital Partners II, LP; and
-- Solas Capital Partners, LP
The last reported sale price for shares of SANUWAVE'S Common Stock
on September 27, 2023, was $0.0201 per share.
A full-text copy of the S-1/A Report is available at
https://tinyurl.com/4hsxmr3m
About SANUWAVE Health
Headquartered in Suwanee, Georgia, SANUWAVE Health, Inc.
(OTCQB:SNWV) -- http://www.SANUWAVE.com-- is focused on the
research, development, and commercialization of its patented,
non-invasive and biological response-activating medical systems for
the repair and regeneration of skin, musculoskeletal tissue, and
vascular structures. SANUWAVE's end-to-end wound care portfolio of
regenerative medicine products and product candidates help restore
the body's normal healing processes. SANUWAVE applies and
researches its patented energy transfer technologies in wound
healing, orthopedic/spine, aesthetic/cosmetic, and
cardiac/endovascular conditions.
SANUWAVE reported a net loss of $10.29 million for the year ended
Dec. 31, 2022, compared to a net loss of $27.26 million for the
year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had
$19.87 million in total assets, $60.88 million in total
liabilities, and a total stockholders' deficit of $41.01 million.
New York, NY-based Marcum LLP, the Company's auditor since 2018,
issued a "going concern" qualification in its report dated March
31, 2023, citing that the Company has incurred recurring losses and
needs to raise additional funds to meet its obligations and sustain
its operations and the occurrence of the events of default on the
Company's debt. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
SEVEN KITCHEN: Court OKs Interim Cash Collateral Access
-------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas, Fort
Worth Division, authorized Seven Kitchen & Cocktails, LLC to use
cash collateral on an interim basis in accordance with the budget,
with a 10% variance.
The Debtor requires the use of cash collateral to continue its
ordinary course of business operations and to maintain the value of
its bankruptcy estate.
The Debtor's Secured Lenders are Blue Vine, Inc./Celtic Bank;
Everest Business Funding; Global Capital (East Hudson); Liquidibee
1, LLC; and Square Financial Services.
The court said the Debtor's use of cash collateral will be limited
to payment of the following post-petition expenses of operating the
business, including actual amounts due for rent, utilities,
management fee, payroll and related taxes, supplies, entertainment,
marketing/advertising, security and related operating expenses.
As adequate protection, the Secured Lenders are granted valid,
binding, enforceable and perfected liens co-extensive with the
Secured Lender's pre-petition liens in all currently owned or
hereafter acquired property and assets of the Debtor.
A final hearing on the matter is set for October 19, 2023 at 9:30
p.m.
A copy of the order is available at https://urlcurt.com/u?l=1OZozh
from PacerMonitor.com.
About Seven Kitchen & Cocktails, LLC
Seven Kitchen & Cocktails, LLC sought protection under Chapter 11
of the U.S. Bankruptcy Code (Bankr. N.D. Tex. Case No. 23-42714-11)
on September 8, 2023. In the petition signed by Cedric Powell,
managing power, the Debtor disclosed up to $50,000 in assets and up
to $500,000 in liabilities.
Marilyn D. Garner, Esq., at Law Office Of Marilyn D. Garner,
represents the Debtor as legal counsel.
SIGNIA LTD: Wins Cash Collateral Access Thru Nov 9
--------------------------------------------------
The U.S. Bankruptcy Court for the District of Colorado authorized
Signia, Ltd. to use cash collateral in accordance with the budget,
through November 9, 2023 at 10:30 a.m.
The Debtor requires the use of cash collateral to pay operating
expenses.
The U.S. Small Business Administration asserts that it has a
properly perfected first position security interest in the Debtor's
personal property.
As adequate protection for the Debtor's use of SBA's cash
collateral, (i) Debtor will timely make its $682 monthly payments
to the SBA, consistent with Debtor's SBA loan documents, and (ii)
SBA will have a replacement lien.
In addition, to the extent that any party possesses a properly
perfected security interest or ownership interest in cash
collateral, as adequate protection for the Debtor's use of cash
collateral, the Debtor will provide such party with a replacement
lien on the proceeds of all post-petition accounts and inventory to
the extent that the use of cash collateral results in a decrease in
the value of such party's interest in the cash collateral pursuant
to 11 U.S.C. Section 361(2).
The Debtor will maintain adequate insurance coverage on all
personal property assets and adequately insure against any
potential loss.
A final hearing on the matter is set for November 9 at 10:30 a.m.
A copy of the order is available at https://urlcurt.com/u?l=9B9LET
from PacerMonitor.com.
About Signia, Ltd.
Signia, Ltd. is in the business of providing marketing and customer
services to targeted business and customer groups. The Debtor
provides both business-to-business and business-to-consumer sales
and marketing services, including outbound telephone calls. The
Debtor also uses its call centers (located in Greeley, Colorado and
Vienna, Virginia) to manage inbound customer service calls, as well
as outbound calls, to customers on behalf of third parties, to
follow up, perform satisfaction surveys, manage customer relations,
conduct sales, perform fulfillment services, to ultimately help
third parties retain customers. Another line of business is in the
nonprofit sector: the Debtor provides telefundraising services for
a variety of well-known non-profit organizations.
The Debtor sought protection under Chapter 11 of the U.S Bankruptcy
Code (Bankr. D. Ga. Case No. 23-14384-TBM) on September 27, 2023.
In the petition signed by Jeffrey Fell, chief executive officer,
the Debtor disclosed up to $500,000 in assets and up to $10 million
in liabilities.
Judge Thomas B. McNamara oversees the case.
David V. Wadsworth, Esq., at Wadsworth Garber Warner Conrardy,
P.C., represents the Debtor as legal counsel.
SILGAN HOLDINGS: Moody's Affirms 'Ba2' CFR, Outlook Positive
------------------------------------------------------------
Moody's Investors Service affirmed Silgan Holdings Inc.'s Ba2
Corporate Family Rating, Ba2-PD Probability of Default rating, and
the ratings on its senior unsecured notes at Ba3. The outlook is
positive. The Speculative Grade Liquidity Rating (SGL) in unchanged
at SGL-2.
The affirmation and positive outlook reflects Moody's expectation
that Silgan will be able to manage through weaker volume trends in
2023 and generate stronger credit metrics in 2024. The company's
credit metrics should benefit from an improvement in operating
performance stemming from contributions from fully integrated
acquisitions, new business wins, and cost cutting initiatives.
These efforts should support free cash flow generation and debt
reduction in both the second half of 2023 and into 2024. While
current leverage and free cash flow to debt levels are weaker than
anticipated, as customers embark on right-sizing inventory and have
been cautious with buying patterns, Moody's expect these trends to
be transitory.
"Moody's expect Silgan's credit metrics to improve as volumes trend
in a positive direction from new business wins, resolution of
elevated and high cost customer inventory, and a possible pivot to
measured customer promotional activity in 2024," said Scott
Manduca, Vice President at Moody's.
RATINGS RATIONALE
Silgan's Ba2 Corporate Family Rating reflects its diversified
portfolio underpinned by a lower, yet steady growth segment in
metal containers that is complimented by higher growth dispensing,
closures, and custom container products. Silgan derives more than
90% of its revenue from the relatively stable food and beverage,
personal and home care, and healthcare end markets, which aids in
limiting volume fluctuations from economic conditions and provides
predictability of revenue. Margin volatility is largely eliminated
by Silgan's ability to pass along input cost and other inflationary
cost pressures to customers in a timely manner. At the same time,
the Ba2 CFR reflects Silgan's willingness to execute debt funded
acquisitions that will grow and further diversify its portfolio. A
track record has been established showing steady debt reduction
over the intermediate term follow such transactions. The company
is focused on consistently operating in a leverage range of 2.5x to
3.5x (by company calculations).
Silgan's senior unsecured notes are rated Ba3, one notch lower than
its Ba2 CFR. The unsecured notes are contractually subordinated to
the revolving credit facility, which has a first-lien stock pledge
on all of the U.S. and Dutch subsidiaries of the company, and all
Canadian subsidiaries owned by U.S. companies.
The notes are also structurally subordinated to the non-debt
liabilities at Silgan's operating companies, given they do not
benefit from any upstream operating company guarantees.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be downgraded if there is a deterioration in
credit metrics caused by aggressive financial policy actions,
including large debt funded acquisitions or shareholder returns.
Specifically, if debt-to-EBITDA (inclusive of Moody's adjustments)
is above 4.25x, EBITDA-to-interest expense is less than 5.0x, and
free cash flow-to-debt is below 7.0%.
The ratings could be upgraded if there is sustained improvement in
credit metrics and good liquidity is maintained. Specifically, if
debt-to-EBITDA (inclusive of Moody's adjustments) is below 3.75x,
EBITDA-to-interest expense is above 5.5x, and free cash
flow-to-debt is above 9%.
Headquartered in Stamford, Connecticut, Silgan is a manufacturer of
metal and plastic consumer goods packaging products. Silgan is a
public company with about 25% of the outstanding stock owned by its
two founders.
The principal methodology used in these ratings was Packaging
Manufacturers: Metal, Glass and Plastic Containers published in
December 2021.
SMILEDIRECTCLUB INC: Seeks Chapter 11 Bankruptcy Protection
-----------------------------------------------------------
Greg Chang of Bloomberg News reports that SmileDirectClub said it
filed for Chapter 11 bankruptcy protection as it seeks a
comprehensive recapitalization transaction.
SmileDirectClub founders have committed to invest at least $20
million.
Up to $60m of additional capital is available upon satisfaction of
some conditions, including the favorable conclusion of a marketing
process.
The company filed for Chapter 11 in the Southern District of
Texas.
Additional liquidity from founders, coupled with normal operating
cash flows, is intended to ensure SmileDirectClub can continue
meeting commitments to stakeholders without disruption.
About SmileDirectClub
SmileDirectClub, Inc. (Nasdaq: SDC) --
http://www.SmileDirectClub.com/-- is an oral care company and
creator of the first medtech platform for teeth straightening.
Through its cutting-edge telehealth technology and vertically
integrated model, SmileDirectClub is revolutionizing the oral care
industry. SmileDirectClub's mission is to democratize access to a
smile each and every person loves by making it affordable and
convenient for everyone. SmileDirectClub is headquartered in
Nashville, Tennessee.
SmileDirectClub and its affiliates sought protection under Chapter
11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Lead Case No.
23-90786) on September 29, 2023. In the petition signed by Troy
Crawford, chief financial officer, the Debtor disclosed up to
$498,712,000 in assets and up to $1,051,823,000 in liabilities.
Judge Christopher M. Lopez oversees the case.
The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis
International LLP as general bankruptcy counsel, Jackson Walker LLP
as local bankruptcy counsel, Centerview Partners LLC as financial
advisor and investment banker, FTI Consulting Inc. as restructuring
advisor, and Kroll Restructuring Administration LLC as notice and
claims agent.
SONIDA SENIOR: Agrees With Fannie Mae to Extend Mortgage Maturities
-------------------------------------------------------------------
Sonida Senior Living, Inc. disclosed in a Form 8-K filed with the
Securities and Exchange Commission that on Oct. 2, 2023, it entered
into certain loan modification agreements and related documents
with the Federal National Mortgage Association ("Fannie Mae").
As previously announced on June 29, 2023, the Company entered into
a binding forbearance agreement with Fannie Mae for all 37 of its
encumbered communities, effective as of June 1, 2023. Under the
Fannie Forbearance, Fannie Mae agreed to forbear on its remedies
otherwise available under the community mortgages and Master Credit
Facility ("MCF") in connection with reduced debt service payments
made by the Company during the Fannie Forbearance period, which was
extended to Oct. 6, 2023. In consideration of the Fannie
Forbearance, the Company made a $5.0 million principal payment on
July 5, 2023. Terms were outlined in an agreed upon term sheet
accompanying the Fannie Forbearance to be included in a subsequent
loan modification as the final step to modify the various 37 Fannie
Mae community mortgages and MCF prior to the expiration of the
Fannie Forbearance.
The material terms of the Loan Modification Agreements dated Oct.
2, 2023, are as follows:
* Maturities on 18 community mortgages, ranging from July 2024
to December 2026, have been extended to December 2026. The
remaining 19 communities under the MCF have existing maturities in
December 2028.
* The Company is not required to make scheduled principal
payments due under the 18 community mortgages and 19 communities
under the MCF through the revised maturity date of December 2026
and 36 months from the Fannie Forbearance Effective Date,
respectively.
* The monthly interest rate has been reduced by a 1.5% weighted
average on all 37 communities for 12 months from the Fannie
Forbearance Effective Date, with savings projected to be $3.6
million and $2.3 million for the years ended 2023 and 2024,
respectively.
* The Company is required to make a second principal payment of
$5 million due on June 1, 2024, the one-year anniversary of the
Fannie Forbearance Effective Date.
* The Company provided a full corporate guaranty in the amount
of $5 million related to the second principal payment of $5
million. This guaranty will fully expire once the second $5
million principal payment has been made.
* In addition to the Second Payment Guaranty above, the Company
also provided a $10 million guaranty. After the expiration of 24
months from the Fannie Forbearance Effective Date, Sonida may
discharge the full amount of the Supplemental Fannie Guaranty by
making a $5 million principal payment to Fannie Mae on its
community mortgages and/or its MCF.
* In the first twelve months following the effective date of the
Loan Modification Agreements, the Company is required to escrow 50%
of Net Cash Flow less Debt Service (as defined in the Fannie
mortgages and Master Credit Facility) on an aggregate basis over
all 37 Fannie Mae communities. The excess cash flow will be
deposited into a lender-controlled capital expenditure reserve on a
monthly basis to support the re-investment into certain
communities, as mutually determined by the Company and Fannie Mae.
The Company will be able to draw down such monies on qualifying
projects as the capital expenditures are incurred.
In connection with the Loan Modification Agreements, the Company
granted Fannie Mae a security interest in the Equity Commitment
Agreement with Conversant and the ability to draw down up to $4
million in an event of a monetary default under the Fannie Mae loan
documents.
About Sonida
Sonida Senior Living, Inc., (formerly known as Capital Senior
Living Corporation), is an owner-operator of senior housing
communities in the United States. The Company and its predecessors
have provided senior housing since 1990. As of Dec. 31, 2022, the
Company operated 72 senior housing communities in 18 states with an
aggregate capacity of approximately 8,000 residents, including 62
senior housing communities that the Company owned and 10
communities that the Company third-party managed.
Dallas, Texas-based RSM US LLP, the Company's auditor since 2022,
issued a "going concern" qualification in its report dated March
30, 2023, citing that the Company has suffered from recurring
losses from operations and total current liabilities exceed total
current assets. This raises substantial doubt about the Company's
ability to continue as a going concern.
SPI ENERGY: Selling Majority Stake in Phoenix Motor to CEO
----------------------------------------------------------
SPI Energy Co., Ltd. disclosed on Form 8-K Report filed with the
Securities and Exchange Commission that EdisonFuture, Inc., its
wholly owned subsidiary, has entered into a stock purchase
agreement with Palo Alto Clean Tech Holding Limited.
Palo Alto is owned and controlled by Xiaofeng Peng, SPI's Chairman
and Chief Executive Officer.
Pursuant to the terms of the Purchase Agreement, EdisonFuture
agreed to sell to Xiaofeng Peng an aggregate of 12,000,000 shares
of common stock, $0.004 par value, of Phoenix Motor Inc., at a per
share price of $1.02, representing an aggregate purchase price of
$12,240,000. Phoenix is a subsidiary of the Company and Xiaofeng
Peng also serves as its Chairman and CEO.
Xiaofeng Peng agreed to pay the Purchase Price to EdisonFuture and
deliver on the date of closing:
(a) a cash payment of $40,000 in immediately available funds
by wire transfer to EdisonFuture; and
(b) a secured promissory note dated September 26, 2023, in the
aggregate principal amount of $12,200,000, secured by a lien and
pledge of all of the Purchaser's interest in the Shares to
EdisonFuture pursuant to a stock pledge agreement dated September
26, 2023.
The Secured Promissory Note bears interest at 3% per annum, payable
annually in arrears, with the full principal balance of $12,200,000
due on the maturity date, which is three years from the Closing, or
September 30, 2026.
This strategic move reduces SPI's ownership stake in Phoenix Motor
to 25.83%, thereby eliminating the requirement to consolidate
Phoenix Motor's financial results into SPI's financial statements.
By divesting the majority of its stake in Phoenix Motor, SPI
eliminates the impact of Phoenix Motor's net losses on its own
profitability, paving the way for improved financial performance.
Moving forward, SPI Energy, through its Edisonfuture subsidiary,
will continue to hold a minority stake in Phoenix Motor and remain
committed to its success.
About SPI Energy Co.
SPI Energy Co., Ltd. is a global renewable energy company and
provider of solar storage and EV solutions that was founded in 2006
in Roseville, California, and is now headquartered in McClellan
Park, California.
SPI Energy reported a net loss of $33.72 million for the year ended
Dec. 31, 2022, compared to a net loss of $44.83 million for the
year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had
$231.09 million in total assets, $213.22 million in total
liabilities, and $17.87 million in total equity.
New York, New York-based Marcum Asia CPAs LLP, the Company's
auditor since 2018, issued a "going concern" qualification in its
report dated April 14, 2023, citing that the Company has a
significant working capital deficit, has incurred significant
losses and needs to raise additional funds to sustain its
operations. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
SPIRIT AIRLINES: S&P Alters Outlook to Negative, Affirms 'B' ICR
----------------------------------------------------------------
S&P Global Ratings revised its outlook on Spirit Airlines Inc. to
negative from stable and affirmed its 'B' issuer credit rating.
The negative outlook reflects S&P's expectation for limited
improvement in the company's credit measures in 2024 from weak
levels this year, and the corresponding risk of a downgrade,
particularly if JetBlue does not acquire the company.
S&P believes various operating constraints will continue to hamper
Spirit's ability to improve its profitability and cash flow
generation through 2024. In September 2023, RTX Corp. (Pratt and
Whitney's parent company) announced that a manufacturing flaw in an
engine component could require it to remove, inspect, and repair
about 3,000 geared turbofan (GTF) engines over the next two to
three years. This included an initial 200 engines that were to be
removed from service for accelerated inspection in the third
quarter of 2023, due to which Spirit recently removed three Airbus
A320neo aircraft from its fleet. The details of how many more
engines from Spirit's fleet will be included in the remaining 2,800
identified by RTX is currently unknown. While RTX has announced its
intention to compensate all airlines whose operations have been
disrupted by this issue, the form and timing of this compensation
is currently unknown.
Separately, through much of 2023, the company's fleet utilization
has also been impaired by extended delays for engine maintenance
(amid industry-wide supply chain constraints) and
lower-than-expected time-on-wing performance of the GTF engines.
This has resulted in Spirit having to park seven (as of Aug. 5,
2023) A320neos; this is separate from the ones parked due to the
manufacturing flaw.
There have also been several other industry operating constraints
beginning in 2022 and through 2023, which have had a larger impact
on Spirit and some of the smaller ultra-low-cost carriers (ULCCs).
Acute infrastructure-related constraints, including staffing
shortages at ATC centers in some key leisure destinations
(including Florida), have led to inefficiencies that have
negatively affected operations and margins. Higher pilot attrition,
particularly in 2022, has also been a notable headwind as the
larger network airlines increased hiring amid a strong rebound in
air travel demand.
As a result, profitability margins of Spirit and other ULCCs in
North America have been weaker than those of the network airlines
(unlike pre-pandemic levels), and S&P expects these trends will
continue at least over the near term.
S&P said, "We expect somewhat lower ticket prices will also affect
Spirit's performance. We continue to expect overall air travel
demand in the U.S. to remain strong for the balance of 2023,
supported by a resilient U.S. economy and consumers favoring
spending on services such as travel rather than goods. However,
amid strong pent-up demand for international travel (as
pandemic-related travel restrictions have largely been removed
globally), demand for domestic air travel has moderated from very
strong levels in 2022 (as passengers choose international trips
instead of domestic travel). Spirit and some other smaller low-cost
carriers have noted an uptick in promotional activity and
discounting in the third quarter and into the fourth quarter of
2023. Therefore, we now forecast Spirit's total revenues per
available seat mile (RASM) to decline in the mid- to
high-single-digit percent area for the full year 2023 as compared
to our previous assumption (a year ago) of RASM levels remaining
flat to slightly down in 2023. In our view, the moderate decline in
our revenue assumptions, in tandem with higher-than-expected cost
headwinds, has a material impact on our estimates.
"Additionally, we believe elevated fuel prices remain a key risk.
Typically, airline fares and fuel costs have been relatively
elastic (that is, when fuel prices increase or decline, ticket
prices tend to follow, with a modest lag). Amid very strong air
travel demand in 2022, U.S. airlines were able to largely pass
along the impact of higher fuel prices to passengers in the form of
higher ticket prices. Fuel prices moderated in the first half of
2023 but have since materially increased over the past few months.
Since Spirit is now faced with a relatively less favorable revenue
environment (in comparison to 2022), we believe sustained higher
jet fuel prices could result in heightened pressure on
profitability and credit metrics.
"We expect Spirit's credit metrics will remain relatively weak
through 2024. We expect the various operational challenges facing
Spirit to persist at least through next year and contribute to
pressure on cash flow generation. We also expect Spirit's debt to
remain elevated through the forecast period as the company
continues to expand its fleet and is likely to continue to finance
all its new aircraft deliveries with sale leaseback transactions.
As a result, we forecast funds from operations (FFO) to debt will
approach 0% in 2023, improving somewhat to the mid-single-digit
percent area in 2024 but remain somewhat weak for the rating. This
compares with FFO to debt of about 20% in 2018 and 2019 (and about
1% in 2022). In our view, the improvement in 2024 credit measures
is heavily reliant on the company's ability to expand its capacity
which, in our view, is increasingly uncertain due to GTF
engine-related issues and broader industry-wide constraints.
"If JetBlue's proposed acquisition of Spirit is successful, we
believe the combined entity will enjoy a stronger competitive
position, but we expect credit metrics will remain highly leveraged
in the near term. The combined entity would be the fifth-largest
airline in the U.S. in terms of available seat miles (ASMs), which
we believe will better position the company to compete against the
larger U.S. legacy carriers (American Airlines Group Inc., Delta
Air Lines Inc., and United Airlines Holdings Inc.) as well as
Southwest Airlines Co. However, JetBlue plans to finance the $3.8
billion acquisition cost through debt. As of June 30, 2023,
JetBlue's capital structure comprised S&P Global Ratings-adjusted
debt of $4.4 billion (including leases) and cash and equivalents of
$1.7 billion, while Spirit's capital structure included S&P Global
Ratings-adjusted debt of $6.3 billion and $1.2 billion in cash. The
acquisition cost is thus significant relative to current
capitalization of both airlines."
However, there remain regulatory uncertainties regarding the
proposed merger. In March 2023, the U.S. Department of Justice
(DOJ) sued to block the proposed acquisition based on the view that
the merger would eliminate a low-cost operator (Spirit) in the U.S.
airline industry; a trial is scheduled to begin in October 2023.
JetBlue expects to close the transaction in the first half of 2024
if it receives approval.
S&P said, "We note that the negative outlook on Spirit only
reflects our expectation that forecasted credit metrics on a
standalone basis (excluding the potential acquisition) are weaker
than our previous expectations.
"The negative outlook reflects our expectation that Spirit's
performance in 2023 will be weaker than our previous expectations
due to various factors, including engine issues, fuel prices, and
pressure on ticket pricing. Excluding a potential acquisition by
JetBlue Airways Corp., we expect FFO to debt will approach 0% in
2023, improving somewhat to the mid-single-digit percent area in
2024. If the proposed acquisition is successfully completed
(although this is not expected to happen until the first half of
2024), we believe the combined entity's competitive position will
benefit from a somewhat larger scale of operations, but its credit
metrics will remain highly leveraged in the near term due to higher
debt levels associated with the transaction, as well as higher
acquisition and integration costs."
S&P could lower its ratings on Spirit over the next year if:
-- The company's operating performance is weaker than expected
such that we expect FFO to debt will remain in the mid-single-digit
percent area on a sustained basis; and
-- JetBlue is unsuccessful in its proposed acquisition of Spirit.
S&P said, "We could revise our outlook to stable over the next year
if operating performance improves such that we expect FFO to debt
to improve to at least the mid- to high-single-digit percent area
on a sustained basis. Alternatively, we could also revise the
outlook if the proposed acquisition by JetBlue is successfully
completed in line with the terms currently outlined."
SPRINGFIELD MEDICAL: Wins Cash Collateral Access Thru Jan 2024
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of New York
authorized Springfield Medical Aesthetic PC to use cash collateral
on an interim basis in accordance with the budget, with a 10%
variance, through January 1, 2024.
The Debtor has one substantially secured creditor, the U.S. Small
Business Administration, and several wholly unsecured merchant cash
advance creditors.
The SBA is owned approximately $751,000 and holds a blanket
security agreement and UCC-1 covering all of the Debtor's assets.
As of the filing date, the Debtor's assets were valued by the
Debtor at $13,448. The SBA is secured only to the extent of
$13,448. The Debtor proposes to pay the SBA $300 per month as and
for adequate protection on the secured portion of its claim.
The Debtor also has three merchant cash advance lenders. These
creditors are:
a) Fox Capital Group $60,000
b) Fund Box $24,324
c) Mcrk Funding $37,000
Each of these creditors have filed UCC-1 but all of the alleged
creditors UCC-1 's are subordinate to the SBA's lien. Accordingly
they are wholly unsecured, and therefore the Debtor proposes no
adequate protection payments to these creditors.
The Debtor is authorized and directed to remit monthly adequate
protection payments in the amount of $800 to the SBA to be paid by
the fifth day of the month, or, if such date falls on a Saturday,
Sunday, or legal holiday, the next business day thereafter. The
first Adequate Protection Payment will be paid by October 5, 2023.
The Adequate Protection Payments made thereunder will be credited
against the pre-petition secured obligation due and owing the SBA
as of the Petition Date, provided however, that the SBA reserves
its rights to assert claims for the payment of additional amounts
provided for under the pre-petition loan documents.
To the extent of any diminution in the value of the SBA's
collateral, including its cash collateral, the SBA is granted
valid, binding and enforceable post-petition replacement liens upon
and security interests in all assets of the Debtor, regardless of
whether such assets are acquired by the Debtor prior to the
Petition Date or after the Petition Date which liens will be senior
to all other security interest in, liens upon or claims against any
of the Collateral, subject to the Carve Out.
As adequate protection for the Debtor's use of the Secured
Creditors' Collateral, the Debtor will grant the Secured Creditors
replacement liens in all of the Debtor's pre petition and post
petition assets and proceeds.
The Replacement Liens will be subject and subordinate only to: (a)
U.S. Trustee fees payable under 28. U.S.C. Section 1930 and 31
U.S.C Section 3717; (b) professional fees of duly retained
professionals in this Chapter 11 case as may be awarded pursuant to
Sections 330 of 331 of the Code or pursuant to any monthly fee
order entered in the Debtor's Chapter 11 case; (c) the fees and
expenses of a hypothetical Chapter 7 trustee to the extent of
$10,000; and (d) the recovery of funds or proceeds from the
successful prosecution of avoidance actions pursuant to 11 U.S.C.
Sections 502(d), 544, 545,547, 548, 549, 550 or 553.
These events constitute an Event of Default:
i. Failure by the Debtor to timely make an Adequate
Protection Payment;
ii. Use by the Debtor of cash collateral in excess of the
Budget and the 10% variance;
iii. The entry of any order by the Court granting relief from or
modifying the automatic stay;
iv. Dismissal of the Chapter 11 case or conversion of the
Chapter 11 case to a Chapter 7 case, or appointment of a Chapter 11
trustee, or examiner with enlarged powers, or other responsible
person; and/or
v. A default by the Debtor in reporting financial or
operational information as and when required under the Interim
Order or the Pre-Petition SBA Agreements that is not cured by the
Debtor within five business days following delivery of written
notice of such default to the Debtor's counsel and the Office of
the United States Trustee.
A final hearing on the matter is set for October 25, 2023 at 10
a.m.
A copy of the order is available at https://urlcurt.com/u?l=7g3CXD
from PacerMonitor.com.
About Springfield Medical Aesthetic P.C.
Springfield Medical Aesthetic P.C. operates a general medical and
surgical hospital.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. N.Y. Case No. 23-73221) on August 31,
2023. In the petition signed by Emmanuel O. Asare, president, the
Debtor disclosed $13,448 in total assets and $1,421,650 in total
liabilities.
Judge Robert E. Grossman oversees the case.
Heath S. Berger, Esq., at Berger, Fischoff, Shumer, Wexler &
Goodman, LLP, represents the Debtor as legal counsel.
SUGAR CREEK: Court OKs Cash Collateral Access on Final Basis
------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Missouri,
Eastern Division, authorized Sugar Greek Acquisition, LLC to use
cash collateral on a final basis in accordance with the budget,
through October 31, 2023 or payment of the Lender's Pre-Petition
Indebtedness, whichever will occur first.
The Debtor's only secured creditor is Midwest Regional Bank. As of
the Petition Date, the Debtor was indebted to Lender as follows:
a. Promissory Note dated July 25, 2014 in the principal amount of
$5 million plus interest and other charges from Borrower payable to
Midwest Regional Bank designated by Loan Number 10208129. The
approximate outstanding balance of the Note is $4.665 million.
b. The Note is also executed by Salt Creek Holdings, LLC. Salt
Creek has pledged the real estate it owns at 45 Progress Parkway,
Maryland Heights, Missouri 63043.
c. The Note is guaranteed by Sugar Creek Acquisition, LLC (MO),
James Gorczyca and Debbie Gorczyca.
d. The Note further secured by a deed of trust in the amount of
$770,326 on the Gorczcya's principal residence located at 1800 W.
Adams, Kirkwood, Missouri 63122.
e. The Note is further secured by valid, perfected, enforceable,
first-priority lien and security interest upon and in the assets of
the Debtor located at 45 Progress Parkway, Maryland Heights,
Missouri 63043.
A copy of the order is available at https://urlcurt.com/u?l=1nRAFv
from PacerMonitor.com.
About Sugar Creek Acquisition
Sugar Creek Acquisition LLC is a regional craft brewery located in
St. Louis, Missouri.
Sugar Creek Acquisition sought relief under Subchapter V of Chapter
11 of the U.S. Bankruptcy Code (Bankr. E.D. Miss. Case No.
23-42041) on June 12, 2023. In the petition filed by James
Gorczyca, as manager, the Debtor reported $4.183 million in assets
against $10.96 million in liabilities as of April 30, 2023.
Judge Kathy A. Surratt-States oversees the case.
Stephen D. Coffin has been appointed as Subchapter V trustee.
Spencer P. Desai, Esq. at the Desai Law Firm, LLC represents the
Debtor as legal counsel.
THAI KITCHEN: Court OKs Interim Cash Collateral Access
------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas,
Lubbock Division, authorized Thai Kitchen LLC to use cash
collateral on an interim basis in accordance with the budget.
The Debtor requires the use of cash collateral to purchase
inventory, pay payroll, pay utilities, and otherwise pay for
supplies and other expenses vital to its operations.
The Debtor has outstanding indebtedness to the U.S. Small Business
Administration. SBA asserts a lien against the Debtor's assets.
The Debtor likewise has outstanding indebtedness to one or more of
the MCA Lenders who likewise assert lines against the Debtor's
assets.
The Debtor currently reflects on its books and records cash in the
amount of $2,900, food inventory in the amount of $1,500, kitchen
equipment and restaurant and office furniture valued at $20,060.
As adequate protection of the SBA's and MCA Lenders' interests, if
any, in the cash collateral being used, the SBA and the MCA Lenders
are granted continuing, post-petition, replacement liens in, to and
over all of the Debtor's property and assets in the same nature,
extent, validity, and priority of the SBA's and the MCA Lenders'
pre-petition liens as of the Petition Date.
As adequate protection of the SBA's interests in the cash
collateral being used, the Debtor will make a monthly adequate
protection payment in the amount of $360 per month with the first
payment due on October 20, 2023, and each subsequent payment due on
the 20th day of each following month until such time as the Debtor
confirms a plan of reorganization, the case is converted to one
under Chapter 7 of the Bankruptcy Code, or the case is dismissed.
A final hearing on the matter is set for October 25, 2023 at 1:30
p.m.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=tyOfr3 from PacerMonitor.com.
The Debtor projects total expenses, on a weekly basis, as follows:
$1,210 for the week of October 16, 2023; and
$11,100 for the week of October 23, 2023.
About Thai Kitchen LLC
Thai Kitchen LLC to 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 here 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., represents
the Debtor as legal counsel.
TROIKA MEDIA: Extends Waiver Deal With Blue Torch
-------------------------------------------------
Troika Media Group, Inc. disclosed in a Form 8-K filed with the
Securities and Exchange Commission that on Sept. 29, 2023, the
Company and Blue Torch Finance LLC entered into a Second Amended
and Restated Limited Waiver of certain events of default under the
Financing Agreement dated March 21, 2022, by and among the Company,
the lenders, and Blue Torch as collateral agent and administrative
agent for the Lenders, as amended by that certain First Amendment
to Financing agreement, dated as of Sept. 22, 2023, and as further
amended, supplemented or otherwise modified from time to time prior
to Oct. 4, 2023. The Second A&R Limited Waiver amends and restates
the Amended Limited Waiver to Financing Agreement dated as of Feb.
10, 2023 (as amended).
The Company and Blue Torch entered into the Second A&R Limited
Wavier to, among other things, (i) waive certain Specified Events
of Default including any failure of the Company to make the
quarterly principal and interest payments under the Financing
Agreement due to be paid on or about Sept. 30, 2023; and (ii)
extend the Outside Date. The Second A&R Limited Waiver will expire
on the earliest of (x) the occurrence of an Event of Default under
the Financing Agreement that is not a Specified Event of Default,
(y) a failure by the Company to comply with certain sale and
refinancing milestones set forth in a side letter agreed by the
Company and the Lenders and (z) Oct. 13, 2023.
Troika Media said, "The Second A&R Limited Waiver concerns events
of default that relate to the Company's existing and anticipated
failures to satisfy certain financial and non-financial covenants
under the Financing Agreement. If the Company is unsuccessful in
curing the continuing events of default by the expiration of the
Waiver Period, the Company intends to seek further Limited Waivers
with Blue Torch, although we cannot assure you that Blue Torch
would be willing to grant additional waivers. If the Company
failed to obtain a waiver or extension, the Company would be in
default under the Financing Agreement and the lenders would be able
to exercise remedies available to them under the Financing
Agreement."
The Prior Waiver would have expired on the earliest of (x) the
occurrence of an Event of Default under the Financing Agreement
that is not a Specified Event of Default, and (z) Sept. 29, 2023,
subject to potential extension of up to 60 days to obtain
regulatory and/or shareholder approval in the event the Company is
pursuing a sale transaction.
About Troika
Troika Media Group, Inc. (fka M2 nGage Group, Inc.) -- thetmgrp.com
-- is a professional services company that architects and builds
enterprise value in consumer facing brands to generate scalable
performance driven revenue growth. The Company delivers three
solutions pillars that: CREATE brands and experiences and CONNECT
consumers through emerging technology products and ecosystems to
deliver PERFORMANCE based measurable business outcomes.
Troika Media reported a net loss of $9.58 million for the six
months ended Dec. 31, 2022. Troika Media reported a net loss of
$38.69 million for the year ended June 30, 2022, a net loss of $16
million for the year ended June 30, 2021, and a net loss of $14.45
million for the year ended June 30, 2020.
TWILIGHT HAVEN: Wins Cash Collateral Access Thru Nov 15
-------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of California,
Fresno Division, authorized Twilight Haven, a California nonprofit
corporation, to use cash collateral on an interim basis in
accordance with the budget, through November 15, 2023.
As previously reported by the Troubled Company Reporter, the Debtor
has an immediate and ongoing need to access cash collateral in
which its secured creditor, the U.S. Small Business Administration
asserts an interest.
As adequate protection for the Debtor's use of cash collateral the
Secured Creditor will have replacement liens in the Debtor's
pre-and post-petition assets of the same type, validity and
priority as are subject to its valid pre-petition liens and
security interests.
The Secured Creditor's liens upon, and security interest in, the
replacement collateral are perfected without any other act or
filing upon entry of the Order.
A continued hearing on the matter is set for November 8 at 10:30
a.m.
A copy of the order and the Debtor's budget is available at
https://urlcurt.com/u?l=u7TC81 from PacerMonitor.com.
The Debtor projects total expenses, on a weekly basis, as follows:
$137,709 for the week of October 18, 2023;
$137,709 for the week of October 25, 2023; and
$137,709 for the week of November 1, 2023.
About Twilight Haven
Twilight Haven, a California non-profit corporation, operates as a
non-profit corporation offering affordable independent senior
apartments, assisted living apartments as well as skilled nursing
services within its 10-acre campus.
Twilight Haven filed a petition under Chapter 11, Subchapter V of
the Bankruptcy Code (Bankr. E.D. Calif. Case No. 23-11332) on June
22, 2023, with $12,592,133 in assets and $3,005,377 in
liabilities.
Kristine Williams, chief executive officer, signed the petition.
Judge Rene Lastreto II oversees the case.
Riley C. Walter, Esq., at Wanger Jones Helsley is the Debtor's
legal counsel.
URBAN ONE: Faces Possible Delisting from NASDAQ
-----------------------------------------------
Urban One Inc. disclosed in a Form 8-K Report filed with the
Securities and Exchange Commission that on September 28, 2023, the
Company received a Staff Delisting Determination from the Listing
Qualifications Department of The Nasdaq Stock Market LLC, notifying
the Company that Nasdaq has initiated a process that could result
in the delisting of the Company's securities from Nasdaq.
The Staff Determination was a result of the Company not being able
to comply with Nasdaq Listing Rule 5250(c)(1), which requires
listed companies to file all required periodic financial reports
with the Securities and Exchange Commission timely. The Company has
not filed its Quarterly Reports on Form 10-Q for the quarterly
periods ended March 31, 2023, and June 30, 2022, by the Extension
Deadline. Furthermore, the Staff Determination has no immediate
effect and will not immediately result in the suspension of trading
or delisting of the Company's shares of common stock.
The Company intends to request a hearing before a Nasdaq Hearings
Panel timely. The hearing request will automatically stay any
suspension or delisting action through October 20, 2023. In
connection with the hearing request, the Company requests that the
stay be extended through the hearing and the expiration of any
additional extension period granted by the Hearings Panel following
the hearing. In that regard, pursuant to the Nasdaq Listing Rules,
the Hearings Panel may grant an additional extension period through
March 26. However, there can be no assurance that the Hearings
Panel will grant the Company an additional extension, or that the
Hearings Panel will grant the Company's request for an extended
stay. There can be no assurance that the Company will be able to
regain compliance by the end of any additional extension period.
On July 11, 223, the Audit Committee of the Company's Board of
Directors approved the dismissal of BDO USA, LLP as the Company's
independent registered public accounting firm effective on July 12.
At that time, the Audit Committee voluntarily appointed Ernst &
Young LLP to serve as the Company's independent registered public
accounting firm for the fiscal year ending December 31, effective
as of July 12.
On August 22, 2023, the Company received a letter from the Listing
Department on August 16, 2023, notifying the Company that it was
not in compliance with the requirements of the Rule as a result of
not having timely filed the Delinquent Reports.
The Company also received a notice from Nasdaq on April 3, 2023,
notifying the Company that it was not in compliance with the Rule
due to its delay in filing the 2022 Annual Report on Form 10-K. On
May 10, 2023, the Company filed a Form 12b-25 Notification of Late
Filing with respect to its Q1 2023 Form 10-Q, triggering a second
letter from Nasdaq dated May 19, as previously disclosed on May 24.
In accordance with the Second Nasdaq Letter, the Company filed a
plan with Nasdaq to regain compliance with the listing requirements
that include completion and filing of the 2022 Form 10-K and the Q1
2023 Form 10-Q with the SEC. Nasdaq accepted the Company's
compliance plan and granted the Company 180 days, or until
September 27, 2023, to file the 2022 Form 10-K and the Q1 2023 Form
10-Q, to regain compliance. The Company subsequently filed the 2022
Form 10-K on June 30. However, the Company has yet to file its Q1
2023 Form 10-Q and this, as well as the identification of certain
errors with the filed 2022 Form 10-K, has delayed the Company's
preparation and filing of its Q2 2023 Form 10-Q. The Company is in
the process of completing its Q1 2023 Form 10-Q and anticipates
filing the Delinquent Reports as soon as practicable after the
resolution of the discrete accounting issues identified below.
During the course of its preparation of the Q1 2023 Form 10-Q, the
Company identified certain errors with regard to the timing of
expense recognition of non-cash stock-based compensation and the
accounting for the Company's investment in the operations of its
Richmond casino joint venture, RVA Entertainment Holdings, LLC, the
activities of which primarily related to 2021.
The Company is currently evaluating the related accounting for the
non-cash stock-based compensation matter and if the Company's
investment in RVA Entertainment Holdings, LLC should have been
consolidated during the historical periods due to its then 75%
ownership interest. The Company is also evaluating the impact these
matters may have on its internal controls over financial reporting.
The ongoing resolution of these issues has further delayed the
preparation process. The Company anticipates that these matters
will be resolved in the near future. Once these matters are
resolved, the Company anticipates filing both of the Delinquent
Reports in an expedited manner.
Additionally, on September 29, 2023, the Company provided an update
to its earnings guidance for the year ended December 31, 2023, as
well as provided certain preliminary financial results with respect
to the period ended March 31, 2023. The Company noted it expected
consolidated net revenues of approximately $109.9 million and
consolidated Adjusted EBITDA1 of approximately $30 million.
The Company updated its Adjusted EBITDA guidance noting it expects
to achieve Adjusted EBITDA of approximately that for the year ended
December 31, 2019. This excludes amounts for distributions related
to the Company's investment in MGM National Harbor which it put
back to MGM in April 2023. The Company anticipates Adjusted EBITDA
of $125 million to $128 million for the year ended December 31,
2023. Finally, the Company also reported cash balances as of
September 25, of approximately $201.5 million, including restricted
cash of approximately $13 million being held in escrow and relating
to the Company's Richmond casino initiative.
About Urban One
Urban One, Inc., formerly known as Radio One, Inc., headquartered
in Silver Spring, Md., is an urban-oriented multimedia company that
operates or owns interests in radio broadcasting stations (32% of
revenue as of LTM Q4 2022) generated by 66 stations in 13 markets,
cable television networks (43% of revenue), an 80% ownership in
Reach Media (9% of revenue), and ownership of Interactive One, its
digital platform, as well as other internet-based properties (16%
of revenue), largely targeting an African-American and urban
audience. The Chairperson, Catherine L. Hughes, and President,
Alfred C. Liggins III (Chairperson's son), maintain voting control
and hold a significant ownership position. The company reported
consolidated revenue of $485 million as of LTM Q4, 2022.
VECTOR ESCAPES: Court OKs Cash Collateral Access on Final Basis
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada authorized
Vector Escapes, Inc. to use cash collateral on a final basis in
amounts not to exceed 125% of each line item set forth in the cash
collateral budget.
As previously reported by the Troubled Company Reporter,
Pre-petition, the Debtor obtained a loans from CDC Small Business
Finance, Celtic Bank and the Small Business Administration, which
are secured by essentially all of the Debtor's personal property,
including deposit accounts.
At the time the case was filed, the Debtor's personal property was
valued at $44,662, which includes cash and cash equivalents of
$35,862, Equipment valued at $6,250, inventory valued at $1,450 and
other miscellaneous assets valued at $1,100.
The court said no administrative expense, including those of the
Debtor's approved reorganization counsel or the Subchapter V
trustee will be paid from any cash collateral during the pendency
of the case.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=T7boy8 from PacerMonitor.com.
The Debtor estimates it will have a total of $19,225 in monthly
operating expenses.
About Vector Escapes, Inc.
Vector Escapes, Inc. operates an escape room business in Reno,
Nevada. The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Nev. Case No. 23-50553-hlb) on August 8,
2023. In the petition signed by Josh Morton, president, the Debtor
disclosed up to $500,000 in assets and up to $1 million in
liabilities.
Judge Hilary L. Barnes oversees the case.
Kevin A. Darby, Esq., at Darby Law Practice, represents the Debtor
as legal counsel.
VECTOR UTILITIES: Court OKs Cash Collateral Access on Final Basis
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas,
Laredo Division, authorized Vector Utilities, LLC to use cash
collateral on a final basis in accordance with the budget.
Specifically, the Debtor is permitted to use cash collateral to pay
its normal operating expenses including, but not limited to,
payroll, utilities, supplies, State and local tax, inventory,
maintenance supplies, and insurance as set out in the monthly
budget.
the Debtor is also authorized to pay U.S. Trustee fees as they
become due.
As previously reported by the Troubled Company Reporter, Newtek
Small Business Finance, LLC asserts an interest in the cash
collateral of the Debtor.
Replacement liens were granted to Newtek as adequate protection on
all assets to the extent of diminution of collateral. Further, the
Debtor will pay Newtek Small Business Finance, LLC $4,000 on
September 1, 2023, and thereafter on the 1st day of each month
until further notice, court ruling and/or agreement between Newtek
Small Business Finance, LLC and the Debtor.
The Debtor has been defaulted and terminated or voluntarily
defaulted on all the Bonded Projects. The Surety is working with
construction consultant J.S. Held and the Texas Department of
Transportation to generate a request for proposal for the purpose
of soliciting bids from prospective completion contractors and
facilitating completion of the Bonded Projects.
Prior to termination or voluntary default, the Debtor earned but
has not been paid $99,569 in Bonded Contract Proceeds. The $99,569
in earned but unpaid receivables constitutes the Surety’s cash
collateral.
A copy of the order is available at https://urlcurt.com/u?l=VtUgpw
from PacerMonitor.com.
About Vector Utilities, LLC
Vector Utilities, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 23-60040) on July
16, 2023. In the petition signed by Griselda C. Gaytan, managing
member, the Debtor disclosed up to $10 million in both assets and
liabilities.
Judge David R. Jones oversees the case.
Margaret M. McClure, Esq., at Law Office of Margaret M. McClure,
represents the Debtor as legal counsel.
VENUS CONCEPT: Reaches Debt Restructuring Agreement With Lenders
----------------------------------------------------------------
Venus Concept Inc. announced that it has finalized an agreement
with its lenders, City National Bank of Florida and Madryn Asset
Management, LP and affiliates, to restructure its existing debt
obligations, improving the Company's overall financial position by
deferring certain principal and interest payments under its senior
debt and exchanging a portion of its convertible notes for
preferred stock. The debt restructuring supports the Company's
strategic turnaround efforts, by strengthening its capital
structure, improving its liquidity position, and enhancing the path
to cashflow breakeven in the second half of 2024.
The loan modification and exchange agreements provide for, among
other things:
* Deferral of the approximately $7.7 million annual payment of
principal plus accrued interest, previously due Dec. 8, 2023, under
the Company's Main Street Priority Loan Facility with CNB until
loan maturity on Dec. 8, 2025;
* Deferral of approximately $3.9 million, or 50% of the annual
payment of principal plus accrued interest, previously due Dec. 8,
2024, under the MSLP Note until loan maturity on Dec. 8, 2025;
* Exchange of $5.0 million of the Company's Secured Subordinated
Convertible Notes with Madryn for newly-created Series X Senior
Convertible Preferred Stock, which pays a dividend in kind, on a
quarterly basis, equal to an annual rate of 12.5%; and
* Remaining outstanding Secured Subordinated Convertible Notes
with Madryn subject to a new conversion price of $24 per share and
interest payable in kind, on a quarterly basis, at an annual rate
of 90-day Adjusted SOFR + 8.5%.
"We appreciate the valuable partnership and continued support from
our lenders, City National Bank of Florida and Madryn Asset
Management," said Rajiv De Silva, chief executive officer of Venus
Concept. "These debt restructuring activities provide Venus
Concept with substantial additional liquidity to support
maintenance of ongoing operations, execution of our
near-to-intermediate term strategic turnaround objectives and
funding of priority investments in key R&D initiatives. The debt
restructuring, along with our previously announced ongoing
multi-tranche equity funding from EW Healthcare Partners are key to
our plan to significantly improve the cash flow and profitability
profile of the Company and return to long-term, sustainable,
growth."
"CNB and Madryn have been critical to the Company's evolution and
we are grateful for the role that the Main Street Lending Program
and our lenders have played in financing the company over the last
several years. We will continue to look for ways to improve our
balance sheet as we progress towards achieving cash flow breakeven
in the second half of 2024," added Domenic Della Penna, executive
vice president and chief financial officer of Venus Concept.
Canaccord Genuity acted as financial advisor to the Company in the
debt restructuring.
Preliminary Third Quarter 2023 Revenue and Updated Fiscal Year 2023
According to the Company, preliminary total revenue for the third
quarter of 2023 is expected to be in the range of $17.0 million to
$18.0 million, compared to total revenue of $21.5 million in the
prior year period. The Company now expects total revenue for the
twelve months ending Dec. 31, 2023 to be in the range of $80.0
million to $82.0 million, compared to prior guidance which called
for total revenue in a range of $90.0 million to $95.0 million.
The preliminary third quarter total revenue results versus
expectations and updated fiscal year 2023 total revenue guidance
are primarily a result of the accelerated impact of the Company's
strategic restructuring activities in international markets.
"We are pleased with the progress we have made in our strategic
turnaround plan in 2023. Our restructuring efforts to reduce
expenses are exceeding expectations, and repositioning of the
business in the US and internationally supports growth in 2024,"
said Rajiv De Silva. "While revenue expectations for the year are
lower than expected, primarily due to our accelerated restructuring
of certain international markets, we are pleased with the
performance in the US market. Our primary objective for 2023 has
been to reduce cash burn by 50% or more year over year, which we
are still on track to achieve due to our cost restructuring
efforts."
About Venus Concept
Toronto, Ontario-based Venus Concept Inc. is an innovative global
medical technology company that develops, commercializes, and
delivers minimally invasive and non-invasive medical aesthetic and
hair restoration technologies and related practice enhancement
services. The Company's aesthetic systems have been designed on a
cost-effective, proprietary and flexible platform that enables the
Company to expand beyond the aesthetic industry's traditional
markets of dermatology and plastic surgery, and into
non-traditional markets, including family and general
practitioners
and aesthetic medical spas.
Venus Concept reported a net loss of $43.58 million in 2022
compared to a net loss of $22.14 million in 2021. As of Dec. 31,
2022, the Company had $125.38 million in total assets, $116.64
million in total liabilities, and $8.74 million in stockholders'
equity.
Toronto, Canada-based MNP LLP, the Company's auditor since 2019,
issued a "going concern" qualification in its report dated March
27, 2023, citing that the Company has reported recurring net losses
and negative cash flows from operations that raise substantial
doubt about its ability to continue as a going concern.
VERDE BUILDING: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Verde Building Solutions, Inc.
7427 Hwy 51 Rd., Suite 105-215
Charlotte, NC 28227
Business Description: Verde is a full-service design,
construction and development firm
specializing in multi-family, residential
and mixed-use projects.
Chapter 11 Petition Date: October 11, 2023
Court: United States Bankruptcy Court
Western District of North Carolina
Case No.: 23-30704
Judge: Hon. Laura T. Beyer
Debtor's Counsel: John C. Woodman, Esq.
ESSEX RICHARDS, P.A.
1701 South Blvd.
Charlotte, NC 28203
Tel: 704-377-4300
Fax: 704-372-1357
Email: jwoodman@essexrichards.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Ronald Staley Jr., as president.
The Debtor did no file 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/SA4YOFA/Verde_Building_Solutions_Inc__ncwbke-23-30704__0001.0.pdf?mcid=tGE4TAMA
WIPE-OUT LOGISTICS: Court OKs Interim Cash Collateral Access
------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Kentucky,
Bowling Green Division, authorized Wipe-Out Logistics, LLC to use
cash collateral in the ordinary course of business.
As adequate protection of its interest in cash collateral, First
Bank & Trust and the Small Business Administration are deemed to
have a continued security interest in the Debtor's accounts to the
extent of its security interest as existed in cash collateral prior
to the commencement of the bankruptcy case.
A copy of the order is available at https://urlcurt.com/u?l=MSskqj
from PacerMonitor.com.
About Wipe-Out Logistics, LLC
Wipe-Out Logistics, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. W.D. Kent. Case No. 23-10736) on
September 29, 2023. In the petition signed by Mirnes Matt
Muminovic, managing member, the Debtor disclosed up to $10 million
in both assets and liabilities.
Judge Joan A. Lloyd oversees the case.
Robert C. Chaudoin, Esq., at Harlin Parker, represents the Debtor
as legal counsel.
XEROX HOLDINGS: Moody's Alters Outlook on 'Ba2' CFR to Negative
---------------------------------------------------------------
Moody's Investors Service affirmed the Ba2 CFR of Xerox Holdings
Corporation ("Xerox") following the announcement that the company
will raise a $550 million secured bridge loan (unrated) to
repurchase all of the shares held by Carl Icahn and affiliates (22%
ownership). As part of this rating action, Moody's affirmed
Xerox's Ba2-PD Probability of Default Rating. Moody's also
downgraded the ratings on the existing backed senior unsecured
notes of Xerox and unsecured notes of subsidiary, Xerox
Corporation, one notch to Ba3 from Ba2 reflecting the increased
percentage of secured instruments in the debt mix. The Speculative
Grade Liquidity rating was changed to SGL-2 from SGL-1. The
increase in financial leverage arising from the debt funded
purchase of shares combined with deterioration in liquidity drove
the outlook of Xerox Holdings Corporation and Xerox Corporation to
negative from stable.
RATINGS RATIONALE
Ratings for Xerox continue to be pressured by the ongoing challenge
to grow core printing and copier revenues and restore profit
margins given the sector's maturity and competitive landscape among
a few deep-pocketed providers. Nevertheless, operating results
through 2Q23 showed steady demand for both higher end equipment
models and post-sale offerings. Adjusted debt to EBITDA will
temporarily climb to roughly 3.8x at closing of the secured bridge
loan from 3.0x as of June 2023; however, Moody's expects that
leverage will decrease to less than 3.5x in 2024 as debt is repaid
with excess cash. Since the beginning of 2023, Xerox has repaid
$650 million of debt, following $500 million of debt repayment in
2022.
The Ba2 CFR incorporates Moody's expectation that credit metrics,
including adjusted debt to EBITDA, will improve over the next year
as the company applies a portion of excess cash to debt repayment
and profit margins expand modestly. Free cash flow will continue to
be supported by the company's revised strategy to conserve cash by
significantly reducing investments in Xerox's innovation portfolio
combined with the ongoing transition to external funding of
equipment financing receivables and continuing cost efficiency
initiatives. Prior to 2022, Xerox had earmarked up to $250 million
for investment in new ventures, but new investments have since been
eliminated.
Xerox's credit profile is supported by the company's good market
position in its core mid-range print and document outsourcing
markets as well as positive adjusted free cash flow metrics. More
than 70% of Xerox's revenue is typically derived from post-sale
activities that include document outsourcing, managed print
services, maintenance service, supplies (toner and paper), and
finance income which come with higher operating margins and provide
some revenue predictability.
Xerox has good liquidity, including $477 million of balance sheet
cash as of June 2023, positive free cash flow enhanced by the
transition to external equipment financing for a good portion of
the roughly $2.7 billion of remaining financing receivables as of
June 2023, and increasing availability under the ABL revolver
(unrated) as outstanding advances are repaid over the next year.
Although the issuance of new debt will increase cash interest
payments by more than $45 million on a pre-tax basis (lower impact
after-tax), annual cash dividends are reduced by roughly $34
million as a result of the repurchase of shares from Carl Icahn and
affiliates. The change in the Speculative Grade Liquidity rating to
SGL-2 from SGL-1 reflects reduced cash balances compared to
historical levels (in excess of $1 billion) as well as lower
revolver availability under the current $300 million ABL revolver
($200 million outstanding as of June 2023) versus the prior $250
million to $500 million, non-ABL revolving facilities which were
historically undrawn.
Xerox's improved governance risk profile is a key consideration
given the exit of activist Carl Icahn who controlled 22% of
outstanding shares and the departure of board members who were
selected by Carl Icahn. The repurchase of shares controlled by Carl
Icahn comes with higher financial leverage, but going forward
governance risks are reduced given the exit of activist ownership
and board members as well as Xerox's post-pandemic focus on
restoring operating metrics and revenue expansion through growth
initiatives which are leading to improved services signings.
Nevertheless, Xerox relies on demand for printers and copiers which
is in secular decline, and Moody's continues to believe the sector
will likely consolidate. In addition, social risks remain elevated
as the demand for office copiers and printers continue to face
secular decline reflecting substitution of traditional physical
copies with digital documents and the trend to go paperless.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The negative outlook incorporates Moody's expectation that revenues
over the next year will decline in the low single-digit percentage
range reflecting secular challenges including declining physical
print volumes, partially offset by the steady demand for higher end
equipment models, increased pricing, and resilience in post-sale
revenue. Credit metrics, including adjusted debt to EBITDA, will
improve consistently following the issuance of the secured loan
through debt reduction and margin improvement. Free cash flow will
continue to benefit from the company's revised strategy to
significantly reduce investments in Xerox's innovation portfolio
combined with the transition to external funding of equipment
financing receivables. The outlook incorporates Moody's expectation
that there will be no resumption of share repurchases until
liquidity improves and adjusted debt to EBITDA is maintained below
3.5x.
An upgrade is not likely in the near term given the negative
outlook. The outlook could be changed to stable if Xerox
demonstrates consistent revenue growth with improving credit
metrics including lower financial leverage, stable to improving
operating margins, and expanding free cash flow. A change in
outlook or an upgrade would also require conservative financial
discipline and ensuring classes of senior unsecured debt at Xerox
and Xerox Corporation will have similar instrument ratings. These
results would be evidenced by achieving and maintaining adjusted
operating margins in the low double-digit percentage range with
adjusted total debt to EBITDA of 2.5x as well as higher cash
balances and revolver availability.
Ratings could be downgraded if Xerox is unable to stabilize
revenues or if operating margins weaken. Downward rating actions
could also occur if liquidity deteriorates, demonstrated by a
reduction in cash balances, revolver availability of less than $200
million after 2024, or if Moody's expects adjusted debt to EBITDA
will not be sustained comfortably below 3.5x after 2024 or adjusted
free cash flow to debt will remain below 10%. Ratings could also be
downgraded if (i) the company funds share buybacks prior to
improving liquidity demonstrated by repaying all advances under the
ABL revolver and growing cash balances, (ii) classes of senior
unsecured debt at Xerox and Xerox Corporation have different
instrument ratings, or (iii) the asset quality of the finance
operations erodes.
The principal methodology used in these ratings was Diversified
Technology published in February 2022.
Xerox Holdings Corporation, based in Norwalk, CT, is a leader in
document processing systems and related supplies for enterprises
including SMBs, governmental entities, and Fortune 100 companies.
Revenues are generated primarily in the Americas and EMEA and
totaled $7.2 billion for LTM June 2023.
[*] Richard Bergin Joins Charles River as VP-Finance Practice
-------------------------------------------------------------
Charles River Associates (NASDAQ: CRAI), a worldwide leader in
providing economic, financial, and management consulting services,
on Oct. 11 disclosed that Richard Bergin has joined the company's
Finance Practice as a vice president.
"We are very pleased to welcome Richard to CRA," said CRA President
and Chief Executive Officer Paul Maleh. "He is a financial markets
expert, particularly in the valuation of investments across a wide
range of asset classes. He joins a very talented CRA team that
supports clients in legal disputes related to securities, company
valuations, bankruptcies, and more."
"Richard has given expert testimony on numerous occasions in US
federal and state courts, in foreign litigation, before domestic
and international arbitration forums, and in regulatory proceedings
in the areas of antitrust and competition, securities,
international arbitration, and environmental disputes," said
Mukarram Attari, CRA's Co-Practice Leader of Finance. "Moreover, he
has led teams in a wide array of economic analyses, the
quantification of economic impacts, the assessment of loss
causation, and the detection of fraud and market abuse."
Dr. Bergin has assisted clients in a broad range of industries,
including energy, chemicals, financial services, sports, life
sciences, manufacturing, software, telecommunications, and
transportation, among others. He has taught courses at institutions
and conferences, including economics, valuation, and finance
programs at New York University and Harvard Business School. His
doctorate and MBA were awarded with highest distinction from
Harvard Business School, which he attended as a Fulbright Scholar.
He received a chemical engineering degree from the University of
Sydney, which was awarded with the university medal.
About CRA's Finance Practice
CRA's Finance Practice focuses on providing expert testimony in
legal disputes relating to securities trading and markets, company
valuations, bankruptcy and solvency, and damages to companies,
shareholders, and other interested parties.
About Charles River Associates (CRA)
Charles River Associates(R) -- http://www.crai.com-- is a leading
global consulting firm specializing in economic, financial, and
management consulting services. CRA advises clients on economic and
financial matters pertaining to litigation and regulatory
proceedings, and guides corporations through critical business
strategy and performance-related issues. Since 1965, clients have
engaged CRA for its unique combination of functional expertise and
industry knowledge, and for its objective solutions to complex
problems. Headquartered in Boston, CRA has offices throughout the
world.
[*] SDNY Judge Beckerman Leads Panel at DI Conference on Nov. 29
----------------------------------------------------------------
The Hon. Lisa Beckerman, United States Bankruptcy Judge for the
Southern District of New York, is leading a six-member panel of
experts who will tackle "The Pros and Cons of Professional
Bankruptcy Directors" at the 30TH DISTRESSED INVESTING CONFERENCE
presented by Beard Group, Inc.
Do bankruptcy experts serving on a debtor's board help a company
navigate chapter 11 expeditiously and maximize value for
stakeholders? Or do they infringe, if not trample, on creditors'
rights?
Join Judge Beckerman and co-panelists Steven Seiden, President,
Seiden Krieger Associates; Lorenzo Marinuzzi, Partner, Morrison &
Foerster; Jared Ellias, Professor of Law, Harvard Law School;
Howard Brownstein, President, Brownstein Corporation; and Harvey
Tepner, Independent Corporate Director and former senior executive
of WL Ross & Co., on this thought-provoking discussion that blends
academic rigor with real-world examples, and may reshape your view
on the role of bankruptcy specialists in boardrooms.
Registration remains open for the 30th DI Conference to be held
Wed., Nov. 29, in-person at the Harmonie Club in Manhattan.
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.
The 30th DI Conference 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
Visit https://www.distressedinvestingconference.com/ for more
information.
For conference sponsorship and speaking opportunities, contact:
Will Etchison
305-707-7493
Will@BeardGroup.com
[^] Recent Small-Dollar & Individual Chapter 11 Filings
-------------------------------------------------------
In re People Who Care Youth Center, Inc.
Bankr. C.D. Cal. Case No. 23-16449
Chapter 11 Petition filed October 3, 2023
See
https://www.pacermonitor.com/view/WTHQM7A/People_Who_Care_Youth_Center_Inc__cacbke-23-16449__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Nariman Seyed Teymourian
Bankr. N.D. Cal. Case No. 23-30668
Chapter 11 Petition filed October 3, 2023
In re Adolphe Judson Edwards
Bankr. D.C. Case No. 23-00283
Chapter 11 Petition filed October 3, 2023
represented by: Janet Nesse, Esq.
In re Spirits & Music LLC
Bankr. M.D. Fla. Case No. 23-02365
Chapter 11 Petition filed October 3, 2023
See
https://www.pacermonitor.com/view/RASFLCQ/Spirits__Music_LLC__flmbke-23-02365__0001.0.pdf?mcid=tGE4TAMA
represented by: Christopher Wickersham, Jr., Esq.
LAW OFFICES OF C.W. WICKERSHAM JR, P.A.
E-mail: pleadings@chriswickersham.com
In re L. Douglas DiBartelo
Bankr. N.D. Ill. Case No. 23-13190
Chapter 11 Petition filed October 3, 2023
represented by: David Herzog, Esq.
DAVID R HERZOG
E-mail: drh@dherzoglaw.com
In re Justham Custom Homes, LLC
Bankr. E.D.N.C. Case No. 23-02858
Chapter 11 Petition filed October 3, 2023
See
https://www.pacermonitor.com/view/CWCWJ2Y/Justham_Custom_Homes_LLC__ncebke-23-02858__0001.0.pdf?mcid=tGE4TAMA
represented by: Danny Bradford, Esq.
PAUL D. BRADFORD, PLLC
E-mail: dbradford@bradford-law.com
In re Charles Weber
Bankr. C.D. Cal. Case No. 23-16484
Chapter 11 Petition filed October 4, 2023
In re Center for Allergic Disease, LLC
Bankr. D. Md. Case No. 23-17168
Chapter 11 Petition filed October 4, 2023
See
https://www.pacermonitor.com/view/HKSCY5Y/Center_for_Allergic_Disease_LLC__mdbke-23-17168__0001.0.pdf?mcid=tGE4TAMA
represented by: Diana L. Klein, Esq.
KLEIN & ASSOCIATES, LLC
E-mail: diana@klein-lawfirm.com
In re L & L Wholesale Homes
Bankr. D. Mass. Case No. 23-11630
Chapter 11 Petition filed October 4, 2023
See
https://www.pacermonitor.com/view/J2YXJBI/L__L_Wholesale_Homes__mabke-23-11630__0001.0.pdf?mcid=tGE4TAMA
represented by: David G. Baker, Esq.
E-mail: david@bostonbankruptcy.org
In re 1091 Ralph Ave LLC
Bankr. E.D.N.Y. Case No. 23-43598
Chapter 11 Petition filed October 4, 2023
See
https://www.pacermonitor.com/view/PYRJ4PQ/1091_Ralph_Ave_LLC__nyebke-23-43598__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Mohamed Baghat Mohamed
Bankr. E.D.N.Y. Case No. 23-43588
Chapter 11 Petition filed October 4, 2023
represented by: Tracy Klestadt, Esq.
In re GAC Environmental, Inc.
Bankr. S.D.N.Y. Case No. 23-11592
Chapter 11 Petition filed October 4, 2023
See
https://www.pacermonitor.com/view/EZT4I5A/GAC_Environmental_Inc__nysbke-23-11592__0001.0.pdf?mcid=tGE4TAMA
represented by: Dawn Kirby, Esq.
KIRBY AISNER & CURLEY LLP
E-mail: dkirby@kacllp.com
In re Kafhayaaynsad Enterprise, LLC
Bankr. W.D.N.Y. Case No. 23-10989
Chapter 11 Petition filed October 4, 2023
See
https://www.pacermonitor.com/view/VJKVTLA/Kafhayaaynsad_Enterprise_LLC__nywbke-23-10989__0001.0.pdf?mcid=tGE4TAMA
represented by: Scott J. Bogucki, Esq.
GLEICHENHAUS, MARCHESE & WEISHAAR, P.C.
In re Roofing Designs by JR, LLC
Bankr. N.D. Tex. Case No. 23-32275
Chapter 11 Petition filed October 4, 2023
See
https://www.pacermonitor.com/view/KXAXHBY/Roofing_Designs_by_JR_LLC__txnbke-23-32275__0001.0.pdf?mcid=tGE4TAMA
represented by: Eric A. Liepins, Esq.
ERIC A. LIEPINS
E-mail: eric@ealpc.com
In re Buckeye Pizza Winter Park, LLC
Bankr. M.D. Fla. Case No. 23-02391
Chapter 11 Petition filed October 5, 2023
See
https://www.pacermonitor.com/view/R5U72OA/Buckeye_Pizza_Winter_Park_LLC__flmbke-23-02391__0001.0.pdf?mcid=tGE4TAMA
represented by: Thomas Adam, Esq.
THOMAS ADAM
E-mail: tadam@adamlawgroup.com
In re Ave P Deli & Grocery Inc.
Bankr. E.D.N.Y. Case No. 23-43627
Chapter 11 Petition filed October 5, 2023
See
https://www.pacermonitor.com/view/MQO27VY/Ave_P_Deli__Grocery_Inc__nyebke-23-43627__0001.0.pdf?mcid=tGE4TAMA
represented by: Alla Kachan, Esq.
LAW OFFICES OF ALLA KACHAN, P.C.
E-mail: alla@kachanlaw.com
In re Shrog Realty Partners LLC
Bankr. E.D.N.Y. Case No. 23-43617
Chapter 11 Petition filed October 5, 2023
See
https://www.pacermonitor.com/view/KXUBOXI/Shrog_Realty_Partners_LLC__nyebke-23-43617__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Castle Point at Bridgeville, LLC
Bankr. S.D.N.Y. Case No. 23-35840
Chapter 11 Petition filed October 5, 2023
See
https://www.pacermonitor.com/view/TY7V25A/Castle_Point_at_Bridgeville_LLC__nysbke-23-35840__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re H.A. Stewart Trucking LLC
Bankr. W.D. Pa. Case No. 23-22125
Chapter 11 Petition filed October 5, 2023
See
https://www.pacermonitor.com/view/Z4JM4CQ/HA_Stewart_Trucking_LLC__pawbke-23-22125__0001.0.pdf?mcid=tGE4TAMA
represented by: Christopher M. Frye, Esq.
STEIDL & STEINBERG, P.C.
E-mail: chris.frye@steidl-steinberg.com
In re 3876 Carrel LLC
Bankr. E.D.N.Y. Case No. 23-73718
Chapter 11 Petition filed October 6, 2023
See
https://www.pacermonitor.com/view/7N52Y5I/3876_Carrel_LLC__nyebke-23-73718__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Ambassador Controls and Engineering, LLC
Bankr. N.D. Tex. Case No. 23-43059
Chapter 11 Petition filed October 6, 2023
See
https://www.pacermonitor.com/view/WPYVCNQ/Ambassador_Controls_and_Engineering__txnbke-23-43059__0001.0.pdf?mcid=tGE4TAMA
represented by: Eric A. Liepins, Esq.
ERIC A. LIEPINS
E-mail: eric@ealpc.com
In re Custom Metal Fabrication LLC
Bankr. D.N.J. Case No. 23-18796
Chapter 11 Petition filed October 7, 2023
See
https://www.pacermonitor.com/view/YWCSUMI/Custom_Metal_Fabrication_LLC__njbke-23-18796__0001.0.pdf?mcid=tGE4TAMA
represented by: Rosemarie E. Matera, Esq.
KIRBY AISNER & CURLEY LLP
E-mail: RMatera@kacllp.com
In re Alafia Holdings III Inc.
Bankr. D. Md. Case No. 23-17234
Chapter 11 Petition filed October 8, 2023
See
https://www.pacermonitor.com/view/LXKN4UQ/ALAFIA_HOLDINGS_III_INC__mdbke-23-17234__0001.0.pdf?mcid=tGE4TAMA
represented by: Chidi Onukwugha, Esq.
ONUKWUGHA AND ASSOCIATES
E-mail: Attorneyonukwugha@gmail.com
In re Jubilee Investments, LLC
Bankr. D. Ariz. Case No. 23-07159
Chapter 11 Petition filed October 9, 2023
See
https://www.pacermonitor.com/view/YQTODDA/JUBILEE_INVESTMENTS_LLC__azbke-23-07159__0001.0.pdf?mcid=tGE4TAMA
represented by: German Yusufov, Esq.
YUSUFOV LAW FIRM PLLC
E-mail: bankruptcy@yusufovlaw.com
In re Pouriya Pete Mozaffary
Bankr. N.D. Cal. Case No. 23-41302
Chapter 11 Petition filed October 9, 2023
represented by: E. Wood, Esq.
In re Marcus Alexander Powers
Bankr. N.D. Ga. Case No. 23-59920
Chapter 11 Petition filed October 9, 2023
represented by: Will Geer, Esq.
In re Falling Timbers Tree Service LLC
Bankr. M.D. Tenn. Case No. 23-03700
Chapter 11 Petition filed October 9, 2023
See
https://www.pacermonitor.com/view/5CYWCYI/Falling_Timbers_Tree_Service_LLC__tnmbke-23-03700__0001.0.pdf?mcid=tGE4TAMA
represented by: Steven L. Lefkovitz, Esq.
LEFKOVITZ & LEFKOVITZ
E-mail: slefkovitz@lefkovitz.com
In re R&J Cleaning Service, Inc.
Bankr. E.D. Va. Case No. 23-33476
Chapter 11 Petition filed October 9, 2023
See
https://www.pacermonitor.com/view/7I3FULQ/RJ_Cleaning_Service_Inc__vaebke-23-33476__0001.0.pdf?mcid=tGE4TAMA
represented by: David K. Spiro, Esq.
SPIRO & BROWNE, PLC
E-mail: dspiro@sblawva.com
*********
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.
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Rousel Elaine Tumanda, Joel Anthony G. Lopez, Psyche A. Castillon,
Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and
Peter A. Chapman, Editors.
Copyright 2023. All rights reserved. ISSN: 1520-9474.
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*** End of Transmission ***