/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/231123.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, November 23, 2023, Vol. 27, No. 326 Headlines 117 S MAIN STREET: Gets OK to Hire Toni Campbell Parker as Counsel 1272775 B.C: Goldman Sachs Marks C$454,000 Loan at 27% Off 1600 E BUTLER: Gets OK to Hire Dickinson Wright as Legal Counsel 511 SEAWARD: Says Disclosures Objections Addressed 5200 SAMPLE ROAD: $325K Sale of Business to Fund Plan ACQUIA INC: Goldman Sachs Marks $3.2MM Loan at 53% Off AIR FORCE VILLAGES: Fitch Affirms 'BB+' IDR, Outlook Stable ALASKA LOGISTICS: Court OKs Cash Collateral Access Thru Dec 14 AMERICAN SCREENING: Plan to Pay All Classes in Full ANSIRA PARTNERS: 96% Markdown for Goldman Sachs $165,000 Loan ANSIRA PARTNERS: 96% Markdown for Goldman Sachs $367,000 Loan ANSIRA PARTNERS: 96% Markdown for Goldman Sachs $6MM Loan AQ HELIOS: 96% Markdown for Goldman Sachs $12.5MM Loan ART & DENTISTRY: Court OKs Cash Collateral Access on a Final Basis ASPIRE BAKERIES: S&P Upgrades ICR to 'B', Outlook Stable ASSEMBLY INTERMEDIATE: Goldman Sachs Marks $10.9MM Loan at 45% Off AULT ALLIANCE: Acquires $15M in Preferred Stock from RiskOn AULT ALLIANCE: Incurs $28.4 Million Net Loss in Third Quarter AVENTIS SYSTEMS: Unsecured Creditors to Get At Least 4% in Plan B & J INTERIORS: Court OKs Cash Collateral Access on Final Basis BAUDAX BIO: Incurs $1.9 Million Net Loss in Third Quarter BAYSIDE OPCO: Goldman Sachs Marks $420,000 Loan at 81% Off BAYSIDE OPCO: Goldman Sachs Marks $973,000 Loan at 17% Off BED BATH & BEYOND: JAT Capital Wants Transparency from Board BERGIO INTERNATIONAL: Delays Filing of Q3 Form 10-Q Report BLUE STAR FOODS: Delays Filing of Q3 Form 10-Q Report BLUE STAR: Incurs $446K Net Loss in Third Quarter BOY SCOUTS: Victims at Risk of Losing Millions Amid Filing Errors BROWNIE'S MARINE: Delays Filing of Q3 Form 10-Q Report BUCKHEAD PROPERTY: Property Sale Proceeds to Fund Plan BUSINESSOLVER.COM: 93% Markdown for Goldman Sachs $5.02MM Loan CAESARS ENTERTAINMENT: S&P Affirms 'B+' ICR, Alters outlook to Pos. CANACOL ENERGY: Moody's Cuts CFR to B1 & Alters Outlook to Negative CEL-SCI CORP: Closes $5 Million Public Common Stock Offering CGCC LLC: Unsecured Creditors to Recover $135K over 36 Months CHRONICLE BIDCO: Goldman Sachs Marks $4.7MM Loan at 68% Off CIVICPLUS LLC: Goldman Sachs Marks $1.2M Loan at 94% Off CLEAN ENERGY: Mast Hill Fund Swaps $1.95MM Debt for Equity CLEARCOURSE PARTNERSHIP: Goldman Sachs Marks GBP11.7MM Loan at 43% CLOUD VENTURES: Seeks Until Feb. 8 to File Disclosure Statement CONCRETE SOLUTIONS: U.S. Bank Says Plan Not Confirmable CORE SCIENTIFIC: Further Fine-Tunes Joint Plan CREATIVE REALITIES: Slipstream Funding Reports Equity Stake CREDITO REAL: Declared Under Bankruptcy Protection in Mexico DEPETRIS FAMILY: Court OKs Cash Collateral Access Thru Jan 2024 DEPETRIS FAMILY: Seeks to Hire Eisner Amper as Accountant DIVERSIFIED HEALTHCARE: Board Appoints New President and CEO DMK PHARMACEUTICALS: Adjourns 2023 Annual Meeting EASTERN NIAGARA: Proposes Liquidating Plan EDGEWOOD FOOD MART: Taps Ogier, Rothschild & Rosenfeld as Counsel ENERFLEX LTD: Fitch Affirms 'BB-' LongTerm IDR, Outlook Stable ESCAMBIA OPERATING: Chapter 11 Trustee Taps Jones Walker as Counsel ESCAMBIA OPERATING: Trustee Seeks to Tap MACCO as Financial Advisor ESCAMBIA OPERATING: Trustee Taps M P Boots as Valuation Advisor ESJ TOWERS: March 8 Hearing on Disclosure Statement ETHEMA HEALTH: Delays Filing of Q3 Form 10-Q Report FANATICS COMMERCE: Moody's Alters Outlook on 'Ba3' CFR to Negative FINTHRIVE SOFTWARE: S&P Upgrades CCR to 'CCC', Outlook Negative FOR PAWS BLUE: Unsecureds Will Get 11.7% of Claims in Plan FREEMANVILLE LIFEHOPE: Unsecureds Owed $75K Unimpaired in Plan GARCIA GRAIN: Unsecureds to Get Share of Profits for 5 Years GAUCHO GROUP: Delays Filing of Q3 Form 10-Q Report GB SCIENCES: Delays Filing of Q3 Form 10-Q Report GB SCIENCES: Incurs $434K Net Loss in Second Quarter GENESIS GLOBAL: Disclosures Hearing Adjourned to Nov. 28 GENEVA REPAIR: Taps Burke, Warren, MacKay & Serritella as Counsel GRAYSON REAL ESTATE: Unsecureds Owed $16,500 to Get 100% GRIFFON GANSEVOORT: Unsecureds Owed $180K Unimpaired in Sale Plan GROM SOCIAL: Delays Filing of Q3 Form 10-Q Report GROM SOCIAL: Incurs $2 Million Net Loss in Third Quarter GROM SOCIAL: To Raise $3.64MM in Deal with Generating Alpha GROUNDSWELL MMA: Seeks to Tap Whiteford Taylor & Preston as Counsel GRUN PROPERTIES: Taps Marcus, Clegg, Bals & Rosenthal as Counsel HAVRE EAGLES: NCP Says Plan Disclosures Insufficient HAWAIIAN HOLDINGS: Vanguard Group Reports 5.18% Equity Stake HERTZ CORP: Fitch Lowers Rating on $500MM Term Loan to 'B-' HEYWOOD HEALTHCARE: Committee Taps Dentons as Bankruptcy Counsel HOWARD MIDSTREAM: Moody's Alters Outlook on 'B1' CFR to Positive HOWARD STREET: Gets OK to Hire Kirby Aisner & Curley as Counsel IAP GLOBAL: Creditor Sets Nov. 28 Sale of Assets INSYS THERAPEUTICS: Ex-CEO's Claims Arbitration Check Ordered IRON EAGLE: Court OKs Interim Cash Collateral Access IRON EAGLE: Seeks to Hire Eric A. Liepins as Bankruptcy Counsel ISLAND ROOFING: Case Summary & 16 Unsecured Creditors JETBLUE AIRWAYS: Fitch Lowers LongTerm IDR to B+, Outlook Negative JUICE ROLL UPZ: Seeks Approval to Hire Northstar as Bookkeeper LAKEPORT CF: Unsecureds to Get Property Sale & Ongoing Proceeds LEXARIA BIOSCIENCE: Posts $6.7 Million Net Loss in FY Ended Aug. 31 LIPSEY PAINTING: Court OKs Interim Cash Collateral Access LIVE WELL: Reaches $1Mil. Deal With Laid-Off Employees in WARN Suit LIVEONE INC: Delays Filing of Q3 Form 10-Q Report LPI LLC: Taps Jane Giles of Advanced Business as Accountant LSF9 ATLANTIS: S&P Alters Outlook to Stable, Affirms 'B' ICR LUZ MA: Court OKs Cash Collateral Access on Final Basis LYLA LEE: Unsecureds to Get $15K in Reorganization Plan MATTHEWS INTERNATIONAL: S&P Affirms 'BB' LT Issuer Credit Rating MBIA INC: Kahn Brothers Group Reports 9.40% Equity Stake MEJJM INC: Ongoing Operations to Fund Plan Payments MERRILL PROPERTIES: Creditors to Get Proceeds From Liquidation MICHIGAN MEDICAL: Case Summary & 20 Largest Unsecured Creditors MILLION DOLLAR SMILE: Court Confirms Chapter 11 Plan MONICATTI AUTO: Affiliate Gets OK to Hire Hilco as Auctioneer MOZART HOLDINGS: Fitch Affirms 'B+' IDR & Alters Outlook to Stable MV REALTY PBC: Taps Carpenter Lipps as Special Litigation Counsel MV REALTY PBC: Taps Frascona Joiner Goodman as Litigation Counsel MV REALTY PBC: Taps Young Moore and Henderson as Local Counsel NATURALSHRIMP INC: Delays Filing of Q3 Form 10-Q Report NATURALSHRIMP INC: Incurs $2.7 Million Net Loss in Second Quarter NEW JERUSALEM: Court Approves Disclosure Statement NORTHEAST GROCERY: Fitch Assigns 'B+' LongTerm IDR, Outlook Stable NOVA ACADEMY: S&P Lowers 2015 Rev. Refunding Bonds Rating to 'BB-' NXT ENERGY: To Raise $2.5MM in Convertible Debenture Offering OMNIQ CORP: Niv Nissenson Steps Down as CFO ONE DREAM: Seeks to Hire Hester Baker Krebs as Bankruptcy Counsel PELICAN POINT: Seeks to Hire J.M. Cook as Bankruptcy Counsel PIXELLE SPECIALTY: S&P Downgrades ICR to 'B-' on Elevated Leverage PODS LLC: S&P Alters Outlook to Negative, Affirms 'B' ICR POMONA VALLEY: Unsecureds Owed $87K to Get Full Payment in Plan PRESSURE BIOSCIENCES: Incurs $5.6 Million Net Loss in Third Quarter PRIMARY PRODUCTS: Moody's Alters Outlook on 'B1' CFR to Negative PUERTO RICO: PREPA Plan Okayed to Start Voting Process RADIO FREE: Voluntary Chapter 11 Case Summary REMARK HOLDINGS: Delays Filing of Q3 Form 10-Q Report REMARK HOLDINGS: Incurs $7.2 Million Net Loss in Third Quarter REMARKABLE HEALTHCARE: Court OKs Interim Cash Collateral RISKON INTERNATIONAL: Posts $15.3 Million Net Loss in 2nd Quarter RISKON INTERNATIONAL: Raising $15MM in Securities Purchase Deal RITE AID: Seeks to Bar U.S. From Reopening Ohio Opioid Case ROBBIN'S NEST: Unsecureds to Get $50K in Plan RUNNER BUYER: S&P Downgrades ICR to 'CCC+', Outlook Negative S-EVERGREEN HOLDING: S&P Upgrades ICR to 'B+' on Debt Reduction SAGO VENTURES: Claims to Get Paid From Loan or Liquidation Proceeds SAN MARINO CAFE: Court OKs Cash Collateral Access SCHIERHOLZ AND ASSOCIATES: Taps Fredrikson & Byron as Counsel SHOWFIELDS INC: Court OKs Cash Collateral Access Thru Jan 2024 SK SPEC 1: Seeks to Hire Spector & Cox as Bankruptcy Counsel SKILLZ INC: Chessen Resigns from Board, Lento Named New Controller SMART EARTH: Wins Interim Cash Collateral Access SPIKE BODY: Taps Crane, Simon, Clar & Goodman as Legal Counsel SPIRIT AIRLINES: Maturity of Revolving Facility Extended Thru 2025 SPITFIRE ENERGY: Taps Energy Capital Solutions as Investment Banker STRUCTURLAM MASS: Class 3A Unsecureds Owed $99.8M Get 21% in Plan SUNLAND MEDICAL: Seeks to Hire Eide Bailly as Tax Advisor SURGERY PARTNERS: S&P Upgrades ICR to 'B' on Improved Cash Flow TENABLE HOLDINGS: S&P Upgrades ICR to 'BB-', Outlook Stable TGPC PROPERTIES: Says Unsecureds Unimpaired in Plan TIMBER PHARMACEUTICALS: Hits Chapter 11 Bankruptcy Protection TRANSPLANT SYSTEMS: Bid to Use Cash Collateral Denied UPHEALTH HOLDINGS: Will Sell Cloudbreak Health to GTCR in Ch. 11 UPHEALTH HOLDINGS: Wins Interim Cash Collateral Access VELO3D INC: To Issue Going Concern Warning, Sees Default VEREGY INTERMEDIATE:S&P Affirms 'B-' ICR, Alters Outlook to Stable VERITAS FARMS: Delays Filing of Q3 Form 10-Q Report VITAL ENERGY: S&P Affirms 'B' ICR, Off CreditWatch Negative WESTJET AIRLINES: Fitch Hikes LongTerm IDR to 'B', Outlook Stable WHAT ABOUT US: Case Summary & 13 Unsecured Creditors WHOLE COFFEE: Seeks to Hire Agentis as Bankruptcy Counsel ZYMERGEN INC: Chapter 11 Bidding Procedures Okayed [^] Recent Small-Dollar & Individual Chapter 11 Filings ********* 117 S MAIN STREET: Gets OK to Hire Toni Campbell Parker as Counsel ------------------------------------------------------------------ 117 S. Main Street, LLC received approval from the U.S. Bankruptcy Court for the Western District of Tennessee to employ Toni Campbell Parker, Esq., an attorney practicing in Memphis, Tenn., to handle its Chapter 11 case. The hourly rates of the firm's counsel and staff are as follows: Toni Campbell Parker $350 Paralegals $100 The attorney received a retainer of $3,262. Mr. Parker disclosed in a court filing that he is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Toni Campbell Parker, Esq. 45 North Third Ave, Ste. 201 Memphis, TN 38103 Telephone: (901) 483-1020 Email: Tparker002@att.net About 117 S. Main Street 117 S. Main Street, LLC filed a voluntary petition for Chapter 11 protection (Bankr. W.D. Tenn. Case No. 23-25310) on Oct. 26, 2023, listing under $1 million in both assets and liabilities. Judge Jennie D. Latta oversees the case. Toni Campbell Parker, Esq., serves as the Debtor's legal counsel. 1272775 B.C: Goldman Sachs Marks C$454,000 Loan at 27% Off ---------------------------------------------------------- Goldman Sachs BDC, Inc has marked its C$454,000 loan extended to 1272775 B.C. LTD. (dba Everest Clinical Research) to market at C$330,000 or 73% of the outstanding amount, as of September 30, 2023, according to Goldman Sachs's Form 10-Q for the Quarterly period ended, September 30, 2023, filed with the Securities and Exchange Commission on November 7, 2023. Goldman Sachs BDC, Inc is a participant in a First Lien Senior Secured Debt to 1272775 B.C. LTD. (dba Everest Clinical Research). The loan accrues interest at a rate of 12.20% (CDN P + 4.75%) per annum. The loan matures on November 6, 2026. The loan is on non-accrual status and has been classified as non-income producing security. Goldman Sachs BDC, Inc. was initially established as Goldman Sachs Liberty Harbor Capital, LLC, a single member Delaware limited liability company, on September 26, 2012 and commenced operations on November 15, 2012 with The Goldman Sachs Group, Inc. as its sole member. On March 29, 2013, the Company elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Effective April 1, 2013, the Company converted from a SMLLC to a Delaware corporation. In addition, the Company has elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2013. Goldman Sachs Asset Management, L.P., a Delaware limited partnership and an affiliate of Goldman Sachs & Co. LLC, is the investment adviser of the Company. 1272775 B.C. LTD, does business as Everest Clinical Research. Everest Clinical Research is a full-service contract research organization providing a broad range of expertise-based clinical research services to worldwide pharmaceutical, biotechnology, and medical device industries. It serves some of the best-known companies and work with many of the most advanced drugs, biologics, and medical devices in development today. 1600 E BUTLER: Gets OK to Hire Dickinson Wright as Legal Counsel ---------------------------------------------------------------- 1600 E. Butler Ave, LLC received approval from the U.S. Bankruptcy Court for the District of Arizona to employ Dickinson Wright, PLLC as its counsel. The Debtor requires legal counsel to: (a) give advice with respect to the powers and duties of the Debtor in the continued management and operation of its business and property; (b) advise and consult on the conduct of this Chapter 11 case; (c) attend meetings and negotiate with representatives of the Debtor's creditors, equity holders, and other parties-in-interest; (d) take all necessary actions to protect and preserve the Debtor's estate; (e) prepare pleadings in connection with this Chapter 11 case; (f) advise the Debtor in connection with any potential sale of assets or transfer of operations; (g) appear before the court and any appellate courts to represent the interests of the Debtor's estate; (h) advise the Debtor regarding tax matters; (i) assist the Debtor in reviewing, assessing, estimating, and resolving claims asserted against its estate; (j) advise the Debtor regarding insurance and regulatory matters; (k) commence and conduct litigation necessary and appropriate to assert rights held by the Debtor, protect assets of its Chapter 11 estate, or otherwise further its goals in this Chapter 11 case; (l) take any necessary action to negotiate, prepare, and obtain approval of a disclosure statement and confirmation of a Chapter 11 plan and all documents related thereto; and (m) perform all other necessary legal services for the Debtor in connection with the prosecution of this Chapter 11 case. The hourly rates of the firm's counsel and staff are as follows: Members (Partners) $400 – $1,175 Associates $300 - $410 Paraprofessionals $170 - $310 In addition, the firm will seek reimbursement for expenses incurred. On Aug. 1, the Debtor paid the firm $15,570 for fees and costs incurred prior to that date. Carolyn Johnsen, Esq., an attorney at Dickinson Wright, disclosed in a court filing that her firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Carolyn J. Johnsen, Esq. Dickinson Wright PLLC 1850 N. Central Ave. Suite 1400 Phoenix, AZ 85004 Telephone: (602) 285-5040 Facsimile: (602) 285-5100 Email: cjjohnsen@dickinsonwright.com About 1600 E. Butler Ave 1600 E. Butler Ave, LLC, a company in Flagstaff, Ariz., filed Chapter 11 petition (Bankr. D. Ariz. Case No. 23-08129) on Nov. 10, 2023, with $8,483,336 in total assets and $6,172,068 in total liabilities. Adam Reich, manager, signed the petition. Judge Paul Sala oversees the case. Carolyn J. Johnsen, Esq., at Dickinson Wright PLLC serves as the Debtor's legal counsel. 511 SEAWARD: Says Disclosures Objections Addressed -------------------------------------------------- 511 Seaward LLC filed a second omnibus reply to the objections to Debtor's Motion for Order Approving Debtor's Disclosure Statement Describing Chapter 11 Plan of Liquidation. The Debtor responds to the objections of (1) Brandy Valdez and Arnold Valdez as Trustees of the Arnold and Brandy Valdez Family Trust ("Valdezes"), (2) Shahla Melamed ("Melamed"), and (3) West Coast Servicing, Inc. ("WCS") (collectively, the "Objecting Parties"). The Debtor has previously addressed the concerns of the Objecting Parties by filing a revised version of the Disclosure Statement Describing Chapter 11 Plan of Liquidation and Chapter 11 Plan of Liquidation Dated. The amendments sufficiently describe a confirmable plan and provides "adequate information" to creditors and other parties in interest regarding the Plan. Accounting: Debtor points out that the Plan is a simple one. The Debtor will sell its sole asset, by separately filed and noticed motion, with Court approval, and pursuant to the terms of the Plan will distribute the funds to creditors under the priority scheme set forth in the Bankruptcy Code. The Debtor has already amended the Disclosure Statement and Plan to provide information regarding the amounts provided to the Debtor that led to the junior lien holders. The Debtor has scheduled these debts, has described these debts, has described the treatment of these debts, and nothing more should be required for the approval of the disclosure statement. Debtor further points out that a full accounting of the Debtor's financial history is unnecessary. but should the Court determine it is required, then the Debtor requests time to amend the Disclosure Statement and Plan to the fullest extent possible that it can. Best Interests Test: Debtor asserts that for the Court to be able to confirm the Plan, the Court must find that all creditors who do not accept the Plan will receive at least as much under the Plan as such holders would receive under a Chapter 7 liquidation of the Debtor. The Debtor maintains that this requirement is clearly met in this case. Disclosures on the HOA: According to the Debtor, as stated in its previous reply, the Debtor has indicated that it was unnecessary for the Debtor to provide additional documentation as to plan, permits, and other approvals as part of the plan process because no such representations were being made to any potential purchasers. The discrepancy between whether such plans had been approved by the HOA or not and what that would even entitle the Debtor or future purchaser to do with the Property was in dispute and the Debtor was not making any representations or warranties regarding the same. Sale Deadline: Debtor points out that again, the Plan does not contain a deadline by which the Debtor has to sell the Property, but by no means is it the Debtor's intention to hold creditors hostage by holding onto the Property for any indefinite period of time. The Debtor is seeking to sell the Property as soon as possible and to exit this case. The Debtor is not at this time providing a deadline by which the Property may be sold but will revise the Plan such that if the Property has not been sold by the time the plan is confirmed, the secured creditors retain their rights to seek relief from the Court to assert their rights against the Property. As such, the Plan is not patently unconfirmable and any further arguments should be left to confirmation and not as part of the Disclosure Statement process. Benefit to Only Insiders and Administrative Professionals: Debtor further points out that as Debtor previously explained, the Debtor is taking all steps necessary to obtain an offer and a carve-out so that it can pay creditors. If there is no carve-out agreement, then the Debtor will pay the secured creditors the amounts that they are owed to the extent of the proceeds and sell free and clear of the remaining liens and all other creditors will receive nothing under the Plan. The insiders of the case are receiving no additional benefit by the sale as it is almost guaranteed that the lower priority insiders, in fact almost every creditor other than WCS, will receive no funds on account of their liens. Attorneys for Debtor 511 Seaward LLC: David M. Goodrich, Esq. Beth E. Gaschen, Esq. GOLDEN GOODRICH LLP 3070 Bristol St., Suite 640 Costa Mesa, CA 92626 Tel: (714) 966 1000 Fax: (714) 966 1002 E-mail: dgoodrich@go2.law bgaschen@go2.law About 511 Seaward 511 Seaward, LLC, which is engaged in activities related to real estate, sought Chapter 11 protection (Bankr. C.D. Cal. Case No. 23-10994) on May 12, 2023. The company is based in Newport Beach, Calif. with as much as $1 million to $10 million in both assets and liabilities. Robert Montgomery as managing member, signed the petition. Golden Goodrich, LLP, serves as the Debtor's legal counsel. 5200 SAMPLE ROAD: $325K Sale of Business to Fund Plan ----------------------------------------------------- 5200 Sample Road LLC, operator of a convenience store and gas station in Margate, Florida, filed a Chapter 11 Small Business Plan and a Disclosure Statement. After the case was filed, the Debtor filed a motion to sell the business as well as a motion to assume and assign the lease. But a dispute with South Florida Commercial Properties, LLC, the landlord for the property, arose. Ultimately, the parties attended a Judicial Settlement Conference and resolved the disputes, which avoided costly litigation. A Settlement Agreement is in the process of being finalized and will be filed with the Court with a Motion to Approve Compromise and Settlement. The settlement provides SFCP will allow a sale and assignment to new buyer which SFCP will determine is acceptable, with such determination not withheld unreasonably. The new buyer is currently engaged in the due diligence process with the landlord. The purchase price is $325,000 plus inventory and the gas deposit. Under the Plan, Class 7 consists of General Unsecured Claims. The general unsecured claims prior to the filing of any objections total the amount of $306,693, which will be paid a pro rata distribution in one lump sum payment upon the sale of the business. The dividend to Class 7 is subject to change upon the determination of objections to claims, if any. To the extent that the Debtor is successful or unsuccessful in any or all of the proposed objections, then the dividend and distribution to each individual creditor will be adjusted accordingly. The dividend will also be dependent upon the ultimate sales price of the business. It is anticipated that the sales price will be approximately $325,000, including inventory valuation and gas deposit. These claims are impaired. Attorneys for the Debtor: Craig I. Kelley, Esq. KELLEY KAPLAN & ELLER, PLLC 1665 Palm Beach Lakes Blvd. The Forum - Suite 1000 West Palm Beach, FL 33401 Tel: (561) 491 1200 Fax: (561) 684 3773 E-mail: bankruptcy@kelleylawoffice.com A copy of the Disclosure Statement dated November 8, 2023, is available at https://tinyurl.ph/tYvJD from PacerMonitor.com. About 5200 Sample Road 5200 Sample Road, LLC, operates a convenience store and gas station in Margate, Florida. Affiliate 1350 Greenview Shores, LLC, operates a convenience store and gas station in Wellington, Florida. Both companies are owned by the same individual, Mark Altsentzer. 5200 Sample Road sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Cal. Case No. 23-13723) on May 12, 2023. In the petition signed by Mark Alsentzer, manager, the Debtor disclosed up to $100,000 in assets and up to $50,000 in liabilities. Judge Mindy A. Mora oversees the case. 1350 Greenview Shores, LLC, sought Chapter 11 protection (Bankr. S.D. Fla. Case No. 23-16952) on Aug. 30, 2023. Craig I. Kelley, Esq., at Kelley, Fulton & Kaplan, P.L., is the Debtors' legal counsel. ACQUIA INC: Goldman Sachs Marks $3.2MM Loan at 53% Off ------------------------------------------------------ Goldman Sachs BDC, Inc has marked its $3,268,000 loan extended to Acquia, Inc. to market at $1,551,000 or 47% of the outstanding amount, as of September 30, 2023, according to Goldman Sachs's Form 10-Q for the Quarterly period ended, September 30, 2023, filed with the Securities and Exchange Commission on November 7, 2023. Goldman Sachs BDC is a participant in a First Lien Senior Secured Debt to Acquia, Inc. The loan accrues interest at a rate of 12.72% (S + 7.00%) per annum. The loan matures on October 31, 2025. Goldman Sachs BDC classified the loan as having non-accrual status and as a non-income producing security. Goldman Sachs BDC was initially established as Goldman Sachs Liberty Harbor Capital, LLC, a single member Delaware limited liability company, on September 26, 2012 and commenced operations on November 15, 2012 with The Goldman Sachs Group, Inc. as its sole member. On March 29, 2013, the Company elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Effective April 1, 2013, the Company converted from a SMLLC to a Delaware corporation. In addition, the Company has elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2013. Goldman Sachs Asset Management, L.P., a Delaware limited partnership and an affiliate of Goldman Sachs & Co. LLC, is the investment adviser of the Company. Acquia Inc. provides software services. The Company offers site and campaign studio, cloud, lightning, lift, commerce, marketing, and other digital software solutions. Acquia serves clients worldwide. AIR FORCE VILLAGES: Fitch Affirms 'BB+' IDR, Outlook Stable ----------------------------------------------------------- Fitch Ratings has affirmed the 'BB+' Issuer Default Rating (IDR) rating on Air Force Villages dba Blue Skies of Texas (BST). Fitch has also affirmed at 'BB+' the $117,000,000 Tarrant County Cultural Education Facilities Finance Corporation retirement facility revenue bonds series 2016 issued on behalf of BST. The Rating Outlook is Stable. Entity/Debt Rating Prior ----------- ------ ----- Air Force Villages (TX) LT IDR BB+ Affirmed BB+ Air Force Villages (TX) /General Revenues/1 LT LT BB+ Affirmed BB+ The 'BB+' rating primarily reflects BST's financial profile through Fitch's forward-looking scenario analysis with good maximum annual debt service (MADS) coverage and stable, but comparatively more limited liquidity at 35% cash to adjusted debt. Fitch expects that both metrics will be sustained due to good cost management, despite BST's history of soft demand. The midrange revenue defensibility reflects BST's modest national draw and aggressive marketing, balanced against consistently soft occupancy. Similarly, the midrange operating risk assessment shows good expense management practices tempered by an elevated average age of plant. SECURITY The series 2016 bonds are secured by a gross revenue pledge, mortgage pledge and debt service reserve fund. KEY RATING DRIVERS Revenue Defensibility - 'bbb' Weak Occupancy Balanced Against Tenacious Marketing BST operates two life plan communities (LPCs): BST Senior Living East (BST East) and BST Senior Living West (BST West). Occupancy at BST East continues to be challenged following a repositioning project that was completed in 2012. Occupancy at BST East was a low 65% at the end of June, 2023, which is consistent with occupancy for the past several years. Independent living (IL) occupancy at BST West has been stronger, and improved to a good 90% at the end of October, 2023 from levels closer to 85%. Healthcare occupancy has been consistently soft with incremental improvement as well, up to the 78% in assisted living and memory care and 74% in skilled nursing in October 2023. Fitch believes BST's demand indicators should support adequate census levels over the longer term in the IL units (ILUs). The weighted average entrance fee is below local home values and rate increases occur regularly, supporting the midrange assessment. The local market is competitive, and the location of BST East results in competition with local for-profit rental facilities, while BST West competes with other not-for-profit retirement communities in the area that offer the full continuum of care. Furthermore, BST differentiates itself with its military affiliation, attracting former military personnel from across the country. Operating Risk - 'bbb' Good Expense Management, Strategic CapEx BST's midrange operating risk assessment reflects a history of good operations but only adequate capital related metrics balanced against elevated capex requirements. Fitch attributes this performance to good expense management practices and a predominantly type-B contract type. The fee for service contract allows BST to pass most healthcare costs on to residents. BST's management team continues to focus on strengthening operations by improving occupancy and expense management. The community's five-year average operating ratio, NOM and NOMA were 98.1%, 9.6 and 20.2%, respectively, which support the midrange operating risk assessment. BST has shown limited capital spending with average capex near 80% of depreciation over the past five years and a relatively elevated age of plant of approximately 15 years. Though capital spending has been below depreciation, it has been strategic. Management underwent a revitalization program on campus. Most capital-related metrics have been adequate with revenue-only MADS coverage averaging 1.2x and MADS averaging 14.4% of revenue over the past five years. Debt to net available averaged a weaker 7.7x reflecting BST's somewhat elevated debt burden. Financial Profile - 'bb' Stable Financial Profile Fitch expects BST will maintain a financial profile that is consistent with the 'bb' assessment even during the economic and financial volatility assumed in Fitch's stress case scenario, within the context of BST's midrange revenue defensibility and operating risk assessments. MADS coverage has been stronger than the weak assessment, averaging 2x over the past five years. BST's balance sheet has been stable and consistent with unrestricted cash and investments at $39.5 million in 2023, or 35% cash-to-adjusted debt at YE 2023. Unrestricted cash represented 296 days cash on hand (DCOH) in 2023, which is neutral to the assessment of BST's financial profile. BST's financial profile remains consistent with these levels with cash-to -adjusted debt of roughly 40% in the recovery years of Fitch's stress case. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Fitch expects BST will maintain a 'BB+' rating through the stress case scenario, but deterioration in core profitability to operating ratios above 100%, or depletion of liquidity such that cash to adjusted debt falls below 30%, would negatively pressure the rating. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - A return to an investment-grade rating or Positive Outlook will be dependent on growing liquidity with cash to adjusted debt sustained above 60%, while maintaining debt service coverage around 2x. PROFILE BST operates two LPCs, BST East and BST West, located in San Antonio, TX. BST East opened in 1970 and BST West opened in 1987, and both communities historically served retired officers of all uniformed services and spouses, widows or widowers. The board approved the expansion of eligibility to individuals with no prior military affiliation as of November 2013. The organization changed its name in May 2014 and the official launch of a rebranding campaign began in October 2014. BST predominately offers a Type B contract but also has a small number of residents in Type A and rental contracts. The large majority of residents at BST are in Type B non-refundable contracts that amortize over 42 months. BST had a total of 714 ILUs, 57 assisted living units (ALUs), 72 memory care units, and 80 skilled nursing facility (SNF) beds as of September 2023. BST had $57 million in total revenue in fiscal 2023 (FYE June 30; audited). Sources of Information In addition to the sources of information identified in Fitch's applicable criteria specified below, this action was informed by information from Lumesis. ESG CONSIDERATIONS 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. ALASKA LOGISTICS: Court OKs Cash Collateral Access Thru Dec 14 -------------------------------------------------------------- The U.S. Bankruptcy Court for the Western District of Washington authorized Alaska Logistics, LLC to continue using cash collateral under the same terms and conditions in the Final Order, through December 14, 2023. The Debtor is directed to provide the same adequate protection and reporting to Banner Bank as provided in the Final Cash Collateral Order. As previously reported by the Troubled Company Reporter, as adequate protection and for the Debtor's use of the cash collateral, Banner Bank, was granted replacement liens in the Debtor's post-petition cash, accounts receivable and inventory, and the proceeds of each of the foregoing, to the same extent and priority as any duly perfected and unavoidable liens in cash collateral held by Banner Bank as of the Petition Date. A hearing on the matter is continued to December 14, 2023 at 1:30 p.m. A copy of the order is available at https://urlcurt.com/u?l=emOZ99 from PacerMonitor.com. About Alaska Logistics LLC Alaska Logistics LLC transports materials and equipment of all sizes, shapes and types from Seattle to Western Alaska. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. W.D. Wash. Case No. 23-11250) on July 7, 2023. In the petition signed by Allyn Long, general manager/president, the Debtor disclosed up to $50 million in both assets and liabilities. Judge Christopher M. Alston oversees the case. Faye C. Rasch, Esq., at Wenokur Riordan PLLC, represents the Debtor as legal counsel. AMERICAN SCREENING: Plan to Pay All Classes in Full --------------------------------------------------- American Screening, LLC, filed a Second Amended Chapter 11 Plan of Reorganization, and a Disclosure Statement dated November 3, 2023. The Plan contemplates payment in full to all classes of creditors. The Plan will be funded from operations of the Debtor and cash on hand. With respect to specific classes of creditors and interest holders, the Plan provides: (1) all Allowed Administrative Claims shall be paid in full, in Cash, on the Effective Date, or as otherwise agreed in writing between the Debtor and any such administrative claimant agreeing to a different treatment; (2) full payment of all Allowed Priority Claims of Governmental Entities, if any, in Cash, through regular Monthly Plan Payments, or as otherwise agreed in writing, together with interest at the rate required by Bankruptcy Code section 511 or, if applicable, the rate authorized by Louisiana law, over a period through the fifth anniversary of the Petition Date; (3) full payment, in Cash, of all Allowed Non-Governmental Priority Claims, if any, on the Effective Date; (4) full payment of all Allowed Secured Claims of Governmental Entities, if any, in Cash, through regular Monthly Plan Payments, or as otherwise agreed in writing, together with interest at the rate required by Bankruptcy Code section 511 or, if applicable, the rate authorized by Louisiana law, over a period through the fifth anniversary of the Petition Date; (5) full payment of the Allowed Secured Claims of First Horizon Bank ("FHB"), in Cash, through reinstatement, deacceleration, cure of any and all pre-Petition Date economic defaults on the Effective Date, including payment of all unpaid pre-Petition Date and post-Petition Date interest, and any unpaid and reasonable fees, costs, and charges provided for under the FHB Loan Documents as of the Effective Date, and thereafter full and timely performance by the Reorganized Debtor (and each co-borrower) of the obligations to FHB under the FHB Loan Documents, which are to remain enforceable and effective; provided, however, so long as the Debtor cures all economic defaults thereunder on the Effective Date, no event of default thereunder shall be deemed to have occurred prior to the Effective Date by reason of the commencement of the Bankruptcy Case or by any failure to make any payment due prior to the Effective Date; and further provided, that no event of default shall be deemed to occur after the Effective Date based upon the existence of the Bankruptcy Case and the Plan. FHB will retain all liens until its Allowed Secured Claims are paid in full. To the extent there is a post-Effective Date default in payment to FHB under the Plan, then all rights and remedies are in effect as set forth in the pre-Petition Date FHB Loan Documents and there is no further obligation by FHB to move for relief from any remaining stay or injunction under the Plan and/or the Confirmation Order; (6) full payment of the Allowed Secured Claim of Ally Bank, in Cash, through reinstatement, deacceleration, cure of any and all pre-Petition Date economic defaults on the Effective Date, including payment of all unpaid pre-Petition Date and post-Petition Date interest, and any unpaid and reasonable fees, costs, and charges provided for under the Ally Bank Loan Documents as of the Effective Date, and thereafter full and timely performance by the Reorganized Debtor of the obligations to Ally Bank under the Ally Bank Loan Documents, which are to remain enforceable and effective; provided, however, so long as the Debtor cures all economic defaults thereunder on the Effective Date, no event of default thereunder shall be deemed to have occurred prior to the Effective Date by reason of the commencement of the Bankruptcy Case or by any failure to make any payment due prior to the Effective Date; and further provided, that no event of default shall be deemed to occur after the Effective Date based upon the existence of the Bankruptcy Case and the Plan. Ally Bank will retain all liens until its Allowed Secured Claim is paid in full. To the extent there is a post-Effective Date default in payment to Ally Bank under the Plan, then all rights and remedies are in effect as set forth in the pre-Petition Date Ally Bank Loan Documents and there is no further obligation by Ally Bank to move for relief from any remaining stay or injunction under the Plan and/or the Confirmation Order; (7) full payment of the Allowed Secured Claims of First Citizens Bank & Trust Company, in cash, through reinstatement, deacceleration, cure of any and all pre-Petition Date economic defaults on the Effective Date, including payment of all unpaid pre-Petition Date and post-Petition Date interest, and any unpaid and reasonable fees, costs, and charges provided for under the First Citizens Bank Loan Documents as of the Effective Date, and thereafter full and timely performance by the Reorganized Debtor of the obligations to First Citizens under the First Citizens Bank Loan Documents, which are to remain enforceable and effective; provided, however, so long as the Debtor cures all economic defaults thereunder on the Effective Date, no event of default thereunder shall be deemed to have occurred prior to the Effective Date by reason of the commencement of the Bankruptcy Case or by any failure to make any payment due prior to the Effective Date; and further provided, that no event of default shall be deemed to occur after the Effective Date based upon the existence of the Bankruptcy Case and the Plan. First Citizens will retain all liens until its Allowed Secured Claims are paid in full. To the extent there is a post- Effective Date default in payment to First Citizens Bank under the Plan, then all rights and remedies are in effect as set forth in the pre-Petition Date First Citizens Bank Loan Documents and there is no further obligation by First Citizens to move for relief from any remaining stay or injunction under the Plan and/or the Confirmation Order; (8) full payment of the Allowed Secured Claim of the United States Small Business Administration ("SBA"), in Cash, through reinstatement, deacceleration, cure of any and all pre-Petition Date economic defaults on the Effective Date, including payment of all unpaid pre-Petition Date and post-Petition Date interest, and any unpaid and reasonable fees, costs, and charges provided for under the SBA Bank Loan Documents as of the Effective Date, and thereafter full and timely performance by the Reorganized Debtor of the obligations to the SBA under the SBA Loan Documents, which are to remain enforceable and effective; provided, however, so long as the Debtor cures all economic defaults thereunder on the Effective Date, no event of default thereunder shall be deemed to have occurred prior to the Effective Date by reason of the commencement of the Bankruptcy Case or by any failure to make any payment due prior to the Effective Date; and further provided, that no event of default shall be deemed to occur after the Effective Date based upon the existence of the Bankruptcy Case and the Plan. The SBA will retain all liens until its Allowed Secured Claim is paid in full. To the extent there is a post-Effective Date default in payment to the SBA under the Plan, then all rights and remedies are in effect as set forth in the SBA Loan Documents and there is no further obligation by the SBA to move for relief from any remaining stay or injunction under the Plan and/or the Confirmation Order; (9) full payment of the Allowed Secured Claim of Chase Bank, in Cash, through reinstatement, deacceleration, cure of any and all pre-Petition Date economic defaults on the Effective Date, including payment of all unpaid pre-Petition Date and post-Petition Date interest, and any unpaid and reasonable fees, costs, and charges provided for under the Chase Bank Loan Documents as of the Effective Date, and thereafter full and timely performance by the Reorganized Debtor of the obligations to Chase Bank under the Chase Bank Loan Documents, which are to remain enforceable and effective; provided, however, so long as the Debtor cures all economic defaults thereunder on the Effective Date, no event of default thereunder shall be deemed to have occurred prior to the Effective Date by reason of the commencement of the Bankruptcy Case or by any failure to make any payment due prior to the Effective Date; and further provided, that no event of default shall be deemed to occur after the Effective Date based upon the existence of the Bankruptcy Case and the Plan. Chase Bank will retain all liens until its Allowed Secured Claim is paid in full. To the extent there is a post-Effective Date default in payment to Chase Bank under the Plan, then all rights and remedies are in effect as set forth in the Chase Bank Loan Documents and there is no further obligation by Chase Bank to move for relief from any remaining stay or injunction under the Plan and/or the Confirmation Order; (10) full payment of the Allowed General Unsecured Non-Insider Claims 60 regular Monthly Plan Payments commencing on the Effective Date and continuing on the first business day of each month thereafter until such Allowed General Unsecured Non-Insider Claims are paid in full; (11) payment of the FTC Final Judgment Claim through the FTC Claim Treatment contained in Article IV of the Plan; (12) full payment of the Allowed Insider Claims commencing only upon payment in full of all senior Classes of Allowed Priority and Non-Priority Non-Insider Unsecured Claims under the Plan, and provided that there is no pending Default under the Plan; (13) the Pre-Petition Membership Interest of R. Kilgarlin in the Debtor shall be preserved; provided, however, that R. Kilgarlin shall receive no payments, dividends, or distributions, solely on account of R. Kilgarlin's Pre-Petition Membership Interest in the Debtor unless and until all Allowed Claims in Classes 9 and 10 are paid in full. Following the Effective Date, the Reorganized Debtor will object, as needed, to Proofs of Claim (and shall continue any objections to Proofs of Claim filed by the Debtor in Possession), shall litigate (and continue any litigation commenced by the Debtor in Possession) all Causes of Action, including any Avoidance Actions, and shall make the distributions required by the Plan. Attorney for American Screening, LLC: Kell C. Mercer, Esq. KELL C. MERCER, P.C. 901 S Mopac Expy Bldg 1 Ste 300 Austin, TX 78746 Tel: (512) 627-3512 Fax: (512) 597-0767 Email: kell.mercer@mercer-law-pc.com A copy of the Disclosure Statement dated November 4, 2023, is available at https://tinyurl.ph/DYUBX from PacerMonitor.com. About American Screening American Screening, LLC is an ISO 13485 Certified distributor of rapid drug and alcohol tests, infectious disease tests, and cardiac tests, and supplies to the United States, South America, Asia, Africa, Europe, and Australia. ASC leases its corporate office and warehouse space from an affiliated nondebtor, Kilgarlin Holdings, LLC. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. W.D. La. Case No. 23-10350) on April 7, 2023. In the petition signed by Ronald Kilgarlin, Jr., managing member, the Debtor disclosed up to $9,100,921 in assets and up to $27,251,799 in liabilities. Judge John S. Hodge oversees the case. Kell C. Mercer, Esq., at Kell C. Mercer, P.C, is the Debtor's legal counsel. ANSIRA PARTNERS: 96% Markdown for Goldman Sachs $165,000 Loan ------------------------------------------------------------- Goldman Sachs BDC, Inc has marked its $165,000 loan extended to Ansira Partners, Inc to market at $7,000 or 4% of the outstanding amount, as of September 30, 2023, according to Goldman Sachs's Form 10-Q for the Quarterly period ended, September 30, 2023, filed with the Securities and Exchange Commission on November 7, 2023. Goldman Sachs BDC is a participant in a First Lien Senior Secured Debt to Ansira Partners, Inc. The loan accrues interest at a rate of 18.5% (P + 10.00% (Incl. 8.00% PIK) per annum. The loan matures on December 20, 2024. Goldman Sachs BDC classified the loan as a Non-income producing security and said the loan is on a non-accrual status. The loan is subject to Chapter 7 bankruptcy process filed by IHS Intermediate Inc. (dba Interactive Health Solutions). Goldman Sachs BDC, Inc. was initially established as Goldman Sachs Liberty Harbor Capital, LLC, a single member Delaware limited liability company, on September 26, 2012 and commenced operations on November 15, 2012 with The Goldman Sachs Group, Inc. as its sole member. On March 29, 2013, the Company elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Effective April 1, 2013, the Company converted from a SMLLC to a Delaware corporation. In addition, the Company has elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2013. Goldman Sachs Asset Management, L.P., a Delaware limited partnership and an affiliate of Goldman Sachs & Co. LLC, is the investment adviser of the Company. Ansira Partners, Inc. provides advertising and marketing services. The Company offers data, analytics, marketing intelligence, experiential marketing, direct marketing, trade promotion management, marketing automation, and digital solutions. ANSIRA PARTNERS: 96% Markdown for Goldman Sachs $367,000 Loan ------------------------------------------------------------- Goldman Sachs BDC, Inc has marked its $367,000 loan extended to Ansira Partners, Inc to market at $16,000 or 4% of the outstanding amount, as of September 30, 2023, according to Goldman Sachs's Form 10-Q for the Quarterly period ended, September 30, 2023, filed with the Securities and Exchange Commission on November 7, 2023. Goldman Sachs BDC is a participant in a First Lien Senior Secured Debt to Ansira Partners. The loan accrues interest at a rate of (L + 6.50% PIK) per annum. The loan matures on December 20, 2024. Goldman Sachs BDC classified the loan as a Non-income producing security. The investment is subject to Chapter 7 bankruptcy process filed by IHS Intermediate Inc. (dba Interactive Health Solutions). Goldman Sachs BDC, Inc. was initially established as Goldman Sachs Liberty Harbor Capital, LLC, a single member Delaware limited liability company, on September 26, 2012 and commenced operations on November 15, 2012 with The Goldman Sachs Group, Inc. as its sole member. On March 29, 2013, the Company elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Effective April 1, 2013, the Company converted from a SMLLC to a Delaware corporation. In addition, the Company has elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2013. Goldman Sachs Asset Management, L.P., a Delaware limited partnership and an affiliate of Goldman Sachs & Co. LLC, is the investment adviser of the Company. Ansira Partners, Inc. provides advertising and marketing services. The Company offers data, analytics, marketing intelligence, experiential marketing, direct marketing, trade promotion management, marketing automation, and digital solutions. ANSIRA PARTNERS: 96% Markdown for Goldman Sachs $6MM Loan --------------------------------------------------------- Goldman Sachs BDC, Inc has marked its $6,032,000 loan extended Ansira Partners, Inc. to market at $256,000 or 4% of the outstanding amount, as of September 30, 2023, according to Goldman Sachs's Form 10-Q for the Quarterly period ended, September 30, 2023, filed with the Securities and Exchange Commission on November 7, 2023. Goldman Sachs BDC, Inc is a participant in a First Lien Senior Secured Debt to Ansira Partners, Inc. The loan accrues interest at a rate of (L + 6.50% PIK) per annum. The loan matures on December 20, 2024. Goldman Sachs BDC classified the loan as a Non-income producing security. The loan is subject to Chapter 7 bankruptcy process filed by IHS Intermediate Inc. (dba Interactive Health Solutions). Goldman Sachs BDC was initially established as Goldman Sachs Liberty Harbor Capital, LLC, a single member Delaware limited liability company, on September 26, 2012 and commenced operations on November 15, 2012 with The Goldman Sachs Group, Inc. as its sole member. On March 29, 2013, the Company elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Effective April 1, 2013, the Company converted from a SMLLC to a Delaware corporation. In addition, the Company has elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2013. Goldman Sachs Asset Management, L.P., a Delaware limited partnership and an affiliate of Goldman Sachs & Co. LLC, is the investment adviser of the Company. Ansira Partners, Inc. provides advertising and marketing services. The Company offers data, analytics, marketing intelligence, experiential marketing, direct marketing, trade promotion management, marketing automation, and digital solutions. AQ HELIOS: 96% Markdown for Goldman Sachs $12.5MM Loan ------------------------------------------------------ Goldman Sachs BDC, Inc has marked its $12,500,000 loan extended to AQ Helios Buyer, Inc to market at $503,000 or 4% of the outstanding amount, as of September 30, 2023, according to Goldman Sachs's Form 10-Q for the Quarterly period ended, September 30, 2023, filed with the Securities and Exchange Commission on November 7, 2023. Goldman Sachs BDC is a participant in a First Lien Senior Secured Debt to AQ Helios Buyer, Inc. The loan accrues interest at a rate of 13.40% (S + 8.00%) per annum. The loan matures on August 7, 2028. Goldman Sachs BDC classified the loan on non-accrual status and as a Non-income producing security. Goldman Sachs BDC, Inc. was initially established as Goldman Sachs Liberty Harbor Capital, LLC, a single member Delaware limited liability company, on September 26, 2012 and commenced operations on November 15, 2012 with The Goldman Sachs Group, Inc. as its sole member. On March 29, 2013, the Company elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Effective April 1, 2013, the Company converted from a SMLLC to a Delaware corporation. In addition, the Company has elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2013. Goldman Sachs Asset Management, L.P., a Delaware limited partnership and an affiliate of Goldman Sachs & Co. LLC, is the investment adviser of the Company. AQ Helios Buyer, Inc is in the Software Industry. ART & DENTISTRY: Court OKs Cash Collateral Access on a Final Basis ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Maryland authorized Art & Dentistry, LLC to use cash collateral on a final basis in accordance with the budget. As previously reported by the Troubled Company Reporter, Dr. Ellen Brodsky, has owned and operated the Debtor's dental practice since 2000. On October 29, 2012, Dr. Brodsky was injured by a light fixture that had been improperly installed and which fell from the ceiling of an examination room, causing closed-head brain injury. The injury severely impacted the business's income, and the practice has struggled financially due to COVID and staff turnovers. Since then, the practice has relied on part-time, contract dentists, and the debtor believes it can rebuild revenue through a Chapter 11 plan. The Debtor has also been delinquent in paying rent, leading to a consent judgment with the landlord in April 2021. The Debtor's finances have deteriorated, and the landlord is pursuing eviction. Of record, the creditor with the senior lien against the Debtor's assets is Wells Fargo Bank, N.A., whose original UCC-1 was recorded September 10, 2009, and was continued thereafter by periodic continuation statements, the most recent of which was filed March 14, 2019. However, in 2020 Wells Fargo sent the Debtor a notice that it was cancelling the Debtor's debt. Because its financing statement remains of record, the Debtor will treat Wells Fargo as if it were still a secured creditor, although disputed. Second in priority of filing is the United States Small Business Administration, which perfected a lien against all the Debtor's assets with the filing of a UCC-1 on May 6, 2020. SBA is owed approximately $166,500. The third and final lien claimant is "E Advance Services," which filed its UCC-1 on June 28, 2023, and is owed approximately $26,500. E Advance Services is one of three "merchant cash advance" companies to which the Debtor turned in recent months in order to get by. The business model of the MCAs is doubtless familiar to the Court. In exchange for money advanced to the Debtor, the MCAs purport to "purchase" future receivables. Largely, their business is structured to try to avoid usury laws for, while their contracts do not express an accurate rate of interest for those advances, undersigned counsel has calculated annual interest rates ranging roughly from 130% to 144%. The MCA agreements are little more than disguised security agreements, if that. As noted above, only one of the MCA "lenders" has recorded a financing statement against the Debtor. Collectively, the Debtor owes the MCA companies approximately $70,000. The UCC-1 filings are all what are commonly referred to as "blanket" liens, intended to encumber all the Debtor's assets. A copy of the court's order is available at https://urlcurt.com/u?l=eOgIyT from PacerMonitor.com. About Art & Dentistry Art & Dentistry is a local dental practice offering general and cosmetic dentistry, teeth whitening, implants, veneers and other services. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Md. Case No. 23-16790) on September 22, 2023. In the petition signed by Ellen Brodsky, managing member, the Debtor disclosed up to $500,000 in assets and up to $10 million in liabilities. Judge Lori S. Simpson oversees the case. David E. Lynn, Esq., at David E. Lynn, P.C., represents the Debtor as legal counsel. ASPIRE BAKERIES: S&P Upgrades ICR to 'B', Outlook Stable -------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on U.S.-based baked goods manufacturer Aspire Bakeries Holdings LLC to 'B' from 'B-'. S&P said, "Concurrently, we raised our ratings on the company's first-lien credit facilities to 'B+' from 'B' and on its second-lien term loan to 'B-' from 'CCC+'. The recovery ratings on the debt remain '2' and '5', respectively. "The stable outlook reflects our expectation that Aspire will sustain S&P Global Ratings-adjusted leverage below 7x and positive free operating cash flow (FOCF)." The upgrade reflects Aspire's substantial profit improvement and reduced leverage. The company reported 10% annual sales growth for fiscal 2023 (ended July 29, 2023) because of double-digit price increases to offset input cost inflation, partially offset by a 1.6% decline in volume, largely due to strategic stock-keeping units (SKU) rationalizations. Underlying demand in the company's three businesses remains stable, despite significant price increases. Aspire modestly increased volumes in its strategic partners and food service businesses. S&P expects the company's demand dynamics to remain stable given its exposure to quick service restaurants (QSR), about 55% of revenue, which tend to do well in weak macroenvironments because they are an affordable dining option. The company's retail sales volumes decreased due to its strategic decision to exit certain lower-margin non-core products. At the same time, the rate of acceleration of ingredient and freight costs slowed, and the company benefited from operational improvements, including the consolidation of sub-scale facilities and reduction of SKUs. In addition, certain one-time costs related to COVID-19, its business transition, and restructuring actions rolled-off, improving the company's quality of earnings. Aspire has pass-through pricing arrangements for more than half of its business, which allowed it to pass on commodity and other input costs to customers. In addition, the company renegotiated prices with other key customers with no formulaic pass-through arrangements to offset rising costs. Aspire's S&P Global Rating-adjusted EBITDA margin expanded about 280 basis points to 7.9% in fiscal 2023 because the impact of inflation was increasingly offset by the company's pricing actions to preserve dollar margins, its shift to a higher-margin product mix, and its more efficient manufacturing operations. The company's S&P Global Rating-adjusted leverage declined to about 4.3x for the 12 months ended July 29, 2023, compared with 8.1x for the same period the previous year. The company's cash flow also improved, which allowed it to pay down debt. Aspire generated FOCF of about $30 million during fiscal 2023, compared with a use of $88 million during fiscal 2022. Lower costs, improved supply chains, more favorable customer payment terms, and better inventory management helped the company reduce its working capital usage by about $84 million during fiscal 2023, compared with fiscal 2022. Positive FOCF allowed the company to pay down about $37 million of revolver borrowings. In the third quarter, Aspire completed the sale of its remaining interest in a property, which generated $4 million of net proceeds and removed the related lease obligation. S&P believes Aspire's long-standing relationships with leading QSRs, food service, and retail customers; pass-through pricing arrangements; and a more efficient manufacturing footprint will help the company sustain FOCF generation, despite anticipated higher capital investments to support growth. S&P said, "While we acknowledge leverage is low for the current rating, we believe the company's financial sponsor ownership may prevent S&P Global Ratings-adjusted leverage from being sustained below 5x. We expect the company will sustain its operating performance improvement and its S&P Global Rating-adjusted leverage will decline to about 3.4x in fiscal 2024. However, the risk of re-leveraging is high because we believe its financial sponsor may seek a debt-funded dividend or expand the company with large acquisitions. We expect the overall baking categories to grow in the low-single-digit percent area in the few years, and the industry is highly fragmented. Aspire and its financial sponsor may eventually use excess cash flow and debt capacity to support acquisitions into faster-growing segments. "The stable outlook reflects our expectation that Aspire will sustain S&P Global Ratings-adjusted leverage below 7x and positive FOCF." S&P could lower the ratings on Aspire over the next 12 months if leverage reached and were sustained above 7x. S&P believes this could result from: -- The loss of key customers because of service issues, market share losses, or changing consumer preferences; -- A decline in foot traffic in the company's largest business segments because of a weak macroenvironment or a recession; and -- More aggressive financial policies such as a large, debt-financed acquisitions or shareholder dividends. While unlikely over the next 12 months, S&P could raise the ratings on Aspire if the company committed to and demonstrated more conservative financial policies that led it to believe S&P Global Ratings-adjusted debt to EBITDA would be sustained below 5x. This could result from: -- A track record of not pursuing large debt-financed acquisitions or shareholder distributions, -- Sustained organic revenue growth, and -- Improvement in profitability leading to higher EBITDA margin and FOCF generation. ASSEMBLY INTERMEDIATE: Goldman Sachs Marks $10.9MM Loan at 45% Off ------------------------------------------------------------------ Goldman Sachs BDC, Inc has marked its $10,998,000 loan extended to Assembly Intermediate LLC to market at $6,049,000 or 55% of the outstanding amount, as of September 30, 2023, according to Goldman Sachs's Form 10-Q for the Quarterly period ended, September 30, 2023, filed with the Securities and Exchange Commission on November 7, 2023. Goldman Sachs BDC is a participant in a First Lien Senior Secured Debt to Assembly Intermediate LLC. The loan accrues interest at a rate of 11.49% (S+6.00%) per annum. The loan matures on October 19, 2027. Goldman Sachs BDC classified the loan on non-accrual status and said the loan is a Non-income producing security. Goldman Sachs BDC, Inc. was initially established as Goldman Sachs Liberty Harbor Capital, LLC, a single member Delaware limited liability company, on September 26, 2012 and commenced operations on November 15, 2012 with The Goldman Sachs Group, Inc. as its sole member. On March 29, 2013, the Company elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Effective April 1, 2013, the Company converted from a SMLLC to a Delaware corporation In addition, the Company has elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2013. Goldman Sachs Asset Management, L.P., a Delaware limited partnership and an affiliate of Goldman Sachs & Co. LLC, is the investment adviser of the Company. Assembly Intermediate LLC provides diversified consumer services. AULT ALLIANCE: Acquires $15M in Preferred Stock from RiskOn ----------------------------------------------------------- Ault Alliance, Inc. disclosed in a Form 8-K Report filed with the Securities and Exchange Commission that on Nov. 14, 2023, the Company entered into a Securities Purchase Agreement with RiskOn International, Inc., a Nevada corporation. The Company purchased from RiskOn International 603.44 shares of its newly designated Series D Convertible Preferred Stock for a total purchase price of $15,085,930.69. The Transaction closed on November 15, 2023. The purchase price was paid by the cancellation of $15,085,930.69 of cash advances made by the Company to RiskOn International between January 1 and November 9, 2023. RiskOn International is an affiliate of the Company. The terms of the Preferred Shares as set forth in the Certificates of Designations of the Rights, Preferences and Limitations of the Series D Convertible Preferred Stock. The Preferred Shares each have a stated value of $25,000 per share. Pursuant to the Certificate, each Preferred Share is convertible into a number of shares of RiskOn International's common stock determined by dividing the Stated Value by $0.51, or an aggregate of 29,580,392 shares of Common Stock. The Conversion Price is subject to adjustment in the event of an issuance of Common Stock at a price per share lower than the Conversion Price then in effect, as well as upon customary stock splits, stock dividends, combinations or similar events. As the Conversion Price represents a premium to the closing price of the Common Stock on the date of execution of the Agreement, the conversion of the Preferred Shares is not subject to limitations on conversion. The Preferred Shares holders are entitled to receive dividends at a rate of 10% of the Stated Value per annum from issuance until November 14, 2033. During the first two years of the Dividend Term, dividends will be payable, in RiskOn International's option, in additional Preferred Shares rather than cash, and thereafter dividends will be payable in either additional Preferred Shares or cash as the Company may elect. If RiskOn International fails to make a dividend payment as required by the Certificate, the dividend rate will be increased to 15% for as long as such default remains ongoing and uncured. Each Preferred Share also has a $25,000 liquidation preference in the event of a liquidation, change of control event, dissolution or winding up of RiskOn International, and ranks senior to all other capital stock of RiskOn International with respect thereto other than the existing Series B Preferred Stock and Series C Preferred Stock, with which the Preferred Shares shall have equal ranking. Each Preferred Share is entitled to vote, on an as-converted basis, with the Common Stock at a rate of 0.9 votes per share of Common Stock into which the Preferred Share is convertible. In addition, for as long as at least 25% of the Preferred Shares remain outstanding, RiskOn International must obtain from the Company consent with respect to certain corporate events, including reclassifications, fundamental transactions, stock redemptions or repurchases, increases in the number of directors, and declarations or payment of dividends, and further RiskOn International is subject to certain negative covenants, including covenants against issuing additional shares of capital stock or derivative securities, incurring indebtedness, engaging in related party transactions, selling of properties having a value of over $50,000, altering the number of directors, and discontinuing the business of any subsidiary, subject to certain exceptions and limitations. RiskOn International is required to maintain a reserve of authorized and unissued shares of Common Stock equal to 200% of the Conversion Shares, which is initially 59,160,784 shares. The Agreement provides the Company with most favored nations rights in the event RiskOn International offers securities with more favorable terms than the Preferred Shares for as long as the Preferred Shares remain outstanding. Under the Agreement, while any Preferred Shares are outstanding, RiskOn International is prohibited from redeeming or declaring or paying dividends on outstanding securities other than the Preferred Shares. Further, the Agreement prohibits RiskOn International from issuing or amending securities at a price per share below the Conversion Price, or to engage in variable rate transactions, for a period ending on the earlier of (i) four years from the Closing Date and (ii) the date that the Company holds less than 250 Preferred Shares. About Ault Alliance Inc. Ault Alliance, Inc. (formerly, BitNile Holdings, Inc.) is a diversified holding company pursuing growth by acquiring undervalued businesses and disruptive technologies with a global impact. Through its wholly- and majority-owned subsidiaries and strategic investments, the Company owns and operates a data center at which the Company mines Bitcoin, and provides mission-critical products that support a diverse range of industries, including crane services, oil exploration, defense/aerospace, industrial, automotive, medical/biopharma, consumer electronics, hotel operations and textiles. In addition, the Company extends credit to select entrepreneurial businesses through a licensed lending subsidiary. Ault Alliance reported a net loss of $189.83 million for the year ended Dec. 31, 2022, compared to a net loss of $23.04 million for the year ended Dec. 31, 2021. As of March 31, 2023, the Company had $526.91 million in total assets, $336.56 million in total liabilities, and $190.34 million in total stockholders' equity. New York, New York-based Marcum LLP, the Company's auditor since 2016, issued a "going concern" qualification in its report dated April 17, 2023, citing that the Company has a working capital deficiency, has incurred net losses and needs to raise additional funds to meet its obligations and sustain its operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. AULT ALLIANCE: Incurs $28.4 Million Net Loss in Third Quarter ------------------------------------------------------------- Ault Alliance, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $28.44 million on $47.96 million of total revenue for the three months ended Sept. 30, 2023, compared to a net loss of $8 million on $44.26 million of total revenue for the three months ended Sept. 30, 2022. For the nine months ended Sept. 30, 2023, the Company reported a net loss of $141.52 million on $119.93 million of total revenue compared to a net loss of $62.87 million on $87.16 million of total revenue for the same period in 2022. As of Sept. 30, 2023, the Company had $378.46 million in total assets, $257.22 million in total liabilities, $2.18 million in redeemable noncontrolling interests in equity of subsidiaries, and total stockholders' equity of $119.06 million. As of Sept. 30, 2023, the Company had cash and cash equivalents of $8.7 million, negative working capital of $45.1 million and a history of net operating losses. The Company has financed its operations principally through issuances of convertible debt, promissory notes and equity securities. The Company said these factors create substantial doubt about the Company's ability to continue as a going concern for at least one year after the date that these condensed consolidated financial statements are issued. Ault Alliance said, "Management expects that the Company's existing cash and cash equivalents, accounts receivable and marketable securities as of September 30, 2023, will not be sufficient to enable the Company to fund its anticipated level of operations through one year from the date these financial statements are issued. Management anticipates raising additional capital through the private and public sales of the Company's equity or debt securities and selling its marketable securities and digital currencies, or a combination thereof. Although management believes that such capital sources will be available, there can be no assurances that financing will be available to the Company when needed in order to allow the Company to continue its operations, or if available, on terms acceptable to the Company. If the Company does not raise sufficient capital in a timely manner, among other things, the Company may be forced to scale back its operations or cease operations altogether." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/0000896493/000121465923015389/aa11823010q.htm About Ault Alliance Inc. Ault Alliance, Inc. (formerly, BitNile Holdings, Inc.) is a diversified holding company pursuing growth by acquiring undervalued businesses and disruptive technologies with a global impact. Through its wholly- and majority-owned subsidiaries and strategic investments, the Company owns and operates a data center at which the Company mines Bitcoin, and provides mission-critical products that support a diverse range of industries, including crane services, oil exploration, defense/aerospace, industrial, automotive, medical/biopharma, consumer electronics, hotel operations and textiles. In addition, the Company extends credit to select entrepreneurial businesses through a licensed lending subsidiary. Ault Alliance reported a net loss of $189.83 million for the year ended Dec. 31, 2022, compared to a net loss of $23.04 million for the year ended Dec. 31, 2021. As of June 30, 2023, the Company had $378.39 million in total assets, $254.94 million in total liabilities, $1.95 million in redeemable noncontrolling interests in equity of subsidiaries, and $121.50 million in total stockholders' equity. New York-based Marcum LLP, the Company's auditor since 2016, issued a "going concern" qualification in its report dated April 17, 2023, citing that the Company has a working capital deficiency, has incurred net losses and needs to raise additional funds to meet its obligations and sustain its operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. AVENTIS SYSTEMS: Unsecured Creditors to Get At Least 4% in Plan --------------------------------------------------------------- Aventis Systems, Inc., and Cortavo, Inc., filed a First Amended Joint Plan of Reorganization and an Amended Disclosure Statement on November 8, 2023. During the pendency of the Chapter 11 cases, Aventis has streamlined its business by concentrating on sales of higher margin hardware and software and also increasing its higher margin managed services business. It has sought to reduce its administrative and other expenses. In May 2023, Aventis finished its installment payments on a large, secured loan owed to Amazon Capital Services, Inc., which greatly improved its free cash flow. It has also made substantial payments on existing debt to its main two suppliers, Ingram Micro, Inc., and D&H Distributing Co. The completion of these critical vendor payments in 2023 will likewise improve free cash flow. Finally, with the help of its accountants at Nichols Cauley, Aventis has overhauled its accounting system and is now able to produce regular detailed accounting reports for its management and for creditors and parties in interest. The allowed claims of Debtors' unsecured creditors, including the convenience class creditors, will be paid pro rata from four sources of funds: (1) sums, if any, left over from the $200,000 paid by the Lamei Group (defined in the Plan as the "Lamei Group Payment"), a group of insider investors which include Debtors' CEO, Mr. Lamei, in consideration for the issuance of new capital stock in the reorganized debtors; (2) sums paid by the Reorganized Debtors to satisfy the Class 2 convenience class unsecured creditors to the extent there are insufficient funds to satisfy those creditors from the Lamei Group Payment; (3) payments of $18,000 per quarter paid by the Reorganized Debtors beginning 150 days after the Effective Date and continuing for a total of 28 quarters (defined in the Plan as the "Unsecured Creditor Payment Fund"); and (4) distributions from the Litigation Trust paid by the Plan Trustee in accordance and at the times specified in this Plan. The Plan divides Unsecured Creditors into three classes: Class 1 includes all unsecured creditors whose claims are more than $500. Class 2 is made up of two subclasses: Class 2A includes those unsecured creditors whose claims are $500 or less. Class 2B includes those creditors in Class 1 who elect to reduce their claims to $500. Class 1 unsecured creditors will be settled and satisfied by Debtors from (1) the balance, if any, of the Lamei Group Payment after the payment in full of all administrative claims, Cashed Out Priority Claims and payments to Class 2 unsecured creditors; (2) payments from the Unsecured Creditor Payment Fund; and (3) distributions from the Litigation Trust. It is estimated that there is approximately $11.6 million in Class 1 unsecured creditors. If all of the Lamei Group Payment was used to pay Administrative and Cash out Priority Claims, then the approximate distribution to Class 1 Unsecured Creditors excluding distributions from the Litigation Trust, would be about 4 percent. Class 2A and 2B unsecured creditors in the convenience class will be paid 100% of their claims in full, from the balance of the Unsecured Creditors Payment Fund left after payment of Administrative and Cashed Out Priority Claims within 10 business days after the Effective Date of the Plan or within 10 days after their claims are allowed, whichever is later. The funds for these distributions will come from funds left over, if any, from the Lamei Group Payment after payment of Administrative Cashed Out Priority Claims and payments made directly by the Reorganized Debtors from their funds. Counsel for the Debtors: Gus H. Smal, Esq. Benjamin S. Klehr, Esq. Anna M. Humnicky, Esq. Small Herrin, LLP 100 Galleria Parkway, Suite 350 Atlanta, GA 30339 Tel: (770) 783 1800 E-mail: gsmall@smallherrin.com bklehr@smallherrin.com ahumnicky@smallherrin.com A copy of the Plan of Reorganization dated November 8, 2023, is available at https://tinyurl.ph/fuvRq from PacerMonitor.com. About Aventis Systems Aventis Systems, Inc., a company in Atlanta, offers custom IT solutions to build and operate complete physical and virtual infrastructures. The comprehensive solutions include refurbished and new hardware, system and application software, and an array of in-depth managed services including infrastructure consultation, cloud hosting and migration, virtualization deployment, data and disaster recovery, security consultation, hardware relocation, and equipment buyback. Aventis Systems and affiliate, Cortavo, Inc., sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Ga. Lead Case No. 23-51162) on Feb. 6, 2023. In the petition signed by its chief executive officer, Hessam Lamei, Aventis Systems disclosed up to $50 million in assets and up to $10 million in liabilities. Judge Lisa Ritchey Craig oversees the cases. The Debtors tapped Anna Humnicky, Esq., at Small Herrin, LLP as bankruptcy counsel; AI Law as special counsel; and Nichols, Cauley & Associates, LLC as accountant. B & J INTERIORS: Court OKs Cash Collateral Access on Final Basis ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Texas, Dallas Division, authorized B & J Interiors, Inc. to use cash collateral on a final basis in accordance with the budget. As previously reported by the Troubled Company Reporter, the Debtor requires the use of cash collateral to make payroll and to pay other immediate expenses to keep its doors open. Creditors American National Bank of Texas, the Small Business Administration and Kapitus Capital have UCC-1's claim a lien on the Debtor's accounts receivable and or inventory. The court said the Secured Credits are granted replacement liens pursuant to 11 U.S.C. section 552 in accordance with their existing priority. A copy of the order is available at https://rb.gy/mj1qmo from PacerMonitor.com. A copy of the budget is available at https://rb.gy/wcickh from PacerMonitor.com. The Debtor asserts $175,000 in income and $50,000 in cost of goods. About B & J Interiors, Inc. B & J Interiors, Inc. sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Tex. Case No. 23-32435) on October 25, 2023. In the petition signed by Bill Fisher, president, the Debtor disclosed up to $50,000 in assets and up to $10 million in liabilities. Eric A. Liepins, Esq., at Eric A. Liepens, P.C., represents the Debtor as legal counsel. BAUDAX BIO: Incurs $1.9 Million Net Loss in Third Quarter --------------------------------------------------------- Baudax Bio, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $1.93 million for the three months ended Sept. 30, 2023, compared to a net loss of $29.21 million for the three months ended Sept. 30, 2022. For the nine months ended Sept. 30, 2023, the Company reported a net income of $2.09 million compared to a net loss of $49.55 million for the same period last year. As of Sept. 30, 2023, the Company had $20.58 million in total assets, $21.78 million in total liabilities, $9.04 million in mezzanine equity, and a total stockholders' deficit of $10.24 million. Baudax stated, "The Company's management assesses the Company's ability to continue as a going concern for one year after the date the consolidated financial statements are issued. Based on the Company’s available cash and cash equivalents as of September 30, 2023, management has concluded that substantial doubt exists about the Company's ability to continue as a going concern for one year from the date these financial statements are issued. The Company expects to seek additional funding to sustain its future operations and while the Company has successfully raised capital in the past, the ability to raise capital in future periods is not assured. The Company is not expected to be able to maintain its minimum liquidity covenant over the next twelve months without additional inflows of funds or capital financing." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/0001780097/000095017023065200/bxrx-20230930.htm About Baudax Bio Headquartered in , Malvern, Pennsylvania, Baudax Bio -- www.baudaxbio.com -- is a pharmaceutical company primarily focused on innovative products for hospital and related settings. The Company holds exclusive global rights to two new molecular entities, which are centrally acting Neuromuscular Blocking Agents (NMBs), BX1000, an intermediate duration of action NMB currently undergoing a Phase II clinical trial, and BX2000, an ultra-short acting NMB currently undergoing a Phase I clinical trial, as well as a proprietary blockade reversal agent, BX3000, currently being evaluated in preclinical studies intended to support an IND filing in 2023. BX3000 is an agent that is expected to rapidly reverse BX1000 and BX2000 blockade. Philadelphia, Pennsylvania-based EisnerAmper LLP, the Company's auditor since 2022, issued a "going concern" qualification in its report dated Feb. 23, 2023, citing that the Company has incurred recurring losses and negative cash flows from operations and has an accumulated deficit of $190.9 million as of Dec. 31, 2022 that raise substantial doubt about its ability to continue as a going concern. BAYSIDE OPCO: Goldman Sachs Marks $420,000 Loan at 81% Off ---------------------------------------------------------- Goldman Sachs BDC, Inc has marked its $420,000 loan extended to Bayside Opco, LLC (dba Pro-PT) to market at $80,000 or 19% of the outstanding amount, as of September 30, 2023, according to Goldman Sachs's Form 10-Q for the Quarterly period ended, September 30, 2023, filed with the Securities and Exchange Commission on November 7, 2023. Goldman Sachs BDC, Inc is a participant in a First Lien Senior Secured Debt to Bayside Opco, LLC (dba Pro-PT). The loan accrues interest at a rate of 12.54% (S + 6.00% PIK) per annum. The loan matures on May 31, 2026. Goldman Sachs BDC classified the loan as a Non-income producing security. Goldman Sachs BDC was initially established as Goldman Sachs Liberty Harbor Capital, LLC, a single member Delaware limited liability Company, on September 26, 2012 and commenced operations on November 15, 2012 with The Goldman Sachs Group, Inc. as its sole member. On March 29, 2013, the Company elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Effective April 1, 2013, the Company converted from a SMLLC to a Delaware corporation. In addition, the Company has elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2013. Goldman Sachs Asset Management, L.P., a Delaware limited partnership and an affiliate of Goldman Sachs & Co. LLC, is the investment adviser of the Company. Bayside Opco, LLC (dba Pro-PT) is a Healthcare Services Provider. BAYSIDE OPCO: Goldman Sachs Marks $973,000 Loan at 17% Off ---------------------------------------------------------- Goldman Sachs BDC, Inc has marked its $973,000 loan extended to Bayside Opco, LLC (dba Pro-PT) to market at $810,000 or 83% of the outstanding amount, as of September 30, 2023, according to Goldman Sachs's Form 10-Q for the Quarterly period ended, September 30, 2023, filed with the Securities and Exchange Commission on November 7, 2023. Goldman Sachs BDC is a participant in a First Lien Senior Secured Debt (S + 7.25% PIK) to Bayside Opco, LLC (dba Pro-PT). The loan matures on May 31, 2026. Goldman Sachs BDC classified the loan as a Non-income producing security. Goldman Sachs BDC, Inc. was initially established as Goldman Sachs Liberty Harbor Capital, LLC, a single member Delaware limited liability company, on September 26, 2012 and commenced operations on November 15, 2012 with The Goldman Sachs Group, Inc. as its sole member. On March 29, 2013, the Company elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Effective April 1, 2013, the Company converted from a SMLLC to a Delaware corporation. In addition, the Company has elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2013. Goldman Sachs Asset Management, L.P., a Delaware limited partnership and an affiliate of Goldman Sachs & Co. LLC, is the investment adviser of the Company. Bayside Opco, LLC (dba Pro-PT) is a Healthcare Services Provider. BED BATH & BEYOND: JAT Capital Wants Transparency from Board ------------------------------------------------------------ CNBC reports that investment firm JAT Capital sent a scathing letter to the board of the new Bed Bath & Beyond on Friday saying it has refused to answer questions from shareholders and is engaging in what the investment firm called unprecedented "poor behavior." The firm, which has a 9.6% stake in the company and claims it is not an activist fund, excoriated the board for a series of misdeeds, including canceling planned investor conferences and twisting the facts about former CEO Jonathan Johnson’s ouster. "We have attempted to engage constructively with investor relations, senior management and the Board of Directors in recent months, making suggestions of best practices that might preserve and enhance value, and more recently pointing out actions taken by management and the board that appear to be destroying shareholder value," the letter, penned by JAT's founder John Thaler, states. "We have taken the more active posture with Beyond because, quite frankly, I have never seen such poor behavior by a Board in my career. The things that I have heard, the things that have been spoken directly to me, and the actions I have witnessed are in a category that I have never seen." Beyond was previously known as Overstock.com, which bought Bed Bath out of bankruptcy and rebranded. Prior to its rebrand, Beyond had been grappling with sluggish sales and a dwindling market cap. After its first quarter as the new Bed Bath, results were mixed with steep declines in sales and profits. Earlier this month, JAT called on Beyond to fire Johnson. Days later, the company announced he was stepping down. In its letter, dated Friday, JAT questioned why Johnson's board seat was removed after his ouster and said it was an attempt to weaken "shareholders ability to have a say." The firm also accused the board of being disingenuous about Johnson’s decision to leave the company and said bluntly that he'd been "fired." "Rather than terminating Johnson and publicly saying so (a statement that would have been well received by everyone involved), the Board decided to craft a press release along with Jonathan suggesting that he had stepped down, and even making the ludicrous statement that he and the Board had jointly concluded that 'now was the ideal time' for a leadership transition,"{ the missive reads. "Now is the ideal time? In the middle of a company re‐branding effort, just as the company embarks on a $150 million marketing campaign? And that coincidentally coincides with shareholders calling for Johnson’s removal? Writing a press release that twists the facts and makes disingenuous characterizations of the situation ... furthers the perception that the Board is engaged in self‐preservation and inside dealing." Meanwhile JAT has called for Marcus Lemonis, the Camping World CEO and TV personality who starred in CNBC's "The Profit," to take over management of the company. He joined the Overstock board last month and has cheered its transition to Beyond Inc. JAT renewed those calls in Friday's letter and accused the board of being "suspicious" of Lemonis, pushing him to the sidelines and refusing his expertise. "In one of the few instances where I have been able to engage with a member of the Board on the subject of why Marcus Lemonis wasn't being permitted to help manage the business, [chair of the board] Allison Abraham acknowledged to me that she (and others) were worried that 'Marcus has a secret nefarious plot'" the letter states. "She has allegedly repeated this same concern to the interim CEO Dave Nielsen. When pressed on what that 'nefarious plot' might be, she acknowledges that she doesn't know." Lemonis told CNBC he has no interest in being CEO of Beyond but did join the board with an expectation that'd he be appointed executive chairman, which is yet to happen more than a month into his tenure with the company. No clear timeline was set but other shareholders beyond JAT have been wondering what's ahead for the company’s board given his appointment, Lemonis said. He added he's "disappointed" relations between the board and investors have reached this low-point but agrees with JAT that change needs to happen. "“To be honest I'm kind of curious to some of the answers too," he said of the question's JAT posed. As far as the "nefarious plot" he's suspected of, Thaler said he's been asked if he's a "trojan horse" for JAT or looking to buy Beyond, which he both denies. "I enjoy working with businesses, it's been my brand for a long time," said Lemonis. "If I wanted to buy the business this wouldn't be the way I'd do it." JAT called on Beyond's board to answer its questions, once and for all, and for everyone from vendors to sell-side analysts to demand more transparency. "It is my strong desire that the Board be forced to explain what it is doing. This is not an unreasonable ask. The actions cited below which the Board has taken in the last 60 days appear to be to the detriment of the company and shareholders," the letter states. "This Board has refused to explain why they have made these decisions." About Bed Bath & Beyond Bed Bath & Beyond Inc., together with its subsidiaries, is an omnichannel retailer selling a wide assortment of merchandise in the Home, Baby, Beauty & Wellness markets and operates under the names Bed Bath & Beyond, buybuy BABY, and Harmon, Harmon Face Values. The Company also operates Decorist, an online interior design platform that provides personalized home design services. At its peak, Bed Bath & Beyond operated the largest home furnishing retailer in the United States with over 970 stores across all 50 states, consistently at the forefront of major home and bath trends. Operating stores spanning the United States, Canada, Mexico, and Puerto Rico, Bed Bath & Beyond offers everything from bed linens to cookware to electric appliances, home organization, baby care, and more. Bed Bath & Beyond closed over 430 locations across the United States and Canada before filing Chapter 11 cases, implementing full-scale wind-downs of their Canadian business and the Harmon branded stores. Left with 360 Bed Bath & Beyond, and 120 buybuy BABY stores, Bed Bath & Beyond Inc. and 73 affiliated debtors on April 23, 2023, each filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code to pursue a wind-down of operations. The cases are pending before the Honorable Vincent F. Papalia and requested joint administration of the cases under Bankr. D.N.J. Lead Case No. 23-13359. Kirkland & Ellis LLP and Cole Schotz P.C. are serving as legal counsel, Lazard Frares & Co. LLC is serving as investment banker, and AlixPartners LLP is serving as financial advisor. Bed Bath & Beyond Inc. has retained Hilco Merchant Resources LLC to assist with inventory sales. Kroll LLC is the claims agent. BERGIO INTERNATIONAL: Delays Filing of Q3 Form 10-Q Report ---------------------------------------------------------- Bergio International, Inc. disclosed in Form 12b-25 filed with the Securities and Exchange Commission that unable to file its Quarterly Report on Form 10-Q. According to the Company, it was unable to compile the necessary financial information required to prepare a complete filing. Thus, the Company is unable to file the periodic report in a timely manner without unreasonable effort or expense. The Company expects to file within the extension period. About Bergio International Based in Fairfield, New Jersey, Bergio International, Inc. -- https://www.bergio.com -- designs, manufactures, and retails, jewelry products. Bergio International reported a net loss of $3.26 million for the year ended Dec. 31, 2022, compared to a net loss of $3.56 million for the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had $9.47 million in total assets, $4.52 million in total liabilities, and $4.95 million in total stockholders' equity. Lakewood, CO-based BF Borgers CPA PC, the Company's auditor since 2019, issued a "going concern" qualification in its report dated March 30, 2023, citing that the Company's significant operating losses raise substantial doubt about its ability to continue as a going concern. BLUE STAR FOODS: Delays Filing of Q3 Form 10-Q Report ----------------------------------------------------- Blue Star Foods Corp. disclosed in Form 12b-25 filed with the Securities and Exchange Commission that unable to file its Quarterly Report on Form 10-Q. According to the Company, it is unable to file its Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, by the prescribed date of November 14, 2023, without unreasonable effort or expense, because it awaits completion of its auditor's review to finalize the Report. In accordance with Rule 12b-25 promulgated under the Securities Exchange Act of 1934, as amended, the Company intends to file the Report on or prior to the fifth calendar day following the prescribed due date. About Blue Star Foods Based in Miami, Florida, Blue Star Foods Corp. -- https://bluestarfoods.com -- is an international sustainable marine protein company based in Miami, Florida, that imports, packages and sells refrigerated pasteurized crab meat, and other premium seafood products. The Company's main operating business, John Keeler & Co., Inc. was incorporated in the State of Florida in May 1995. The Company's current source of revenue is importing blue and red swimming crab meat primarily from Indonesia, Philippines and China and distributing it in the United States and Canada under several brand names such as Blue Star, Oceanica, Pacifika, Crab & Go, First Choice, Good Stuff and Coastal Pride Fresh, and steelhead salmon and rainbow trout fingerlings produced under the brand name Little Cedar Farms for distribution in Canada. Blue Star reported a net loss of $13.19 million for the year ended Dec. 31, 2022, compared to a net loss of $2.61 million for the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had $8.68 million in total assets, $9.92 million in total liabilities, and a total stockholders' deficit of $1.24 million. Houston, Texas-based MaloneBailey, LLP, the Company's auditor since 2014, issued a "going concern" qualification in its report dated April 17, 2023, citing that the Company has suffered recurring losses from operations and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. BLUE STAR: Incurs $446K Net Loss in Third Quarter ------------------------------------------------- Blue Star Foods Corp. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $445,813 on $1.56 million of net revenue for the three months ended Sept. 30, 2023, compared to a net loss of $3.74 million on $2.43 million of net revenue for the three months ended Sept. 30, 2022. For the nine months ended Sept. 30, 2023, the Company reported a net loss of $3.85 million on $5.12 million of net revenue compared to a net loss of $6.23 million on $10.71 million of net revenue for the nine months ended Sept. 30, 2022. As of Sept. 30, 2023, the Company had $7.24 million in total assets, $6.76 million in total liabilities, and $482,294 in total stockholders' equity. For the nine months ended Sept. 30, 2023, the Company had an accumulated deficit of $33,188,070 and a working capital deficit of $1,254,840, inclusive of $768,839 in stockholder debt. "These factors raise substantial doubt as to the Company's ability to continue as a going concern. The Company's ability to continue as a going concern is dependent upon the Company's ability to increase revenues, execute on its business plan to acquire complimentary companies, raise capital, and to continue to sustain adequate working capital to finance its operations. The failure to achieve the necessary levels of profitability and cash flows would be detrimental to the Company." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/0001730773/000149315223042157/form10-q.htm About Blue Star Foods Based in Miami, Florida, Blue Star Foods Corp. --https://bluestarfoods.com -- is an international sustainable marine protein company based in Miami, Florida that imports, packages and sells refrigerated pasteurized crab meat, and other premium seafood products. The Company's main operating business, John Keeler & Co., Inc. was incorporated in the State of Florida in May 1995. The Company's current source of revenue is importing blue and red swimming crab meat primarily from Indonesia, Philippines and China and distributing it in the United States and Canada under several brand names such as Blue Star, Oceanica, Pacifika, Crab & Go, First Choice, Good Stuff and Coastal Pride Fresh, and steelhead salmon and rainbow trout fingerlings produced under the brand name Little Cedar Farms for distribution in Canada. Blue Star reported a net loss of $13.19 million for the year ended Dec. 31, 2022, compared to a net loss of $2.61 million for the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had $8.68 million in total assets, $9.92 million in total liabilities, and a total stockholders' deficit of $1.24 million. Houston, Texas-based MaloneBailey, LLP, the Company's auditor since 2014, issued a "going concern" qualification in its report dated April 17, 2023, citing that the Company has suffered recurring losses from operations and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. BOY SCOUTS: Victims at Risk of Losing Millions Amid Filing Errors ----------------------------------------------------------------- Alex Wolf of Bloomberg Law reports that several hundred former Boy Scouts are at risk of losing out on millions of dollars in sex abuse compensation due to paperwork errors made when voting on the organization's $2.46 billion bankruptcy settlement. The Boy Scouts of America abuse survivors are now relying on a bankruptcy court judge to let them correct their nearly two-year-old mistakes to collect from the largest sex abuse settlement in US history. They cite confusion from a lengthy and complicated form in which they inadvertently chose to receive a one-time, expedited payment of just $3,500 instead of pursuing potential six- or seven-figure recoveries. "Making that decision on the plan was a huge, huge deal," said Timothy C. Hale of Nye Stirling Hale Miller & Sweet LLP, an attorney for a victim who mistakenly selected the expedited payment. "I'm just pulling my hair out that this guy who had been raped multiple times is now looking at just a four-figure recovery." Claims processing in mass tort bankruptcies can be complex in order to account for a wide range of parties and variety of injuries. The immense size and scope of the Boy Scouts bankruptcy case, coupled with the provision for a one-time expedited payment, added to the confusion for many claimants. The requests will be heard at a Nov. 20 hearing in front of Judge Laurie Selber Silverstein of the US Bankruptcy Court for the District of Delaware. But they face stiff opposition from the court-approved settlement trustee, who has roundly rejected attempts by survivors or their attorneys to change payment elections. Trustee Barbara Houser, herself a former bankruptcy judge, has told the court that while she's sympathetic to the roughly 500 claimants asking to correct their bankruptcy plan ballots, the plan doesn’t permit the trustee to grant the relief. Allowing hundreds or thousands of claimants to modify their payment elections at this stage of the process "would result in significant delays and complications in trust claims administration and accounting," Houser said in court filings. The trustee declined to provide additional comment for this story. Boy Scouts declined to comment, noting the matter is between claimants and the trust. Complex Procedures Hundreds of abuse claimants have highlighted the complexity of the 23-page ballot they had to fill out before the Boy Scouts of America could finalize the abuse settlement. Lengthy, dense ballots are commonly sent to creditors in large Chapter 11 cases—and many creditors in mass tort cases have little experience with legal paperwork. The ballot included two questions: one asking the claimants to indicate whether they wanted to approve the bankruptcy plan, and another on whether they wanted to receive an expedited, one-time $3,500 payment—an unusual provision in mass tort bankruptcies. Many said they were confused by the way the questions were posed or didn't understand the consequence of choosing the quick-pay option: they would be unable to pursue additional payouts. "I can't believe I didn’t read it close enough to understand it," said Susan Dunn, the sister of incarcerated claimant Gerard Edwin Burns who has power of attorney on his behalf. "I was going to stick it in some CDs so he could have some cash when he gets out when he's almost 70." Burns was imprisoned on sexual assault charges. The youth organization's bankruptcy plan was the product of more than two years of legal wrangling and negotiations that began in 2020. The plan created a victims' trust to administer claims and distribute funds to about 82,000 former scouts who allege they were abused as children by scout leaders or volunteers. For the most part, individual payments are being decided based on complex formulas and an abuse claim matrix. Trust administrators evaluate the strength of claims based on submitted answers to questionnaires. They determine allocations based on a number of factors, including severity of abuse, where it occurred, and psychological impact. About 7,300 people chose the expedited pay option, which relieves them of having to provide more substantial details of the abuse they say they suffered. Attorney Andrew Van Arsdale of AVA Law Group, who has requested that the court allow over 230 of his clients to correct their ballots, said he believes he was just following instructions from the judge to let his clients fill out the ballots themselves instead of doing it for them. Allowing lawyers to complete bankruptcy plan ballots on their clients' behalf has caused problems for Silverstein before. The judge indicated during a September 2021 hearing in the Boy Scouts case that she would be looking closely at the ballot certifications due in part to issues she had encountered as part of a separate bankruptcy case. In the Imerys Talc America Inc. case in 2021, she denied a plaintiff law firm’s motion to switch the votes of over 15,000 talc claimants to vote in favor of the company’s plan to establish an asbestos injury trust. Silverstein found in the Imerys case that Bevan & Associates LPA Inc. conducted no diligence to discern whether its clients had been exposed to talc. She held that the firm improperly switched clients’ votes without consulting them. The judge told attorneys in the Boy Scouts case that she appreciated concerns raised "that each individual survivor’s vote needs to be appropriately reflected in a ballot." Legal Hurdles Complex settlements, like the one pieced together by the Boy Scouts, “always end up with people having errors in their claims forms,” said Sam Dolce, an attorney whose firm specializes in delivering settlement funds to plaintiffs. Modification requests and appeals are common in large mass tort cases, and they have in the past worked out in favor of claimants, he said. Allowing ballot modifications as the Boy Scouts trust slogs through the difficult task of evaluating claims and preparing payments could depend on how the bankruptcy judge interprets language in the plan voting documents. "The uniqueness of the circumstance merits the trustee giving these people some slack," said Hale, the attorney at Nye Stirling. "This is a truly unprecedented proceeding that was forced on these survivors." Don Robson, a retired commercial fisherman who alleges he was fondled by a scout leader during an outdoor trip in Oregon in the 1960s, said he spent his whole life without a computer and didn’t understand the language in the plan voting documents that he received. "I don't know why they couldn’t have one page written out for the layman," said Robson, a Van Arsdale client who permitted Bloomberg Law to use his full name. "I remember looking at it and thinking, this isn’t even written in English." Realizing the Mistake Houser argued in court documents that allowing some claimants to change their ballot elections would only harm the rest who are waiting to make their case for their payouts. "The expense, confusion, and procedural difficulties in allowing all claimants to change their elections now, nearly two years after they originally made these decisions, would be immense and would only serve to delay compensation to the tens of thousands of claimants who have not expressed a desire to change their elections," she said. Many of the survivors and their attorneys didn't realize the mistake until the trust opened up an online portal for processing claims in August 2023. The reality of the error has elicited motions from several law firms to allow ballot modifications and avoid the disposition of claims for far less than they could be paid out from the settlement trust. "This is complicated, and these are folks that don't have the level of sophistication and education that lawyers do," Van Arsdale said. Another Van Arsdale client, who preferred to provide only his first name Charles in an interview with Bloomberg Law, said he realized the mistake as soon as he submitted his ballot electronically, but all attempts to amend the choice afterwards were unsuccessful. Charles, who was a scout in Southern California, alleges he was masturbated by a scout master during a car trip in the mid 1960s. AVA Law believes the claim should pay out around $150,000. "This is not the case of someone who changed their mind," said Charles. "This is a person who made a mistake on a form coming from a law office in a case that’s been going on for years." The case is In re Boy Scouts of America, Bankr. D. Del., No. 20-10343. About Boy Scouts of America The Boy Scouts of America -- https://www.scouting.org/ -- is a federally chartered non-profit corporation under title 36 of the United States Code. Founded in 1910 and chartered by an act of Congress in 1916, the BSA's mission is to train youth in responsible citizenship, character development, and self-reliance through participation in a wide range of outdoor activities, educational programs, and, at older age levels, career-oriented programs in partnership with community organizations. Its national headquarters is located in Irving, Texas. The Boy Scouts of America and affiliate Delaware BSA, LLC, sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10343) on Feb. 18, 2020, to deal with sexual abuse claims. Boy Scouts of America was estimated to have $1 billion to $10 billion in assets and at least $500 million in liabilities as of the bankruptcy filing. The Debtors have tapped Sidley Austin LLP as their bankruptcy counsel, Morris, Nichols, Arsht & Tunnell LLP as Delaware counsel, and Alvarez & Marsal North America, LLC, as financial advisor. Omni Agent Solutions is the claims agent. The U.S. Trustee for Region 3 appointed a tort claimants' committee and an unsecured creditors' committee on March 5, 2020. The tort claimants' committee is represented by Pachulski Stang Ziehl & Jones, LLP, while the unsecured creditors' committee is represented by Kramer Levin Naftalis & Frankel, LLP. BROWNIE'S MARINE: Delays Filing of Q3 Form 10-Q Report ------------------------------------------------------ Brownie's Marine Group, Inc. disclosed in a Form 12b-25 filed with the Securities and Exchange Commission that the Company is unable to file its Quarterly Report on Form 10-Q for the three months ended September 30, 2023, by the prescribed date of November 14, 2023, without unreasonable effort or expense. The Company stated that it needed additional time to prepare and review the financial statements, including notes, to be included in the Report primarily due to limited resources and financial and accounting personnel. In accordance with Rule 12b-25 promulgated under the Securities Exchange Act of 1934, as amended, the Company intends to file the Report on or prior to the fifth calendar day following the prescribed due date. About Brownie's Marine Headquartered in Pompano Beach, Florida, Brownie's Marine Group, Inc., owns and operates a portfolio of companies with a concentration in the industrial, and recreational diving industry. The Company, through its subsidiaries, designs, tests, manufactures, and distributes recreational hookah diving, yacht-based scuba air compressors and nitrox generation systems, and scuba and water safety products in the United States and internationally. Brownie's Marine reported a net loss of $1.89 million for the year ended Dec. 31, 2022, compared to a net loss of $1.59 million for the year ended Dec. 31, 2021. As of March 31, 2023, the Company had $5.32 million in total assets, $2.90 million in total liabilities, and $2.41 million in total stockholders' equity. Margate, Florida-based Assurance Dimensions, the Company's auditor since 2023, issued a "going concern" qualification in its report dated March 30, 2023, citing that the Company had a net loss of approximately $1,893,000 and cash used in operating activities of approximately $678,000 for the year ended Dec. 31, 2022 as well as an accumulated deficit of approximately $16,437,000 as of Dec. 31, 2022. These factors raise substantial doubt about the Company's ability to continue as a going concern. BUCKHEAD PROPERTY: Property Sale Proceeds to Fund Plan ------------------------------------------------------ Buckhead Property Development, LLC, submitted a Disclosure Statement for Amended Plan of Reorganization dated November 13, 2023. The Debtor is in the business of purchasing, developing, and selling property. The Debtor is wholly owned and operated by Lloyd Dominick. The Debtor is a real estate development company that owns two properties in the Buckhead neighborhood of Atlanta, a six-lot undeveloped property on Wieuca Road (the "Wieuca Property") and a lot with a foundation poured on Ivy Road (the "Ivy Property"), and a singlefamily home in Milledgeville, Georgia (the "Sweetgum Property"). The Debtor became involved in very contentious pre-petition litigation with creditor Southern Gentry Homes, LLC. The litigation led to the Debtor being unable to obtain funds from its construction loan, which put a halt to the development of the Wieuca Property. The Debtor was unable to fund its secured debt, which forced it to seek protection under Chapter 11. The Debtor's real properties all have significant equity and the Debtor has begun to market all of the properties for sale. The Debtor believes that it will have excess proceeds from the sales after all of the claims in the case are paid, and intends to continue to purchase and develop real property post-bankruptcy. The plan provides for the payment in full of all secured, priority, and general unsecured claims and retention of equity interests in the Debtor. The Debtor believes all scheduled creditors holding General Unsecured Claims ("GUCs") will waive their right to payment under the Plan. To the extent any GUCs require payment, the Debtor proposes to pay General Unsecured Claims with post-petition interest in full within 60 days of the Effective Date. The Reorganized Debtor shall not make any distributions or pay any dividends related to any Equity Interests unless and until all distributions related to all Allowed Claims in Classes 1 to 8 have been made in full as set forth in the Plan. The cash distributions contemplated by the Plan shall be funded by cash generated from the sales of the Ivy Property, the Wieuca Property, and the Sweetgum Property. The sale of all three properties will pay the Debtor's creditors in full. Creditors will receive the same as they would receive under a Chapter 7 liquidation. In a Chapter 7 however, creditors would not be paid in as expeditious a manner. On September 8, 2023 the Court entered an Order granting the Application to Employ Chris Howington as Real Estate Broker to sell the Sweetgum Property. On September 18, 2023 the court entered an Order approving the Application to Employ Comer Jennings as Real Estate Agent to sell the Ivy Property and the Wieuca Property. Mr. Howington has found a potential buyer for the Sweetgum Property and on September 27, 2023 the Debtor entered into a contract to sell the Sweetgum Property, subject to Bankruptcy Court approval, for $225,000.00. At this point, due diligence has been extended several times due to the need for further inspection of potentially necessary structural repairs and aluminum wiring. There is not a closing date set for the sale. On November 1, 2023 the Debtor entered into a contract to sell the Ivy Property for $2.25M, subject to Bankruptcy Court approval, without the aid of a broker. Mr. Jennings has agreed to waive his brokerage fee. Pursuant to the contract, the purchaser wired $100,000.00 nonrefundable earnest money to Debtor's bankruptcy counsel, who is holding the funds in trust. The Debtor will be filing a motion to approve the sale along with the filing of this Disclosure Statement. Mr. Jennings continues to market the six lots that make up the Wieuca Property for $839,000.00 each. The Debtor and Mr. Jennings are confident that the Wieuca Property will be sold imminently. A full-text copy of the Disclosure Statement dated November 13, 2023 is available at https://urlcurt.com/u?l=kQsmWf from PacerMonitor.com at no charge. Attorney for Debtor: William A. Rountree, Esq. Rountree Leitman Klein & Geer, LLC Century Plaza I 2987 Clairmont Road, Suite 350 Atlanta, GA 30329 Telephone: (404) 584-1238 Facsimile: (404) 704-0246 Email: wrountree@rlkglaw.com About Buckhead Property Development Buckhead Property Development, LLC, a Georgia-based company, filed Chapter 11 petition (Bankr. M.D. Ga. Case No. 23-50755) on June 5, 2023, with $1 million to $10 million in both assets and liabilities. Lloyd Dominick, member, signed the petition. Judge Austin E. Carter oversees the case. The Debtor is represented by William A. Rountree, Esq., at Rountree Leitman Klein & Geer, LLC. BUSINESSOLVER.COM: 93% Markdown for Goldman Sachs $5.02MM Loan -------------------------------------------------------------- Goldman Sachs BDC, Inc has marked its $5,022,000 loan extended to Businessolver.com, Inc.to market at $376,000 or 7% of the outstanding amount, as of September 30, 2023, according to Goldman Sachs's Form 10-Q for the Quarterly period ended, September 30, 2023, filed with the Securities and Exchange Commission on November 7, 2023. Goldman Sachs BDC is a participant in a First Lien Senior Secured Debt to Businessolver.com, Inc. The loan accrues interest at a rate of 10.99% (S + 5.50%) per annum. The loan matures on December 1, 2027. Goldman Sachs BDC classified the loan on non-accrual status and as a Non-income producing security. Goldman Sachs BDC was initially established as Goldman Sachs Liberty Harbor Capital, LLC, a single member Delaware limited liability company, on September 26, 2012 and commenced operations on November 15, 2012 with The Goldman Sachs Group, Inc. as its sole member. On March 29, 2013, the Company elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Effective April 1, 2013, the Company converted from a SMLLC to a Delaware corporation. In addition, the Company has elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2013. Goldman Sachs Asset Management, L.P., a Delaware limited partnership and an affiliate of Goldman Sachs & Co. LLC, is the investment adviser of the Company. Businessolver.com, Inc. provides benefits management solutions. The Company offers flex spending account, custom communication and fulfillment, verification, direct billing, voluntary benefits enrollment, and pooled insurance services. Businessolver.com serves customers in the State of Iowa. CAESARS ENTERTAINMENT: S&P Affirms 'B+' ICR, Alters outlook to Pos. ------------------------------------------------------------------- S&P Global Ratings revised its rating outlook to positive from stable and affirmed its 'B+' issuer credit rating on U.S. gaming operator Caesars Entertainment Inc. (Caesars). S&P said, "Our 'B+' issue-level rating on Caesars' secured debt remains on CreditWatch, where we placed it with positive implications on March 9, 2023. In addition, our 'B' unsecured issue-level rating remains on CreditWatch, where we placed it with negative implications on March 9, 2023. We expect to resolve these CreditWatch listings when management refinances Caesars Resort Collection LLC's (CRC) secured debt at parent Caesars, likely in 2024. At this point, we would expect CRC to guarantee Caesars' debt and secure Caesars' secured debt, implying improved recovery prospects for secured lenders yet impaired recovery prospects for unsecured lenders." The positive outlook reflects the possibility of an upgrade over the next 12 months if Caesars appears on track to sustain adjusted leverage below 6x, incorporating potential operating volatility, heightened investment spend, and leveraging acquisitions. The positive outlook reflects S&P's expectation for further deleveraging in 2024 because of continued strength in group and convention business in Las Vegas and increased profitability in Caesars' digital segment. In the third quarter of 2023, Caesars' Las Vegas segment achieved record performance, driven by high occupancy levels, high average daily rates (ADRs), and continued strength in the group and convention segment. Although Caesars experienced a cybersecurity breach in the third quarter at one of its outsourced information technology (IT)-support vendors that resulted in stolen customer data, it did not materially affect its financial performance in the quarter. Caesars' regional segment also achieved modest growth, resulting from stable guest demand and contribution from recently completed capital projects and newly opened facilities, partially offset by competitive pressures in some markets. In the third quarter of 2023, Caesars Digital reported a second consecutive quarter of positive EBITDA and was profitable on a trailing-12-month basis. Caesars has reversed its digital segment's previous drag on EBITDA in recent quarters as it scales up digital revenue in new states to cover fixed costs in the business and leverages player loyalty data to more efficiently target its marketing to customers, supporting customer retention and allowing Caesars to maintain market share. Additionally, S&P expects Caesars' customer acquisition costs, advertising, and promotional spending will be lower as fewer states are scheduled to launch digital sports betting and internet gaming (iGaming) in 2024 compared to 2022 and 2023. S&P said, "We expect the digital segment to be slightly EBITDA positive in 2023 and for continued EBITDA growth in 2024 absent any significant change to the schedule of states that are expected to approve online sports betting and iGaming within the next 12 months. Furthermore, we believe the recent rollout of its new icasino app, Caesars Palace Online, will further increase digital revenues and support improved profitability in this segment. Notwithstanding, we continue to view online sports betting and iGaming as highly competitive and believe operators will continue to compete aggressively for market share particularly as new states approve online gaming. "Continued EBITDA growth across all 3 segments and over $700 million in debt repayment in 2023 resulted in S&P Global Ratings-adjusted leverage declining to about 6.5x as of Sept. 30, 2023. A favorable event calendar for the remainder of 2023 and early 2024, driven by Formula 1's Las Vegas Grand Prix auto race in November 2023 and the Super Bowl in February 2024, should support further deleveraging. As a result, we forecast adjusted leverage will decline to the mid-to high-5x area in 2024 from around 6x at the end of 2023. This would provide some cushion below our current 6x upgrade threshold. (Our measure of adjusted leverage includes Caesars' financing obligations as reported on its balance sheet). "Large-scale development projects could increase Caesars' leverage relative to our base case. We don't expect the company will experience the leveraging effects of any large-scale development projects for at least the next 18 to 24 months. In addition, we believe it could potentially absorb the additional leverage while remaining below our 6x upgrade threshold. Caesars has partnered with developer SL Green Realty Corp. on a bid for a New York casino development in Times Square. The company has not disclosed the size of the project, the ownership structure of the partnership, or its potential contribution. However, the company has indicated it expects to finance the project with debt at the joint venture level and possible equity investments. We believe the joint venture's spending on the development would likely exceed $2 billion, given construction costs in New York and expected quality of the asset. However, because the proposed project is a renovation of an existing property, we expect it would cost significantly less than those proposed by Wynn Resorts Ltd. or Las Vegas Sands Corp., which we expect will both exceed $5 billion. We believe it is unlikely New York will select licensees before the second half of 2024 and don't anticipate the company would initiate any material capital spending before 2025. We anticipate the development could take several years to complete given the complexity of building in New York and the likely scale of the redevelopment. Investments in its regional portfolio and continued strength in convention and group business in Las Vegas will partly offset inflationary pressures. S&P said, "We believe inflationary pressures on operating costs could result in some margin moderation in 2024. This is largely due to our expectation for a significant increase in labor costs, resulting from the tentative agreement with the Culinary Workers Union in Las Vegas for a new five-year labor contract." However, Caesars stands to benefit from a number of capital investments across its regional portfolio next year, including the completion of the construction of temporary casinos in Virginia and Nebraska, Harrah's Hoosier Park property expansion, and new Versailles Tower rooms in Vegas by the end of 2023. In 2024, the company expects to complete the construction of permanent facilities in Virginia and Nebraska as well as the renovation of Caesars New Orleans and the addition of a new hotel tower at the property. In addition to these capital investments, the company will also benefit from a higher mix of group and convention business in Las Vegas that could partially offset margin pressure from rising labor costs. Macroeconomic factors that could impede consumers' discretionary spending are rising, which poses a risk to Caesars' strong cash flow. However, we expect the recovery in convention and group visitation and a strong event calendar in Las Vegas may be sufficient to offset these headwinds. The performance of destination markets, such as Las Vegas, tends to be more volatile during a downturn than regional gaming markets. However, the continued recovery in group and convention visitation, the return of international travel, and investment in new attractions--including the opening of Allegiant Stadium (2020) and the MSG Sphere (2023)--will likely continue to support a recovery in visitation to Las Vegas. In addition, supply growth in the market has been modest and much lower than in 2008-2010. Hotel room capacity will expand by about 2.4% in 2024 following the December 2023 opening of the Fontainebleau Las Vegas. A favorable event calendar over the next year will likely also support Caesars' performance. S&P said, "We expect the recent Formula 1 Las Vegas Grand Prix race, which is scheduled to occur annually in November through at least 2025, attracted significant visitation and spending during what is normally a slower period for the market. In addition, Las Vegas will host the Super Bowl at Allegiant Stadium in February 2024. While Super Bowl weekend is typically a good weekend for Las Vegas, and will coincide with Lunar New Year in 2024, we believe hosting the event will draw additional customers and events ahead of the game. These events may help offset the loss of CONEXPO-CON/AGG, a construction trade show held every three years that attracted record attendance of 139,000 in 2023. Therefore, we expect the effect of the weakening U.S. economy on Las Vegas and Caesars over the next 12 months will be less dramatic than during the financial crisis. "Caesars' geographic diversity may lessen the impact of a downturn on its performance. We believe Caesars' diversified portfolio of gaming assets (about 40% of its brick-and-mortar revenues are generated in Las Vegas and about 60% are generated in regional markets) can help mitigate some potential EBITDA volatility caused by economic downturns or event risks. If gaming customers have less discretionary dollars available to spend, they may stay closer to home and visit a regional casino instead of Las Vegas. This partly explains why regional casinos have historically exhibited less revenue volatility in a downturn than destination markets. Caesars' presence in the majority of regional gaming markets allows it to benefit from this shift in spending. "The positive outlook reflects the possibility of an upgrade within the next 12 months if we believe Caesars could sustain S&P Global Ratings-adjusted leverage below 6x. We expect revenue growth and increasing profitability in the digital segment, returns from recently completed capital investments in its regional portfolio, and continued strength in convention and group business in Las Vegas will result in continued EBITDA and cash flow growth. This should provide the company some flexibility to navigate potential operating volatility from a likely macroeconomic slowdown. "We could raise our rating on Caesars if we expect it can maintain lease-adjusted leverage below 6x, and that it had enough cushion to absorb potential operating volatility, heightened investment spend, and possible leveraging acquisitions. This could occur if the company sustains its recent strong operating performance. "We could revise the outlook back to stable if we expect Caesars' leverage will remain above 6x. This could occur if operating performance materially underperforms our base-case forecast because a macroeconomic slowdown leads the consumer to significantly pull back discretionary spending, if development spend was significantly higher than our base-case forecast, or if the company pursued leveraging acquisitions. "Social factors are a moderately negative consideration in our credit rating analysis of Caesars. Good leisure demand in both regional gaming and Las Vegas and the subsequent return of convention and group business in Las Vegas supported the company's strong revenue and cash flow recovery following the COVID-19 pandemic disruptions. Nevertheless, while we view the pandemic as a rare and extreme disruption that is unlikely to recur at the same magnitude, health and safety scares are an ongoing risk factor. "Cyber risks to and concerns about customer data are increasingly relevant in the gaming sector given increasing data privacy regulations and the volume of customer and payment data operators collect and sometimes store in their loyalty program databases. Caesars recently experienced a cybersecurity breach at one of its outsourced information technology (IT)-support vendor that resulted in significant stolen customer data. Data breaches like the one Caesars experienced can result in regulatory actions or fines, brand or reputational risk, lawsuits, or business disruption. While we don't expect Caesars' financial position to be materially affected by the breach, it relies upon its loyalty program to sustain its substantial ability to attract loyal guests to its properties. If similar events were to occur in the future, we believe this could hurt Caesars' reputation if it diminishes guests' confidence in the security of their personal information. Other factors include regulatory risks, as Caesars is subject to high regulation across the jurisdictions where it operates." CANACOL ENERGY: Moody's Cuts CFR to B1 & Alters Outlook to Negative ------------------------------------------------------------------- Moody's Investors Service downgraded Canacol Energy Ltd.'s Corporate Family Rating to B1 from Ba3. The Senior Unsecured Global Notes rating was also downgraded to B1 from Ba3. The outlook was changed to negative from stable. RATINGS RATIONALE The downgrade of Canacol's ratings to B1 from Ba3 reflects a shift in the company's financial policy, as leverage has risen concurrently with the ongoing distribution of dividends and the implementation of an ambitious capital investment strategy spanning the next three years. Retained cash flow (comprising funds from operations less dividends, divided by total debt) decreased throughout 2022 to 6.7% compared to an average of 20.8% for 2019-2021, coupled with Moody's expectations that this metric will equal 18.5% for the years 2023 and 2024, on average. The projected metrics take into account a higher debt level, not expected to start to decrease until 2025, and continued dividend payments. According to Moody's calculations, leverage measured as gross debt to adjusted EBITDA will be equivalent to 3.5x at the end of 2023, not reaching levels below 3.0x until 2026. Canacol has plans to operate in Bolivia in 2024 and expects to restart a currently shut-in gas field via a $25 million investment. The resulting cash flow will be used to fund future Bolivian growth including exploration wells on other concessions. Production growth is also expected in Colombia in both the Lower Magdalena Basin to target full use of existing transportation infrastructure and the Middle Magdalena Basin to deliver into Colombia's interior market including Bogota, Medellin and Cali. However, Moody's also acknowledges that, over the past two years, capital investments have not resulted in an important increase of the company's average daily production, thereby introducing additional risks to future liquidity and contributing to elevated leverage. Canacol's B1 ratings also reflect the company's small production and reserves size, which is balanced by stable and predictable cash flow, derived from contracted sales with solid fixed prices that reduce volume and commodity price risk. About 80% of the company's sales are secured through long-term take-or-pay contracts that have an average remaining weighted life of five years, resulting in stable EBITDA margins, which supports stable operating netback. Canacol has adequate liquidity. Cash and equivalents of $44 million as of September 2023 plus $269 million in cash from operations that Moody's expects from October 2023 to December 2023 are enough to fund Canacol's capital spending program of about $177 million as well as interest expenses and dividends of around $85 million both, in the same period. Moreover, the company's debt maturity profile is comfortable because no major debt matures before 2027. Canacol also has available $55 million of its revolving credit facility due in 2027. The negative rating outlook is based on Moody's view that, without a successful exploration and production plan implemented within the next 12 months, the company's ambitious capital investment program and the dividend distributions could lead to a tight liquidity position delaying the repayment of the revolver due in 2027. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Canacol's rating outlook would be stabilized if the company is able to strengthen its financial policies, increase production in the next 12 months and if it manages to raise its reserve size efficiently. Quantitatively, the company would require that its leveraged full-cycle ratio, which measures an oil company's ability to generate cash after operating, financial and reserve replacement costs, is consistently above 1.5 times for a sustained period and a retained cash flow to total debt above 20%. Canacol's B1 ratings could be downgraded if retained cash flow (funds from operations less dividends) to total debt remains below 15%, or if its interest coverage, as per EBITDA to interest expense, falls to below 4.5 times with limited prospects of a quick turnaround. In addition, a deterioration of the company's liquidity profile could lead to a further downgrade. Canacol, with headquarters in Alberta, Canada, is an independent natural gas & oil exploration and production company in Colombia. As of September 2023, its total assets amounted to $1,133 million. The principal methodology used in these ratings was Independent Exploration and Production published in December 2022. CEL-SCI CORP: Closes $5 Million Public Common Stock Offering ------------------------------------------------------------ CEL-SCI Corporation announced the closing of its public offering of 2,490,000 shares of its common stock to a single investor at a public offering price of $2.00 per share, for gross proceeds of approximately $5 million, before deducting underwriting discounts and offering expenses. All of the shares of common stock were offered by the Company. The Company intends to use the net proceeds from this offering to fund the continued development of Multikine, for general corporate purposes, and working capital. ThinkEquity acted as sole book-running manager for the offering. The securities were offered and sold pursuant to the Company's currently effective shelf registration statement on Form S-3 (File No. 333-265995), including a base prospectus, filed with the U.S. Securities and Exchange Commission on July 1, 2022 and declared effective on July 15, 2022. The offering was made by means of a prospectus supplement and prospectus which have been filed with the SEC and available on the SEC's website at www.sec.gov. These documents can be obtained free of charge by visiting the SEC website at www.sec.gov. Alternatively, you may contact ThinkEquity, 17 State Street, 41st Floor, New York, New York 10004. About CEL-SCI CEL-SCI Corporation is a clinical-stage biotechnology company focused on finding the best way to activate the immune system to fight cancer and infectious diseases. Its lead investigational therapy Multikine (Leukocyte Interleukin, Injection) completed a pivotal Phase 3 clinical trial for patients who are newly diagnosed with locally advanced (stage III and IV) primary (not yet treated) squamous cell carcinoma of the head and neck (SCCHN). Multikine has received Orphan Drug Status from the U.S. Food and Drug Administration (FDA) for this indication. The Company has operations in Vienna, Virginia, and near Baltimore, Maryland. Cel-SCI Corporation reported a net loss of $36.70 million for the year ended Sept. 30, 2022, compared to a net loss of $36.36 million for the year ended Sept. 30, 2021. As of Dec. 31, 2022, the Company had $44.56 million in total assets, $17.96 million in total liabilities, and $26.59 million in total stockholders' equity. Potomac, Maryland-based BDO USA, LLP, the Company's auditor since 2005, issued a "going concern" qualification in its report dated Dec. 27, 2022, citing that the Company has suffered recurring losses from operations and has future liquidity needs that raise substantial doubt about its ability to continue as a going concern. CGCC LLC: Unsecured Creditors to Recover $135K over 36 Months ------------------------------------------------------------- CGCC, LLC, filed with the U.S. Bankruptcy Court for the Middle District of Georgia a Plan of Reorganization dated November 13, 2023. The Debtor is a limited liability company with five equal members: Dr. James F. Smith, Dr. Frederick M. Schnell, Dr. Kenneth D. Deaton, Dr. Linda K. Hendricks, and Dr. Bruce T. Burns. Under the initial management and leadership of Dr. Smith, Debtor was formed with the intention that when the five original members retired from practice in CGCC PC, another younger CGCC PC physician would buyout the retiring doctor's interest in Debtor. As time has passed, however, younger doctors no longer participate in this traditional form of physician investment. As a result, no market exists for a single retiring doctor's membership interest in Debtor. Dr. Smith decided to exercise the retirement provision in the Operating Agreement that presumably required Debtor to purchase Dr. Smith's interest if he could not find an eligible doctor to buy his interest. As a result of Dr. Smith choosing to trade his economic and membership equity for debt, Debtor was compelled to file this Bankruptcy Case. Thus, this Plan provides for payment to Dr. Smith as a general unsecured creditor. Debtor's original Operating Agreement is dated May 20, 2009. This Plan provides for the amendment of Debtor's Operating Agreement in accordance with Article 13 of the Operating Agreement that will be effective on the Confirmation Date (the "Amended Operating Agreement"). Through the Plan, Debtor proposes to pay its disposable income to general unsecured creditors over a 36-month time frame on a pro rata basis. Based upon historical distributions, Debtor anticipates its 36-month disposable income to be $135,000.00. This Plan deals with all property of Debtor and provides for treatment of all Claims against Debtor and its property. Class 1 shall consist of General Unsecured Claims including any potential deficiency claims. If the Plan is confirmed under Section 1191(a) of the Bankruptcy Code, Debtor shall pay the General Unsecured Creditors all of Debtor's Disposable Income in installments commencing on the first day of the first full quarter immediately following the Effective Date and continuing on the 1st day of each quarter through and including the 12th quarter following the Effective Date. General Unsecured Creditors will receive 12 disbursements totaling all of Debtor's disposable income, which will vary depending upon distributions from HHC. In the event the Building is sold or Debtor is sold during the 36-month Plan period, General Unsecured Creditors will receive an additional distribution on a pro rata basis up to the full amount of their claims after crediting the amounts they received under the Plan before Class 2 Equity Security Holders receive any distributions. Dr. Smith is the principal general unsecured credit of Debtor. He is swapping all of his ownership interests in Debtor for debt, which is evidenced by his claim against Debtor. This claim is based upon Dr. Smith's exercise of the Operating Agreement and subsequent Lawsuit, pursuant to which he demands that Debtor purchase all of his ownership interests in Debtor. Debtor anticipates and projects, but does not warrant, James Smith as the holder of Class 1 claim in the amount of $583,909.00. This Class will receive a distribution of $135,000.00 of their allowed claims. If the Plan is confirmed under Section 1191(b) of the Bankruptcy Code, Class 1 shall be treated the same as if the Plan was confirmed under Section 1191(a) of the Bankruptcy Code. The Claims of the Class 1 Creditor is Impaired by the Plan, and the holders of Class 1 Claims are entitled to vote to accept or reject the Plan. Class 2 consists of the Equity Holders of Debtor. Each equity security holder will retain their Interest in the Reorganized Debtor with each Interest increasing to 25% as of the Confirmation Date to absorb Dr. Smith's return of his 20% member interest in Debtor under this Plan. This class is not impaired and is not eligible to vote on the Plan. The source of funds for the payments pursuant to the Plan is the distributions received from HHC in the normal course of Reorganized Debtor's business operations. A full-text copy of the Plan of Reorganization dated November 13, 2023 is available at https://urlcurt.com/u?l=1mL0lX from PacerMonitor.com at no charge. Attorneys for Debtor: William A. Rountree, Esq. Caitlyn Powers, Esq. ROUNTREE LEITMAN KLEIN & GEER, LLC Century Plaza I 2987 Clairmont Road, Suite 350 Atlanta, GA 30329 Tel: (404) 584-1238 Email: wgeer@rlkglaw.com cpowers@rlkglaw.com About CGCC LLC CGCC, LLC, was formed by Albert P. Reichert, Jr. as a Georgia Limited Liability Company by executing and transmitting Articles of Organization to the Secretary of State of Georgia in accordance with the provisions of Georgia law. The Debtor sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Ga. Case No. 23-51097) on August 14, 2023, listing up to $50,000 in assets and $500,001 to $1 million in liabilities. Caitlyn Powers, Esq. at Rountree Leitman Klein & Geer, LLC, is the Debtor's counsel. CHRONICLE BIDCO: Goldman Sachs Marks $4.7MM Loan at 68% Off ----------------------------------------------------------- Goldman Sachs BDC, Inc has marked its $4,753,000 loan extended to Chronicle Bidco Inc. (dba Lexitas) to market at $1,533,000 or 32% of the outstanding amount, as of September 30, 2023, according to Goldman Sachs's Form 10-Q for the Quarterly period ended, September 30, 2023, filed with the Securities and Exchange Commission on November 7, 2023. Goldman Sachs BDC is a participant in a First Lien Senior Secured Debt to Chronicle Bidco Inc. (dba Lexitas). The loan accrues interest at a rate of 12.07% (S+6.75%) per annum. The loan matures on May 18, 2029. Goldman Sachs BDC classified the loan on non-accrual status and as a Non-income producing security. Goldman Sachs BDC, Inc. was initially established as Goldman Sachs Liberty Harbor Capital, LLC, a single member Delaware limited liability company, on September 26, 2012 and commenced operations on November 15, 2012 with The Goldman Sachs Group, Inc. as its sole member. On March 29, 2013, the Company elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Effective April 1, 2013, the Company converted from a SMLLC to a Delaware corporation. In addition, the Company has elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2013. Goldman Sachs Asset Management, L.P., a Delaware limited partnership and an affiliate of Goldman Sachs & Co. LLC, is the investment adviser of the Company. Chronicle Bidco Inc., dba Lexitas, is a provider of outsourced litigation support services and solutions to law firms and legal departments of insurance companies and corporations. CIVICPLUS LLC: Goldman Sachs Marks $1.2M Loan at 94% Off -------------------------------------------------------- Goldman Sachs BDC, Inc has marked its $1,217,000 loan extended to CivicPlus LLC. to market at $76,000 or 6% of the outstanding amount, as of September 30, 2023, according to Goldman Sachs's Form 10-Q for the Quarterly period ended, September 30, 2023, filed with the Securities and Exchange Commission on November 7, 2023. Goldman Sachs BDC is a participant in a First Lien Senior Secured Debt to CivicPlus LLC. The loan accrues interest at a rate of 11.42% (S + 6.00%) per annum. The loan matures on August 24, 2027. Goldman Sachs BDC classified the loan on non-accrual status and as a Non-income producing security. Goldman Sachs BDC was initially established as Goldman Sachs Liberty Harbor Capital, LLC, a single member Delaware limited liability company, on September 26, 2012 and commenced operations on November 15, 2012 with The Goldman Sachs Group, Inc. as its sole member. On March 29, 2013, the Company elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Effective April 1, 2013, the Company converted from a SMLLC to a Delaware corporation. In addition, the Company has elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2013. Goldman Sachs Asset Management, L.P., a Delaware limited partnership and an affiliate of Goldman Sachs & Co. LLC, is the investment adviser of the Company. CivicPlus, LLC provides software solutions. The Company offers platform that helps governments to optimize digital interactions for residents and staff with the Company's full suite of integrated solutions, resulting in revenue generation, more efficient operations, and more positive civic experiences. CivicPlus serves customers in the United States. CLEAN ENERGY: Mast Hill Fund Swaps $1.95MM Debt for Equity ---------------------------------------------------------- Clean Energy Technologies, Inc. disclosed in a Form 8-K Report filed with the Securities and Exchange Commission that the Company on November 8, 2023, entered into an exchange agreement with Mast Hill Fund, L.P., a Delaware limited partnership, pursuant to which the Company agreed to issue to the Holder 2,199,387 shares of the newly designated 15% Series E Convertible Preferred Stock of the Company, par value $0.001 per share, in exchange for the outstanding balances of $1,955,122.43, as of November 8, under the six promissory notes the Company issued to the Holder from November 2022 to July 2023. The Company has designated the rights of Mast Hill Fund with respect to its shares of Series E Preferred Stocks pursuant to a Certificate of Designations, Preferences, and Rights of Series E Convertible Preferred Stock. The issuance of shares of Series E Preferred Stock by the Company to the Holder under the Agreement will be made without registration under the Securities Act of 1933, as amended, or the securities laws of the applicable state, in reliance on the exemptions provided by Section 4(a)(2) of the Act and Regulation D promulgated thereunder, and in reliance on similar exemptions under applicable state law, based on the offering of such securities to only one person, the lack of any general solicitation or advertising in connection with such issuance, that the issuee is an accredited investor (as that term is defined in Rule 501(a) of Regulation D), and that the issuee is acquiring the securities for its own account and without a view to distribute them. Key Highlights of the Equity Conversion include: * Non-Mandatory Redemption in Cash: The preferred stocks in exchange for the outstanding balances under the Notes do not mandate redemption in cash, providing CETY with increased flexibility in managing its financial resources. This feature allows the Company to allocate funds more efficiently, supporting strategic initiatives and growth opportunities. * Variable Conversion: The conversion mechanism incorporates a variable structure, aligning the interests of investors with the Company's performance. This dynamic conversion feature reflects CETY's commitment to shareholder value and ensures that conversions are based on prevailing market conditions. * 15% Dividend for the Converted Class of Stock: Preferred stockholders benefiting from the conversion will receive a 15% dividend, which was originally stipulated as part of the original notes. This dividend underscores CETY's commitment to delivering value to its investors and provides an attractive incentive for long-term investment. The converted securities will be subject to customary transfer restrictions. Mast Hill, a key stakeholder, is considered a long-term partner of CETY, and this strategic move reflects the commitment to nurturing and enhancing this valued relationship. The Company values Mast Hill's partnership immensely and looks forward to continued collaboration in achieving mutual success. Kam Mahdi, CEO at CETY, commented "We believe that the conversion of the Notes is a strategic move that aligns with our long-term vision for sustainable growth. This decision not only strengthens our financial position but also reflects our commitment to creating value for our shareholders and partners." About Clean Energy Headquartered in Costa Mesa, California, Clean Energy Technologies, Inc. -- http://www.cetyinc.com-- designs, produces and markets clean energy products and integrated solutions focused on energy efficiency and renewables. The Company provides waste heat recovery solutions, waste to energy solutions, and engineering, consulting and project management solutions. Spokane, Washington-based Fruci & Associates II, PLLC, the Company's auditor since 2015, issued a "going concern" qualification in its report dated April 17, 2023, citing that the Company has an accumulated deficit, a working capital deficit and negative cash flows from operations. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern. CLEARCOURSE PARTNERSHIP: Goldman Sachs Marks GBP11.7MM Loan at 43% ------------------------------------------------------------------ Goldman Sachs BDC, Inc has marked its GBP11,741,000 loan extended to Clearcourse Partnership Acquireco Finance Limited to market at GBP6,698,000 or 57% of the outstanding amount, as of September 30, 2023, according to Goldman Sachs's Form 10-Q for the Quarterly period ended September 30, 2023, filed with the Securities and Exchange Commission on November 7, 2023. Goldman Sachs BDC is a participant in a First Lien Senior Secured Debt to Clearcourse Partnership Acquireco Finance Limited. The loan accrues interest at a rate of 12.43% (SN + 7.50% (Incl. 0.75% PIK) per annum. The loan matures on August 19, 2028. Goldman Sachs BDC classified the loan on non-accrual status and as a non-income producing security. Goldman Sachs BDC, Inc. was initially established as Goldman Sachs Liberty Harbor Capital, LLC, a single member Delaware limited liability company, on September 26, 2012 and commenced operations on November 15, 2012 with The Goldman Sachs Group, Inc. as its sole member. On March 29, 2013, the Company elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Effective April 1, 2013, the Company converted from a SMLLC to a Delaware corporation. In addition, the Company has elected to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, commencing with its taxable year ended December 31, 2013. Goldman Sachs Asset Management, L.P., a Delaware limited partnership and an affiliate of Goldman Sachs & Co. LLC, is the investment adviser of the Company. Clearcourse Partnership Acquireco Finance Limited is in the IT Services industry. CLOUD VENTURES: Seeks Until Feb. 8 to File Disclosure Statement --------------------------------------------------------------- Cloud Ventures 1, LLC d/b/a Pipeline Trenchers Group, filed a motion to extend the Nov. 13, 2023 deadline to file a plan of reorganization and a disclosure statement, and the Dec. 28, 2023 deadline to confirm a plan. The Debtor is currently selling equipment and an Order to Sell was signed by this Honorable Court on November 6, 2023. There is still equipment secured by Lea County State Bank. Counsel for the Debtor and for the Bank have agreed there is a large deficiency which makes the Bank the largest secured and unsecured creditor. Both the Debtor and the Bank have agreed that it is in the best interest of the creditors and the bankruptcy estate to elect to no longer be considered a small business case as defined by the Code and reset the deadline to file a disclosure statement for 90 days to February 8, 2024. This will allow the Debtor more time to sell the equipment. Attorneys for Debtor(s): Craig Douglas Davis, Esq. DAVIS, ERMIS & ROBERTS, P.C. 1521 N. Cooper, Suite 860 Arlington, TX 76011 Tel: (817) 265-8832 Fax: (972) 262-3264 About Cloud Ventures 1 Cloud Ventures 1, LLC, doing business as Pipeline Trenchers Group, filed a Chapter 11 bankruptcy petition (Bankr. N.D. Texas Case No. 23-40228) on Jan. 26, 2023, with as much as $1 million in both assets and liabilities. Judge Mark X. Mullin oversees the case. The Debtor tapped Davis Ermis & Roberts, P.C. as legal counsel and Hagen Sharp & Company, PLLC as accountant. CONCRETE SOLUTIONS: U.S. Bank Says Plan Not Confirmable ------------------------------------------------------- Secured Creditor U.S. Bank National Association submitted an objection to Concrete Solutions & Supply's initial Disclosure Statement describing Chapter 11 Plan. U.S. Bank says the Disclosure Statement contains only conclusory statements by Debtor's sole shareholder and principal, Alton "Aray" Anderson, regarding the value and marketability of Debtor's assets. Likewise, the alleged liquidation values of the assets are conclusory. Additional specificity is needed to provide creditors with sufficient information to verify Mr. Anderson's assertions. In reliance solely upon Mr. Anderson's valuations, the Disclosure Statement states that Creditor's claim is under-secured. Accordingly, the Disclosure Statement purports to bifurcate Creditor's claim into "secured" and "unsecured" portions. However, there is no specificity regarding the asserted amounts of the bifurcated portions of the Creditor's claim, and Creditor is left guessing what amounts constitute the secured vs. unsecured portions of its Claim under Debtor's Disclosure Statement. The Disclosure Statement provides that Creditor would be paid the full amount of the secured portion of its claim and values its assets at liquidation in the amount of $165,400. Accordingly, Creditor presumes that Creditor's secured claim under the Plan would equal $165,400, leaving $164,779 of Creditor's claim unsecured; however, it is unclear from the plain language of the Disclosure Statement if Creditor's presumption is correct. The Disclosure Statement, U.S. Bank points out, also fails to adequately describe the extent of Mr. Anderson's continuing medical difficulties and their projected impact on the business, particularly where, as here, the Debtor has consistently attributed Mr. Anderson's medical difficulties and absence as key events leading to the Debtor's Chapter 11 filing. Finally, the Plan is itself patently unconfirmable, U.S. Bank tells the Court. It purports to violate the absolute priority rule by not providing fair and equitable treatment to Creditor, as required by 11 U.S.C. Sec. 1129(b)(2)(A). The Plan proposes to pay the secured portion of Creditor's claim, the amount of which is unspecified, over a period of eight years at zero percent interest, with minimal monthly payments and a large-lump sum payment at the beginning of year eight, which payment would be paid from an anticipated (and hypothetical) refinancing of the Debtor. In essence, the Plan allocates the risk of the reorganization of this corporate debtor, which has a long history of unsuccessfully attempting to restructure its debts and obligations, on the shoulders of the Creditor alone. Attorneys for Secured Creditor U.S. Bank National Association: Byron B. Mauss, Esq. Joshua R. Duffy, Esq. Allison C. Murray Esq. SNELL & WILMER L.L.P. 600 Anton Blvd, Suite 1400 Costa Mesa, CA 92626-7689 Tel: (714) 427 7000 Fax: (714) 427 7799 E-mail: bmauss@swlaw.com jduffy@swlaw.com acmurray@swlaw.com About Concrete Solutions & Supply Concrete Solutions & Supply sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No. 9:23-bk-10314-RC) on April 25, 2023. In the petition signed by Alton Anderson, president, the Debtor disclosed up to $500,000 in assets and up to $1 million in liabilities. Judge Ronald A. Clifford III oversees the case. Steven R. Fox, Esq., at The Fox Law Corporation Inc., is the Debtor's legal counsel. CORE SCIENTIFIC: Further Fine-Tunes Joint Plan ---------------------------------------------- Core Scientific, Inc., et al., submitted a Third Amended Joint Chapter 11 Plan. Under the Plan, Class 8 General Unsecured Claims will receive on the later of (a) the Effective Date or as soon as reasonably practicable thereafter and (b) the first Business Day after the date that is 30 calendar days after the date such General Unsecured Claim becomes an Allowed General Unsecured Claim, New Common Interests with a value, based on Plan Value, equal to 100% of such Holder's Allowed General Unsecured Claim. For purposes of this section 4.8, the Allowed amount of any General Unsecured Claim will include all interest accrued from the Petition Date through the date of distribution at the Federal Judgment Rate. For the avoidance of doubt, the Allowed Miner Equipment Lender Deficiency Claim of each Holder of a Miner Equipment Lender Secured Claim shall be treated as an Allowed General Unsecured Claim under the Plan; provided, that any Holder electing Miner Equipment Lender Treatment Election 2 will waive its recovery on account of its Allowed Miner Equipment Lender Deficiency Claim. Class 8 is impaired. "New Common Interests" means the new common equity of Reorganized Parent to be issued (a) on the Effective Date or thereafter under the Plan or (b) as otherwise permitted pursuant to the Plan and the New Corporate Governance Documents. On the Effective Date, the proceeds of the Rights Offering may be used to (i) pay all reasonable and documented Restructuring Fees and Expenses, (ii) fund Plan Distributions, case administration expenses, and exit costs, including Professional Fee Claims, and (iii) provide the Reorganized Debtors with additional liquidity for working capital and general corporate purposes. On the Effective Date, the Reorganized Debtors shall be authorized to execute, deliver, and enter into the Exit Facility Documents without further (i) notice to or order or other approval of the Bankruptcy Court, (ii) act or omission under applicable law, regulation, order, or rule, (iii) vote, consent, authorization, or approval of any Person, or (iv) action by the Holders of Claims or Interests. The Exit Facility Documents shall constitute legal, valid, binding and authorized joint and several obligations of the applicable Reorganized Debtors, enforceable in accordance with its terms and such obligations shall not be enjoined or subject to discharge, impairment, release, avoidance, recharacterization, or subordination under applicable law, the Plan, or the Confirmation Order. The financial accommodations to be extended pursuant to the Exit Facility Documents (and other definitive documentation related thereto) are reasonable and are being extended, and shall be deemed to have been extended, in good faith and for legitimate business purposes. Confirmation of the Plan shall be deemed approval of the Exit Facility and the Exit Facility Documents, all transactions contemplated thereby (including the Designated Amount that will become obligations under the Exit Facility), and all actions to be taken, undertakings to be made, and obligations to be incurred by the Reorganized Debtors in connection therewith, and authorization of the Reorganized Debtors to enter into, execute, and deliver the Exit Facility Documents and such other documents as may be required to effectuate the treatment afforded by the Exit Facility. On the Effective Date, all Liens and security interests granted pursuant to the Exit Facility Documents shall be (i) valid, binding, perfected, and enforceable Liens and security interests in the personal and real property described in and subject to such document, with the priorities established in respect thereof under applicable non-bankruptcy law and as provided for in the New Intercreditor Agreement (New Secured Convertible Notes, New Secured Notes, and Exit Facility) and (ii) not subject to avoidance, recharacterization, or subordination under any applicable law, the Plan, or the Confirmation Order. The Reorganized Debtors and the Persons granted Liens and security interests under the Exit Facility Documents are authorized to make all filings and recordings and to obtain all governmental approvals and consents necessary to establish and perfect such Liens and security interests under the provisions of the applicable state, provincial, federal, or other law (whether domestic or foreign) that would be applicable in the absence of the Plan and the Confirmation Order (it being understood that perfection shall occur automatically by virtue of the entry of the Confirmation Order without the need for any filings or recordings) and will thereafter cooperate to make all other filings and recordings that otherwise would be necessary under applicable law to give notice of such Liens and security interests to third parties. As consideration for providing the commitments under the Exit Facility Commitment Letter, on the Effective Date, the Put Option Premium (as defined in the Exit Facility Commitment Letter) shall be allocated among the Commitment Parties (as defined in the Exit Facility Commitment Letter) in accordance with the Exit Facility Commitment Letter. Attorneys for the Debtors: Alfredo R. Pérez, Esq. Clifford W. Carlson, Esq. WEIL, GOTSHAL & MANGES LLP 700 Louisiana Street, Suite 1700 Houston, TX 77002 Tel: (713) 546-5000 Fax: (713) 224-9511 -and- Ray C. Schrock, Esq. Ronit J. Berkovich, Esq. WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, NY 10153 Tel: (212) 310-8000 Fax: (212) 310-8007 A copy of the Third Amended Joint Chapter 11 Plan dated November 10, 2023, is available at https://tinyurl.ph/VqDzZ from Stretto, the claims agent. About Core Scientific Core Scientific, Inc. (OTCMKTS: CORZQ) is the largest U.S. publicly-traded Bitcoin mining company in computing power. Core Scientific, which was formed following a business combination in July 2021 with blank check company XPDI, is a large-scale operator of dedicated, purpose-built facilities for digital asset mining colocation services and a provider of blockchain infrastructure, software solutions and services. Core mines Bitcoin, Ethereum and other digital assets for third-party hosting customers and for its own account at its six fully operational data centers in North Carolina (2), Georgia (2), North Dakota (1) and Kentucky (1). Core was formed following a business combination in July 2021 with XPDI, a blank check company. In July 2022, one of the Company's largest customers, Celsius Mining LLC, filed for Chapter 11 bankruptcy in New York. With low Bitcoin prices depressing mining revenue to a record low, Core Scientific first warned in October 2022 that it may have to file for bankruptcy if the company can't find more funding to repay its debt that amounts to over $1 billion. Core Scientific did not make payments that came due in late October and early November 2022 with respect to several of its equipment and other financings, including its two bridge promissory notes. Core Scientific and its affiliates filed petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 22-90341) on Dec. 21, 2022. As of Sept. 30, 2022, Core Scientific had total assets of US$1.4 billion and total liabilities of US$1.3 billion. Judge David R. Jones oversees the cases. The Debtors hired Weil, Gotshal & Manges, LLP as legal counsel; PJT Partners, LP as investment banker; and AlixPartners, LLP as financial advisor. Stretto is the claims agent. A group of Core Scientific convertible bondholders is working with restructuring lawyers at Paul Hastings. Meanwhile, B. Riley Commercial Capital, LLC, as administrative agent under the Replacement DIP facility, is represented by Choate, Hall & Stewart, LLP. On Jan. 9, 2023, the U.S. Trustee for Region 7 appointed an official committee to represent unsecured creditors in the Debtors' Chapter 11 cases. The committee tapped Willkie Farr & Gallagher, LLP as legal counsel and Ducera Partners, LLC as investment banker. The U.S. Trustee for Region 7 appointed an official committee of equity security holders. The equity committee is represented by Vinson & Elkins, LLP. CREATIVE REALITIES: Slipstream Funding Reports Equity Stake ----------------------------------------------------------- Slipstream Funding, LLC filed Amendment No. 5 to its Schedule 13G to provide updated information on its ownership of Creative Realities, Inc.'s Common Stock. Slipstream Funding, LLC is the beneficial owner of 317,455 shares of Common Stock, representing 2.51% of Common Stock outstanding as of November 9, 2023 Slipstream Communications, LLC, BCOM Holdings, LP, Business Services Holdings, LLC, Pegasus Investors IV, L.P, Pegasus Investors IV GP, LLC, Pegasus Capital, LLC, and Craig Cogut share beneficial ownership of 3,686,935 shares of the Common Stock, of which 2,261,446 are issuable in respect of the Warrants, representing 29.10% of Creative Realities, Inc.'s outstanding Common Stock. Slipstream Funding, LLC may be reached at: Craig Cogut c\o Pegasus Capital Advisors, L.P. 750 East Main Street, Suite 600 Stamford, CT 06902 (203) 869-4400 A full-text copy of the Schedule 13G Report is available at https://tinyurl.com/f6y64f3x About Creative Realities Creative Realities, Inc. -- http://www.cri.com-- Creative Realities helps clients use place-based digital media to achieve business objectives such as increased revenue, enhanced customer experiences, and improved productivity. The Company designs, develops and deploys digital signage experiences for enterprise-level networks, and is actively providing recurring SaaS and support services across diverse vertical markets, including but not limited to retail, automotive, digital-out-of-home (DOOH) advertising networks, convenience stores, foodservice/QSR, gaming, theater, and stadium venues. As of June 30, 2023, the Company had $63,934,000 in total assets and $40,076,000 in total liabilities. As of June 30, 2023, the Company has an accumulated deficit of $52,834,000 negative working capital of $6,071,000 including current debt obligations of $4,197,000 and cash of $3,264,000. For the six months ended June 30, 2023, the Company incurred an operating loss of $790,000 and generated positive net cash flows from operations of $6,344,000. In addition, pursuant to the Second Amended and Restated Credit and Security Agreement made between the Company and Slipstream Communications the Company is required to make monthly repayments of principal on the Consolidation Term Loan beginning on Sept. 1, 2023 and on the first day of each month thereafter until the Maturity Date on Feb. 17, 2025. The monthly principal payment beginning on Sept. 1, 2023 is approximately $399,00, or total principal repayments for the 12 months subsequent to the reporting date of these Condensed Consolidated Financial Statements of $4,389,000. As a result of the principal debt service payments required to be paid on account of the Consolidation Term Loan, the Company does not currently have cash on hand or committed available liquidity to repay all of its outstanding debt due within one year after the date that these financial statements are issued. The Company said these conditions and events raise substantial doubt about the Company's ability to continue as a going concern. CREDITO REAL: Declared Under Bankruptcy Protection in Mexico ------------------------------------------------------------ Alex Vasquez of Bloomberg News reports that Credito Real, S.A.B. de C.V., confirmed in a statement Tuesday, Nov. 14, 2023, it was declared in bankruptcy protection in Mexico. "[Today] the judicial ruling rendered on November 13, 2023 by the First District Judge in Matters of Commercial Bankruptcy was notified to the Credito Real, through which the Company's commercial bankruptcy was declared, and the reconciliation stage is declared open. Likewise, the procedural and conservatory measures of the bankruptcy procedure are dictated, in the terms of the provisions of the Commercial Bankruptcy Law," Credito Real said in the statement. About Credito Real SAB Credito Real SAB de CV SOFOM ENR is a Mexico-based company that provides consumer financing. Credito is Mexico's biggest payroll lender and second largest non-bank lender after Real Unifin. Credito Real provides loans, either by providing direct financing to consumers or by establishing financing programs with consumer financing dealers that sell to Credito Real the collection rights from consumer financing products. It also provides financing directly to individuals that are employed by corporations with payroll deduction agreements with consumer financing dealers authorized by Credito Real. Credito Real operates through a number of subsidiaries, including AFS Acceptance LLC. Three alleged creditors signed a petition to send Credito Real to Chapter 11 bankruptcy on June 22, 2022 (Bankr. S.D.N.Y. Case No. 22-10842). Institutional Multiple Investment Fund LLC, of Boston, Massachusetts; Banco Monex, S.A., of Mexico, and Solitaire Fund, of Liechtenstein, who claim to own an aggregate $8 million of unsecured bond debt, signed the involuntary Chapter 11 petition. David H. Botter, Esq., at Akin Gump Strauss Hauer & Feld LLP is advising the three bondholders. Despite efforts by bondholders to force the company to pursue a Chapter 11 restructuring in the U.S., the Debtor opted to pursue proceedings in Mexico instead. On June 28, 2022, Angel Francisco Romanos Berrondo, one of the Debtor's shareholders and the former CEO of Credito Real, filed a petition, in his capacity as a shareholder, with the Mexican Court seeking to commence the Mexican Liquidation Proceeding. On June 30, 2022, the Mexican Court entered an order commencing the dissolution and liquidation proceedings for the Company and appointing Mr. Fernando Alonso-de-Florida Rivero as the Mexican Liquidator. The liquidator for Credito Real filed a Chapter 15 bankruptcy petition (Bankr. D. Del. Case No. 22-10630) on July 14, 2022, to seek U.S. recognition of the Mexican proceedings. The petition was signed by Robert Wagstaff, the foreign representative of the liquidator. Richards, Layton & Finger, P.A., led by John Henry Knight, is counsel in the U.S. case. DEPETRIS FAMILY: Court OKs Cash Collateral Access Thru Jan 2024 --------------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Pennsylvania authorized DePetris Family, LLC to use cash collateral on an interim basis in accordance with the budget, with a 10% variance, through January 31, 2024. The Debtor requires the use of cash collateral to meet ordinary cash needs and pay actual expenses. The Debtor is permitted to use cash collateral solely for the following purposes: a. maintenance and preservation of their assets; b. continued operation of their businesses, including but not limited to payroll, payroll taxes, employee expenses, and insurance costs; c. completion of work-in-process; and d. operation and maintenance of the shopping center. People's Security Bank has a secured claim against the Debtor in the approximate principal amount of $3.8 million pursuant to the loan transaction entered into by and between the Debtor and People's Security Bank. First Commonwealth Bank has a secured claim against the Debtor in the approximate principal amount of $9.7 million, inclusive of a cash reserve held by First Commonwealth Bank of approximately $419,631. These credit facilities are documented between the Debtor and the Secured Creditors, and certain, related notes and various other documents as described in detail in the Loan Agreements. As adequate protection, the Debtor will pay People's Security Bank monthly installments of $28,785 per month, and pay First Commonwealth Bank monthly installments of $40,499. The Lender is also granted a valid, automatically-perfected and fully-enforceable, replacement security interest and first lien in all of the Debtor's assets and the proceeds thereof, subject only to any preexisting, validly-perfected, prior liens, pursuant to 11 U.S.C. section 361(2) and 363 to the extent of the Debtor's use of the Secured Creditor's cash collateral and to the extent the value of the Collateral declines after the Petition Date. The Adequate Protection Payments and Replacement Liens granted will be automatically deemed perfected upon entry of the Order without the necessity of the Secured Creditors taking possession, tiling financing statements, mortgages or other documents. A final hearing on the matter is set for January 24, 2023 at 11:30 a.m. A copy of the court's order and the Debtor's budget is available at https://urlcurt.com/u?l=MnJqYq from PacerMonitor.com. The Debtor projects $129,043 in total income and $47,200 in total operating expenses for November 2023. About DePetris Family LLC DePetris Family LLC owns and operates a shopping center located at 200 Tuckerton Road, Medford, NJ 08053. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. Penn. Case No. 23-12542) on August 25, 2023. In the petition signed by James DePetris, manager, the Debtor disclosed up to $50 million in both assets and liabilities. Judge Magdeline D. Coleman oversees the case. Allen B. Dubroff, Esq., at Allen B. Dubroff Esq. & Associates, LLC, represents the Debtor as legal counsel. DEPETRIS FAMILY: Seeks to Hire Eisner Amper as Accountant --------------------------------------------------------- DePetris Family, LLC seeks approval from the U.S. Bankruptcy Court for the Eastern District of Pennsylvania to employ Eisner Amper as its accountant. The firm's services include: (a) general accounting and bookkeeping matters; (b) tax return preparation; (c) preparation of the Debtor's monthly operating reports for the Office of the U.S. Trustee; and (d) such other items as the Debtor may ordinarily require the services of a certified public accountant. On July 26, the firm received $8,062 for accounting services rendered in the ordinary course of the Debtor's business. The firm has requested a payment of $8,625 for the preparation of the 2022 tax returns. Jeffrey Richman, CPA, a member of Eisner Amper, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Jeffrey Richman, CPA Eisner Amper 130 North 18th Street Philadelphia, PA 19103 Telephone: (215) 881-8800 Facsimile: (215) 881-8801 About DePetris Family DePetris Family LLC owns and operates a shopping center located at 200 Tuckerton Road, Medford, N.J. DePetris Family, LLC filed Chapter 11 petition (Bankr. E.D. Pa. Case No. 23-12542) on Aug. 25, 2023, with $10 million to $50 million in both assets and liabilities. James DePetris, manager, signed the petition. Judge Magdeline D. Coleman oversees the case. The Debtor tapped Allen B. Dubroff, Esq., at Allen B. Dubroff Esq. & Associates, LLC as legal counsel and Jeffrey Richman, CPA, at Eisner Amper as accountant. DIVERSIFIED HEALTHCARE: Board Appoints New President and CEO ------------------------------------------------------------ Diversified Healthcare Trust disclosed in a Form 8-K filed with the Securities and Exchange Commission that the Company's Board of Trustees appointed Christopher J. Bilotto as its president and chief executive officer, effective Jan. 1, 2024. Mr. Bilotto, age 46, has been an executive vice president of the Company's manager, The RMR Group LLC since October 2023, senior vice president of RMR from October 2020 to September 2023 and a vice president of RMR from 2016 to September 2020. Mr. Bilotto is responsible for overseeing portfolio management for all office, industrial and retail properties managed by RMR and hotel and senior living asset management, as well as development and redevelopment across the United States. Prior to joining RMR in 2011, Mr. Bilotto worked at General Growth Properties in various management roles. Mr. Bilotto currently serves as president and chief executive officer of Office Properties Income Trust, but he has resigned from those positions effective Dec. 31, 2023. The Company said there is no arrangement or understanding between Mr. Bilotto and any other person pursuant to which Mr. Bilotto was appointed as the Company's president and chief executive officer. Mr. Bilotto will replace Jennifer F. Francis, who is retiring from RMR on June 30, 2024, and therefore has resigned as the Company's president and chief executive officer, effective Dec. 31, 2023. In connection with Mr. Bilotto's appointment, the Company will enter into an indemnification agreement with Mr. Bilotto, which agreement will be on substantially the same terms as the indemnification agreements the Company has entered with its Trustees and other executive officers. About Diversified Healthcare Trust Diversified Healthcare Trust (Nasdaq: DHC) -- www.dhcreit.com -- is a real estate investment trust, which owns senior living communities, medical office and life science buildings and wellness centers throughout the United States. As of Sept. 30, 2023, DHC's approximately $7.2 billion portfolio included 376 properties in 36 states and Washington, D.C., occupied by approximately 500 tenants, and totaling approximately 9 million square feet of life science and medical office properties and more than 27,000 senior living units. DHC is managed by The RMR Group (Nasdaq: RMR), an alternative asset management company with approximately $36 billion in assets under management as of Sept. 30, 2023 and more than 35 years of institutional experience in buying, selling, financing and operating commercial real estate. The Company stated in its Quarterly Report for the period ended Sept. 30, 2023, that "As discussed in Note 1 to our condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, based on these challenges and upcoming debt maturities, we have concluded that there is substantial doubt about our ability to continue as a going concern for at least one year from the date of issuance of the financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q. Our continuation as a going concern is dependent upon many factors, including our ability to meet our debt covenants and repay our debts and other obligations when due. While we believe raising permissible new capital, including proceeds from our planned asset sales, and the possible extension of our credit facility, will alleviate the substantial doubt about our ability to continue as a going concern, we cannot provide assurance that any new capital raised, including proceeds from our planned asset sales, will be available to us or sufficient to repay our upcoming maturing debt, or that our lenders will agree to an extension of the maturity date of our credit facility. We cannot be sure that we will be able to obtain any future debt financing, and any such debt financing we may obtain may not be sufficient to repay our upcoming maturing debt. If we are unable to obtain sufficient funds, we may be unable to continue as a going concern." DMK PHARMACEUTICALS: Adjourns 2023 Annual Meeting ------------------------------------------------- DMK Pharmaceuticals Corporation disclosed in a Form 8-K Report filed with the Securities and Exchange Commission that the Company convened its 2023 annual meeting of stockholders on November 9, 2023. According to the Company, it adjourned the Annual Meeting to allow additional time for the Company to solicit additional proxies and votes to establish a quorum for the conduct of business at the Annual Meeting and additional time for stockholders to vote on the proposals described in the Company's notice of meeting and definitive proxy statement filed with the Securities and Exchange Commission on October 12, 2023. The adjourned Annual Meeting will reconvene on November 30, 2023. The adjourned Annual Meeting will be a completely "virtual" meeting of stockholders, and stockholders will be able to listen and participate in the virtual meeting as well as vote during the live webcast of the meeting by visiting www.virtualshareholdermeeting.com/DMK2023 To participate in the virtual meeting, stockholders will need the control number found on their proxy cards or in the instructions that accompanied their proxy materials. Only stockholders of record on the record date of October 6, 2023, are entitled to vote. About DMK Pharmaceuticals DMK Pharmaceuticals (formerly known as Adamis Pharmaceuticals Corporation) is a commercial stage neuro-biotech company primarily focused on developing and commercializing products for the treatment of opioid overdose and substance use disorders. DMK's commercial products approved by the FDA include ZIMHI (naloxone) Injection for the treatment of opioid overdose, and SYMJEPI (epinephrine) Injection for use in the emergency treatment of acute allergic reactions, including anaphylaxis. The Company is focused on developing novel therapies for opioid use disorder (OUD) and other important neuro-based conditions where patients are currently underserved. DMK believes its technologies are at the forefront of endorphin-inspired drug design with its mono, bi- and tri-functional small molecules that simultaneously modulate critical networks in the nervous system. DMK has a library of approximately 750 small molecule neuropeptide analogues and a differentiated pipeline that could address unmet medical needs by taking the novel approach to integrate with the body's own efforts to regain balance of disrupted physiology. The Company's lead clinical stage product candidate, DPI-125, is being studied as a potential novel treatment for OUD. DMK also plans to develop the compound for the treatment of moderate to severe pain. The Company's other development stage product candidates include DPI-221 for bladder control problems and DPI-289 for severe end stage Parkinson's disease. San Diego, California-based BDO USA, LLP, the Company's auditor since 2020, issued a "going concern" qualification in its report dated March 16, 2023, citing that the Company has suffered recurring losses from operations and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. EASTERN NIAGARA: Proposes Liquidating Plan ------------------------------------------ Eastern Niagara Hospital, Inc., submitted a Plan of Liquidation under Chapter 11 of the Bankruptcy Code and a Disclosure Statement on November 10, 2023. The Plan is a plan of liquidation. Funds distributed under the Plan will consist of funds accumulated by ENH as of the Effective Date and any proceeds of assets collected after the Effective Date, including accounts receivable and cost report audit proceeds. Distribution of the proceeds are contingent on confirmation of the Plan, which requires the affirmative vote of Class 3 general unsecured creditors. The Plan provides a release to and exculpation for ENH and other parties for actions taken during the course of the bankruptcy case, and limits the liability of ENH and related parties for actions taken in carrying out the Plan. Allowed claims will be paid from available funds in order of priority under the Bankruptcy Code. Unless a secured creditor agrees to less favorable treatment, each holder of an allowed secured claim will either be paid the value of their collateral or will have recourse to their collateral. ENH is aware of approximately $3,407,896 in filed priority claims. ENH disputes the amount of and entitlement to priority status of many of the claims, and will seek to have the claims consensually reduced, withdrawn and/or reclassified. ENH believes that some or all of the claims asserted by the Department of Health ("DOH") in connection with the Debtor's participation in the Indigent Care Pool Program, Financial Assistance Compliance Pool, Net Recast and MOE Receivable and UPL Receivable programs (hereinafter the "Combined Pools, Programs and Receivables") have been satisfied and should be withdrawn. Absent the agreement of the parties filing the claims, ENH will file objections to the amount and/or priority of such claims. The Debtor has sufficient funds on hand to satisfy all claims asserted to priority treatment, with the exception of Claim #97 asserted the DOH. ENH believes that claim (as well as Claims 94, 95, and 96 file by the DOH) have been consensually resolved and is working with the DOH and NYS Attorney General to memorialize such resolution. If ENH is correct with respect to Claim #97, all allowed priority claims will be paid in full, without interest, on the Effective Date. The DOH shall continue to conduct final Audits of funds released through the Combined Pool, Programs and Receivables for periods of time prior or subsequent to the Petition Date in accordance with applicable rules regulations and statutes, with the full cooperation of the Debtor ("Final Audits"). Any amounts that may be found to be owing by the Debtor to DOH resulting from Final Audits for the period of time commencing on the Petition Date through the Effective Date shall be treated as an Administrative Expense claim pursuant to 11 U.S.C. s 503(b)(1)(A) and (D). The filed priority claims also include several claims filed by the PBGC. PBGC is the wholly-owned United States government corporation and agency created under Title IV of ERISA to administer the federal pension insurance program and to guarantee the payment of certain pension benefits upon termination of a pension plan covered by Title IV of ERISA. The Debtor sponsored the Pension Plan, which is covered by Title IV of ERISA. On April 12, 2021, the Debtor and PBGC entered into an agreement terminating the Pension Plan, establishing the Pension Plan's termination date as March 31, 2021, and appointing PBGC as statutory trustee of the Pension Plan. When a single employer pension plan terminates, the sponsor of a pension plan and all members of its controlled group are jointly and severally liable for the unfunded benefit liabilities of the terminated single employer pension plan. See 29 U.S.C. s 1362(b). PBGC filed an amended claim (Claim No. 17) against the Debtor asserting unfunded benefit liabilities in the amount of $30,190,437 which, to the extend allowed, will be treated as a general unsecured claim in Class 3. The sponsor of a pension plan and all other members of its controlled group are obligated to pay the contributions necessary to satisfy the minimum funding standards under sections 412 and 430 of the Internal Revenue Code and sections 302 and 303 of ERISA. PBGC has filed an amended claim (Claim No. 15) against the Debtor for unpaid required minimum contributions owed to the Pension Plan in the total amount of $4,775,757. Portions of PBGC's claim for unpaid required minimum contributions are asserted to be entitled to priority under 11 U.S.C. ss 507(a)(2) and (a)(5) in the amounts of $715,249 and $466,148, respectively. Any allowed claim for contributions not entitled to priority is a general unsecured claim in Class 3. The sponsor of a pension plan and all other members of its controlled group are jointly and severally liable to PBGC for all annual premium obligations owed to the pension plan. See 29 U.S.C. Sec. 1307. PBGC filed an amended claim (Claim No. 16) against the Debtor for unpaid statutory premiums owed to PBGC on behalf of the Pension Plan in the amount of $3,371,869. When a single employer pension plan terminates in a PBGC-initiated termination pursuant to 29 U.S.C. Sec. 1342, the sponsor of the pension plan and its controlled group are also liable to PBGC for a termination premium at the rate of $1,250 per plan participant per year for three years under 29 U.S.C. s 1306(a)(7). A portion of PBGC's claim for statutory premiums in the amount of $143,119 is for annual premiums arising after the Petition Date and is asserted to be entitled to priority under 11 U.S.C. ss 507(a)(2) and 507(a)(8). The remaining premiums claim amount of $3,228,750 is for the termination premium and is asserted to be a general unsecured claim in Class 3. ENH's secured claims consist of the following: * Class 2A claim held by Citizens. Citizens' claim in the amount of approximately $3.5 million is secured by a mortgage on the Debtor's former hospital campus located at 521 East Avenue, Lockport, NY. Citizen's will receive, at its choice, a deed in lieu of foreclosure or a stipulated judgment of foreclosure. Unless agreed otherwise by the Debtor in its sole discretion, the Debtor will abandon any interest it may have in the property securing Citizen's claim on the Effective Date of the Plan; * Class 2B claim held by ICH. ICH's claim in the amount of $2,970,000 plus accrued interest, is secured by a subordinate lien on the Debtor's accounts receivable and a senior lien on the Debtor's remaining personal property. The value of ICH's collateral is of inconsequential value and under 11 U.S.C. Sec. 506(b), ICH's claim will be treated as unsecured; * Class 2C claim held by the Dormitory Authority of the State of New York in the amount of $2 million plus accrued interest, secured by a lien on the Debtor's entitlement to the VAP Grant and the Debtor's accounts receivable. The Class 2C claim holder will receive payment of its claim from by virtue of the assignment of the Debtor's VAP Grant to the Class 2C claim holder. ENH anticipates after claim objections are completed, the pool of allowed general unsecured claims will equal approximately $30 million. During the course of its Chapter 11 case, has obtained authority to sell a number of unencumbered assets which were no longer necessary to the Debtor's health care delivery system. Those funds, equaling approximately $897,000, have been placed in an escrow account and earmarked for distribution to unsecured creditors, but subject to further order of the Court. If the claims resolution process is resolved as expected by ENH, those funds and more should be available for distribution to holders of Allowed Class 3 claims. In addition, the Debtor has been collecting its accounts and has sufficient funds on hand and to be collected to permit payment of all obligations under the plan. As is set forth in the Sources and Uses Of Cash exhibit (attached hereto as Exhibit B), the Debtor has accumulated $2.6 million as of the date hereof (in addition to the equipment sale proceeds). The Plan is a plan of liquidation that provides for payment to creditors from (i) funds already accumulated and in the possession of Debtor's Chapter 11 counsel, (ii) funds collected by and in the possession of the Debtor, and (iii) funds that may be collected by the Debtor after the date hereof. Under the circumstances, the Debtor believes that a liquidation in accordance with the terms of the Plan, including all settlements and compromises contained in the Plan, is fair, appropriate, and in the best interests of the Debtor and all parties in interest. Under the Plan, Class 3 — Unsecured Claims will receive a pro rata share of the Class 3 Distribution Payment. The Debtor believes that after reconciliation of claims, the amount of allowed Class 3 unsecured claims will equal approximately $30 million. The Class 3 Distribution Payment will consist of the funds remaining available after payment of allowed higher priority claims. If the Allowed Claims holding a higher priority that Class 3 exceed approximately $1.5 million, there may be no distribution to Class 3. If the Allowed Claims holding a higher priority than Class 3 are equal to $700,000, the Debtor estimates there will be approximately $830,000 available to distribute to Class 3 Allowed Claims, resulting in a distribution of approximately $ 0.027 on each dollar of Allowed Class 3 Claim. If Allowed Claims having a higher priority than Class 3 Claims are equal to $500,000, the Debtor estimates there will be approximately $1,030,000 available to distribute to Class 3 Allowed Claims, resulting in a distribution of approximately $0.034 on each dollar of Allowed Class 3 Claim. Allowed Class 3 Claims are impaired under the Plan and may vote on the Plan. The allowance of a Class 3 claim for voting purposes, or the lack of a pending objection to a Class 3 claim on date of the Voting Deadline, Confirmation Hearing or Effective Date shall not constitute a waiver of the Debtor's or Plan Administrator's right to file a claim objection, and shall not constitute res judicata or collateral estoppel against the right of the Debtor or Plan administrator's right to file a claim objection with respect to any claim. "Class 3 Distribution Payment" means the amount of money available to be paid to holder of Allowed Class 3 Claims, consisting of the cash remaining in ENH's operating account and in ENH's counsel's escrow account after payment of or reservation for payment for of all claims having a higher priority than general unsecured claims under Bankruptcy Code s 507. Counsel for Debtor: Jeffrey A. Dove, Esq. Beth Ann Bivona, Esq. BARCLAY DAMON LLP Barclay Damon Tower 125 East Jefferson St. Syracuse, NY 13202 Tel: (315) 413 7112 Fax: (315) 703 7346 Email: jdove@barclaydamon.com bbivona@barclaydamon.com A copy of the Disclosure Statement dated November 10, 2023, is available at https://tinyurl.ph/zBwgW from PacerMonitor.com. About Eastern Niagara Hospital Eastern Niagara Hospital, Inc. -- http://www.enhs.org-- is a not-for-profit organization focused on providing general medical and surgical services. Eastern Niagara Hospital sought Chapter 11 protection (Bankr. W.D.N.Y. Case No. 20-10903) on July 8, 2020, with $10 million to $50 million in both assets and liabilities. Judge Michael J. Kaplan oversees the case. The Debtor tapped Barclay Damon, LLP as its bankruptcy counsel; Francis P. Weimer, Esq., as special counsel; Freed Maxick CPAs, P.C. as financial advisor; and Lumsden & McCormick, LLP as accountant. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors on Nov. 22, 2019. Bond Schoeneck & King, PLLC and Next Point, LLC serve as the committee's legal counsel and financial advisor, respectively. Michele McKay was appointed as patient care ombudsman in the Debtor's bankruptcy case. Jeffrey Dove, Esq., is the PCO's attorney. EDGEWOOD FOOD MART: Taps Ogier, Rothschild & Rosenfeld as Counsel ----------------------------------------------------------------- Edgewood Food Mart, Inc. seeks approval from the U.S. Bankruptcy Court for the Northern District of Georgia to employ the law firm of Ogier, Rothschild & Rosenfeld, PC. The Debtor requires legal counsel to: (a) advise, assist, and represent the Debtor with respect to its rights, powers, duties, and obligations in the administration of this Chapter 11 case, and the collection, preservation, and administration of assets of its estate; (b) advise, assist, and represent the Debtor with regard to any claims and causes of action which the estate may have against various parties; (c) advise, assist, and represent the Debtor with regard to investigation of the desirability and feasibility of the rejection or assumption and potential assignment of any executory contracts or unexpired leases, and to advise, assist, and represent the Debtor with regard to liens and encumbrances asserted against property of the estate and potential avoidance actions for the benefit of the estate; (d) advise, assist, and represent the Debtor in connection with all applications, motions, or complaints concerning reclamation, sequestration, relief from stays, disposition, or other use of assets of the estate, and all other similar matters; (e) advise, assist, and represent the Debtor with regard to the preparation, drafting, and negotiation of a plan of reorganization or liquidation; and/or to advise, assist, and represent Debtor in connection with the sale or other disposition of any assets of the estate; (f) provide support and assistance to the Debtor with regard to the review of claims against it, the investigation of amounts properly allowable and the appropriate priority or classification of same, and the filing and prosecution of objections to claims as appropriate; (g) perform any and all other legal services incident or necessary to the proper administration of this case. The hourly rates of the firm's counsel and staff are as follows: Kathleen Steil $325 Allen Rosenfeld $425 Tamara Ogier $450 William Rothschild $450 Paralegal $180 In addition, the firm will seek reimbursement for expenses incurred. The firm received from the Debtor a pre-bankruptcy retainer of $50,000, of which $14,372.25 was used to pay its pre-bankruptcy fees and expenses, including the Chapter 11 filing fee of $1,738. Tamara Miles Ogier, Esq., an attorney at Ogier, Rothschild & Rosenfeld, disclosed in a court filing that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Tamara Miles Ogier, Esq. Ogier, Rothschild & Rosenfeld, PC P.O. Box 1547 Decatur, GA 30031 Telephone: (404) 525-4000 Email: tmo@orratl.com About Edgewood Food Mart Edgewood Food Mart, Inc., a domestic profit company in Georgia, filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. N.D. Ga. Case No. 23-61204) on Nov. 10, 2023, with up to $500,000 in assets and up to $10 million in liabilities. Leon S. Jones has been appointed as Subchapter V trustee. Tamara Miles Ogier, Esq., at Ogier, Rothschild & Rosenfeld, PC represents the Debtor as legal counsel. ENERFLEX LTD: Fitch Affirms 'BB-' LongTerm IDR, Outlook Stable -------------------------------------------------------------- Fitch Ratings has affirmed Enerflex Ltd.'s (Enerflex) Long-Term Issuer Default Rating (IDR) at 'BB-' and senior secured notes rating at 'BB-'/'RR4'. Fitch has reclassified the debt class of the senior secured notes to "first lien secured", to align with the final issued debt class, and this reclassification has not impacted the rating. The Rating Outlook is Stable. Enerflex's IDR reflects the company's stable, recurring revenue streams from its infrastructure and aftermarket services segments, significantly increased scale and competitiveness following the integration of the Exterran acquisition, strong customer and geographic diversification, and debt reduction prioritization with an achievable net leverage target of 2.5x. Credit concerns include expectations for negative FCF and tightened liquidity at YE 2023 given the growth-linked capital program. Other considerations include project execution and construction risks along with the company's exposure to countries with increased transfer and convertibility risks. The Stable Outlook reflects Fitch's forecast positive FCF generation that is expected to be directed towards repayment of revolver borrowings and overall gross debt reduction, leading to improved liquidity, beginning in 2024. KEY RATING DRIVERS Stable, Predictable Cash Flow: Fitch views the cash flow profile positively as approximately 65% of the company's gross margin is generated through stable, recurring revenue streams that help reduce commodity price linked fluctuations. The company's contracted asset cash flows are protected by take-or-pay contracts with five- to 10-year terms, while rental asset terms range from three months up to three years. These segments, in addition to the company's aftermarket services segment, historically maintained stable revenue and margins through commodity price downturns and help stabilize financial performance against the more cyclical manufacturing segment. Transition to Positive FCF: Although the company has faced operational challenges and higher than expected costs YTD 2023 leading to Fitch forecasted negative FCF of approximately CAD40 million, Fitch expects a transition to positive FCF surpassing $100 million in 2024 and increasing thereafter. Negative FCF for 2023 has been primarily driven by increased capex from growth projects, a large working capital build, and higher than expected restructuring costs in the first half of the year. The company generated positive FCF of approximately $37 million in 3Q and expects further FCF generation in 4Q primarily driven by working capital reduction. Fitch forecasts elevated capex of approximately CAD220 million in 2023 which decreases as growth capex moderates toward mid-cycle levels. Debt Reduction Prioritized; Improving Leverage Metrics: Fitch's base case forecasts gross leverage of 2.9x in 2023, and expects deleveraging towards 2.0x thereafter as FCF is allocated toward gross debt reduction. Fitch expects that FCF generated in 2024 and 2025 will be directed to paying back outstanding borrowings on the revolver. Management maintains a net debt target of less than 2.5x for YE 2023. Project Construction Risks: The company's engineered systems segment, comprising approximately 35% of total gross margin, is exposed to new global natural gas infrastructure projects and has experienced volatility in recent commodity price downturns. The company has experienced start up delays which have negatively impacted working capital, operating cost profile, and gross margins. Fitch believes these risks will remain going forward, but are partially offset by the company's geographic and customer diversification. Strong Geographic Diversification: The Exterran acquisition has bolstered the company's customer and geographic diversification which enables pursuit of a larger, more diverse set of projects. The company operates in more than 20 countries and exhibits a balanced geographic exposure with the Middle East, U.S. and Latin America each contributing approximately 25%-30% of total revenues. Although diversified, Enerflex is nevertheless exposed to countries with material transfer and convertibility risk, namely Argentina. Supportive Customer Diversification: The combined company's top ten customers are primarily national oil companies and large, public E&P's with high credit quality. These customers are forecast to contribute less than 30% of total revenue. The fixed asset nature of the Enerflex's products also helps prevent customers from switching providers and stabilizes cash flows given the high switching costs and costly downtime associated with interrupting the natural gas stream. DERIVATION SUMMARY Enerflex's operating profile compares most similarly to USA Compression Partners, LP (USAC; BB-/Stable) in that cash flow streams for both companies are largely protected by long-term take-or-pay contracts that help eliminate volumetric and commodity-linked risks. Approximately 65% of Enerflex's gross margin will be generated through recurring revenue streams while USAC is almost 100%. Enerflex's operating profile compares favorably to oilfield servicer Precision Drilling (B+/Positive) who owns and operates a fleet of onshore drilling rigs and is more exposed to commodity price fluctuations. Enerflex compares similarly to oilfield servicer Weatherford International Ltd. (B+/Stable) who benefits from long-term contracts on a substantial portion of revenues, but has higher exposure to the highly cyclical oilfield services industry. Enerflex also compares similarly to midstream processor and service provider Secure Energy (B+/Stable) who also benefits from long-term contracts. Enerflex has among the highest leverage of the peer group. Fitch forecasts 2023 leverage of 2.9x, 2024 leverage of 2.5x and decreasing towards 2.0x thereafter. This compares favorably to USAC (5.4x in 2023F) but is higher than Precision (1.6x in 2023F), Weatherford (1.9x in 2023F), and Secure Energy (1.7x in 2023F). KEY ASSUMPTIONS - WTI oil price of $75/bbl in 2023, $70/bbl in 2024, $65/bbl in 2025, $60/bbl in 2026, and $57/bbl thereafter; - Henry Hub natural gas price of $2.80/mcf in 2023, $3.25/mcf in 2024, $3.00/mcf in 2025 and $2.75/mcf thereafter; - High double-digit revenue growth in 2023 as new projects are completed; - Capex spend of approximately CAD220 million in 2023 which decreases as growth capex moderates toward mid-cycle levels.; - $10 million per quarter of mandatory repayments on Term Loan beginning in 3Q23; - $40 million of asset sales in 2023 completed in Q4; - Post-dividend FCF used toward revolver borrowings in 2024 and 2025; - Modest dividends of CAD12 million annually in 2023 and 2024 with moderate increases beginning in 2025; - Base interest rates applicable to the company's outstanding variable rate debt obligations reflects current SOFR forward curve. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: - Demonstrated commitment to conservative financial policy and repayment of the revolving credit facility leading to a stronger liquidity profile; - Successful transaction integration and execution on growth projects while maintaining margins and utilization rates; - EBITDA Leverage sustained below 3.5x. Factors that could, individually or collectively, lead to negative rating action/downgrade: - Inability to repay revolver borrowings and proactively manage the maturity that leads to a weakened liquidity profile; - Failure to integrate acquisition and execute on growth projects that leads to sustained margin and/or utilization rate erosion; - Deviation from stated financial policy and/or shift in capital allocation toward shareholders; - EBITDA Leverage sustained above 4.5x. LIQUIDITY AND DEBT STRUCTURE Adequate Liquidity: Enerflex had CAD163 million of cash on the balance sheet as of 3Q23. The company had CAD474 million borrowings outstanding on the USD700 million revolving credit facility, leading to availability of CAD328 million on the revolver and total liquidity of approximately CAD490 million at 3Q23. Fitch expects the company will generate positive FCF in 2024 and forecasts borrowings on the revolver to be materially reduced in 2024 and 2025. Moderate Refinancing Risk: The term loan and revolving facilities both mature in October 2025, leaving two years of runway for repayment and/or refinancing. The term loan has mandatory quarterly payments of $10 million which began in 3Q23. Fitch expects that the company will use FCF generated to pay down revolver borrowings beginning in 2024. ISSUER PROFILE Enerflex is a global supplier of natural gas infrastructure and energy transitions solutions with expanded product lines and technical expertise spanning across 22 countries. 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 ----------- ------ -------- ----- Enerflex Ltd. LT IDR BB- Affirmed BB- senior secured LT BB- Affirmed RR4 BB- ESCAMBIA OPERATING: Chapter 11 Trustee Taps Jones Walker as Counsel ------------------------------------------------------------------- Drew McManigle, the Chapter 11 trustee appointed in the bankruptcy cases of Escambia Operating Company, LLC and Escambia Asset Company, LLC, seeks approval from the U.S. Bankruptcy Court for the Southern District of Mississippi to employ Jones Walker, LLP. The trustee requires legal counsel to: (a) give advice with respect to the powers and duties of the trustee in the Debtors' cases; (b) advise and consult on the conduct of the Debtors' cases; (c) attend meetings and negotiations with representatives of creditors and other parties in interest in the Debtors' cases; (d) take all necessary actions to protect and preserve the Debtors' estates; (e) prepare pleadings in connection with the Debtors' cases; (f) represent the trustee in connection with obtaining authority to continue using cash collateral (if applicable) and (as necessary) to obtain post-petition financing; (g) advise the trustee in connection with any potential sale of assets; (h) appear before the court, and any other courts and administrative agencies to represent the interests of the Debtors' estates; (i) advise the trustee regarding tax matters involving the Debtors; (j) take any necessary action on behalf of the Debtors' estates to negotiate, prepare, and obtain approval of a disclosure statement and confirmation of a Chapter 11 plan and all documents related thereto; (k) perform all other necessary legal services for the trustee in connection with the prosecution of the Debtors' cases; and (l) to the extent necessary to effectuate the trustee's duties in the Debtors' cases, represent the trustee in all aspects of Blue Diamond Energy, Inc.'s case. The hourly rates of the firm's counsel and staff are as follows: Partners $615 - $890 Associates $470 - $570 Paralegals $220 - $270 In addition, the firm will seek reimbursement for expenses incurred. Joseph Bain, Esq., a partner at Jones Walker, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Joseph E. Bain, Esq. Jones Walker LLP 811 Main Street, Suite 2900 Houston, TX 77002 Telephone: (713) 437-1800 Facsimile: (713) 437-1810 Email: jbain@joneswalker.com About Escambia Operating Company Escambia Operating Company, LLC and Escambia Asset Company, LLC filed Chapter 11 petitions (Bankr. S.D. Miss. Lead Case No. 23-50491) on April 2, 2023, with $10 million to $50 million in both assets and liabilities. Judge Jamie A. Wilson oversees the cases. Drew McManigle, the Chapter 11 trustee appointed in the Debtors' cases, tapped Jones Walker, LLP as bankruptcy counsel; MACCO Restructuring Group, LLC as financial advisor; and M P Boots Petroleum Engineering Services, LLC as valuation advisor. ESCAMBIA OPERATING: Trustee Seeks to Tap MACCO as Financial Advisor ------------------------------------------------------------------- Drew McManigle, the Chapter 11 trustee appointed in the bankruptcy cases of Escambia Operating Company, LLC and Escambia Asset Company, LLC, seeks approval from the U.S. Bankruptcy Court for the Southern District of Mississippi to employ MACCO Restructuring Group, LLC. The trustee requires a financial advisor to: (a) evaluate near-term business plan and financial forecast; (b) assist or prepare a weekly 13-week cash flow forecast and related financial and business models; (c) evaluate and/or assist in developing a liquidation analysis; (d) identify and implement both short-term and long-term liquidity generating initiatives; (e) review or implement the trustee's directives related to assuring ongoing operations of the Debtors' estates; (f) represent the trustee in discussion with lenders, banking institutions, vendors, field operators, State and Federal agencies and similar parties, each related to an operating entity; (g) assist in development of cost containment procedures; (h) evaluate and make recommendations and decisions in connection with strategic alternatives to maximize the value of the Debtors' estates; (i) review inventory and other assets to determine its salability and to provide monetization alternatives; (j) provide business and debt restructuring advice; (k) provide advice on restructuring alternatives; (l) provide projections, liquidation analysis, and claims analysis for preparation of plan to be confirmed; and (m) render such other restructuring, general business consulting, operational action or other assistance as may be requested by the trustee. The hourly rates of the firm's professionals are as follows: Managing Directors $500 - $750 Senior Directors and Directors $400 - $525 Senior Financial Analysts $350 - $475 Financial Analysts $175 - $350 Administrative/Paraprofessional Staff $100 - $300 In addition, the firm will seek reimbursement for expenses incurred. Pablo Bonjour, a managing director of MACCO, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Pablo Bonjour MACCO Restructuring Group, LLC 700 Milam St., Suite 1300 Houston, TX 77002 Telephone: (713) 363-0296 Email: pablo@macco.group About Escambia Operating Company Escambia Operating Company, LLC and Escambia Asset Company, LLC filed Chapter 11 petitions (Bankr. S.D. Miss. Lead Case No. 23-50491) on April 2, 2023, with $10 million to $50 million in both assets and liabilities. Judge Jamie A. Wilson oversees the cases. Drew McManigle, the Chapter 11 trustee appointed in the Debtors' cases, tapped Jones Walker, LLP as bankruptcy counsel; MACCO Restructuring Group, LLC as financial advisor; and M P Boots Petroleum Engineering Services, LLC as valuation advisor. ESCAMBIA OPERATING: Trustee Taps M P Boots as Valuation Advisor --------------------------------------------------------------- Drew McManigle, the Chapter 11 trustee appointed in the Chapter 11 cases of Escambia Operating Company, LLC and Escambia Asset Company, LLC, seeks approval from the U.S. Bankruptcy Court for the Southern District of Mississippi to employ M P Boots Petroleum Engineering Services, LLC. The trustee requires a valuation advisor to: (a) provide engineering and technical services, and assist in and make recommendations regarding marketing efforts; and (b) provide expert witness services, as necessary. The hourly rates of the firm's professionals are as follows: General Services Manager $400 Testimony Related Services Manager $650 In addition, the firm will seek reimbursement for expenses incurred. Myron Boots, a petroleum engineer and founder of M P Boots Petroleum Engineering Services, disclosed in a court filing that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Myron P. Boots M P Boots Petroleum Engineering Services, LLC 12 Lakeview Pl Houston, TX 77070 About Escambia Operating Company Escambia Operating Company, LLC and Escambia Asset Company, LLC filed Chapter 11 petitions (Bankr. S.D. Miss. Lead Case No. 23-50491) on April 2, 2023, with $10 million to $50 million in both assets and liabilities. Judge Jamie A. Wilson oversees the cases. Drew McManigle, the Chapter 11 trustee appointed in the Debtors' cases, tapped Jones Walker, LLP as bankruptcy counsel; MACCO Restructuring Group, LLC as financial advisor; and M P Boots Petroleum Engineering Services, LLC as valuation advisor. ESJ TOWERS: March 8 Hearing on Disclosure Statement --------------------------------------------------- Judge Enrique S. Lamoutte has entered an order that the hearing on approval of amended disclosure statement of ESJ Towers Inc. is scheduled for March 8, 2024 at 10:00 AM. Objections will be filed and served not less than 14 days prior to the hearing. ESJ Towers, Inc., filed a motion to extend its Sept. 13, 2023 deadline to file its Amended Plan of Reorganization and Disclosure Statement by 45 days. The Debtor is in the process of drafting and filing a motion for the entry of a sale order for substantially all of its assets, to be shared with its principal secured creditor, Oriental Bank, for the purpose of exploring for its filing to be of a consensual nature, which motion not only will alter the course of the captioned case but will require a different Plan and Disclosure Statement from those previously in process. Counsel for the Debtor: Charles A. Cuprill-Hernandez, Esq. CHARLES A. CUPRILL, P.S.C. LAW OFFICES 356 Fortaleza St., Second Fl. San Juan, PR 00901 Tel: (787) 977-0515 Fax: (787) 977-0518 E-mail: ccuprill@cuprill.com About ESJ Towers, Inc. ESJ Towers, Inc. owns the ESJ Towers in Carolina, P.R. The luxury apartments and condo units at ESJ Towers have direct access to Isla Verde Beach, widely considered one of the best in Puerto Rico. ESJ sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D.P.R. Case No. 22-01676) on June 10, 2022, with as much as 50 million in both assets and liabilities. ESJ President Keith St. Clair signed the petition. Judge Enrique S. Lamoutte Inclan oversees the case. The Debtor tapped Charles A. Cuprill, Esq., at Charles A. Cuprill, PSC Law Offices as bankruptcy counsel; Ramon Luis Nieves, Esq., at RL Legal Consulting Services, LLC and Luis Daniel Muniz, Esq., as special counsels; Dage Consulting CPAS, PSC as financial advisor; CPA Luis R. Carrasquillo & Co., P.S.C. as financial consultant; and De Angel & Compania, PA, LLC as auditor. The U.S. Trustee for Region 21 appointed an official committee of unsecured creditors on Sept. 12, 2022. The committee tapped the Law Office of Jonathan A. Backman as lead bankruptcy counsel; Julio Cesar Alejandro Serrano, Esq., at JCAS Law as local counsel; and Dage Consulting CPAS, PSC as financial advisor. ETHEMA HEALTH: Delays Filing of Q3 Form 10-Q Report --------------------------------------------------- Ethema Health Corporation disclosed in Form 12b-25 filed with the Securities and Exchange Commission that the Company's filing of its Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, will be delayed. According to the Company, it is unable to file its Quarterly Report on Form 10-Q for the period ended September 30, 2023, by the prescribed date without unreasonable effort or expense because it was unable to compile and review certain information required in order to permit the Company to file a timely and accurate report on the Company's financial condition. The Company believes that the Quarterly Report will be completed and filed within the fifth day extension period provided under Rule 12b-25 of the Securities Exchange Act of 1934, as amended. About Ethema Health Headquartered in West Palm Beach, Florida, Ethema Health Corporation – http://www.ethemahealth.com-- operates in the behavioral healthcare space specifically in the treatment of substance use disorders. Ethema developed a unique style of treatment over th last eight years and has had much success with in-patient treatment for adults. Boca Raton, Florida-based Daszkal Bolton LLP, the Company's auditor since 2018, issued a "going concern" qualification in its report dated March 31, 2023, citing that the Company has accumulated deficit of approximately $43.5 million and negative working capital of approximately $12.7 million at Dec. 31, 2022, which raises substantial doubt about its ability to continue as a going concern. FANATICS COMMERCE: Moody's Alters Outlook on 'Ba3' CFR to Negative ------------------------------------------------------------------ Moody's Investors Service changed Fanatics Commerce Intermediate Holdco, LLC's outlook to negative from stable and downgraded its senior secured term loan B to B1 from Ba3. At the same time Moody's affirmed Fanatics Commerce's Ba3 corporate family rating and Ba3-PD probability of default rating. The outlook change to negative reflects the company's significantly weaker than expected earnings and cash flow, and the risk that the increasingly difficult operating environment will challenge its ability to achieve the appropriate level of returns on its current investments and return EBITDA and EBITDA margins back to their previous levels. Adjusted EBITDA has materially declined due to planned investments in the fan experience, slowing revenue growth, and increased costs to take on new rights. Inventory levels remain high as the company continues to work down excess inventory in a more challenging environment while making investments to prepare for new licensing rights. As a result, free cash flow remains highly negative, resulting in heavy seasonal borrowing under the company's $700 million asset base revolving credit facility ("ABL"). With lower earnings and high seasonal borrowing, Moody's adjusted debt/EBITDA quickly, but temporarily, spiked to over 9x and interest coverage, as measured by EBITDA less Capex to interest, was negative for the latest twelve month period ended September 2023; both well below indicated levels needed to maintain the Ba3 rating. Nevertheless, the affirmation of the Ba3 CFR reflects the company's commitment to returning leverage near its 3-4x leverage target by the end of 2023 through material debt reduction that would be funded by an equity contribution from its parent company, Fanatics Holdings, Inc. (FHI). FHI does not contractually guarantee Fanatics Commerce debt. However, it has a significant amount of cash on its balance sheet (around $1.7 billion as of September 2023) which is available for investment in its various subsidiaries to support growth and other cash flow needs such as debt reduction. The affirmation also reflects Moody's expectations for modest revenue and earnings growth in 2024, with a challenging consumer spending environment offset by new license arrangements and cost reduction efforts, and that the company will maintain adequate liquidity through a return to modest positive free cash flow and improved excess revolver availability in 2024. The downgrade of the senior secured term loan B reflects the materially higher than anticipated borrowings under Fanatics Commerce $700 million asset based revolving credit facility and slower than expected business growth. While the company's senior secured term loan B is secured by substantially all assets of the company, it only has a second lien position on the more liquid assets (receivables and inventory) on which the company's ABL has a first lien. Moody's treats the ABL as having a priority position in the capital structure when applying its Loss Given Default for Speculative Grade Companies Methodology (LGD Methodology). RATINGS RATIONALE Fanatics Commerce's Ba3 CFR reflects its leading position as an online retailer of licensed sports merchandise and its long-term partnership agreements with major sports leagues and relationships with key suppliers. The rating also reflects governance considerations, particularly Moody's expectation that the company will maintain balanced financial strategies that will focus on reducing debt and improving leverage over the very near term including with assistance from FHI. The company also benefits from a significant pipeline of potential new and exclusive licensing relationships which should support revenue and EBITDA growth over the next 12-18 months. Fanatics Commerce's credit profile is constrained by its narrow product focus on sports related apparel, reliance on its relationships with major sports leagues, teams and suppliers and current weak operating performance. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Given the weak performance and the difficult operating environment, a higher rating over the near-to-intermediate term is unlikely. Longer term, ratings could be upgraded over time through sustained revenue, earnings and profit margin growth, while maintaining conservative financial policies and good liquidity. Quantitatively, an upgrade would require average lease-adjusted debt/EBITDA sustained below 3.25 times and EBIT/interest expense above 3.5 times. The ratings could be downgraded if the company fails to reduce debt and leverage over the very near term. Ratings could also be downgraded if the company is unable to achieve the appropriate level of returns on its recent investments by failing to improve EBITDA or EBITDA margins to historic levels. Ratings could also be downgraded should liquidity weaken or should the company not return to positive free cash flow. Specific metrics include average lease-adjusted debt/EBITDA sustained above 4.0 times or EBIT/interest expense remining below 2.25 times. Fanatics Commerce Intermediate Holdco, LLC is a retailer specializing in the online sale of licensed sports merchandise through a platform of sports related ecommerce sites. This includes its flagship Fanatics brand and a variety of partner sites such as NFLshop.com, NBAstore.com, MLBshop.com, NHLshop.com and MLSstore.com. The company also operates through venue storefronts primarily located in sports stadiums as well as wholesale to third-party retailers. Fanatics is privately owned by a consortium of investors including founder and CEO, Michael Rubin, who owns the majority of voting stock. Revenue for the twelve-month period ended June 2023 exceeded $4.5 billion. The principal methodology used in these ratings was Retail and Apparel published in November 2023. FINTHRIVE SOFTWARE: S&P Upgrades CCR to 'CCC', Outlook Negative --------------------------------------------------------------- S&P Global Ratings raised the corporate credit rating on FinThrive Software Intermediate Holdings Inc. to 'CCC' from 'SD' (selective default). S&P said, "At the same time, we lowered our issue-level rating on the company's first-lien debt obligations to 'CCC' from 'CCC+' and removed it from credit watch with negative implications. "Our 'D' issue-level rating on the company's $460 million second-lien term loan remains unchanged until we believe the risk of additional distressed debt repurchases is remote, following the company's multiple below-par repurchases of the debt. "Our negative outlook reflects our view that underperformance in expected revenue and EBITDA could further erode FinThrive's liquidity. It also reflects the heightened risk of additional debt repurchases below par within the next 12 months, which we would likely view as distressed. "The 'CCC' issuer credit rating reflects our belief that FinThrive's capital structure could be unsustainable longer term. We expect the company's revenue to decline in 2023 as it faces longer sales cycles and slower implementations. Lack of resources at hospitals may also continue to impair customers' ability to quickly implement and use the company's software. "We also expect elevated costs in 2023 and 2024, including restructuring costs related to the integration of acquisitions, a new contract with Microsoft Azure to move its products to the cloud, and some other cost-saving moves. We believe these will begin to subside and, with expected working capital improvement, could improve cash generation in 2024. "Still, given the company's interest burden despite an interest rate hedge, FinThrive will struggle to generate positive cash flow in 2024 and will maintain high leverage. We expect the company's high interest burden and sustained cash flow deficits will necessitate reliance on its $150 million revolving credit facility. We also view the use of scarce liquidity for debt-repurchases that provide little near-term benefit as an aggressive financial policy. "We expect FinThrive will continue to pursue subpar debt repurchases that we view as tantamount to a default over the next 12 months. We would likely view the repurchases as distressed exchanges because we no longer believe FinThrive would be viewed as an anonymous buyer given its accumulated open market purchases to date. We see heightened risk that FinThrive will complete more below-par debt repurchases over the next 12 months given the price at which the longer dated term loan continues to trade (about 60 cents on the dollar). "We view FinThrive's liquidity as less than adequate despite its revolver access. While the company's cash balance has eroded (to about $8 million as of Sept. 30, 2023, from over $120 million 12 months ago), FinThrive has full access to the undrawn $150 million revolver and loose covenants. The revolver is subject to a springing 9.55x first-lien leverage covenant when 35% drawn. "While we continue to expect liquidity to support the cash flow deficit over the next 12 months and enable FinThrive to drive revenue growth as its sales force matures, execution risk remains, especially given the slower sales cycle, longer implementations, and cost-cutting measures. "The negative outlook reflects the heightened risk of further debt repurchases below par within the next 12 months, which we would likely view as distressed exchanges. It also reflects our view that FinThrive's underperformance in expected revenue and EBITDA and minimal cash flow could further erode its liquidity. "We could lower the rating on FinThrive if we expect a debt restructuring, default, or bankruptcy in the near term. "We could raise the rating if FinThrive improves operating performance, with new bookings flowing through to cash flow generation, such that its liquidity increases and the likelihood of further repurchases of debt at below-par decreases." FOR PAWS BLUE: Unsecureds Will Get 11.7% of Claims in Plan ---------------------------------------------------------- For Paws Blue Cross Animal Hospital, LLC, submitted a First Amended Plan of Reorganization dated November 13, 2023. The Debtor's current business with the addition of a second veterinarian has reached a level where it can propose the following Plan. Restructuring the debt secured by the Debtor's assets and changes in the Debtor's operations have returned the Debtor to sufficient profitability to reorganize its finances as proposed by the Plan. The primary objectives of the Plan are: (a) to alter the Debtor's capital structure to permit it to emerge from its chapter 11 case with a viable capital structure; (b) to maximize the value of the ultimate recoveries to all creditors on a fair and equitable basis; and (c) to settle, compromise or otherwise dispose of certain claims and interests on the terms that the Debtor believes to be fair and reasonable and in the best interests of its estate and creditors. The Plan provides for, among other things: (a) the cancellation of certain indebtedness in exchange for cash or other property of the Debtor, (b) the assumption or rejection of executory contracts and unexpired leases to which the Debtor is a party, and (c) the restructuring of obligations the Debtor owe to certain secured and creditors. Class A-1 Secured claim of Banker's Healthcare Group ("BHG") in the amount of $202,395.46. BHG will be paid the value of its collateral ($41,718.00) with the remainder of its claim ($160,677.46) being treated as a Class B Claim. Classes A-2 through A-7 consists of the Secured Claims of Small Business Administration, BHG 2, Kapitus, IDEA 247, Forward Financing, White Road Capital: Claim amounts $399,898.05. In full satisfaction of Allowed Class A-2 through A-7 Claims, holders of Allowed Claims in Classes A-2 through A-7 will receive Payment of Distributable Cash as the holders of Allowed Class B Claims. Class A-8 Secured Claim of Stockman Bank. In full satisfaction of Allowed Class A-8 Claim Stockman Bank will receive the following: * The Debtor will pay the balance owed on the Secured Claim in the total amount of $332,926.69, plus a per diem interest of $41.00 from the Petition Date until the Effective Date. * The principal balance owed on the Effective Date shall be paid in equal monthly installments of $2,208.11 through January 2027, with all other terms of the prepetition loan documents remaining in full force and effect. Class B Unsecured Claims and Unsecured Portion of Class A-1 through A-7 Claims. The amount of claim in this Class total $971,469.00. In full satisfaction of all Class B Nonpriority Unsecured Claims and the Unsecured portion of Class A-1 through Class A-7 Claims, such creditors shall receive a prorata portion of Distributable Cash Estimated to be not less than $114,013.00 for an estimated distribution of 11.7%. Each holder of an Allowed Interest shall retain such Interest. Though Restructuring Transactions, the Debtor will restructure its finances by committing its projected disposable income to plan payments and by modifying certain secured obligations. A full-text copy of the First Amended Plan dated November 13, 2023 is available at https://urlcurt.com/u?l=Otm6FS from PacerMonitor.com at no charge. Counsel for the Debtor: Anthony J. DeGirolamo, Esq. 3930 Fulton Dr., Ste. 100B Canton, OH 44718 Telephone: (330) 305-9700 Facsimile: (330) 305-9713 Email: tony@ajdlaw7-11.com About For Paws Blue Cross Animal Hospital For Paws Blue Cross Animal Hospital, LLC, operates an animal hospital. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Ohio Case No. 23-60829) on July 14, 2023. In the petition signed by Jennifer D. Jellison, managing member, the Debtor disclosed up to $1 million in assets and up to $10 million in liabilities. Judge Tiiara N.A. Patton oversees the case. Anthony J. DeGirolamo, Esq., is the Debtor's legal counsel. FREEMANVILLE LIFEHOPE: Unsecureds Owed $75K Unimpaired in Plan -------------------------------------------------------------- Freemanville Lifehope House LLC submitted a Second Amended Disclosure Statement. The Debtor was formed in 2016 to acquire 12 acres of real property in Milton, GA (the "Real Property"). The principal owner (90%) is Scott Honan. The Real Property was divided by a metes and bound description in accordance with local ordinances. However, the new parcels have not yet been platted in the real property records. In the process of renovating the existing home in 2017 and 2018, it was determined in 2018, that the house was riddled with mold all the way down to the framing, and so it was determined to demolish the existing home. In the beginning of 2019, a new home was drawn and permitted and construction started in the summer of 2019. Mr. Honan and companies he owns financed all of the new construction for the home. In the second quarter of 2020 construction stalled due to Covid. In May 2021, debtor sought financing through Civic Financial Services, LLC ("Civic"). However, because of the unique nature of the Real Property (subdividing under local ordinance but not platted in the real estate records and the existence of a conservation easement) the lender imposed certain requirements that resulted in a land swap with an entity owned by Mr. Honan. The loan was closed, and renovations recommenced. One of the key steps in the renovation, was the relocation of a power line through Georgia Power. On December 5, 2022, Debtor filed the present bankruptcy case to prevent the foreclosure, refinance the debt and pay its creditors. Unfortunately, the unique nature of the Real Property presented unanticipated obstacles to refinancing. Specifically, the "land swap", which was required by the lender during the purchase of the Real Property, is now preventing the refinancing of that same property. Debtor has identified a potential purchaser for the Real Property, but that purchaser requires that a new "land swap" occur prior to closing. The proposal involves swapping two parcels (approximately 2.25 acres) for two different parcels (approximately 3.0 acres) to create contiguous road access. Based on recent land sales, the "land swap" will involve parcels of similar value and will increase the value of the Real Property for the estate. The Debtor will use the funds of the sale of the Real Property to pay creditors in full at closing. Under the Plan, Class 9 General Unsecured Class total $75,000 and unimpaired. The timely filed, allowed claims of general, undisputed, liquidated, unsecured, non-priority creditors will be paid in full upon the closing of the sale of the Real Property. The amount paid to holders in this class will satisfy their claims in full. Class 10 Unsecured Disputed and/or un-liquidated claims for which no proof of claim was filed will be paid 0% of the claims. Class 10 is impaired. Attorneys for Debtor: Ian M. Falcone, Esq. THE FALCONE LAW FIRM, P.C. 363 Lawrence Street. Marietta, GA 30060 Tel: (770) 426-9359 E-mail: imf@falconefirm.com A copy of the Disclosure Statement dated November 10, 2023, is available at https://tinyurl.ph/jFFBO from PacerMonitor.com. About Freemanville Lifehope House Freemanville Lifehope House, LLC is primarily engaged in renting and leasing real estate properties. It is based in Alpharetta, Ga. Freemanville Lifehope House filed a petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No. 22-59875) on Dec. 5, 2022. In the petition filed by its manager, Mark Allen, the Debtor reported between $1 million and $10 million in both assets and liabilities. The Debtor is represented by Ian M. Falcone, Esq., at The Falcone Law Firm. GARCIA GRAIN: Unsecureds to Get Share of Profits for 5 Years ------------------------------------------------------------ Garcia Grain Trading Corp. submitted a First Amended Chapter 11 Plan of Reorganization. The Plan provides for a reorganization of the Debtor and for the resolution and treatment of outstanding claims and equity interests and payments to creditors. The Plan provides for the Debtor to transfer its issued and outstanding stock to the Plan Trust, and to eventually dissolve its organizational structure following confirmation -- with the result being all of its assets transferred to a Plan Trust or to a new entity ("New Co.") that owns and holds those assets subject to the terms of this Plan. In other words, the Plan does not provide for the continued operations of Garcia Grain Trading Corp. as an ongoing Texas corporation. Instead, the Plan contemplates operations by New Co. that will supervise operations, work with the Plan Agent, and will pay over net profits to the Plan Trust Agent (the "Plan Agent") to be distributed to the holders of unsecured claims over the 5-year term of the Plan. The Plan Agent and New Co. will also work to realize the highest obtainable price for the assets to be contributed to the Plan Trust and to be sold in accordance with this Plan and when sold, the net proceeds to be distributed by the Plan Trust to creditors who are the beneficiaries of the Plan Trust. Under the Plan, Class 8 (the Unsecured Bean Claims) consists of the Unsecured Bean Claims of American Bean, LLC, in the amount of $184,000; and the claim of Stony Ridge Food, Inc. in the net amount of $1,439,028 after deduction of $118,539 (for one PACA Claim paid) from the original POC #31 amount of $1,557,567. The Debtor's calculations based on the information provided in its Statement of Financial Affairs (SOFA) as well as Vantage Bank statements, indicates that these two claimants have received a total of $917,189 of payments that constitute "preference claims" of the estate under 11 U.S.C. Sec. 547. Vantage Bank check numbers were noted in parenthesis next to the dates those checks were deposited. Likewise, the creditors who did not file a POC in the Bankruptcy Case but had a claim listed in the Schedules. Those claims amount to an estimated total of $617,572. Together, all Unsecured Bean Claims have an estimated amount of $2,240,600. American Bean, LLC, has filed an unsecured claim in the amount of $184,000 (POC #14). In return, the Estate has a preference claim against American Bean, LLC in the amount of $603,908. The preference claims will be settled or prosecuted by the Plan Agent. Stony Ridge Food, Inc., has an unsecured claim in the net amount of $1,439,028 after deduction of $118,539 (for one PACA Claim paid) from the original POC #31 amount of $1,557,567. The Estate has a preference claim against Stony Ridge in the amount of $733,281. The Debtor has agreed to seek recognition of Stony Ridge as a "critical vendor" and to settle the preference claims by offsetting approximately30% of the amount of the claimed preferences against its claim and agreeing that the Estate will recognize Stony Ridge as having an Allowed Unsecured Claim in the agreed upon sum of $1,220,000 to be treated as a General Unsecured Claim. In exchange Stony Ridge will continue to supply the Debtor with black beans at a price and terms to be mutually agreed upon between Stony Ridge and the Debtor. The Allowed Unsecured Claims of the creditors classified as Unsecured Bean Claims shall be treated equally with the Claims of General Unsecured Claims in Class 10 and share pro rata with the holders of General Unsecured Claims from the distributions made by the Plan Agent to participants in the Unsecured Note to be paid 40% of the net after tax profits of New Co. or from the sales of the New Co. properties. Class 8 is impaired. Class 9 (the Farmers' and Grain Claims) consists of the claims of farmers ("Farmers") or other grain claimants ("Grain Claimants") who have sold grains to the Debtor. Farmers and Grain Claimants holding claims that may be entitled to distributions from the proceeds of the surety bonds may either choose to be paid solely by the bond receipts, or to participate and receive their pro-rata share of the percentages paid to General Unsecured Creditors on a pro-rata basis from the receipt of net proceeds from the sales of real estate or the net profits from the operations of the Debtor. All Farmers and Grain Claimants deemed eligible to participate in the distribution of the surety bond proceeds will be paid from the pool of funds to be distributed by the TDA. However, if these holders of grain claims choose distribution from the bond claims they will not have any preferences they received waived by the Debtor. For the Class 9 claimants who filed POCs in the Bankruptcy Case, their Claim Amounts are calculated as the POC Amounts minus the $7,475 priority amounts claimed under the Bankruptcy Code Section 507(a)(6) where applicable, which is the non-priority positions of their claims. The priority portions of the same claims are treated under Class 2. For those Class 9 claimants who have not filed POCs, their Claim Amounts are the estimated scheduled amounts. The Debtor's calculations based on the information provided in its Statement of Financial Affairs (SOFA) as well as Vantage Bank statements, indicates that these Farmers who have filed a POC have received an estimated total of $3,896,715.69 of payments that constitute "preference claims" of the Estate under 11 U.S.C. s 547, (Vantage Bank check numbers were noted in parenthesis next to the dates those checks were deposited). The claims of the Farmers and Grain Claimants who have filed a POC (calculated as the POC amount minus the priority portions of their claims which are treated under Class 2) amount to an estimated total of $3,509,951.12; and the claims of Farmers and Grain Claimants who have not filed a POC amount to an estimated total of $188,515.29, and together, Class 9 is estimated to have a total amount of $3,698,466.41. The provisions of the Plan provide the Unsecured Farmers' and Grain Claims will be resolved according to each claimant's choice to opt in or opt out of the treatment of General Unsecured Claims under the Plan, i.e., either be paid solely by the bond receipts or to participate and receive their pro-rata share of the percentages paid to General Unsecured Creditors on a pro-rata basis from the receipt of net proceeds from the sales of real estate or the net profits from the operations of the Debtor in exchange for release of all preference claims and obligations arising under this Bankruptcy Proceeding. The division and distribution of profits of the New Co. shall be in accord with the provisions established for the split of profits in the Operation Agreement approved by the Bankruptcy Court and as provided in this Plan, whereby GrainChain, Harco National Insurance Company ("Harco"), and the General Unsecured Creditors each receive their respective share of the profits from the operations of the Debtor in relation to the amount their claims constitute a percentage of the total amount of the General Unsecured Class. In this regard, the total amount of unsecured claims is estimated to total $20,126,212 while the claims of the General Unsecured Creditors are estimated to total $9,770,328.65, Harco's allowed subrogation claim evidenced by its filed proof of claim tied to the payment of the surety bonds it granted to the Texas Department of Agriculture ("TDA") is estimated to total $2,402,704.00, and GrainChain's unsecured claim in the amount of $7,841,054.99. A specific provision of the Plan of Reorganization shall be that upon the entry of the confirmation order the claims asserted by the estate contesting the nature, extent and validity of the liens of GrainChain against certain assets of the estate and its related entities as well as any other claims or causes of action the estate may be entitled to assert against GrainChain shall be fully compromised and settled in exchange for the commitment by GrainChain to provide post-confirmation financing to the New Co. and its agreement to release and declare null and void its liens asserted against the Progreso Facility, the Edcouch Facility, the Moore Farms tract, the Emory Farms tract, and the Baryta Industrial tract. The Progreso Facility, the Edcouch Facility, the Moore Farms tract, the Emory Farms tract, and the Baryta Industrial tract are collectively referred to herein as the Contested Lien Tracts. In consideration of GrainChain's agreement to release its asserted liens against the Contested Lien Tracts, and in consideration of the estate's agreement to release any claims or causes of action it may hold against GrainChain, the provisions of the Plan of Reorganization shall provide that GrainChain, the General Unsecured Creditors, and Harco are each granted a lien against the Contested Lien Tracts in the amounts of their respective percentages -- i.e., GrainChain a 45% lien to secure the payment of its claim of $7,841,055, the holders of General Unsecured Claims a 45% lien to secure the payment of its estimated claims of $7,038,659, and Harco a 10% lien to secure the payment of its contingent unliquidated claim in the amount $2,402,704. Class 9 is impaired. Class 10 consists of the Administrative Convenience Class. These claimants will be given two options: either (1) to receive 40% of their claims on the effective date or (2) to participate in the sharing of net profits of operation of GrainChain and Elkins. The Debtor offers to pay 40 cents on the dollar for each of the claimants making up the Administrative Convenience Claims disregarding any of its preference claims against any. This way, the amount paid for Administrative Convenience Claims will amount to $36,040.44 [which is calculated as $90,101.12 (x0.40)]. In sum, the Administrative Convenience Claims will be resolved by payment of a total sum of $36,040 to the claimants making up this class in exchange of release of all claims and obligations arising under this Bankruptcy Proceeding or they participate in the Plan treatment for General Unsecured Creditors. The total amount of General Unsecured Claims of $9,770,329 does not take into account the total amount of $112,125 of "priority" portions of Farmers' claims, which are treated under Class 2. This amount is made up of the claims of the Farmers claiming $7,475 priority under 11 U.S.C. Sec. 507(a)(6). Those Farmers are as follows: Brian Jones Farms, Carl Hensz, Chad Szutz, Dreibelbis Farms, Eat Fresh Farms, Fike Farms, HAR-VEST, Johnny Guin, Karen Arnold, Lothringer Family Farms, Robert Walsdorf, Russell Plantation II, Skalitsky Farms, Wesley Valerius, and Zdansky, J.V. These priority claims are treated under Class 2, and priority grain claims will be paid in full on the Effective Date. Allowed general unsecured claims in an amount less than $10,000, including the Priority Claims of shall be paid in full by the Plan Agent on the Effective Date of the Plan. Class 10 is impaired. Class 11 consists of General Unsecured Trade Claims. To sum up, the Total Unsecured Claims (Classes 8 through 11) consisting of Class 8 (Unsecured Bean Claims in the estimated total amount of $2,240,600 with an estimated total Preference Amount of $1,073,007); Class 9 (Unsecured Farmers' and Grain Claims in the estimated total amount of $3,698,466 with an estimated total Preference Amount of $4,526,019); Class 10 (Administrative Convenience Class in the estimated total amount of $90,101 with an estimated total Preference amount of $354,956); and Class 11 (General Trade Claims in the estimated amount of $3,741,161 with an estimated total Preference Amount of $314,995) together add up to $9,770,329 with an estimated Total Preference Amount of $6,268,977. Class 11 is impaired. Class 12 is a category of Unsecured Claims that is separate from Classes 8, 9, 10 and 11. Class 12 consists of the Unsecured Claims of Harco National Insurance Company ("Harco") which has filed a Proof of Claim in the amount of $2,402,704.00 (POC #44 filed 6/20/2023) for the full amounts due on the TDA Surety Bonds, general indemnity agreement, and of GrainChain, Inc. which has filed a Proof of Claim in the amount of $7,841,055 (POC #42 filed 6/19/2023). The Plan Allows Harco Claim in full upon Harco's vote to accept the Plan treatment. To resolve these issues as among the TDA, Harco, and the various claimants and avoid multi-years litigation, the Debtor proposes the following solution to resolve all unsecured claims (which includes the Unsecured Claims section described above, plus the unsecured portions of Harco's and GrainChain's claims): 1. Harco's filed Proof of Claim (POC #44) shall be allowed in full. 2. GrainChain, Harco and General Unsecured Claims (subject to the 3-year subordination of Harco Claims Dividends) each will receive (from Net Operating Profits and Plan Trust or GrainChain real property sales) under the Plan Distributions according to the following percentages mutually agreed between all Parties described herein: GrainChain 45% of the net proceeds from sale proceeds of encumbered real estate and net profits; Unsecured Claims 45% of the net proceeds from the sale of encumbered real estate and 55% of the net profits for 3 years and 45% beginning on the fourth (4th) year; Harco 10% of net proceeds of all sold Plan Trust real estate, and ten percent (10%) of the proceeds of the sale of encumbered real estate, staring in the fourth (4th) and continuing through the 5th year and final New Co. disposition of Harco's interest in New Co.'s encumbered assets. 3. As to Plan Trust Asset and Properties (excluding the New Co. encumbered assets), if as and when sold at any time after the Effective Date, Harco shall receive its 10% pro-rata portion through and including any property sales after the end of the fifth year as provided in the Plan. Alternative Treatment: Harco has filed its proof of claim and is entitled to vote to accept or reject this Plan, and otherwise may object to this Plan treatment. In the event that Harco votes to reject the Plan, the Debtor invokes 11 U.S.C. § 1129 to confirm the Plan over dissenting votes. However, in the event Harco objects to the Plan treatment, the following Plan Terms Apply: a. Harco must file a written objection to the Plan timely in accordance with the objection deadlines set by Bankruptcy Court Order; b. Upon the filing of a Harco Objection, the Debtor shall be deemed to a have, without further pleading, filed a Motion to invoke the Adversary Rules of Procedure to the Objection, to all responses or intervention pleadings, to the discovery, and to the testimony and evidence her or admitted, as well as any ruling and any appeal from any such ruling. c. Filing of the Objection must also include any response of Harco or reply to the Plan provisions that invoke the Adversary rules to any such Harco Objection;9 and d. Debtor and Creditors or Parties in Interest desiring to reply must timely file responses to the Harco Objection in accordance with the objection deadlines set by Bankruptcy Court Order; e. The Debtor and Harco shall be entitled to limited discovery prior to the confirmation hearing consisting of one deposition each of a corporate representative including a reasonable request for production of documents; and f. At the Confirmation hearing, as scheduled by the Bankruptcy Court, the Bankruptcy Court shall hear evidence and arguments of counsel and determine the Harco Objection. Class 12 is impaired. The Debtor believes that the Plan as proposed is feasible based on the financial projections for the next five years as reflected in the Cashflow Analysis. Based on the Debtor's 2023 circumstances, the Cashflow Analysis identifies five major sources of revenue for New Co. for the next five-year period which are the sales of cottonseed, pinto beans, black beans, yellow corn, and sunflower. Each comes with its associated costs in addition to the indirect expenses and administrative expenses to be incurred in order to enable New Co.'s operations. The Cashflow Analysis projects a steady level of Total Net Revenues for each year ($60,245,086) for the next five-year period, which is significantly higher than—in fact, more than double—the 2023 figure ($27,234,148). Likewise, the Cashflow Analysis shows a steady level of Total Commodity Gross Profit for each year ($7,311,718) for the next five-year period, which is also significantly higher than—and in fact more than double—the 2023 figure ($3,212,890). The Cashflow Analysis shows increased costs and expenses; however, the five-year projections show sufficient Net Income Before Taxes, which is projected to be more than double the 2023 figures and which the Debtor believes is sufficient to justify this Plan. Attorneys for Garcia Grain Trading Corporation: David R. Langston, Esq. MULLIN HOARD & BROWN, L.L.P. P.O. Box 2585 Lubbock, TX 79408-2585 Tel: (806)765 7491 Fax: (806) 765 0553 A copy of the Plan of Reorganization dated November 8, 2023, is available at https://tinyurl.ph/xWVTO 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 Bankruptcy Code (Bankr. S.D. Tex. 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, is the Debtor's 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. GAUCHO GROUP: Delays Filing of Q3 Form 10-Q Report -------------------------------------------------- Gaucho Group Holdings, Inc. disclosed in Form 12b-25 filed with the Securities and Exchange Commission that the Company has determined that it is unable to file its Quarterly Report on Form 10-Q for the period ended September 30, 2023 by November 14, 2023, the due date for such filing. According to the Company, the Auditor's review of the Company's consolidated financial statements for the period ended September 30, 2023 has not been finalized. As a result, the Company cannot, without unreasonable effort or expense, file its Form 10-Q on or prior to the original due date. The Company anticipates that it will be able to file the Form 10-Q within the extension period provided pursuant to Rule 12b-25. About Gaucho Group Headquartered in New York, NY, Gaucho Group Holdings, Inc. -- http://www.algodongroup.com-- was incorporated on April 5, 1999. Effective Oct. 1, 2018, the Company changed its name from Algodon Wines & Luxury Development, Inc. to Algodon Group, Inc., and effective March 11, 2019, the Company changed its name from Algodon Group, Inc. to Gaucho Group Holdings, Inc. Through its wholly owned subsidiaries, GGH invests in, develops and operates real estate projects in Argentina. GGH operates a hotel, golf and tennis resort, vineyard and producing winery in addition to developing residential lots located near the resort. In 2016, GGH formed a new subsidiary and in 2018, established an e-commerce platform for the manufacture and sale of high-end fashion and accessories. The activities in Argentina are conducted through its operating entities: InvestProperty Group, LLC, Algodon Global Properties, LLC, The Algodon - Recoleta S.R.L, Algodon Properties II S.R.L., and Algodon Wine Estates S.R.L. Algodon distributes its wines in Europe through its United Kingdom entity, Algodon Europe, LTD. Gaucho Group reported a net loss of $21.83 million for the year ended Dec. 31, 2022, compared to a net loss of $2.39 million for the year ended Dec. 31, 2021. As of March 31, 2023, the Company had $21.01 million in total assets, $8.60 million in total liabilities, and $12.40 million in total stockholders' equity. New York, NY-based Marcum LLP, the Company's auditor since 2013, issued a "going concern" qualification in its report dated April 17, 2023, citing that the Company has a significant working capital deficiency, has incurred significant losses and needs to raise additional funds to meet its obligations and sustain its operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. GB SCIENCES: Delays Filing of Q3 Form 10-Q Report ------------------------------------------------- GB Sciences, Inc. disclosed in Form 12b-25 filed with the Securities and Exchange Commission that it has determined that it is unable to file its Quarterly Report on Form 10-Q for the fiscal quarter ending September 30, 2023, within the prescribed time period without unreasonable effort or expense. According to the Company, during the quarter it had an inordinate amount of warrant reinstatement, repricing and exercise activity necessitating extensive and complicated accounting activity. This has resulted in the Company not being able to compile and file the Form 10-Q within the customary time period. About GB Sciences Headquartered in Las Vegas, Nevada, GB Sciences, Inc. is a plant-inspired, biopharmaceutical research and development company creating patented, disease-targeted formulations of cannabis- and other plant-inspired therapeutic mixtures for the prescription drug market through its wholly owned Canadian subsidiary, GbS Global Biopharma, Inc. GB Sciences reported a net loss of $4.13 million for the year ended March 31, 2023, compared to a net loss of $530,873 for the year ended March 31, 2022. As of March 31, 2023, the Company had $352,323 in total assets, $4.76 million in total liabilities, and a total stockholders' deficit of $4.41 million. Margate, Florida-based Assurance Dimensions, the Company's auditor since 2020, issued a "going concern" qualification in its report dated July 14, 2023, citing that the Company incurred a net loss of $4,125,194 and cash used in operations of $1,526,861 for the year ended March 31, 2023. In addition, the Company had an accumulated deficit of $108,705,315 and working capital deficit of $4,450,202 at March 31, 2023. These factors raise substantial doubt about the Company's ability to continue as a going concern. GB SCIENCES: Incurs $434K Net Loss in Second Quarter ---------------------------------------------------- GB Sciences, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $434,233 on $0 of sales revenue for the three months ended Sept. 30, 2023, compared to a net loss of $313,057 on $0 of sales revenue for the three months ended Sept. 30, 2022. For the six months ended Sept. 30, 2023, the Company reported a net loss of $707,354 on $0 of sales revenue compared to a net loss of $811,146 on $0 of sales revenue for the same period in 2022. As of Sept. 30, 2023, the Company had $234,185 in total assets, $4.93 million in total liabilities, and a total stockholders' deficit of $4.69 million. GB Sciences stated, "The Company will need additional capital to implement its strategies. There is no assurance that it will be able to raise the amount of capital needed for future growth plans. Even if financing is available, it may not be on terms that are acceptable. If unable to raise the necessary capital at the times required, the Company may have to materially change the business plan, including delaying implementation of aspects of the business plan or curtailing or abandoning the business plan. The Company represents a speculative investment and investors may lose all of their investment. In order to be able to achieve the strategic goals, the Company needs to further expand its business and financing activities. Based on the Company's cash position, it is necessary to raise additional capital by the end of the next quarter in order to continue to fund current operations. These factors raise substantial doubt about the ability to continue as a going concern. The Company is pursuing several alternatives to address this situation, including the raising of additional funding through equity or debt financing. In order to finance existing operations and pay current liabilities over the next twelve months, the Company will need to raise additional capital. No assurance can be given that the Company will be able to operate profitably on a consistent basis, or at all, in the future." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/1165320/000143774923032645/gblx20230930_10q.htm About GB Sciences Headquartered in Las Vegas, Nevada, GB Sciences, Inc. is a plant-inspired, biopharmaceutical research and development company creating patented, disease-targeted formulations of cannabis- and other plant-inspired therapeutic mixtures for the prescription drug market through its wholly owned Canadian subsidiary, GbS Global Biopharma, Inc. GB Sciences reported a net loss of $4.13 million for the year ended March 31, 2023, compared to a net loss of $530,873 for the year ended March 31, 2022. As of March 31, 2023, the Company had $352,323 in total assets, $4.76 million in total liabilities, and a total stockholders' deficit of $4.41 million. Margate, Florida-based Assurance Dimensions, the Company's auditor since 2020, issued a "going concern" qualification in its report dated July 14, 2023, citing that the Company incurred a net loss of $4,125,194 and cash used in operations of $1,526,861 for the year ended March 31, 2023. In addition, the Company had an accumulated deficit of $108,705,315 and working capital deficit of $4,450,202 at March 31, 2023. These factors raise substantial doubt about the Company's ability to continue as a going concern. * * * This concludes the Troubled Company Reporter's coverage of GB Sciences until facts and circumstances, if any, emerge that demonstrate financial or operational strain or difficulty at a level sufficient to warrant renewed coverage. GENESIS GLOBAL: Disclosures Hearing Adjourned to Nov. 28 -------------------------------------------------------- Genesis Global Holdco, LLC, et al., on Nov. 17, 2023, filed a further revised version of the Debtors' Amended Joint Chapter 11 Plan, and a further revised version of the Amended Disclosure Statement. According to a Nov. 20, 2023 notice, the hearing on the Debtors' motion to approve the adequacy of the information in the Disclosure Statement, which began on Nov. 7, 2023, scheduled for Nov. 20, 2023 has been adjourned to Nov. 28, 2023 at 2:00 p.m. (Prevailing Eastern Time). The Disclosure Statement Hearing will be hybrid and conducted in-person and via Zoom. The Debtors will file a revised version of the Debtors' Amended Disclosure Statement with Respect to the Amended Joint Plan of Genesis Global Holdco, LLC et al., Under Chapter 11 of the Bankruptcy Code (the "Revised Disclosure Statement") with the Bankruptcy Court no later than Nov. 27, 2023 at 12:00 p.m. (Prevailing Eastern Time) and serve the Revised Disclosure Statement as required by the Order Implementing Certain Notice and Case Management Procedures. A copy of the Nov. 17 Disclosure Statement is available at: https://restructuring.ra.kroll.com/genesis/Home-DocketInfo?DockRelatedSearchValue=900921-950 About Genesis Global Genesis Global Holdco, LLC, through its subsidiaries, and Global Trading, Inc., provide lending and borrowing, spot trading, derivatives and custody services for digital assets and fiat currency. Genesis Global Capital, LLC (GGC) and Genesis Asia Pacific PTE. LTD. (GAP) provide lending and borrowing, spot trading, derivatives and custody services for digital assets and fiat currency. Genesis Global Holdco, LLC owns 100% of GGC and GAP. Genesis Global Holdco, LLC, GGC and GAP each filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 23-10063) on Jan. 19, 2023. The cases are pending before the Honorable Sean H. Lane. At the time of the filing, Genesis Holdco reported $100 million to $500 million in both assets and liabilities. Genesis Holdco is a sister company of Genesis Global Trading, Inc. ("GGT") and 100% owned by Digital Currency Group, Inc. ("DCG"). GGT, DCG and certain of the Holdco subsidiaries are not included in the Chapter 11 filings. The non-debtor subsidiaries include Genesis UK Holdco Limited, Genesis Global Assets, LLC, Genesis Asia (Hong Kong) Limited, Genesis Bermuda Holdco Limited, Genesis Custody Limited ("GCL"), GGC International Limited ("GGCI"), GGA International Limited, Genesis Global Markets Limited, GSB 2022 II LLC, GSB 2022 III LLC and GSB 2022 I LLC. The Debtors tapped Cleary Gottlieb Steen & Hamilton, LLP as bankruptcy counsel; Morrison Cohen, LLP as special counsel; Alvarez & Marsal Holdings, LLC as financial advisor; and Moelis & Company, LLC as investment banker. Kroll Restructuring Administration, LLC, is the Debtors' claims and noticing agent and administrative advisor. The ad hoc group of creditors is represented by Kirkland & Ellis, LLP and Kirkland & Ellis International, LLP. The ad hoc group of Genesis lenders is represented by Proskauer Rose, LLP. The U.S. Trustee for Region 2 appointed an official committee to represent unsecured creditors in the Debtors' Chapter 11 cases. The committee tapped White & Case, LLP as bankruptcy counsel; Houlihan Lokey Capital, Inc., as investment banker; Berkeley Research Group, LLC as financial advisor; and Kroll as information agent. GENEVA REPAIR: Taps Burke, Warren, MacKay & Serritella as Counsel ----------------------------------------------------------------- Geneva Repair Shop, Inc. seeks approval from the U.S. Bankruptcy Court for the Northern District of Illinois to employ the law firm of Burke, Warren, MacKay & Serritella, PC to handle its Chapter 11 case. The firm was paid $31,686 as an advance retainer for its representation of the Debtor in this bankruptcy case. David Welch, Esq., an attorney at Burke, Warren, MacKay & Serritella, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: David K. Welch, Esq. Burke, Warren, MacKay & Serritella, P.C. 330 N. Wabash Ave., Suite 2100 Chicago, IL 60611 Telephone: (312) 840-7000 Facsimile: (312) 840-7900 Email: dwelch@burkelaw.com About Geneva Repair Shop Geneva Repair Shop, Inc. is a family-owned business offering an array of auto body collision services, custom paint, airbrushing and restoration projects. The company is based in Batavia, Ill. Geneva Repair Shop filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. N.D. Ill. Case No. 23-13878) on Oct. 17, 2023, with $1 million to $10 million in both assets and liabilities. Neema Varghese of NV Consulting Services has been appointed as Subchapter V trustee. Judge Donald R. Cassling oversees the case. David K. Welch, Esq., at Burke, Warren, Mackay & Serritella, PC represents the Debtor as legal counsel. GRAYSON REAL ESTATE: Unsecureds Owed $16,500 to Get 100% -------------------------------------------------------- Grayson Real Estate, LLC, submitted a Plan and a Disclosure Statement, dated November 10, 2023. Formed in 2008, the Debtor is a North Carolina limited liability company that owns a 26-acre tract of land located at 6509 Grayson Lane, Kannapolis, North Carolina. A portion of the land is developed, including a 56,601-square-foot industrial building and adjoining parking areas. The building has been continuously occupied by affiliate Grayson O Corporation, a manufacturer of shampoos and hair care products for wholesalers, whose customers include salons, retailers, and catalog sellers of beauty and grooming supplies. The members of the Debtor are its manager, Van D. Stamey (97.9%), and Toni R. Stamey (2.1%). Cabarrus County holds a lien against the Debtor's real property for unpaid ad valorem taxes of $25,273.56. Newtek Small Business Finance, LLC ("Newtek") asserts a secured claim against the Debtor of approximately $2,363,651.45 related to an SBA loan, which is also collateralized by a deed of trust on its real estate holdings. Other claims against the Estate, including additional tax liabilities and unsecured trade debts, are estimated at $16,500.00. The appraised, fair market value of the Debtor's real property as of December 2022 exceeds the amount of its total indebtedness. The Bankruptcy Court approved the sale of +/-8.5 acres of the property for an initial asking price of $3,412,500.00 in that Order Granting Motion to Sell Real Property Via Broker (the "Sale Order") entered on November 9, 2023. The Court also approved an Exclusive Right to Sell Listing Agreement between the Debtor and Iron Horse Commercial Properties, LLC in the Sale Order. The Debtor believes that said property will be under contract by late 2023 or early 2024 and will close in approximately 60 days thereafter. Pursuant to the terms of the Plan, the proceeds of this sale (after payment of all usual and customary closing costs) will be distributed to the holders of Allowed Claims against the Estate in their order of priority under the Bankruptcy Code on the Effective Date. The Plan contemplates that the Claims of all Creditors will be satisfied in full. After satisfaction of all Claims of higher priority, the holders of the Equity Interests in the Debtor will receive any remaining net sale proceeds commiserate with their respective ownership percentages and shall retain their Equity Interests in the Reorganized Debtor after the Effective Date. However, the holders of Equity Interests will not receive or retain any property under the Plan unless all Allowed Claims of higher priority are fully satisfied. If that contingency does not occur, the Equity Interests shall be cancelled and the Debtor will be dissolved under applicable state law. Mr. Stamey is the Debtor's sole manager, but will not be compensated for his service in this capacity by the Estate. He may, however, receive lawful distributions as a member of the Reorganized Debtor if it continues to conduct business following the sale set forth in the Plan. The Debtor reserves the right to resort to the "cram down" provisions of Section 1129 of the Bankruptcy Code. Under the Plan, Class 4: Allowed General Unsecured Claims total $16,500 and creditors will recover 100% of claims. Class 4 consists of the Allowed Secured Claim of Summit, secured by a first lien on pre-petition A/R and inventory of the Debtor and a junior lien on all other pre-petition assets. These Claims will be treated as unsecured obligations of the Reorganized Debtor. On the Effective Date, holders of Allowed General Unsecured Claims shall be paid Pro Rata Shares of the remaining Net Sale Proceeds (after satisfaction of all Claims of higher priority pursuant to the Bankruptcy Code) up to the full amounts of their Allowed General Unsecured Claims as of the Petition Date. Class 4 is impaired. Counsel for the Debtor: Richard S. Wright, Esq. MOON WRIGHT & HOUSTON, PLLC 212 North McDowell St., Suite 200 Charlotte, NC 28204 Tel: (704) 944 6560 Fax: (704) 944 0380 A copy of the Disclosure Statement dated November 10, 2023, is available at https://tinyurl.ph/LcUrY from PacerMonitor.com. About Grayson Real Estate Grayson Real Estate, LLC, sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. W.D.N.C. Case No. 23-50125) on May 15, 2023. In the petition signed by Van D. Stamey, manager, the Debtor disclosed up to $10 million in both assets and liabilities. Judge Laura T. Beyer oversees the case. Richard S. Wright, Esq., at Moon Wright & Houston, PLLC, is the Debtor's legal counsel. GRIFFON GANSEVOORT: Unsecureds Owed $180K Unimpaired in Sale Plan ----------------------------------------------------------------- Griffon Gansevoort Holdings LLC submitted an Amended Disclosure Statement. The Debtor owns the real property at 55 Gansevoort Street, New York, New York. The Property is a commercial building subject to a triple net lease with Restoration Hardware, Inc. Based on a contract of sale with Restoration Hardware, the Debtor estimates that the Property value is $57,711,000. The Property is encumbered that certain Consolidated, Amended and Restated Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated as of March 29, 2016 (the "Mortgage") between the Debtor and Mishmeret Trust Company Limited ("Mortgagee"), as trustee for those certain Debentures (Series B) issued by Delshah Capital Limited ("DCL") pursuant to that certain Deed of Trust, dated as of January 5, 2016 (as amended, the "Deed of Trust"). The Mortgage secures obligations of the Debtor under (a) that certain Consolidated, Amended and Restated Promissory Note, dated as of March 29, 2016 among the Debtor, DCL, and the Mortgagee (the "Note"), (b) that certain Guaranty, dated as of March 29, 2016, between the Debtor and Griffon GHC LLC, in favor of the Mortgagee (the "Guarantee"), and (c) the Deed of Trust (collectively, the "Secured Obligations"). The Secured Obligations are also secured by that certain Assets Pledge and Security Agreement, dated as of March 29, 2016, between the Debtor, DCL, and the Mortgagee (the "Asset Pledge" and collectively with the Deed of Trust, the Note, the Mortgage, and the Guarantee, the "Bond Documents"). As of the Petition Date, the Mortgagee's Claim is approximately $58,692,020. The Debtor expects the Mortgagee's claim to be reduced to the extent that the proceeds from that certain sale of 100 Christopher Street (the "Christopher Property") as described more fully in an affiliated bankruptcy case of 100 Christopher Street Propco LLC Case No. 23-11542. (PB) (Bankr. S.D.N.Y. 2023) (See Dkt. No. 35) are distributed to the Mortgagee. If such proceeds are not distributed, the Mortgagee's claim will remain impaired, and the Mortgagee will be entitled to vote on the Plan. Under the Plan, Class 5 General Unsecured Claims total $180,955. The claims will receive payment in full in Cash on the Effective Date of allowed amount of each Claim, plus interest at the Legal Rate through the payment date. Class 5 is unimpaired. Effective Date obligations under the Plan will be satisfied from the proceeds of the sale of the Property under the contract. Subject to the terms of the Sale Contract, if the sale does not close by December 21, 2023, or if it is determined before December 21, 2023, that the Purchaser is not closing, the Debtor shall market Property through Meridian Capital Group LLC and sell the Property, subject to Bankruptcy Court approval, under the bidding procedures, provided, however, that in the event of a sale under the Plan pursuant to the bidding and auction procedures, the Debtor shall obtain Bankruptcy Court approval for the dates, amounts and other terms necessary and or helpful to complete such bidding and Auction procedures. Attorneys for the Debtor: Mark A. Frankel, Esq. BACKENROTH FRANKEL & KRINSKY, LLP 488 Madison Ave. New York, NY 10022 Tel: (212) 593 1100 Fax: (212) 644 0544 A copy of the Disclosure Statement dated November 8, 2023, is available at https://tinyurl.ph/GKdnD from PacerMonitor.com. About Griffon Gansevoort Griffon Gansevoort Holdings LLC owns the real property at 55 Gansevoort Street, New York, New York, (the "Property"). The Debtor filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 23-11771) on November 6, 2023. Mark A. Frankel of Backenroth Frankel & Krinsky, LLP, is the Debtor's legal counsel. GROM SOCIAL: Delays Filing of Q3 Form 10-Q Report ------------------------------------------------- Grom Social Enterprises Inc. disclosed in Form 12b-25 filed with the Securities and Exchange Commission that the Company's filing of its Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, will be delayed. According to the Company, it is unable to file its Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, by the prescribed date of November 14, 2023, without unreasonable effort or expense because additional time is needed to complete certain disclosures and analyses to be included in the Report. In accordance with Rule 12b-25 promulgated under the Securities Exchange Act of 1934, as amended, the Company intends to file the Report on or prior to the fifth calendar day following the prescribed due date. About Grom Social Enterprises Inc. Boca Raton, Florida-based Grom Social Enterprises, Inc. -- https://www.gromsocial.com -- is a media, technology and entertainment company focused on delivering content to children under the age of 13 years in a safe secure Children's Online Privacy Protection Act ("COPPA") compliant platform that can be monitored by parents or guardians. Grom Social reported a net loss of $16.77 million for the year ended Dec. 31, 2022, compared to a net loss of $10.22 million for the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had $24.64 million in total assets, $4.30 million in total liabilities, and $20.35 million in total stockholders' equity. Somerset, New Jersey-based Rosenberg Rich Baker Berman, P.A., the Company's auditor since 2022, issued a "going concern" qualification in its report dated April 17, 2023, citing that the Company's significant operating losses and negative cash flows from operations raise substantial doubt about its ability to continue as a going concern. GROM SOCIAL: Incurs $2 Million Net Loss in Third Quarter -------------------------------------------------------- Grom Social Enterprises, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q reporting a net loss of $1.99 million on $970,237 of sales for the three months ended Sept. 30, 2023, compared to a net loss of $2.11 million on $1.48 million of sales for the three months ended Sept. 30, 2022. For the nine months ended Sept. 30, 2023, the Company reported a net loss of $6.59 million on $3.13 million of sales, compared to a net loss of $8.76 million on $3.86 million of sales for the same period during the prior year. As of Sept. 30, 2023, the Company had $22.38 million in total assets, $3.79 million in total liabilities, and $18.59 million in total stockholders' equity. Grom Social stated, "On a consolidated basis, the Company has incurred significant operating losses since its inception. As of September 30, 2023, the Company has an accumulated deficit of $90.2 million. During the nine months ended September 30, 2023, it used approximately $5.9 million, respectively, in cash for operating activities. "The Company has funded its operations primarily through sales of its common stock in public markets, proceeds from the exercise of warrants to purchase common stock, and the sale of convertible notes. Future capital requirements will depend on many factors, including the (i) rate of revenue growth, (ii) expansion of sales and marketing activities, (iii) timing and extent of spending on content development efforts, and (iv) market acceptance of the Company's content, products and services. "The Company's management intends to raise additional funds through the issuance of equity securities or debt to enable the Company to meet its obligations for the twelve-month period. However, there can be no assurance that, in the event the Company requires additional financing, such financing will be available at terms acceptable to the Company, if at all. Failure to generate sufficient cash flows from operations and/or raise additional capital could have a material adverse effect on the Company's ability to achieve its intended business objectives. These factors raise substantial doubt about the Company's ability to continue as a going concern." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/1662574/000168316823008354/grom_i10q-093023.htm About Grom Social Enterprises Inc. Boca Raton, Florida-based Grom Social Enterprises, Inc. -- www.gromsocial.com -- is a media, technology and entertainment company that focuses on (i) delivering content to children under the age of 13 years in a safe secure platform that is compliant with the Children's Online Privacy Protection Act ("COPPA") and can be monitored by parents or guardians, (ii) creating, acquiring, and developing the commercial potential of Kids & Family entertainment properties and associated business opportunities, (iii) providing world class animation services, and (iv) offering protective web filtering solutions to block unwanted or inappropriate content. Grom Social reported a net loss of $16.77 million for the year ended Dec. 31, 2022, compared to a net loss of $10.22 million forthe year ended Dec. 31, 2021. As of June 30, 2023, the Company had $22.06 million in total assets, $3.75 million in total liabilities, and $18.31 million in total stockholders' equity. Somerset, New Jersey-based Rosenberg Rich Baker Berman, P.A., the Company's auditor since 2022, issued a "going concern" qualification in its report dated April 17, 2023, citing that the Company's significant operating losses and negative cash flows from operations raise substantial doubt about its ability to continue as a going concern. GROM SOCIAL: To Raise $3.64MM in Deal with Generating Alpha ----------------------------------------------------------- Grom Social Enterprises, Inc. disclosed in a Form 8-K Report filed with the Securities and Exchange Commission that on November 9, 2023, the Company entered into a Securities Purchase Agreement with Generating Alpha Ltd., a Saint Kitts and Nevis Corporation, pursuant to which the Company has agreed to sell two convertible promissory notes of the Company, with each Note having an initial principal amount of $4,000,000, for a price of $3,640,000 per Note. In connection with the purchase and sale of the Notes, the Company has agreed to issue to Generating Alpha warrants to acquire a total of 3,028,146 shares of the Company's Common Stock, par value $0.001 per share. EF Hutton, division of Benchmark Investment, LLC, is acting as placement agent for the financing. The Transactions are subject to shareholder approval. Pursuant to the SPA, the Company has agreed to secure Shareholder Approval for the SPA and the Transactions at a special meeting or via a written consent in lieu of a meeting. Concurrently with the execution of the SPA, the Company delivered to Generating Alpha a fully executed copy of a Voting Agreement, wherein certain shareholders of the Company have agreed to vote certain securities of the Company held by them as set forth therein. The Note in the aggregate principal amount of $4,000,000 has a five-year maturity with an interest at 9% per calendar year and carries a 9% of original issue discount. The Company has agreed to make amortization payments each month in the amount of $83,033.42 in cash or in kind. The Note is convertible at the discretion of Generating Alpha into Common Stock at a price of $1.50. Generating Alpha may choose the alternate Conversion Price equal to 85% of the average of the three lowest trading prices during the previous 10 trading day period ending on the latest complete trading day prior to notice of conversion. The Conversion Price is subject to full ratchet anti-dilution protections in the event that the Company issues any Common Stock at a per share price lower than the conversion price then in effect, provided, however, Generating Alpha shall have the sole discretion in deciding whether to utilize such Dilutive Price instead of the Conversion Price otherwise in effect at the time of the respective conversion. In the event of an Event of Default, the Conversion Price shall be equal to 70% percent multiplied by the lower of (i) the lowest intraday trading price in the 40 trading days prior to the applicable Conversion Date or (ii) the lowest closing bid price in the 40 trading days prior to the applicable Conversion Date. Pursuant to the SPA, the issuance of the Notes and the Warrants shall occur at two closings. The Warrant to be issued at the First Closing shall be a Warrant for 1,514,073 shares of Common Stock and shall have an exercise price of $1.78 per share of Common Stock. The Warrant to be issued at the Second Closing shall be a Warrant for 1,514,073 shares of Common Stock and shall have an exercise price of $0.001 per share of Common Stock. Subject to the terms and conditions set forth in the SPA, the First Closing shall occur on the first business day following the receipt of the Shareholder Approval, and the Second Closing shall occur 35 business days following the date that the Registration Statement has been declared effective by the Securities and Exchange Commission. Pursuant to the Registration Rights Agreement, the Company is required to file a registration statement with the SEC five days following the date that the Shareholder Approval has been obtained, and go effective no later than the 60th calendar day following the filing date, provided, however, that in the event the Company is notified by the SEC that the Registration Statement will not be reviewed or is no longer subject to further review and comments, the effectiveness date as to such Registration Statement shall be the fifth trading day following the date on which the Company is so notified if such date precedes the dates otherwise required above. About Grom Social Enterprises Inc. Boca Raton, Florida-based Grom Social Enterprises, Inc. -- https://www.gromsocial.com -- is a media, technology and entertainment company focused on delivering content to children under the age of 13 years in a safe secure Children's Online Privacy Protection Act ("COPPA") compliant platform that can be monitored by parents or guardians. Grom Social reported a net loss of $16.77 million for the year ended Dec. 31, 2022, compared to a net loss of $10.22 million for the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had $24.64 million in total assets, $4.30 million in total liabilities, and $20.35 million in total stockholders' equity. Somerset, New Jersey-based Rosenberg Rich Baker Berman, P.A., the Company's auditor since 2022, issued a "going concern" qualification in its report dated April 17, 2023, citing that the Company's significant operating losses and negative cash flows from operations raise substantial doubt about its ability to continue as a going concern GROUNDSWELL MMA: Seeks to Tap Whiteford Taylor & Preston as Counsel ------------------------------------------------------------------- Groundswell MMA, LLC seeks approval from the U.S. Bankruptcy Court for the District of Maryland to employ Whiteford Taylor & Preston, LLP as its legal counsel. The Debtor requires legal counsel to: (a) give advice with respect to the powers and duties of the Debtor in the operation of its business; (b) represent the Debtor in defense of any proceedings instituted to reclaim property or to obtain relief from the automatic stay under Section 362(a) of the Bankruptcy Code; (c) prepare legal papers and appear in proceedings instituted by or against the Debtor; (d) assist the Debtor with any sale of its assets under Section 363 of the Bankruptcy Code; (e) assist the Debtor in the preparation of schedules, statement of financial affairs, and any amendments thereto which it may be required to file in this Chapter 11 case; (f) assist the Debtor in the preparation of a Chapter 11 plan that complies with the provisions of Subchapter V; (g) prosecute affirmative cases on behalf of the Debtor seeking the recovery of any assets; (h) assist the Debtor with other legal matters; and (i) perform other necessary legal services. The Debtor paid Whiteford a retainer of $27,500 for its pre-bankruptcy services and a $10,859.10 retainer for post-petition services. The hourly rates of the firm's counsel and staff are as follows: Dennis J. Shaffer, Senior Counsel $630 Alexandra DiSimone, Associate $396 Kathleen McCruden, Paralegal $373.50 Partners and Of Counsel $510 - $780 Associates $350 - $470 Legal Assistants/Paralegals $365 - $415 In addition, the firm will seek reimbursement for expenses incurred. Dennis Shaffer, Esq., a senior counsel at Whiteford, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Dennis J. Shaffer, Esq. Whiteford Taylor & Preston, LLP 7 St. Paul Street, Suite 1500 Baltimore, MD 21202 Telephone: (410) 347-8700 Facsimile: (410) 223-4337 Email: dshaffer@whitefordlaw.com About Groundswell MMA Groundswell MMA, LLC filed Chapter 11 petition (Bankr. D. Md. Case No. 23-17981) on Nov. 3, 2023, with as much as $1 million in both assets and liabilities. Zachary Davis, member, signed the petition. Judge Lori S. Simpson oversees the case. Dennis J. Shaffer, Esq., at Whiteford Taylor & Preston, LLP serves as the Debtor's legal counsel. GRUN PROPERTIES: Taps Marcus, Clegg, Bals & Rosenthal as Counsel ---------------------------------------------------------------- Grun Properties LLC seeks approval from the U.S. Bankruptcy Court for the District of Maine to employ the law firm of Marcus, Clegg, Bals & Rosenthal, PA as its general bankruptcy counsel. The firm's services include: (a) preparation and filing of schedules, statement of financial affairs, amendments to the foregoing, and all other documents and pleadings required by this court, the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure and the Local Rules of this court; (b) representation of the Debtor at the first meeting of creditors and responses to individual creditor inquiries; (d) representation of the Debtor in connection with debtor-in-possession financing, refinancing of existing secured debt, and the disposition of any of its assets; (e) development of the Debtor's plan of reorganization, analysis of the feasibility of any such plan, drafting, filing and negotiation of the plan and confirmation of the plan; (f) review and evaluation of the Debtor's executory contracts, and representation of the Debtor with respect to any motions to assume or reject such contracts; (g) representation of the Debtor in connection with any adversary proceedings or automatic stay litigation which may be commenced in these proceedings; (h) analysis of the Debtor's cash flow and business operations, advice regarding its responsibilities as a debtor in possession and its post-petition financial operations, negotiation of any borrowing and/or cash collateral stipulations which may be required, furnishing of financial information to the United States Trustee's Office and to any committee appointed pursuant to Section 1102 of the code; (i) review and analysis of various claims of the Debtor's creditors, secured, unsecured, and priority, and the treatment of such claims; (j) representation of the Debtor regarding post-confirmation operations and consummation of any plan of reorganization; (k) representation of and advice to the Debtor with respect to general business law issues; and (l) general representation of the Debtor during these bankruptcy proceedings. As of the petition date, the firm held a retainer in the amount of $2,500. The retainer shall be increased to a total of $17,500. George Marcus, Esq., an attorney at Marcus, Clegg, Bals & Rosenthal, disclosed in a court filing that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: George J. Marcus, Esq. Marcus, Clegg, Bals & Rosenthal, PA 16 Middle Street, Unit 501 Portland, ME 04101 Telephone: (207) 828-8000 Email: bankruptcy@marcusclegg.com About Grun Properties Grun Properties, LLC, a company in Cumberland Center, Maine, filed Chapter 11 petition (Bankr. D. Maine. Case No. 23-20234) on Nov. 7, 2023, with up to $10 million in both assets and liabilities. Marlene Eaton, sole member and manager, signed the petition. Judge Peter G. Cary oversees the case. George J. Marcus, Esq., at Marcus, Clegg, Bals & Rosenthal, PA serves as the Debtor's legal counsel. HAVRE EAGLES: NCP Says Plan Disclosures Insufficient ---------------------------------------------------- NCP East, LLC ("NCP") objects to Havre Eagles Manor's Disclosure Statement dated October 18, 2023. The Debtor's Disclosure Statement does not provide sufficient information that would enable NCP and other creditors to make an informed decision on whether to accept the plan and fails to conform to the requirements of 11 U.S.C. Sec. 1125 and 1129. The deficiencies identified by NCP as the primary grounds for denial of the approval of the Disclosure Statement are as follows: * The Disclosure Statement does not adequately describe the plan of liquidation with sufficient detail to allow creditors to make an informed decision. * The Disclosure Statement inaccurately states the amount due and owing NCP. * The Disclosure Statement does not adequately explain the "existence, likelihood, and possible success of non-bankruptcy litigation." The Disclosure Statement references allegations against NCP that have already been adjudicated at the state court level. * The Disclosure Statement lists both Harmon Properties and NCP as secured creditors, but it is unclear as to liquidation priority as between the two secured creditors. NCP holds a prior and senior lien as to Harmon Properties and should be paid out of proceeds from liquidation before Harmon Properties shares in any proceeds. The Disclosure Statement appears to suggest that Harmon Properties will be paid first, which is improper. * The Disclosure Statement indicates that the Debtor believes unsecured creditors will receive up to 100% of their claims if the property sells at its value, but the value of the property is listed at $1,750,000.00, and NCP's claim is in excess of $2,000,000.00. Creditors cannot reconcile the discrepancy. NCP incorporates and adopts the grounds set forth in the United States Trustee's Objection to the Debtor's Disclosure Statement filed herein. Attorneys for NCP East, LLC: Lindy M. Lauder, Esq. CROWLEY FLECK PLLP 305 S. 4th St. East, Suite 100 P.O. Box 7099 Missoula, MT 59801 Tel: (406) 523 3600 E-mail: llauder@crowleyfleck.com -and- Allison Dubs, Esq. CROWLEY FLECK PLLP 490 N. 31st St., Ste. 500 P.O. Box 2529 Billings, MT 59103-2529 Tel: (406) 252-7315 E-mail: adubs@crowleyfleck.com About Havre Eagles Manor Havre Eagles Manor is engaged in the business of operating an adult independent living facility in Havre, Hill County, Montana. On June 20, 2023, Havre Eagles Manor commenced a voluntary reorganization proceeding by the filing of a voluntary petition under Chapter 11 of the United States Bankruptcy Code (Bankr. D. Mont. Case No. 23-40044). The Debtor is represented by Gary S. Deschenes, Esq. HAWAIIAN HOLDINGS: Vanguard Group Reports 5.18% Equity Stake ------------------------------------------------------------ Vanguard Group Inc. filed Amendment No. 11 to its Schedule 13G to update about its ownership of Hawaiian Holdings, Inc.'s Common Stock as of October 31, 2023, pursuant to Rule 13d-1(b) under the Securities Exchange Act of 1934. The Vanguard Group reported beneficially owning an aggregate of 2,676,178 shares, equivalent to 5.18% of Hawaiian Holdings' Common Stock. Vanguard Group Inc. may be reached at: Vanguard Group Inc. 100 Vanguard Blvd. Malvern, PA 19355 A full-text copy of the Report is available at https://tinyurl.com/5cnj99ja About Hawaiian Holdings Headquartered in Honolulu, Hawaii, Hawaiian Holdings, Inc. provides transportation services. As of September 30, 2023, Hawaiian Holdings has $3,923,260 in total assets and $3,744,502 in total liabilities. Egan-Jones Ratings Company on August 15, 2023, maintained its 'CCC-' foreign currency and local currency senior unsecured ratings on debt issued by Hawaiian Holdings, Inc. As reported by the TCR on Oct. 18, 2023, Fitch Ratings has revised the Rating Outlook for Hawaiian Holdings, Inc. and Hawaiian Airlines, Inc. to Negative from Stable and has affirmed both entities' IDRs at 'B-'. In addition, Fitch has affirmed the Hawaiian Brand Intellectual Property, Ltd's, and Hawaiian Miles Loyalty, Ltd's senior secured debt at 'B+'/'RR2′. The Negative Outlook is driven by Fitch's expectation for weaker coverage and liquidity levels in the near to intermediate term. This is due to a delayed recovery in profitability driven by continued heavy competition that has been exacerbated by recent maintenance issues with Pratt and Whitney's geared turbo fan (GTF) engines. HERTZ CORP: Fitch Lowers Rating on $500MM Term Loan to 'B-' ------------------------------------------------------------ Fitch Ratings has assigned a final rating of 'BB'/'RR1' to the upsized $500 million senior secured term loan issued by The Hertz Corporation (Hertz). Concurrently, Fitch has downgraded the senior unsecured debt rating to 'B-'/'RR5' from 'B'/'RR4'. The final rating on the senior secured term loan aligns with the expected rating Fitch assigned on Nov. 7, 2023. KEY RATING DRIVERS Hertz's senior secured term loan is rated three notches above its Long-Term Issuer Default Rating (IDR) of 'B' reflecting strong collateral coverage and outstanding recovery prospects in a stress scenario. Proceeds from the secured issuance are expected to be used for general corporate purposes, including paying down outstanding revolving credit facilities. The downgrade of the senior unsecured debt rating to one notch below the IDR reflects Fitch's expectation for weaker recovery prospects for unsecured debt holders in a stress scenario following the senior secured term loan issuance, which increased Hertz's asset encumbrance. Hertz's ratings remain supported by its established market position and well-recognized global franchise within the car rental industry, solid operating performance driven by still favorable industry dynamics, including strong travel demand, still elevated used car prices underpinning vehicle disposal gains, and an adequate liquidity profile. Rating constraints include elevated leverage, the business model's sensitivity to global travel volumes, vehicle supply-demand dynamics, and higher interest rates, which expose the company to heightened residual value risk. Hertz's ratings are also constrained by expected earnings variability across market cycles, which can have a meaningful impact on cash flow leverage metrics, the continued reliance on secured, wholesale funding sources and relatively high funding costs. The Negative Rating Outlook reflects the recent and expected increase in Hertz's cash flow leverage (corporate debt plus operating lease liabilities to adjusted corporate EBITDA) resulting from deteriorating profitability due to higher-than-expected direct operating expenses in 3Q23, including elevated collision repair costs of its electric vehicles (EV), and the increase in debt resulting from the secured term loan transaction. Failure to reduce and sustain leverage below 4x over the Outlook horizon could result in a one-notch downgrade. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Failure to reduce and sustain Fitch-calculated leverage at 4x or below over the Outlook horizon; - A sustained reduction in interest coverage to 3x or below; - Inability to maintain sufficient liquidity to meet operational needs and service debt; - Inability to maintain economic access to the capital markets through market cycles; - Failure to execute on the stated strategies leading to a significant deterioration of vehicle economics and profitability; - A degradation in the company's competitive position including inability to adapt to changes in the mobility industry, a significant weakening in franchise strength particularly arising from a decline in customer loyalty and/or increased reputational risk associated with legal disputes, among other non-financial risks. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade A revision of the Rating Outlook to Stable could be driven by improved operating performance which contributes to a sustained reduction in cash flow leverage below 4x. Beyond that, positive rating action could arise from: - Enhanced consistency of operating performance resulting from disciplined fleet management and continued optimization of vehicle economics; - Maintenance of Fitch-calculated leverage below 2x; - Maintenance of corporate interest coverage above 6x on a sustained basis; - Maintenance of an adequate liquidity profile to support capital expenditures and debt servicing needs. DEBT AND OTHER INSTRUMENT RATINGS: KEY RATING DRIVERS The senior secured debt rating is three notches above the Long-Term IDR and reflects Fitch's view of outstanding recovery prospects under a stress scenario given the available collateral. The senior unsecured debt rating is one notch below the Long-Term IDR, reflecting below-average recovery prospects under a stress scenario, given the structural subordination resulting from the heavily secured funding mix. DEBT AND OTHER INSTRUMENT RATINGS: RATING SENSITIVITIES The senior secured debt and senior unsecured debt ratings are primarily sensitive to changes in Hertz's Long-Term IDR and, secondarily, to the relative recovery prospects of the instruments. ADJUSTMENTS The Standalone Credit Profile has been assigned below the implied Standalone Credit Profile due to the following adjustment reasons: Weakest Link - Capitalisation & Leverage (negative), Weakest Link - Funding, Liquidity & Coverage (negative). The Sector Risk Operating Environment score has been assigned below the implied score due to the following adjustment reasons: Business model (negative), Regulatory and legal framework (negative). The Earnings & Profitability score has been assigned below the implied score due to the following adjustment reasons: Earnings stability (negative), Historical and future metrics (negative). The Funding, Liquidity & Coverage score has been assigned below the implied score due to the following adjustment reasons: Historical and future metrics (negative), Funding flexibility (negative). 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 ----------- ------ -------- ----- Hertz Corporation (The) senior unsecured LT B- Downgrade RR5 B senior secured LT BB New Rating RR1 BB(EXP) HEYWOOD HEALTHCARE: Committee Taps Dentons as Bankruptcy Counsel ---------------------------------------------------------------- The official committee of unsecured creditors appointed in the Chapter 11 cases of Heywood Healthcare, Inc. and its affiliates seeks approval from the U.S. Bankruptcy Court for the District of Massachusetts to employ Dentons Bingham Greenebaum, LLP and Dentons US, LLP. The committee requires legal counsel to: (a) give advice with respect to the powers and duties of the committee in the Debtors' cases; (b) assist and advise the committee in its consultations with the Debtors relating to the administration of the cases; (c) assist the committee in analyzing the claims of creditors and the Debtors' capital structure, and in negotiating with the holders of claims and, if appropriate, equity interests; (d) assist in the committee's investigation of the Debtors' acts, conduct, assets, liabilities and financial condition and other parties involved in the operation of their business; (e) assist the committee in its analysis of, and negotiations with the Debtors or any other third-party concerning matters related to, among other things, the assumption or rejection of certain leases of non-residential real property and executory contracts, asset dispositions, financing transactions and the terms of a plan of reorganization or liquidation for the Debtors; (f) assist and advise the committee as to its communications, if any, to the general creditor body regarding significant matters in these cases; (g) represent the committee at all hearings and other proceedings; (h) review, analyze, and advise the committee with respect to applications, orders, statements of operations and schedules filed with the court; (i) assist the committee in preparing pleadings and applications as may be necessary in furtherance of its interests and objectives; and (j) perform such other services as may be required and are deemed to be in the interests of the committee. During the 90-day period prior to the petition date, Dentons received payments and advances in the aggregate amount of $40,000. The hourly rates of Dentons' counsel and staff are as follows: Partners $600 - $900 Associates $380 - $550 Paraprofessionals $250 - $350 In addition, Dentons will seek reimbursement for expenses incurred. Andrew Helman, Esq., a partner at Dentons Bingham Greenebaum, disclosed in a court filing that the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Andrew C. Helman, Esq. Dentons Bingham Greenebaum LLP One Beacon Street, Suite 25300 Boston, MA 02108 Telephone: (207) 619-0919 Email: andrew.helman@dentons.com - and - Sam J. Alberts, Esq. Dentons US LLP 1900 K Street NW Washington, DC 20006 Telephone: (202) 408-7004 Email: sam.alberts@dentons.com About Heywood Healthcare Heywood Healthcare, Inc. is a non-profit community-owned hospital in Gardner, Mass. Heywood Healthcare and its affiliates filed Chapter 11 petitions (Bankr. D. Mass. Lead Case No. 23-40817) on Oct. 1, 2023. In the petition signed by its chief executive officer, Thomas Sullivan, Heywood Healthcare disclosed up to $500,000 in assets and up to $50,000 in liabilities. Judge Elizabeth D. Katz oversees the cases. John M. Flick, Esq., at Flick Law Group, PC represents the Debtors as counsel. The U.S. Trustee for Region 1 appointed an official committee to represent unsecured creditors in the Debtors' Chapter 11 cases. The committee tapped Dentons Bingham Greenebaum, LLP and Dentons US, LLP as its legal counsel. HOWARD MIDSTREAM: Moody's Alters Outlook on 'B1' CFR to Positive ---------------------------------------------------------------- Moody's Investors Service changed Howard Midstream Energy Partners, LLC's (Howard Midstream or HMEP) rating outlook to positive from stable and upgraded the company's senior unsecured notes to B2 from B3. Concurrently, Moody's affirmed Howard Midstream's B1 Corporate Family Rating and B1-PD Probability of Default Rating. "The positive rating outlook reflects Howard Midstream's growing scale and the expectation of improving leverage metrics through 2024," commented Amol Joshi, Moody's Vice President and Senior Credit Officer. RATINGS RATIONALE Howard Midstream's positive rating outlook reflects the company's growing scale supported by organic capital investment. Moody's expects the company's EBITDA to approach $300 million, while generating meaningful free cash flow and reducing leverage through 2024. Howard Midstream's senior unsecured notes are rated B2, one notch below the company's B1 CFR, reflecting the priority claim of its secured revolving credit facility. The company has completed significant capital projects and should be able to repay its existing revolver borrowings with free cash flow. Moody's expects the company to be less reliant on secured revolver borrowings relative to the considerable amount of unsecured debt in its capital structure, resulting in the upgrade of the notes. Howard Midstream's B1 CFR reflects its diversified asset base and meaningful contracted revenue, with a mix of natural gas gathering and processing, liquids transportation and processing, and terminalling, storage and rail assets. These assets connect supply sources to attractive demand markets with a diverse customer base including producers, refiners and power generators. The company faces modest commodity price and volume risk affecting earnings, even as HMEP benefits from meaningful fee-based revenue and contracts underpinned by minimum contracted payments and acreage dedications providing cash flow and volume visibility. Howard Midstream's debt balances increased in 2023 to fund growth capital spending, but project completions including the Port Arthur Terminal expansion should benefit scale and earnings, likely leading to improving leverage metrics through 2024. The company has a stated long-term net leverage target of below 4x. Howard Midstream is challenged by its limited scale and modest track record in its current form. The company's credit profile is tempered by the inherent risks associated with discretionary yet potentially sizeable excess cash distributions to its private owner, although no equity distributions have occurred while funding its significant capital spending in 2023. The company has primary operations in several regions, and also has interests in certain joint ventures, including a 50% operating interest in the Nueva Era pipeline connecting to Monterrey, Mexico. Howard Midstream should maintain good liquidity through 2024. Howard Midstream's $1 billion revolving credit facility matures in December 2026. At September 30, HMEP had $20.7 million in cash and $62 million of revolver borrowings. Moody's expects the company to generate meaningful free cash flow through 2024 prior to any potential equity distributions. The revolving credit facility has financial covenants including maximum Total Leverage Ratio of 5x, maximum Senior Secured Leverage Ratio of 3.75x and minimum Interest Coverage Ratio of 2.5x. While these covenants will limit the company's ability to borrow a sizeable proportion of the credit facility, Moody's expect HMEP to be in compliance with these covenants through 2024. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Howard Midstream's ratings could be upgraded if the company has meaningful growth in scale and cash flow, its overall counterparty risk profile is supportive, Moody's adjusted leverage proportionately consolidated for its joint ventures remains below 4.5x, distribution coverage is sufficient, and liquidity is at least adequate. Howard Midstream's ratings could be downgraded if Moody's adjusted leverage exceeds 5.5x, its counterparty risk profile deteriorates, or liquidity weakens considerably. Howard Midstream Energy Partners, LLC, headquartered in San Antonio, Texas, is a privately owned midstream energy company with primary operations in Texas, Mexico, the Appalachian Basin and the Gulf Coast. Certain investment funds managed by affiliates of Alberta Investment Management Corporation own approximately 93% of the company's common capital units. The principal methodology used in these ratings was Midstream Energy published in February 2022. HOWARD STREET: Gets OK to Hire Kirby Aisner & Curley as Counsel --------------------------------------------------------------- Howard Street Dance Company, LLC received approval from the U.S. Bankruptcy Court for the Southern District of New York to employ the law firm of Kirby Aisner & Curley, LLP. The Debtor requires legal counsel to: (a) give advice with respect to the powers, duties and responsibilities of the Debtor in the continued management of its property and affairs; (b) negotiate with creditors of the Debtor and work out a Chapter 11 plan of reorganization and take the necessary legal steps to effectuate such a plan; (c) prepare legal papers; (d) appear before the bankruptcy court; (e) attend meetings and negotiate with representatives of creditors and other parties involved in the Debtor's Chapter 11 case; (f) advise the Debtor in connection with any potential refinancing of secured debt and any potential sale of the business and its assets; (g) represent the Debtor in connection with obtaining post-petition financing; (h) take any necessary action to obtain approval of a disclosure statement and confirmation of a plan of reorganization; and (i) perform all other legal services for the Debtor. The hourly rates of the firm's counsel and staff are as follows: Partners $475 - $575 Associates $295 - $325 Paraprofessionals/Law Clerks $150 - $200 In addition, the firm will seek reimbursement for expenses incurred. The firm received a pre-bankruptcy retainer payment in the amount of $31,738 from 6365 Fourth Avenue Corp., a third-party. Julie Cvek Curley, Esq., a partner at Kirby Aisner & Curley, disclosed in a court filing that her firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Julie Cvek Curley, Esq. Kirby Aisner & Curley LLP 700 Post Road, Suite 237 Scarsdale, NY 10583 Telephone: (914) 401-9500 Email: jcurley@kacllp.com About Howard Street Dance Company Howard Street Dance Company, LLC is engaged in activities related to real estate. The company is based in White Plains, N.Y. Howard Street Dance Company filed Chapter 11 petition (Bankr. S.D.N.Y. Case No. 23-22766) on Oct. 16, 2023, with $1 million to $10 million in assets and $500,000 to $1 million in liabilities. James McGown, managing member, signed the petition. Judge Sean H. Lane oversees the case. The Debtor tapped Julie Cvek Curley, Esq., at Kirby Aisner & Curley, LLP as its bankruptcy counsel. IAP GLOBAL: Creditor Sets Nov. 28 Sale of Assets ------------------------------------------------ Pursuant to Section 9-610 of the New York Uniform Commercial Code, the authorized agent for secured lenders to IAP Global Services LLC, IAP Worldwide Services Inc., and together with those certain guarantors ("Debtors"), intends to offer to sell, or cause to be sold, at a public sale on Nov. 28, 2023, at 10:00 a.m. (Prevailing Eastern Time), at the offices of Winston & Strawn LLP, 200 Park Avenue, New York, New York 10166, all right, title, and interest of the Debtors in, under, and to the sale assets. The sale assets may be sold in one or more lots and may be subject to inclusions or exclusions as the agent may determine. Sale assets will not include assets that are not owned by the Debtors or subject to a lien in favor of the agent, other than certain assets being made available by the Debtors directly or third-party sellers of related assets, as further set forth in the bidding procedures. The assets secured the payment of the indebtedness of borrower and guarantors to the secured lenders pursuant to the credit agreement. The public sale is subject to certain bidding procedures and any prospective bidder must enter into a confidentiality agreement to be eligible to receive any due diligence materials, the bidding procedures, or to become a qualified bidder in order to participate and bid at the public sale. Potential bidders must contact Candlewood Partners, Attn: Steve Latkovic, via email at sjl@candlewoodpartners.com to obtain the form of confidentiality agreement, the bidding procedures, and access to due diligence materials. Agent reserves the right, in its sole discretion, to cancel the public sale at any time, or to cause the public sale to be adjourned from time to time, without further notice or publication other than any announcement at or prior to the public sale. IAP Global Services LLC -- https://www.iapws.com/ -- provides logistics, facilities management, and technical services. The Company manages airfield and airspace operations, as well as offers emergency response, facilities management and maintenance, health care, IT and communications, and power solutions. INSYS THERAPEUTICS: Ex-CEO's Claims Arbitration Check Ordered ------------------------------------------------------------- Jeff Montgomery of Law360 reports that former Insys Therapeutics CEO Michael L. Babich secured a Court of Chancery order Thursday compelling arbitration of claims lodged against him by Insys' bankruptcy court liquidating trustee, rather than disposition in Chancery. About Insys Therapeutics Headquartered in Chandler, Ariz., Insys Therapeutics Inc. -- http://www.insysrx.com/-- is a specialty pharmaceutical company that develops and commercializes innovative drugs and novel drug delivery systems of therapeutic molecules that improve patients' quality of life. Using proprietary spray technology and capabilities to develop pharmaceutical cannabinoids, Insys is developing a pipeline of products intended to address unmet medical needs and the clinical shortcomings of existing commercial products. Insys is committed to developing medications for potentially treating anaphylaxis, epilepsy, Prader-Willi syndrome, opioid addiction and overdose, and other disease areas with a significant unmet need. As of March 31, 2019, Insys had $172.6 million in total assets, $336.3 million in total liabilities, and a total stockholders' deficit of $163.7 million. Insys Therapeutics and six affiliated companies filed petitions seeking relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 19-11292) on June 10, 2019. The Debtors' cases are assigned to Judge Kevin Gross. The Debtors tapped Weil, Gotshal & Manges LLP and Richards, Layton & Finger, P.A., as legal counsel; Lazard Freres & Co. LLC as investment banker; FTI Consulting, Inc. as financial advisor; and Epiq Corporate Restructuring, LLC as claims agent. Andrew Vara, acting U.S. trustee for Region 3, on June 20, 2019, appointed nine creditors to serve on an official committee of unsecured creditors in the Chapter 11 cases. Akin Gump Strauss Hauer & Feld LLP, and Bayard, P.A., serve as the Committee's attorneys; and Province, Inc., is the financial advisor. * * * Insys sold its epinephrine 7mg and 8.5mg unit-dose nasal spray products and naloxone 8mg unit-dose nasal spray products and certain equipment and liabilities to Hikma Pharmaceuticals USA Inc. for $17 million. It sold for $12.2 million to Chilion Group Holdings US, Inc., its (i) CBD formulations across current pre-clinical, clinical, third-party grants and investigator initiated study activities (including any future activities or indications), (ii) THC programs of Syndros oral dronabinol solution, and (iii) Buprenorphine products. Insys sold to BTcP Pharma, LLC for $52 million in royalty payments plus other amounts all strengths, doses and formulations in the world (except for the Republic of Korea, et al.). Insys sold to Pharmbio Korea, Inc., for $1.2 million in cash specific intellectual property, records and certain other assets related to strengths, doses and formulations of the Subsys Product in the Republic of Korea, Japan, China, Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Timor-Leste, and Vietnam. After selling substantially all of their assets, the Debtors filed a Chapter 11 Plan and Disclosure Statement. Judge Kevin Gross on Jan. 16, 2020, confirmed the Debtors' Plan of Liquidation. IRON EAGLE: Court OKs Interim Cash Collateral Access ---------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Texas, Sherman Division, authorized Iron Eagle, Inc. to use cash collateral on an interim basis in accordance with the budget. The Debtor requires the use of cash collateral to make payroll and to pay other immediate expenses to keep its doors open. A number of potential creditors have filed UCC-1's claiming a lien on the Debtor's accounts receivable and or inventory: 1. The U.S. Small Business Administration file number 20-0022897010 filed June 4, 2020. 2. Mazon Associates, Inc., file number 20-0046122310 filed on September 2, 2020. 3. Foward Financing file number 23-0031400336 filed July 18, 2023. As adequate protection for the use of cash collateral, the Secured Creditors are granted replacement liens under 11 U.S.C. Section 552, to the extent of any diminishment in the value of Secured Creditors's interest in such cash collateral, in accordance with its existing existing priority. A hearing on the matter is set for December 12, 2023 at 10 a.m. A copy of the motion is available at https://rb.gy/gztrfd from PacerMonitor.com. A copy of the order is available at https://urlcurt.com/u?l=Fsur1K from PacerMonitor.com. About Iron Eagle, Inc. Iron Eagle, Inc. sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. Tex. Case No. 23-42145) on November 8, 2023. In the petition signed by Weinlein, president, the Debtor disclosed up to $50,000 in assets and up to $10 million in liabilities. Judge Brenda T. Rhoades oversees the case. Eric Liepins, Esq. represents the Debtor as legal counsel. IRON EAGLE: Seeks to Hire Eric A. Liepins as Bankruptcy Counsel --------------------------------------------------------------- Iron Eagle Inc. seeks approval from the U.S. Bankruptcy Court for the Eastern District of Texas to employ Eric A. Liepins, PC as its bankruptcy counsel. The Debtor requires legal assistance for the purpose of orderly liquidating the assets, reorganizing the claims of the estate, and determining the validity of claims asserted in the estate. The hourly rates of the firm's counsel and staff are as follows: Eric A. Liepins $275 Paralegals and Legal Assistants $30 - $50 In addition, the firm will seek reimbursement for expenses incurred. The firm received a retainer of $5,000, plus filing fee. Mr. Liepins, the sole shareholder of the firm, disclosed in a court filing that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Eric A. Liepins, Esq. Eric A. Liepins, PC 12770 Coit Road, Suite 850 Dallas, TX 75251 Telephone: (972) 991-5591 Facsimile: (972) 991-5788 Email: eric@ealpc.com About Iron Eagle Iron Eagle Inc., a company in Wylie, Texas, filed a voluntary Chapter 11 petition (Bankr. E.D. Texas Case No. 23-42145) on Nov. 8, 2023, with up to $50,000 in assets and up to $10 million in liabilities. Brandon Weinlein, president, signed the petition. Eric A. Liepins, PC serves as the Debtor's legal counsel. ISLAND ROOFING: Case Summary & 16 Unsecured Creditors ----------------------------------------------------- Debtor: Island Roofing and Restoration, LLC DBA Franks Roofing and Spraying DBA Island Roofing & Sheet Metal LLC DBA Island Services Roofing HVAC Electrical Plumbing 5570 Enterprise Pkwy Fort Myers, FL 33905 Business Description: The Debtor is a roofing contractor in Fort Myers, FL. Chapter 11 Petition Date: November 22, 2023 Court: United States Bankruptcy Court Middle District of Florida Case No.: 23-01419 Debtor's Counsel: Alberto ("Al") F. Gomez, Jr., Esq. JOHNSON, POPE, BOKOR, RUPPEL & BURNS, LLP 401 East Jackson Street #3100 Tampa, FL 33602 Tel: 813-225-2500 Estimated Assets: $10 million to $50 million Estimated Liabilities: $1 million to $10 million The petition was signed by Jason Martin as manager. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/SW6CQRA/Island_Roofing_and_Restoration__flmbke-23-01419__0001.0.pdf?mcid=tGE4TAMA List of Debtor's 16 Unsecured Creditors: Entity Nature of Claim Claim Amount 1. ABC Supply Co Inc. $806,196 PO Box 742067 Atlanta, GA 30374-2067 2. First Florida Credit Card $34,940 Integrity Bank PO Box 71205 Charlotte, NC 28272-1205 3. Jason and Joshua Martin Shareholder $645,417 5570 Enterprise Pkwy Note Fort Myers, FL 33905 4. Mesh Pay US, Inc. Credit Card $795,356 26 Broadway New York, NY 10004 5. Michael F. Larkin $0 Deborah J. Larkin 8012 Princeton Dr. Naples, FL 34104 6. NB Handy $6,860 4550 Home Run Blvd, Ste 400 Davenport, FL 33837 7. NRG2 LLC Lawsuit $0 2125 April Lane Guthrie, OK 73044 8. PMB Holdings LLC Lawsuit $0 11153 Lakeland Cir Fort Myers, FL 33913 9. Reliant Public Lawsuit $0 Adjusters LLC 2338 Immokalee Rd #185 Naples, FL 34110 10. Reliant Public Insurance Lawsuit $0 Adjusters, Inc. 2338 Immokalee Rd #185 Naples, FL 34110 11. Sims Crane & Equipment Co $34,109 1219 US Hwy N 301 Tampa, FL 33619 12. SPEC Building Mat. Corp $6,518 2840 Roe Lane Kansas City, KS 66103 13. Spectra Gutter Systems $27,029 2081 Beacon Manor Dr Fort Myers, FL 33907 14. Sunniland Corporation $83,663 PO Box 8001 Sanford, FL 32772-8001 15. Thomas Caffrey Lawsuit $0 c/o Tom J. Manos Manos Schenk PL 1395 Brickell Ave 8th FL Miami, FL 33131 16. Wex Bank $15,707 PO Box 6293 Carol Stream, IL 60197-6293 JETBLUE AIRWAYS: Fitch Lowers LongTerm IDR to B+, Outlook Negative ------------------------------------------------------------------ Fitch Ratings has downgraded JetBlue Airways Corporation's Long-Term Issuer Default Rating (IDR) to 'B+' from 'BB-'. The Rating Outlook remains Negative. Fitch has affirmed the ratings on JetBlue Airways Pass Through Trust Certificates, series 2019-1 and 2020-1 and has also affirmed JetBlue's secured revolving credit facility at 'BB+'/'RR1' The downgrade reflects Fitch's expectation that JetBlue's profitability in 2023 and 2024 will be materially lower than the agency's prior forecast, resulting in credit metrics that remain outside of levels supportive of the 'BB-' rating. The company faces several near-term challenges that have driven weaker than expected results through the first nine months of the year. Though Fitch expects some improvement in 2024, margins will likely remain under pressure, leading to additional borrowing and elevated leverage. Fitch expects JetBlue's EBITDAR leverage to end 2023 above 8x, gradually declining toward 5x through the forecast period. The Negative Rating Outlook incorporates pressures driven by JetBlue's pending acquisition of Spirit as well as uncertainties around the timing and recovery of JetBlue's standalone credit profile. The 'B+' rating remains supported by the company's favorable fleet mix, as well as network and routes, that should lead to improving operating margins. Another consideration is JetBlue's liquidity and capacity to raise additional funds if necessary as it manages through a period of weak profitability. Enhanced Equipment Trust Certificate (EETC) Ratings Fitch has affirmed JetBlue's 2019-1 Class AA certificates at 'A+' and affirmed its Class A certificates at 'BBB'. The class AA certificates remain well overcollateralized, while the rating of the Class As reflects limited LTV headroom under the 'BBB' stress scenario and slow rate of amortization in the transaction, making the rating susceptible to marginal value declines. Fitch has also affirmed JetBlue's 2020- 1 Class A certificates at 'A'. These ratings are supported by sufficient overcollateralization and quality of collateral. The affirmation of the subordinated tranche ratings of the 2019-1 and 2020-1 transactions are driven by strong affirmation and presence of a liquidity facility. The affirmed class B certificate ratings of the 2019-1 and 2020-1 transactions are driven by an additional affirmation notch available once issuers reach the 'B' category. As a result, the total notching from the IDR is +4, up from +3 in the previous review. Fitch has chosen not to assign recovery notching on the 2020-1 Class B Certificates, despite the transaction's solid expected stress scenario recovery. This is due to qualitative weaknesses surrounding the parent company, particularly tied to potential event risk regarding its proposed merger with Spirit. KEY RATING DRIVERS Profit Performance Drags on Credit Metrics: Fitch expects JetBlue's profit margins to remain well below historical averages at least through 2024 driven by a number of near-term headwinds. JetBlue is faced with outsized impacts from air traffic control delays due to its concentration in the Northeast and pressures from industry capacity that is outpacing demand, particularly in off-peak periods. The wind down of JetBlue's alliance with American airlines and softness in off-peak flying in domestic markets are also creating a drag. As such, Fitch has revised its base case forecast for JetBlue and the agency now expects the company to generate modestly negative operating margins in 2023 and neutral to slightly positive margins in 2024. Weaker profits will drive the company's gross leverage above 8x this year with modest improvement in 2024, which is outside of Fitch's prior downgrade sensitivity. Fitch expects margins to improve over time. The retirement of JetBlue's E-190s and integration of more efficient A220s and A321s will be beneficial. Air traffic control delays should also normalize over time, though it may take several years. Various airlines have also begun to moderate capacity plans for 2024, which should support unit revenues. Positives are partly offset by continued pressure on costs, including Pratt & Whitney engine availability issues, which will limit JetBlue's capacity growth. Fitch's forecast includes improving operating margins through the forecast period, though Fitch expects profitability to remain below pre-pandemic levels. Capital Spending to Pressure Cash flow: JetBlue is scheduled to take delivery of a substantial number of aircraft in the next two years, driving elevated capex and pressuring cash flow. Fitch expects FCF as a percent of revenue to be negative in the low double digit to mid-teens range in 2024 and potentially negative in the high single digits in 2025. Fitch's prior forecast included negative FCF through the next several years, but the magnitude of the outflows has increased in its revised view. Cash outflows will necessitate more meaningful borrowing against future deliveries to maintain adequate liquidity and will pressure leverage metrics over the next several years. Fitch anticipates that JetBlue could defer deliveries if necessary, particularly given current production constraints faced by Airbus. JetBlue is scheduled to take delivery of 43 aircraft in 2024 and 35 in 2025, though deliveries will likely slip based on manufacturer delays. Unencumbered Assets Support Financial Flexibility: Fitch believes that JetBlue has better financial flexibility than lower rated peers, which supports the 'B+' rating. The company expects to end the year with around 50 fully unencumbered aircraft that are readily financeable. JetBlue also has a $3.5 billion bridge facility in place to fund its acquisition of Spirit. Should the acquisition fall through, those assets, including its loyalty program, certain aircraft, engines and slots, gates and routes would become unencumbered and would provide additional contingent liquidity. JetBlue's asset base puts it in a better position than competitors like Spirit or Hawaiian that have more limited assets to borrow against. Should the Spirit acquisition be approved, JetBlue is likely to fund the transaction with debt issued against some but not all of the assets securing the bridge facility, leaving the company with more limited options for future debt raises, which Fitch will factor in the rating of the combined companies. Spirit Acquisition a Concern: In addition to the leveraging nature of JetBlue's purchase of Spirit Airlines, integration will pose a risk over the near term. Airline integrations have historically proven to be complex and costly. Combining IT systems, labor groups and networks while reconfiguring aircraft all pose logistical challenges. These challenges are heightened by other near-term headwinds (weak profitability at Spirit, engine availability issues, ATC shortages, etc.). While Fitch expects air traffic demand to remain healthy over the forecast period, a slowdown in the midst of the JetBlue/Spirit acquisition could create further risks. Should demand falter or operating issues persist for longer than anticipated, the combined companies could be in a position where acquisition-related debt further pressures credit metrics. EETC Ratings Senior Tranche Ratings The ratings on the class AA and A certificates are driven by a top-down analysis incorporating a series of stress tests that simulate the rejection and repossession of the aircraft in a severe aviation downturn. Fitch notes that given the one notch downgrade to JetBlue's IDR from the 'BB' category to the 'B' category, Fitch now applies its LTV stresses one year in the future (as opposed to two years in the last review). This changed assumption affects the change in LTVs period-over-period slightly negatively, even though updated depreciation rates were in line with Fitch's expectations. 2019-1 Fitch has affirmed the JetBlue 2019-1 class A certificates at 'BBB' due to limited loan-to-value (LTV) headroom under the 'BBB' stress scenario. Maximum LTVs stayed relatively flat since Fitch's last review in September, increasing to 96.7% from 96.3%, as the 25 2017-2018 A321s value depreciation was in line with Fitch's assumptions. The collateral in the pool is still seen as highly attractive; however, the low diversification and slow amortization profile make the transaction's LTVs susceptible to marginal value declines. Fitch has affirmed JetBlue's 2019-1 Class AA certificates at 'A+' due to a large amount of overcollateralization. The class AA certificates saw LTVs stay relatively flat, decreasing to 80.9% from 80.6% under the A level stress scenario. The large buffer in LTVs helps mitigate concerns related to slow amortization and diversification mentioned above. 2020-1 Fitch has affirmed the ratings on JetBlue's 2020-1 transaction at 'A', as the transaction continues to pass the A level stress scenario with sufficient headroom. Fitch calculated the maximum loan-to-value (LTV) for the class A certificates transaction to be 91.0%, up from 89.5%. Collateral declines for the pool's 17 A321s and 7 A321 NEOs were within Fitch's updated depreciation assumptions. Unlike the 2019- 1 transaction, Fitch expects collateralization to improve over the next several years as the transaction's pace of amortization increases. Subordinate Tranche Ratings The rating for the class B certificates is based on the bottom-up approach detailed in Fitch's EETC criteria, which calls for the rating to be notched up from JetBlue's corporate rating of 'B+'. Subordinated tranches receive notching uplift based on three factors: 1) the affirmation factor (0-3 notches) 2) the presence of a liquidity facility, (0-1 notch) and 3) recovery prospects (0- 1 notch). The class B certificates qualify for a four-notch uplift to 'BBB-' from JetBlue's IDR of 'B+'. The notching consists of +3 notches for the affirmation factor (maximum is +3 for a 'B' category issuer) and +1 notch for the presence of a liquidity facility. Affirmation Factor 2020-1: Fitch continues to view the 2020-1 transaction as having a high affirmation supported by the large portion of JetBlue's active fleet contained in the pool, the high-quality collateral including next gen NEO and work-horse CEO aircraft important to the company's strategy, and a relatively young collateral pool. Partially offsetting these positive factors is the pool's low diversification as it relates to comparable transactions. 2019-1: Fitch considers the affirmation factor for this pool of aircraft to be high. The 25 aircraft in this transaction make up nearly 40% of JetBlue's sub-fleet of A321s (it operated 63 A321s in total as of September 2023), and about 9% of its total fleet, making it highly unlikely that the aircraft in this pool would be rejected in the case of a bankruptcy. The A321 has taken a key role in JetBlue's fleet since the carrier started operating it in 2013. A321s now make up almost a quarter of JetBlue's fleet by number of aircraft, and they are essential to the carrier's transcontinental operations and to its operations in slot-constrained JFK airport. DERIVATION SUMMARY JetBlue's 'B+' rating is one notch above Spirit Airlines, Inc. (B/Negative) and in line with United Airlines, Inc. and American Airlines, Inc. (B+/Stable). Compared with the network carriers, JetBlue has a relatively low cost structure, and domestic/leisure focus which may prove more stable in a downturn compared to long-haul international markets. However, Fitch views JetBlue as having limited headroom at the 'B+' level, whereas United and American are on improving trajectories. Gross leverage metrics for JetBlue are expected to be above both United and American in the near term driven by JetBlue's weaker profit metrics in 2023. JetBlue maintains a stronger balance sheet than Spirit, and has historically operated with more conservative financial policies. This is partly offset by Spirit's low cost base, though in the near term, operational issues at Spirit limit the benefits of its low-cost operating model. JetBlue's network and route diversification still lag behind the big four U.S. carriers, but have strengthened as the carrier has continued to grow. The company has built a more defensible network with a leading market share in each of its three main focus cities (BOS, JFK and FLL). JetBlue also offers a compelling product compared with competitors with its relatively generous leg room and in-flight offerings. EETC Ratings The certificates rated 'A+' are one notch higher than ratings for several class A certificates issued by other carriers. Stress scenario LTVs for the 2019-1 transaction remain low and continue to support the 'A+' rating. The 2020-1 class A certificates that are rated 'A' compare well with issuances from American, Air Canada and British Airways Plc that are also rated 'A'. Rating similarities are driven by similar levels of overcollateralization and high-quality pools of collateral. The 'BBB' ratings on the class B certificates are derived through a four-notch uplift from JetBlue's IDR. The four-notch uplift reflects a high affirmation factor, benefit of a liquidity facility and no benefit for recovery expectations. KEY ASSUMPTIONS Key Assumptions in Fitch's Ratings Case Include: - JetBlue's capacity growth is limited to the low single digits in 2024; - Modest unit revenue improvement in 2024 driven in part by slower capacity growth and prioritization of more profitable routes; - Jet Fuel around $3.05 for 2023, declining modestly thereafter; - Capex in line with management's forecast; - Fitch assumes that JetBlue uses debt financing for the bulk of its capital spending. RECOVERY ANALYSIS KEY RECOVERY RATING ASSUMPTIONS The recovery analysis assumes that JetBlue would be reorganized as a going concern in bankruptcy rather than liquidated. Fitch has assumed a 10% administrative claim Going-Concern (GC) Approach The GC EBITDA estimate of $1,050 million reflects Fitch's view of a sustainable, post-reorganization EBITDA level upon which Fitch bases the enterprise valuation. The GC EBITDA assumption above LTM levels but below what Fitch expects JBLU to generate beyond year three in its forecast. Fitch's recovery scenario envisions JetBlue experiencing financial distress due to a leveraged capital structure in the midst of a sharp industry downturn. Post restructuring EBITDA reflects a scenario where airline operating margins are structurally lower than pre-pandemic levels, potentially due to a combination of higher fuel prices, increasing competition, or weakening levels of demand. Although the GC EBITDA figure is above LTM numbers, Fitch views the estimate as appropriate, as it represents a modest margin compared to historical results. Prior to the pandemic, JetBlue generated EBITDA margins in the mid-teens, whereas the GC estimate used in Fitch's analysis is more in-line with an approximately 10% post-exit margin expectation. Historical bankruptcy case study exit multiples for peer companies ranged from 3.1x to 6.8x. Fitch assumes a 5x enterprise value (EV) multiple. The middle to low of the range is supported by JetBlue's growth trajectory offset by industry volatility inherent for the airlines. The secured credit facility results in a Recovery Rating of 'RR1' with a WGRC in the 91%-100% range. RATING SENSITIVITIES Factors that could, individually or collectively, lead to an Outlook Stabilization: - Demonstrated ability to manage revenue per available seat mile ahead of cost per available seat mile, leading EBITDAR margins to the mid-teens or higher. Factors that could, individually or collectively, lead to positive rating action/upgrade: - EBIT margins improving to the high single digits; - Adjusted debt/EBITDAR sustained below 4.0x; - EBITDAR fixed-charge coverage remaining above 2.5x. Factors that could, individually or collectively, lead to negative rating action/downgrade: - Completion of the acquisition in a manner leading credit metrics to remain outside levels commensurate with the current rating; - Sustained adjusted debt/EBITDAR above 5.0x; - EBITDAR fixed-charge coverage falling below 2.0x on a sustained basis; - Evidence of decreasing financial flexibility potentially illustrated by continued leveraging of assets to maintain liquidity. EETC Sensitivities The class AA and A certificate ratings are primarily based on a top-down analysis based on the value of the collateral. Therefore, a negative rating action could be driven by an unexpected decline in collateral values. Senior tranche ratings could also be affected by a perceived change in the affirmation factor or deterioration in the underlying airline credit. The 2019-1 class A certificates are more susceptible to collateral value fluctuations due to a less aggressive amortization profile relative to the other transactions. Positive rating actions are not expected for these transactions in the near term, driven by current collateral coverage and limited LTV headroom under the 'BBB' stress scenario for the 2019-1 Class A's. Subordinated tranche ratings are based off of the underlying airline IDR. If JetBlue's IDR is downgraded to 'B' from B+, the class B certificates could be notched downward but have the potential to be affirmed if additional notching was ultimately applied for solid recovery prospects. In the event the proposed merger with Spirit closes, the subordinated tranche ratings could be negatively affected, as the collateral pool would make up a lower percentage of the combined company's overall fleet, which may imply a lower affirmation factor. Subordinate tranches are sensitive to recovery expectations in a stress scenario. LIQUIDITY AND DEBT STRUCTURE Sufficient Stand-Alone Liquidity: As of Sept. 30, 2023, JetBlue had a cash and cash equivalents balance of $973 million and short-term investment securities of $409 million, equaling 14% of LTM revenue. Total liquidity, including JetBlue's $600 million undrawn revolver, is equivalent to 20% of LTM revenue. The company reports that it will bring in an additional $400 million in cash in the fourth quarter by financing previously unencumbered aircraft. Liquidity remains comfortable but is roughly back at pre-pandemic levels. Conversely, JetBlue held materially higher amounts of liquidity through the pandemic at levels that provided significant downside protection. Cash declined through 2022 and 2023 due to a combination of negative FCF, exacerbated by weaker than expected financial margins, debt repayment, and a $297 million prepayment for the Spirit acquisition. Upcoming debt maturities are manageable given JetBlue's current liquidity balance and the financeability of the bulk of the company's upcoming capital spending commitments. Maturities total $87 million for the remainder of 2023, $265 million in 2024 and $234 million in 2025. Maturities step up in 2026 when the company's $740 million convertible notes come due. EETC JBLU 2020-1 Both tranches of debt in this transaction feature a dedicated liquidity facility provided by Natixis (Fitch rated A/F1/Stable). JBLU 2019-1 All three tranches of debt in this transaction feature a dedicated liquidity facility provided by Credit Agricole (Fitch rated A+/F1/Stable) ISSUER PROFILE JetBlue is a low-cost carrier that serves over 100 destinations throughout the United States, Caribbean, and Latin America. 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 ----------- ------ -------- ----- JetBlue Airways Corporation LT IDR B+ Downgrade BB- senior secured LT BB+ Affirmed RR1 BB+ JetBlue Airways Pass Through Trust Series 2019-1 senior secured LT A+ Affirmed A+ senior secured LT BBB Affirmed BBB senior secured LT BBB- Affirmed BBB- JetBlue Airways Pass Through Trust Series 2020-1 senior secured LT A Affirmed A senior secured LT BBB- Affirmed BBB- JUICE ROLL UPZ: Seeks Approval to Hire Northstar as Bookkeeper -------------------------------------------------------------- Juice Roll Upz, Inc. seeks approval from the U.S. Bankruptcy Court for the Central District of California to employ Northstar LLC, doing business as Northstar Bookkeeping. The Debtor requires a bookkeeper to: (a) obtain and evaluate financial records; (b) assist in the preparation of monthly operating reports; (c) prepare and update budgets to the extent such services are provided in conjunction with the Debtor's usage of bookkeeping software; (d) clean up prior bookkeeping services provided by the Debtor's prior bookkeeper to the extent such is necessary; and (e) correspond with the Subchapter V trustee through the offices of the Debtor's proposed counsel. The firm will charge $70 per hour for its services. The retainer fee is $700. Heather Kirstein, co-owner of Northstar, disclosed in a court filing that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Heather Kirstein Northstar LLC 18001 Irvine Boulevard, Ste. 205 Tustin, CA 92780 Telephone: (714) 608-1526 Email: heather@northstar-bookkeeping.com About Juice Roll Upz Juice Roll Upz, Inc. is a manufacturer of e-liquids and vape juices based in Fullerton, Calif. The Debtor filed Chapter 11 petition (Bankr. C.D. Calif. Case No. 23-12077) on October 10, 2023, with $497,964 in assets and $3,103,919 in liabilities. Mark Sharf, Esq., a practicing attorney in Los Angeles, has been appointed as Subchapter V trustee. Judge Theodor Albert oversees the case. The Debtor tapped Anerio Ventura Altman, Esq., at Lake Forest Bankruptcy as legal counsel and Heather Kirstein at Northstar LLC as bookkeeper. LAKEPORT CF: Unsecureds to Get Property Sale & Ongoing Proceeds --------------------------------------------------------------- Lakeport CF, LLC, submitted a Second Amended Disclosure Statement describing Third Amended Plan dated November 13, 2023. The Debtor's primary assets are approximately 1,200 acres of the Real Property and a sublease under which it operates the Golf Course. As of the Petition Date, May 31, 2022, the Debtor's Real Property consisted of largely undeveloped parcels, each of which is situated in Elbert County, Colorado (the "Real Property"). The Debtor's Real Property is worth approximately $9,150,000 in its "as is" and undeveloped condition without a Planned Unit Development ("PUD") designation, per an August 10, 20222 appraisal performed by Daniel's Real Estate Services (the "Daniels Appraisal"). The Debtor intends to obtain a PUD for the Real Property and develop it for single family homes and commercial uses. On February 24, 2023, the Debtor moved to approve its Settlement Agreement with River Bend and the Pinetree Financial Corporation. The Settlement Agreement provided that River Bend and Pinetree Financial Corporation (the "Secured Creditors") would withdraw their motion to dismiss the Debtor's bankruptcy case, and the Debtor would stipulate to relief from stay for the Secured Creditors to foreclose on their secured interests in the Debtor's Real Property. The Debtor sought the Court's approval of its Second Motion to Obtain Postpetition Financing from C2R Capital Management, LLC, in which the Debtor sought to borrow up to approximately $9,000,000 to fund the payments required under the Settlement Agreement. The Court granted the Debtor's motion on March 23, 2023. The Debtor then paid the Secured Creditors an additional $7,000,000 to settle their secured claims against the Estate and reduce interest under their claims from 29% to the 13% provided by the Settlement Agreement and the Debtor's lender. Following Confirmation of the Plan, the Debtor intends to continue to operate the Golf Course, obtain a PUD designation for the Real Property it retains, then develop and sell the Real Property. Class Eight of allowed Unsecured Claims against the Debtor and the Claims that are deemed allowed by a Final Order in connection with the Deaderick Adversary. The unsecured creditors shall receive semi-annual payments pro rata over the course of five years (or until they are paid in full) from a combination of Income, the net proceeds from the State Court Litigation, and the sale of lots of the Debtor's developed Real Property. Amounts included in Class Eight shall accrue interest at the Federal Judgment Rate until paid, and such interest shall be paid the unsecured claimholder with the semi-annual payments. The Debtor, in its sole discretion, may pay the claims in Class Eight in full, with accrued but unpaid interest, at any time prior to the end of five years. Class Nine consists of the equitable interests of Moorstead Real Estate, LLC, the holder of 100% of the Debtor's ownership interests. The holder of Class Nine interests will receive no money under the Plan on the Effective Date. It will retain its interests to the same extent that it held such interests prior to the filing of the Bankruptcy. Class Nine is not impaired under the Plan. The Debtor and G&O have agreed to a Loan Term Sheet ("Loan Agreement"). The Loan Agreement provides for the funding of Debtor's Plan. The Debtor selected G&O to be its lender in place of C2R because, consistent with the Court's Order authorizing postpetition financing, G&O is able to offer the Debtor a better interest rate (13% per annum) than its former lender, C2R Capital Management, LLC (14% per annum). The Debtor projects that the Plan of Reorganization described herein and in the Debtor's Plan will significantly increase the value of its operations and Assets, allow it to successfully reorganize, and provide payment to all legitimate creditors in full on their allowed claims. The Debtor proposes to pay its unsecured creditors from the sale of parts or all of its developed Real Property and from ongoing proceeds from operations of the Golf Course. A full-text copy of the Second Amended Disclosure Statement dated November 13, 2023 is available at https://urlcurt.com/u?l=QYzs5I from PacerMonitor.com at no charge. Attorneys for the Debtor: Jeffrey A. Weinman, Esq. Michael T. Gilbert, Esq. Patrick Vellone, Esq. Brenton L. Gragg, Esq. ALLEN VELLONE WOLF HELFRICH & FACTOR P.C. 1600 Stout Street, Ste. 1900 Denver, Colorado 80202 303-534-4499 E-mail: JWeinman@allen-vellone.com MGilbert@allen-vellone.com PVellone@allen-vellone.com BGragg@allen-vellone.com About Lakeport CF Lakeport CF, LLC, a company in Elbert County, Colo., filed Chapter 11 petition (Bankr. D. Colo. Case No. 22-11941) on May 31, 2022, with $10 million to $50 million in both assets and liabilities. Judge Michael E. Romero oversees the case. Jeffrey A. Weinman, Esq., at Allen Vellone Wolf Helfrich & Factor, PC and Fairfield and Woods P.C. serve as the Debtor's bankruptcy counsel and special counsel, respectively. LEXARIA BIOSCIENCE: Posts $6.7 Million Net Loss in FY Ended Aug. 31 ------------------------------------------------------------------- Lexaria Bioscience Corp. filed with the Securities and Exchange Commission its Annual Report on Form 10-K reporting a net loss of $6.71 million on $226,208 of revenue for the year ended Aug. 31, 2023, compared to a net loss of $7.38 million on $255,397 of revenue for the year ended Aug. 31, 2022. As of Aug. 31, 2023, the Company had $3.08 million in total assets, $403,908 in total liabilities, and $2.68 million in total stockholders' equity. Lexaria stated, "Since inception, the Company has incurred significant operating and net losses. The losses attributable to shareholders were $6.7 million and $7.34 million, for the years ended August 31, 2023 and 2022, respectively. As of August 31, 2023, we had an accumulated deficit of $45.8 million. We expect to continue to incur significant operational expenses and net losses in the upcoming 12 months. Our net losses may fluctuate significantly from quarter to quarter and year to year, depending on the stage and complexity of our R&D studies and corporate expenditures, additional revenues received from the licensing of our technology, if any, and the receipt of payments under any current or future collaborations we may enter into. The recurring losses and negative cash flows from operations raise substantial doubt as to the Company's ability to continue as a going concern. "During the year ended August 31, 2023, we raised $114,456 from the sale of shares pursuant to our ATM offering and on May 11, 2023 we raised an additional $2 million pursuant to a brokered registered offering. Net proceeds from these offerings totaled $1,589,731, respectively. On October 3, 2023, the Company closed a registered direct offering resulting in net proceeds of approximately $1.29 million. We may offer additional securities for sale during our fiscal year 2024 or thereafter in response to market conditions or other circumstances if we believe such a plan of financing is required to advance the Company's business plans and is in the best interests of our stockholders. "Based on our existing working capital, management believes the Company has sufficient working capital to satisfy the Company's estimated liquidity needs for the next 12 months. In making this assessment, the Company believes that this alleviates the substantial doubt in connection with the Company's ability to continue as a going concern. However, there is no assurance that management's plans will be successful. If the Company is unable to obtain funding, the Company would be forced to delay, reduce or eliminate some or all of its research and development programs, preclinical and clinical testing or commercialization efforts, which could adversely affect its business prospects." A full-text copy of the Form 10-K is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/0001348362/000164033423002227/lxrp_10k.htm About Lexaria Lexaria Bioscience Corp. -- http://www.lexariabioscience.com-- is a biotechnology company developing the enhancement of the bioavailability of a broad range of fat-soluble active molecules and active pharmaceutical ingredients using its patented DehydraTECH drug delivery technology. DehydraTECH combines lipophilic molecules or APIs with specific long-chain fatty acids and carrier compounds that improve the way they enter the bloodstream, increasing their effectiveness and allowing for lower overall dosing while promoting healthier oral ingestion methods. Lexaria Bioscience reported a net loss and comprehensive loss of $7.38 million for the year ended Aug. 31, 2022, a net loss and comprehensive loss of $4.19 million for the year ended Aug. 31, 2021, a net loss and comprehensive loss of $4.08 million for the year ended Aug. 31, 2020, and a net loss and comprehensive loss of $4.16 million for the year ended Aug. 31, 2019. LIPSEY PAINTING: Court OKs Interim Cash Collateral Access --------------------------------------------------------- The U.S. Bankruptcy Court for the Northern District of Alabama, Southern Division, authorized Lipsey Painting Contractors, LLC to use cash collateral on an interim basis in accordance with the budget. As adequate protection for the use of cash collateral, Valley National Bank and Funding Circle are granted replacement liens in all assets of the Debtor. The security interests granted are deemed perfected without the necessity for filing or execution of documents which might otherwise be required under non-bankruptcy law for the perfection of said security interests. As further adequate protection for Valley National Bank, the Debtor will make weekly adequate protection payments directly to Valley National Bank in the amount of $600 per week as provided in the budget. As further adequate protection for Valley National Bank, the insurance policy on the life of Robert Lipsey will provide that Valley National Bank is listed as a beneficiary and entitled to payment upon his death to satisfy the outstanding balance owed to Valley National Bank. A final hearing on the matter is set for November 29 at 10:30 a.m. A copy of the order is available at https://urlcurt.com/u?l=2ruduG from PacerMonitor.com. About Lipsey Painting Contractors, LLC Lipsey Painting Contractors, LLC filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. N.D. Ala. Case No. 23-02712) on Oct. 12, 2023, with $50,001 to $100,000 in assets and $500,001 to $1 million in liabilities. Judge Tamara O. Mitchell oversees the case. C. Taylor Crockett, Esq., represents the Debtor as legal counsel. LIVE WELL: Reaches $1Mil. Deal With Laid-Off Employees in WARN Suit ------------------------------------------------------------------- Yun Park of Law360 reports that a Delaware bankruptcy judge has given preliminary approval to a $1.1 million settlement between the Chapter 7 trustee for bankrupt reverse-mortgage provider Live Well Financial Inc. and 163 former employees who sued the company claiming they were laid off without proper notice. About Live Well Medical Centers Orlando Live Well Medical Centers Orlando, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 21-02027) on Aug. 19, 2021, listing as much as $50,000 in both assets and liabilities. The Debtor is represented by Thomas C. Adam, Esq., at Adam Law Group, P.A. LIVEONE INC: Delays Filing of Q3 Form 10-Q Report ------------------------------------------------- LiveOne, Inc. disclosed in Form 12b-25 filed with the Securities and Exchange Commission that the Company is unable to file its Quarterly Report on Form 10-Q for the quarter ended September 30, 2023 within the prescribed time period without unreasonable effort or expense. According to the Company, it needs additional time to complete certain financial disclosures and analyses to be included in the Form 10-Q. The Company expects to file the Form 10-Q with the SEC as soon as possible, but no later than November 20, 2023, the fifth calendar day following the prescribed due date of the Form 10-Q. About LiveOne Headquartered in Los Angeles, California, LiveOne, Inc. (NASDAQ: LVO) (formerly known as LiveXLive Media, Inc.) is a creator-first, music, entertainment and technology platform focused on delivering premium experiences and content worldwide through memberships and live and virtual events. LiveOne reported a net loss of $10.02 million for the year ended March 31, 2023, compared to a net loss of $43.91 million for the year ended March 31, 2022. As of March 31, 2023, the Company had $65.89 million in total assets, $62.07 million in total liabilities, $4.83 million in redeemable convertible preferred stock, and a total stockholders' deficit of $1.01 million. Los Angeles, CA-based Macias Gini & O'Connell LLP, the Company's auditor since 2022, issued a "going concern" qualification in its report dated June 29, 2023, citing that the Company has suffered recurring losses from operations, negative cash flows from operating activities and has a net capital deficiency. These matters raise substantial doubt about the Company's ability to continue as a going concern. LPI LLC: Taps Jane Giles of Advanced Business as Accountant ----------------------------------------------------------- LPI, LLC seeks approval from the U.S. Bankruptcy Court for the District of Oregon to employ Jane Giles, CPA, a member of Advanced Business Logistics LLC, as its accountant. The Debtor needs an accountant to assist it in all financial matters involved in this Chapter 11 case including review of internal bookkeeping records; preparation of tax returns and analysis of potential short year election; potential amendment of prior year tax returns not prepared by the proposed accountant; and potentially assisting the attorneys with financial data supporting a disclosure statement and plan of reorganization. Ms. Giles will charge $50 per hour for bookkeeping and $100 per hour for tax return preparation, plus reimbursement for expenses incurred. The projected cost is estimated to be $5,000. Ms. Giles disclosed in a court filing that she is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The professional can be reached at: Jane L. Giles, CPA Advanced Business Logistics, LLC 822 SE Locust PI Albany, OR 97322 Telephone: (610) 263-0115 Facsimile: (215) 754-4934 About LPI LLC LPI, LLC a company in Albany, Ore., filed its voluntary petition for Chapter 11 protection (Bankr. D. Ore. Case No. 23-60789) on May 10, 2023, with $2,064,118 in assets and $974,196 in liabilities. Mahmood Almayah, a member of LPI, LLC, signed the petition. Judge Thomas M. Renn oversees the case. The Debtor tapped Michael D. O'Brien & Associates, PC as counsel and Jane L. Giles, CPA, at Advanced Business Logistics LLC as accountant. LSF9 ATLANTIS: S&P Alters Outlook to Stable, Affirms 'B' ICR ------------------------------------------------------------ S&P Global Ratings revised the outlook on U.S.-based LSF9 Atlantis Holdings LLC (Victra) to stable from positive and affirmed its 'B' issuer credit rating on the company and 'B' issue-level rating on its senior secured debt. The stable outlook reflects S&P's view that although sales and profitability will likely remain pressured amid a challenging operating environment, it forecasts Victra will sustain S&P Global Ratings'-adjusted leverage in the high-4x area for 2024. Victra's operating performance will likely remain pressured in 2024 amid softer customer discretionary spending on wireless device upgrades and accessories combined with low promotional activity at Verizon. After year-over-year revenue growth in 2022 following its acquisition of Go Wireless Holdings, Victra's net sales declined more than 9% during the third fiscal quarter (ended Sept. 30, 2023). Verizon retail box sales dropped roughly 12% due to less discounting and promotional activity. S&P said, "However, through its longstanding relationship with Verizon, Victra received meaningful incremental commissions to help offset lower sales volumes, which we anticipate it will continue to receive in the fourth quarter. Customer demand for the company's products and offerings have slowed as price-sensitive consumers pull back on discretionary spending, particularly wireless device upgrades and accessories. As such, we now forecast negative revenue growth in the low-single-digit percent area for fiscal-year 2023 and roughly flat to modestly positive revenue growth in fiscal-year 2024." S&P said, "We forecast S&P Global Rating's-adjusted leverage to be in the low-5x area this year, moderating toward the high-4x area in 2024. We project S&P Global Ratings'-adjusted EBITDA margins will contract modestly toward the low- to mid-11% area this year and remain relatively flat in 2024 due to lower box volume arising from softer customer demand trends and higher store expenses related to legacy Go Wireless. As such, we now expect Victra's leverage will remain in the high-4x area relative to our previous expectation in the low-4x area for 2024, attributed to sustained top-line and profitability headwinds. In addition, Victra's reliance on Verizon's strategy, programs, and promotions to propel sales remain a key risk factor. We believe Victra's business depends on the competitiveness of Verizon's plans against other carriers to drive sales and profitability." Victra has adequate liquidity with no near-term maturities and positive free operating cash flow (FOCF) generation. As of Sept. 30, 2023, Victra had roughly $120 million of balance sheet cash with an undrawn balance on its $115 million asset-based lending (ABL) facility. However, Victra's term loan facility is currently set to mature on Nov. 21, 2025, as it is subject to a springing maturity 90 days before its senior secured notes mature to the extent they are not refinanced, replaced, or extended. Victra generated roughly $40 million of reported FOCF in the third quarter, a significant improvement to its cash flow generation of $7.5 million during the prior year period. S&P said, "We project the company will generate $77 million of FOCF this year, accounting for capital spending of roughly $33 million, primarily for maintenance costs, store refreshes, and new unit developments. We anticipate capex levels will increase roughly $5 million-10 million in fiscal-year 2024 amid Victra's target to open 100 new Total by Verizon locations by mid-2024." During the fourth quarter of 2023, the company paid down $7.3 million under its $820 million senior secured notes and is required to pay roughly $31 million of mandatory amortization under its $620 million term loan facility annually. S&P anticipates Victra will use a portion of its balance sheet cash to opportunistically pay down additional debt to reach its leverage target of 4x or below. The stable outlook reflects S&P views that, although sales and profitability will likely stay pressured over the next 12 months amid a challenging operating environment, Victra will sustain S&P Global Ratings'-adjusted leverage in the high-4x area for 2024. S&P could lower its rating if: -- Performance deteriorates below our base-case expectations possibly because of unfavorable commission arrangements or business execution issues that might impair Victra's competitive standing; -- EBITDA contracts below our base case or the company pursues a more aggressive financial policy, leading to S&P Global Ratings'-adjusted leverage approaching 5.5x; or -- Cash flow levels erode such that FOCF declines to relatively flat levels on a sustained basis. S&P could raise its rating if: -- The company can build on its track record of execution and meaningfully expand its EBITDA base relative to higher rated peers, leading to better profitability metrics; and -- S&P expects S&P Global Ratings'-adjusted leverage to remain about 4x or less. ESG factors have had no material influence on S&P's credit rating analysis of Victra. LUZ MA: Court OKs Cash Collateral Access on Final Basis ------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Florida, Miami-Dade Division, authorized Luz Ma Aesthetics Inc. to use cash collateral on a final basis in accordance with the budget, with 10%. The Debtor is authorized to use the cash collateral with monthly adequate protection payments to the U.S. Small Business Administration in the amount of $244 per month. Citizens Bank N.A. will receive $0.00 adequate protections payments. There will be a carve-out in the budget for the inclusion of fees due the Clerk of Court and the U.S. Trustee pursuant to 28 U.S.C. Section 1930, and to the extent not already included in the budget for the adequate protection payments. A copy of the court's order and the Debtor's budget is available at https://urlcurt.com/u?l=5V9Eo4 from PacerMonitor.com. The Debtor projects $26,260 in total income and $22,521 in total expenses for November 2023. About Luz Ma Aesthetics Luz Ma Aesthetics Inc. filed a petition for relief under Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 23-14986) on June 27, 2023. In the petition signed by Luz Marin, president, the Debtor disclosed under $1 million in both assets and liabilities. Judge Corali Lopez-Castro oversees the case. Chad Van Horn, Esq., at Van Horn Law Group, PA represents the Debtor as counsel. LYLA LEE: Unsecureds to Get $15K in Reorganization Plan ------------------------------------------------------- Lyla Lee, LLC, submitted a 1st Amended Plan of Reorganization. On Dec. 30, 2021, the Debtor purchased all assets including equipment, fixtures, furniture, and other assets of the former Hanky Pies from its owners Krista & Kevin Moorehead. for the approximate sum of $70,000 and took over the leasehold premises located at 106 Cascade Ave., Unit 101, Granite Falls, WA 98252. After finalizing the purchase, it became evident that the assets purchased needed updating, repair and cleaning. The decor of the restaurant needing complete updating. During January 2022, the Company revamped the menu, cleaned, repaired and updated the equipment, updated the decor, hired new employees and began operating the new restaurant under the dba of Lyla's Café. With the new menu concepts and fresh decor, the customer base began returning to the restaurant and by spring and summer of 2022, volume was approximately three times what the prior owners had realized. Under the Plan, during the Plan term, the Debtor will continue operating the restaurant with the trucking operation and anticipates that sufficient net income can be generated from its services to make the payments under the proposed plan. The Plan provides for unclassified administrative claims and priority tax claims, one class of unsecured claims, and one class of equity security holders. Under the Plan, Class 1 - General Unsecured Claims will be paid a pro rata share of $5,500 to be paid in equal monthly installments of $100 for 55 months beginning December 15, 2023. If necessary, on or before October 15th 2028 allowed general unsecured claims will be paid a pro rata share of a lump sum payment in an amount sufficient so that the total amount paid to general unsecured claims, totals the liquidation amount of $15,470. Class 1 is impaired. The Plan will be funded with revenue from the Debtor's operation. Attorney for Debtor: Thomas D. Neeleman, Esq. NEELEMAN LAW GROUP, P.C. 1403 8th Street Marysville, WA 98270 Tel: (425) 212 4800 Fax: (425) 212 4802 A copy of the Plan of Reorganization dated November 8, 2023, is available at https://tinyurl.ph/iivJH from PacerMonitor.com. About Lyla Lee Lyla Lee, LLC, filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. W.D. Wash. Case No. 23-11126) on June 16, 2023, with as much as $50,000 in assets and $50,001 to $100,000 in liabilities. Judge Timothy W. Dore oversees the case. The Debtor is represented by Thomas D. Neeleman, Esq., at Neeleman Law Group, P.C. MATTHEWS INTERNATIONAL: S&P Affirms 'BB' LT Issuer Credit Rating ---------------------------------------------------------------- S&P Global Ratings revised the outlook to negative from stable on Matthews International Corp. At the same time, S&P affirmed its 'BB' long-term issuer credit rating on the company. The negative outlook reflects the increasing refinancing risk and the possibility that the company's revolving credit facility could become current, despite mostly positive operating results and decreasing leverage. S&P said, "Our negative outlook reflects Matthews' approaching maturities in 2025 and increasing refinancing risk. We view a shorter time to maturity, especially under two years, as a credit risk, in part due to an increasing reliance on factors out of the company's control (for example, the lending environment). We believe Matthews can refinance given its leverage profile (expected about 4x in 2024) and revenue growth trajectory (expected about 5% in 2024), but the company has allowed its revolver to approach a year until maturity with an unsecured notes tranche maturing about nine months later. We view the company's willingness to defer refinancing as signal of management's tolerance for risk. If the company does not refinance its revolver by the first couple months of 2024, we could consider a lower rating. If the debt does become current, we could consider a subsequent lower rating. "Our affirmation reflects increasing EBITDA across all three segments, declining adjusted debt to EBITDA, and our expectation for the positive business momentum to continue through at least 2025.We expect memorialization to remain a steady contributor to EBITDA with low-single-digit percent revenue growth supported by inflationary price increases offsetting a lower death rate and fewer casketed deaths. We think margins in memorialization will improve slightly from continuous improvement projects and potentially favorable commodity prices, especially in an economic downturn. "We expect industrial technologies to continue its rapid growth, but at a slower rate in 2024 than in 2023. Although customer orders may be choppy, we think the segment will be the most meaningful contributor to revenue and EBITDA growth over the next three years as customers ramp up production of electric vehicles with dry cell batteries. We are forecasting industrial technologies revenue to increase by about $115 million by 2025, but the forecast has upside if the company deepens relationships with many large auto manufacturers. The segment should also see some revenue boost from a new, differentiated industrial printing product, but the contribution of this product is small relative to the energy storage business. We believe industrial technologies margins will improve as the business scales, but the business may need additional investment to meet upcoming demand, which could require capital expenditures (capex)and stifle margin growth. "We think SGK will have flattish revenue growth and continue to improve its margins via cost cutting and other efficiencies. "We expect leverage to continue to decline from increasing EBITDA and modest debt repayment. The company stated its intention to deleverage to below 3x from about 3.3x currently, which coincides with leverage declining below S&P Global Ratings-adjusted debt to EBITDA of 4x. We expect the company to use any cash left over after the dividend and acquisitions to repay debt but think that EBITDA growth will be the primary source of deleveraging. We are forecasting adjusted debt to EBITDA of 4x in 2024. "The rating continues to reflect the company's diverse business, and good positions in their niche industries, but we also think margins are low and customers have significant pricing power. Matthews consists of three largely unrelated businesses, which we believe mitigates the risk of potential disruption to a single market or product line. In addition, the company is concentrated in North America (70% of 2022 revenue) but has some geographic diversification from Europe. The exposure to Europe has recently caused volatility from currency translation and a write-down of assets due to the war between Russia and Ukraine, but longer term should be a source of diversification. The company has leading positions in all three niche segments, including memorialization, brand-management, and battery electrode processing equipment. Partly offsetting credit strengths, Matthews' adjusted EBITDA margins (11%-13%) are relatively low given memorialization is fairly commoditized, SGK brand-solutions has limited negotiating power with much larger customers, and the industrial technologies do not have a sustainable competitive advantage beyond scale and a first mover advantage, in our view. "Our negative outlook reflects the increasing refinancing risk due to the maturities in 2025, including the revolver that matures in March 2025 and has $463 million outstanding. We expect Matthews to increase revenue in the mid-single-digits percent area in 2024 and for EBITDA margins to expand about 50 basis points, which should support refinancing, but the company is still exposed to market risks out of its control as maturities approach. "We will lower the rating if Matthews did not refinance by early 2024, leading us to believe the revolver could become current and that management's risk tolerance were higher than expected. "We could also consider a lower rating if we expected adjusted debt to EBITDA sustained above 4.5x, likely due to a significant increase in investment in the business or delays in orders that may persist. "If the revolving credit facility became current, we could consider a subsequent negative rating action. "We could consider revising the outlook to stable if the company successfully refinanced its debt such that we expected it to have adequate liquidity. In this scenario, total liquidity would cover the company's current revolver balance, notes, and at least 1.2x of other typical uses of liquidity like capex and dividends. In this scenario, we would continue to expect adjusted debt to EBITDA in the 3.5x-4.5x range." MBIA INC: Kahn Brothers Group Reports 9.40% Equity Stake -------------------------------------------------------- Kahn Brothers Group Inc. filed a Schedule 13G Report with the Securities and Exchange Commission to disclose its ownership of MBIA Inc.'s common stock. Kahn Brothers Group Inc. beneficially owns 4,809,384 common shares, representing approximately 9.40% of the outstanding common shares of MBIA Inc. Kahn Brothers Group Inc. may be reached at: 555 Madison Avenue, Suite 1303 New York, NY 10022 A full-text copy of the Report is available at https://tinyurl.com/che8rd4j About MBIA MBIA Inc., together with its consolidated subsidiaries, operates within the financial guarantee insurance industry. MBIA manages its business within three operating segments: 1) United States public finance insurance; 2) corporate; and 3) international and structured finance insurance. The Company's U.S. public finance insurance portfolio is managed through National Public Finance Guarantee Corporation, its corporate segment is managed through MBIA Inc. and several of its subsidiaries, including our service company, MBIA Services Corporation, and its international and structured finance insurance business is primarily managed through MBIA Insurance Corporation and its subsidiaries. MBIA reported a net loss attributable to the Company of $195 million in 2022, a net loss attributable to the Company of $445 million in 2021, and a net loss attributable to the Company of $578 million in 2020. Egan-Jones Ratings Company on September 28, 2023, maintained its 'CCC-' foreign currency and local currency senior unsecured ratings on debt issued by MBIA Inc. MEJJM INC: Ongoing Operations to Fund Plan Payments --------------------------------------------------- MEJJM, Inc., filed with the U.S. Bankruptcy Court for the Southern District of Indiana a Combined Small Business Chapter 11 Plan of Reorganization and Disclosure Statement dated November 13, 2023. MEJJM, Inc., acquired Crown Point Graphics LLC in November of 2019 and has done business as such ever since. Debtor employs 6 people and subcontracts with 2 others to run a business that designs, imports and sells stationery, greeting cards and holiday cards into the retail space via its wholesale business. Cash generated by ongoing operations shall first be used to fund administrative expenses, including professional and case Trustee fees and expenses, secured and lease claims, and operating expenses. The Plan pays priority claims in accordance with the treatment allowed under the Code. After satisfaction of these claims, general unsecured creditors shall be paid pro rata out of all remaining Plan payments. The Plan shall last for 35 months following the first payment made under it, which is due within 30 days of the date the Confirmation Order becomes a Final Order. Class 3 consists of Allowed General Unsecured Claims, including the deficiency claim of SBA, and the putative secured claims of IOU Financial and WebBank that are listed and treated as general unsecured claim herein. The Debtor's projections indicate that the Debtor expects not to generate profits initially but that it expects to earn profits in year 3 of the Plan in the amount of $90k. Rather than pay Class 3 from those profits, but using them as the Debtor's Projected Disposable Income, Class 3 claims shall receive a pro rata payment and shall be allowed, settled, compromised, satisfied and paid by three annual payment due on the anniversary of the Effective Date in the amount of $30k. Class 3 is impaired and is entitled to vote on the Plan. Class 4 consists of the Equity Interests, which interests shall be retained by existing interest owners. Debtor shall continue to operate its business in accordance with the projection of income, expense and cash flow, and shall pay its projected net after tax cash profit to satisfy creditor claims. A full-text copy of the Combined Plan and Disclosure Statement dated November 13, 2023 is available at https://urlcurt.com/u?l=GAcYyu from PacerMonitor.com at no charge. Attorney for the Debtor: KC Cohen, Esq. KC COHEN, LAWYER, PC 1915 Broad Ripple Ave. Indianapolis, IN 46220 Tel: (317) 715-1845 Fax: (317) 636-8686 Email: kc@smallbusiness11.com About MEJJM Inc. MEJJM, Inc., employs 6 people and subcontracts with 2 others to run a business that designs, imports and sells stationery, greeting cards and holiday cards into the retail space via its wholesale business. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Ind. Case No. 23-03538) on Aug. 14, 2023. In the petition signed by Michael Smith, president, the Debtor disclosed $1,502,094 in assets and $2,887,831 in liabilities. Judge Jeffrey J. Graham oversees the case. KC Cohen, Esq., at KC COHEN, LAWYER, PC, is the Debtor's legal counsel. MERRILL PROPERTIES: Creditors to Get Proceeds From Liquidation -------------------------------------------------------------- Merrill Properties, LLC, filed with the U.S. Bankruptcy Court for the Northern District of Georgia a First Plan of Reorganization dated November 13, 2023. The Debtor is a Georgia limited liability company. Debtor is owned in equal 50/50 percentages by Sharon Law ("Mrs. Law") and her sister ("Mrs. Law's Sister"). One of Debtor's real properties is located at 421 W. Solomon Street, Griffin, Georgia (the "Furniture Store Property") and the other property is located at 206 W. Broad Street Griffin, Georgia (the "Warehouse Property"; collectively with the Furniture Store Property, the "Properties"). In 2011, SE Property Holdings, LLC filed a lawsuit against Debtor, Mrs. Law, and other related persons and entities in the Superior Court of Spalding County, Georgia (the "Spalding County Action"), but not including Mrs. Law's Sister. The Spalding County Action alleges that transfers of various real properties were fraudulent transfers avoidable under Georgia law as a result of a Judgment held by SE Property against Mrs. Law arising from a loan and personal guaranty involving a property in Florida that was not owned by Debtor. Over the 11 years since SE Property filed the Spalding County Action, circumstances have changed substantially. Mrs. Law's Sister is now affected by a very serious health condition, and is in need of the proceeds from her asserted 50% ownership of Debtor's Properties for healthcare purposes. Mr. Law's husband, who managed the properties, is also subject to very serious health conditions, which has caused him to supervise non-party subcontractors rather than personally to repair the Properties. Debtor filed this bankruptcy case in an effort to address the lack of progress toward disposing of the Properties for the benefit of all interested stakeholders, which arose from Debtor's inability to reach a resolution with SE Property for more than a decade, and which has recently become urgent due to the health problems of Debtor's management team, a declining real estate market, the Properties being unoccupied, and a serious risk of being unable to insure the Properties. This Plan proposes to pay creditors and equity holders of Debtor from a liquidation of Debtor's assets. Class 3 consists of the non-priority unsecured claim of Southeast Property Holdings LLC. The unsecured claim of Class 3 shall be paid, to the extent allowed, from assets of Debtor. Assets of Debtor shall not include any assets that the Court determines in an adversary proceeding are equitably owned by any person or entity other than Debtor. Class 4 consists of the claims of holders of equitable ownership interests. The unsecured claim of Class 3 shall be paid, to the extent allowed, from assets in which the Debtor may hold legal title but in which the Court determines a claimant has an equitable interest. Class 5 consists of equity interests. Equity interests shall only be paid to the extent that all other classes have been satisfied in full. The Debtor will fund the plan payments through sale of all of Debtor's assets. A full-text copy of the First Plan of Reorganization dated November 13, 2023 is available at https://urlcurt.com/u?l=CJ6l4N from PacerMonitor.com at no charge. Attorneys for Debtor: Michael D. Robl, Esq. Maxwell W. Bowen, Esq. ROBL LAW GROUP, LLC 3754 Lavista Road, Suite 250 Tucker, GA 30084 Tel: (404) 373-5153 Fax: (404) 537-1761 Email: michael@roblgroup.com max@roblgroup.com About Merrill Properties Merrill Properties, LLC, is a Georgia limited liability company. The Debtor filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. N.D. Ga. Case No. 23-10978) on Aug. 15, 2023, with up to $1 million in assets and up to $50,000 in liabilities. Judge Paul Baisier oversees the case. Michael D. Robl, Esq., at Robl Law Group, LLC, is the Debtor's bankruptcy counsel. MICHIGAN MEDICAL: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Michigan Medical Group, P.C. 22348 Wick Rd Taylor, MI 48180 Business Description: The Debtor provides healthcare services. Chapter 11 Petition Date: November 22, 2023 Court: United States Bankruptcy Court Eastern District of Michigan Case No.: 23-50240 Judge: Hon. Mark A. Randon Debtor's Counsel: Elliot G. Crowder, Esq. STEVENSON & BULLOCK, P.L.C. 26100 American Drive Suite 500 Southfield, MI 48034 Tel: (248) 354-7906 Ext. 2254 Email: ecrowder@sbplclaw.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Najam Syed as president. A copy of the Debtor's list of 20 largest unsecured creditors is now available for download at PacerMonitor.com. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/5ZIPXNY/Michigan_Medical_Group_PC__miebke-23-50240__0001.0.pdf?mcid=tGE4TAMA MILLION DOLLAR SMILE: Court Confirms Chapter 11 Plan ---------------------------------------------------- The Bankruptcy Court has entered an order confirming the Plan of Million Dollar Smile, LLC, under 11 U.S.C. Sec. 1129. All objections to confirmation of the Plan, which have not been resolved, are expressly overruled. The Debtor is not liquidating its business. It will continue in business after consummation of the Plan. The U.S. Trustee raised objections to the Plan on the basis of plan feasibility. The UST and the Debtor met and conferred various times, resulting in the Debtor modifying its financial reporting and projections. Based on the revised financial information, the UST's concerns as to plan feasibility have been resolved. The Court raised a concern about a proposed injunction (Article VII-C) in the Plan. In response, the Debtor served a "Notice to Guarantors and to Others of intended Temporary Injunction to Restrain Legal Actions and Collections Against Debtor''s Principal and Opportunity to Object" (ECF 136). No objections were thereafter made to the proposed injunction. As to Class 2 which did not cast a ballot, the Plan provides that the Fasanara will retain its lien until payment of its claim, as provided in the Plan, is made. In addition, the Plan provides that Fasanara will receive on account of it claim, deferred cash payments totaling at least the allowed amount of its claim, of a value, as of the Plan's effective date of at least the value of Fasanara's interest in the estate's interest in the property that is security for Fasanara's claim. That treatment of Class 2 is fair and equitable and does not unfairly discriminate. Angelo DeSimone will act as the disbursing agent for the Plan. The Temporary Post-Confirmation Injunction (Plan, Article XII (C)) is approved in its entirety and will be issued effective as of the Plan's Effective Date. All creditors, parties-in-interest, third parties and those served with this Order are bound by the Temporary Post-Confirmation Injunction for the duration of payments made under the Plan. During the time the temporary injunction is in effect, all creditors, parties-in-interest and/or third parties are restrained from pursuing Angelo DeSimone for the collection of any portion or for all of their claims or for any claim that could or should have been brought against the Debtor. All terms and conditions of the temporary injunction as set forth in the Plan are approved. The temporary injunction will restrain claims against Mr. DeSimone and his real and personal property. Counsel for the Debtor: Steven R. Fox, Esq. THE FOX LAW CORPORATION, INC. 17835 Ventura Blvd Ste 306 Encino, CA 91316 Tel: (818) 774-3545 Fax: (818) 774-3707 E-mail: srfox@foxlaw.com About Million Dollar Smile Million Dollar Smile, LLC, offers oral hygiene and beauty products. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Cal. Case No. 23-00001) on January 2, 2023. In the petition signed by Angelo De Simone, managing member, the Debtor disclosed up to $500,000 in assets and upt o $10 million in liabilities. Judge Margaret Mann oversees the case. Steven R. Fox, Esq., at The Fox Law Corporation, Inc., is the Debtor's legal counsel. MONICATTI AUTO: Affiliate Gets OK to Hire Hilco as Auctioneer ------------------------------------------------------------- Double Vision Holdings, LLC, an affiliate of Monicatti Auto Sales, LLC, received approval from the U.S. Bankruptcy Court for the Eastern District of Michigan to employ Hilco Real Estate, LLC. The Debtor requires a real estate auctioneer to: (a) develop a sales strategy; (b) market the Debtor's real property through an online auction process; (c) conduct an online auction for the sale of the real property if a purchaser is not previously identified; and (d) at the Debtor's direction, negotiate the terms of the sale of the real property on the Debtor's behalf. Hilco will receive a commission equal to a purchaser's premium of 5 percent, which will be charged to the winning bid. In addition, the firm will receive reimbursement for work-related expenses. Sarah Baker, a member of Hilco, disclosed in a court filing that her firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Sarah Baker Hilco Real Estate, LLC 5 Revere Drive, Suite 206 Northbrook, IL 60062 Telephone: (847) 504-2462 Facsimile: (847) 897-0874 Email: sbaker@hilcoglobal.com About Monicatti Auto Sales Monicatti Auto Sales, LLC is a seller of pre-owned vehicles in New Baltimore, Mich. Monicatti Auto Sales and Double Vision Holdings, LLC filed voluntary petitions for relief under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. E.D. Mich. Case No. 23-47427) on Aug. 24, 2023. In the petitions signed by Michael Monicatti, member, Monicatti Auto Sales disclosed up to $100,000 in assets and up to $10 million in liabilities while Double Vision Holdings disclosed up to $10 million in both assets and liabilities. Judge Thomas J. Tucker oversees the cases. Elliot G. Crowder, Esq., at Stevenson & Bullock, PLC represents the Debtors as legal counsel. MOZART HOLDINGS: Fitch Affirms 'B+' IDR & Alters Outlook to Stable ------------------------------------------------------------------ Fitch Ratings has affirmed Mozart Holdings, LP's and Medline Borrower, LP's Long-Term Issuer Default Ratings (IDRs) at 'B+'. In addition, Fitch has affirmed Medline Borrower, LP's and Medline Co-Issuer, Inc.'s senior secured debt at 'BB-'/'RR3' and senior unsecured debt at 'B-'/'RR6'. The Rating Outlook has been revised to Stable from Negative. The revision reflects Medline's improved performance as reflected in its meaningful revenue, EBITDA and cash flow growth. Fitch believes that Medline is capable of growing revenue at approximately 5% or higher and maintaining EBITDA margins to support future deleveraging. Medline's FCF relative to debt remains strong for the 'B+' rating category. Fitch expects that the company's EBITDA leverage will decline to levels appropriate for the 'B+' rating or higher during the rating horizon so long as FCF is directed toward debt repayment and acquisitions and not to dividends to the sponsor. KEY RATING DRIVERS Leading Market Position for Medical/Surgical Products: Medline is a market leader in the manufacturing and distribution of medical/surgical products in the U.S. The company's vertical integration of manufacturing and distribution capabilities and global sourcing relationships helps to differentiate it from leading competitors, such as Cardinal Health, Inc. and Owens & Minor, Inc. Medline's profitability is enhanced by its ability to maintain and grow relationships across a significant number of the largest integrated delivery networks across the U.S. with Medline branded products. Revenue, EBITDA and Cash Flow Growth: Strong product demand, driven by new prime vendor relationships and share gains across non-acute channels, is expected to underpin meaningful revenue and EBITDA expansion. Cash flow from operations (CFO) has expanded in 2023 because of a reduction in inventory levels providing Medline with significant levels of cash and greater financial flexibility. Fitch expects that a combination of strong persistency of existing customers and the ability to effectively penetrate both the acute care and post-acute care health care market with private label products will continue to produce a high level of profitability and cash flow, albeit somewhat constrained by inflationary pressures. Investments in new and existing capacity are expected to remain within a range of $300 million to $400 million over the forecast horizon. EBITDA Leverage is High, but FCF/Debt is Good: Two years after the acquisition of Medline by Blackstone, Carlyle and Hellman & Friedman (the Sponsors), Fitch estimates that gross leverage (gross debt/EBITDA) remains at approximately 6.7x for the TTM period ending Sept. 23, 2023, which is above Fitch's original expectation of 6.0x as of and for the year ending December 2023. The higher than expected EBITDA leverage is primarily a function of Medline's decision to direct FCF to fund management compensation that was required to be paid upon the change of control of Medline. Now that such payments have been fully settled, Fitch anticipates that some portion of FCF will be directed to debt repayment, but that EBITDA leverage will remain above 6.0x until year-end 2024. Offsetting the high levels of debt is Fitch's view that FCF will remain above the negative sensitivity of 5% over the forecast period. Fitch's calculation of gross leverage includes an amount of mortgage debt secured principally by Medline's manufacturing and distribution facilities. Such debt is treated as a having a higher priority of claim than all other senior secured and senior unsecured debt. Governance and Financial Policy: In its inaugural coverage of Medline, Fitch identified two critical assumptions underpinning its forecast for Medline: 1) the ability of the Mills family and the Sponsors to work together effectively and 2) to reduce debt over the near to medium term. Fitch continues to believe these assumptions are valid because it will lead to the highest value proposition for all parties. However, the decision to prioritize the use of FCF for management compensation instead of debt reduction heightens the weight of this assumption to Fitch's medium-term forecast. Any signs that Medline no longer has the ability or intent to reduce debt toward its negative sensitivities will heighten downgrade pressure. Ultimately, future positive rating actions will be evaluated in the context of actual debt repayments and whether Medline articulates plans for meaningful debt reduction through a public offering of equity securities. DERIVATION SUMMARY Medline's 'B+'/Stable Long-Term IDR reflects its strong position in the large and stable market for medical/surgical products. The company has established a wide array of branded products for sale to acute care, post-acute care, physician office and surgery center markets. The company's vertical integration of manufacturing capabilities, distribution network and global sourcing relationships differentiates Medline from its principal competition: Cardinal Health, Inc. (CAH; BBB/Positive), Owens & Minor, Inc. (OMI; BB-/Stable) and McKesson Corporation (MCK; A-/Stable). Medline's strategy of leading with manufactured products helps to subsidize and win prime-vendor relationships with large integrated delivery networks. Private label products comprise a majority of Medline's gross profits compared with significantly lower amounts for CAH and OMI. While OMI, CAH and MCK focus on parts of the acute care, post-acute care, physician office and surgery center markets, only CAH has a comparable segment focus and level of price competitiveness. The company's revenues from the distribution of medical-surgical products and EBITDA margins are significantly higher than other distributors revenue from such products. Fitch believes this is because of Medline's successful prime relationship strategy that leads to the sale of its branded products. Fitch believes that private label products offer higher margins, albeit at lower price points. The IDRs of Mozart Holdings, LP and Medline Borrower, LP are rated on a consolidated basis as discussed in Fitch's Parent-Subsidiary Linkage Criteria using the weak parent/strong subsidiary approach, open access and control factors based on the entities operating as a single enterprise with strong legal and operational ties. KEY ASSUMPTIONS - Revenue increases at a CAGR of approximately 5%-6% over the period 2023-2026 (the forecast period); - Adjusted EBITDA margins are maintained around 11% over the forecast period; - Working capital changes represent a significant source of cash flow in 2023 and revert to a use of cash of approximately $300 million-$350 million for the remainder of the forecast period; - Capex of approximately $300 million to $400 million per year; - FCF is used principally to fund MPU payments in 2022 and 2023 and thereafter to make "tuck-in" acquisitions and to reduce debt while maintaining cash balances of at least $200 million to $400 million. Fitch has not assumed any dividend payments to sponsors; - Secured mortgage debt of $2.2 billion is assumed to be senior to all other senior secured and senior unsecured debt; - Interest expense for the next 12 months assumes SOFR between 4.75% and 5.30%. RECOVERY ANALYSIS In assigning and maintaining instrument ratings for issuers with 'B+' and below IDRs, Fitch conducts a bespoke recovery analysis. For Medline, Fitch estimates an enterprise value (EV) on a going-concern basis of approximately $10.125 billion, after deduction of 10% for administrative claims. The EV assumption is based on a post-reorganization EBITDA of $1.5 billion and a 7.5x multiple; neither assumption has changed since Fitch's initial rating assignment. The post-reorganization EBITDA estimate is approximately 35% lower than Fitch's 2023 adjusted EBITDA estimate. Fitch's estimate of the post-reorganization EBITDA is premised on an EBITDA approximating pre-pandemic levels, which assumes a significantly lower base of revenues and, therefore, EBITDA generation. A bankruptcy scenario could arise as a result of disruption to third-party manufacturing services and key supplier relationships along with decreasing prices for Medline's goods and services and an inability to reduce its expenses in sufficient time to offset a material adverse effect on its business. In this scenario, Fitch expects Medline would need to reduce the size of its operations to offset the loss of revenue. The 7.5x multiple employed for Medline reflects acquisition multiples of healthcare distributors and trading ranges of Mozart's peer group (CAH, OMI, MCK), which have fluctuated generally between 6x-12x in the past few years. Instrument ratings and RRs for Medline's debt instruments are based on Fitch's Corporates Recovery Ratings and Instruments Ratings Criteria. Fitch includes Medline's CMBS debt in its waterfall (approximately $2.2 billion) that occupies a super-senior position. The secured mortgage debt is assumed to be fully recovered before the other senior secured and senior unsecured debt in the capital structure. The waterfall analysis also includes secured credit facilities and notes as follows: a cash flow revolving credit facility (assumed to be fully drawn on $1.0 billion capacity); secured term loans (approximately $7.7 billion USD equivalent after concession allocation of 2%); and other secured debt (approximately $4.5 billion). The secured debt is expected to recover in a range of 51%-70% and, therefore, is rated 'RR3'. Medline's senior unsecured debt of $2.5 billion ranks below other secured debt and is estimated to have a recovery in a range of 0%-10%; therefore, it is rated 'RR6'. Fitch has assumed 2% of the recovery value available to senior creditors is allocated to the senior unsecured debt. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: - Expectation of sustaining gross debt/EBITDA (including secured mortgage debt) at or below 5.0x; - FCF of approximately $750 million-$1.0 billion/year is applied to the reduction of debt over the next three years; - Operational strength demonstrated by customer retention and market share growth leading to increasing CFO; - Expectation of FCF/debt remains consistently above 10%. Factors that could, individually or collectively, lead to negative rating action/downgrade: - Expectation of sustaining gross debt/EBITDA (including secured mortgage debt) at or above 6.0x; - Total revenue growth rate declines to low-to-mid-single digits as a result of customer turnover and price concessions; - Expectation of EBITDA margins falling below 10% and FCF/debt remaining consistently below 5%. LIQUIDITY AND DEBT STRUCTURE Ample Liquidity: Fitch expects Medline's cash flow from operations together with its revolving credit facilities will be more than sufficient to fund its long-term and short-term capital expenditures, working capital and debt service requirements. The company's revolving credit facility has a financial covenant that provides ample room to borrow in the event of liquidity stress (7.5x, excluding the company's CMBS debt). Medline is expected to have approximately $1.5 billion in cash and cash equivalents as of year-end 2023, which is well in excess of its cash needs. As a result, Medline is in a position to either reduce debt or potentially acquire other businesses. Interest coverage (operating EBITDA/interest paid) is expected to remain above 3.0x for FYs 2024-2026. Debt Maturities: The amortization of the term loan B is expected to be approximately $70 million/year through maturity in 2028 and all other debt maturities are due in five years, except the CMBS debt, which has been extended to November 2024. Fitch expects Medline to exercise its option to extend the maturity by one year two more times; hence, refinancing risk remains low over the forecast period. ISSUER PROFILE Medline, headquartered in Northfield, Illinois, is the nation's largest supplier of medical-surgical ("med-surg") products to healthcare providers across the continuum of care. It is vertically integrated, combining manufacturing, sales and distribution capabilities at scale to provide medical-surgical products consumed by the healthcare industry every day. SUMMARY OF FINANCIAL ADJUSTMENTS Fitch adjusted reported EBITDA to remove non-recurring costs, inventory normalization adjustments and non-operating income/expense. In addition, for the forecast periods, Fitch's leverage metrics include CMBS debt. ESG CONSIDERATIONS Medline has an ESG Relevance Score of '4' for Governance Structure, because of the challenge of managing financial policy and capital allocation objectives among the Mills family and the new major shareholders. This has a negative impact on the credit profile and is relevant to the rating in conjunction with other factors. Medline has an ESG Relevance Score of '4' for Group Structure, because of its complex capital structure and use of secured mortgage debt to fund a material portion of the acquisition of the company. This has a negative impact on the credit profile and is relevant to the rating in conjunction with other factors. The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Medline Co-Issuer, Inc. senior unsecured LT B- Affirmed RR6 B- senior secured LT BB- Affirmed RR3 BB- Mozart Holdings, LP LT IDR B+ Affirmed B+ Medline Borrower, LP LT IDR B+ Affirmed B+ senior unsecured LT B- Affirmed RR6 B- senior secured LT BB- Affirmed RR3 BB- MV REALTY PBC: Taps Carpenter Lipps as Special Litigation Counsel ----------------------------------------------------------------- MV Realty PBC, LLC and its affiliates seek approval from the U.S. Bankruptcy Court for the Southern District of Florida to employ Carpenter Lipps, LLP. The Debtors require a special litigation counsel to: (a) give advice regarding the litigation pending before the Court of Common Pleas for Franklin County, Ohio, Case No. 23-CV-000963, and other Ohio regulatory and investigative matters; (b) assist in negotiation on behalf of the Debtors; and (c) render such other services as the Debtors require in connection with the litigation and possibly other litigation matters in the State of Ohio. The hourly rates for Carpenter's attorneys range from $200 for most junior attorneys to $800 for most senior partners. David Wallace, Esq., and Karen Cadieux, Esq., attorneys at Carpenter, will be compensated at $500 per hour and $350 per hour, respectively. In addition, the firm will seek reimbursement for expenses incurred. Mr. Wallace disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: David A. Wallace, Esq. Karen M. Cadieux, Esq. Carpenter Lipps LLP 280 Plaza, Suite 1300 280 North High Street Columbus, OH 43215 Telephone: (614) 365-4100 Email: wallace@carpenterlipps.com cadieux@carpenterlipps.com About MV Realty PBC MV Realty PBC, LLC, is a real estate brokerage firm based in Boca Raton, Fla. MV Realty and its affiliates filed Chapter 11 petitions (Bankr. S.D. Fla. Lead Case No. 23-17590) on Sept. 22, 2023. In the petitions signed by Antony Mitchell, authorized party, MV Realty disclosed $10 million to $50 million in assets and $50 million to $100 million in liabilities. Judge Erik P. Kimball oversees the cases. The Debtors tapped Seese, PA as bankruptcy counsel; Young Moore and Henderson, PA as local counsel; and Carpenter Lipps LLP and Frascona Joiner Goodman and Greenstein PC as special litigation counsel. MV REALTY PBC: Taps Frascona Joiner Goodman as Litigation Counsel ----------------------------------------------------------------- MV Realty PBC, LLC and its affiliates seek approval from the U.S. Bankruptcy Court for the Southern District of Florida to employ Frascona Joiner Goodman and Greenstein, PC. The Debtor requires a special litigation counsel to: (a) give advice regarding state litigation, regulatory, and investigative matters in Colorado; (b) assist in negotiation with states and regulatory divisions; and (c) render other necessary legal services. The hourly rates for Frascona's attorneys range from $350 for most junior attorneys to $450 for most senior partners. Paralegal work will be billed at the rate of $75 to $150 per hour. Jordan May, a partner at Frascona, will be paid at his hourly rate of $450. In addition, the firm will seek reimbursement for expenses incurred. Mr. May disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Jordan C. May, Esq. Caroline W. Young, Esq. Frascona Joiner Goodman and Greenstein PC 4750 Table Mesa Dr. Boulder, CO 80305 Telephone: (303) 494-3000 Email: jordan@frascona.com caroline@frascona.com About MV Realty PBC MV Realty PBC, LLC, is a real estate brokerage firm based in Boca Raton, Fla. MV Realty and its affiliates filed Chapter 11 petitions (Bankr. S.D. Fla. Lead Case No. 23-17590) on Sept. 22, 2023. In the petitions signed by Antony Mitchell, authorized party, MV Realty disclosed $10 million to $50 million in assets and $50 million to $100 million in liabilities. Judge Erik P. Kimball oversees the cases. The Debtors tapped Seese, PA as bankruptcy counsel; Young Moore and Henderson, PA as local counsel; and Carpenter Lipps LLP and Frascona Joiner Goodman and Greenstein PC as special litigation counsel. MV REALTY PBC: Taps Young Moore and Henderson as Local Counsel -------------------------------------------------------------- MV Realty PBC, LLC and its affiliates seek approval from the U.S. Bankruptcy Court for the Southern District of Florida to employ Young Moore and Henderson, PA. The Debtors require a local counsel to: (a) give legal advice regarding the litigation pending before the Superior Court, Wake County, North Carolina, Case No. 23-CV-006408-910; (b) assist in negotiation with various states in connection with the litigation; and (c) render other necessary legal services. The firm receive a general retainer in the amount of $50,000. The hourly rates for Young Moore's attorneys range from $275 for most junior attorneys to $425 for most senior partners. Walter Brock, Jr., a partner at Young Moore, will be paid at his hourly rate of $425 per hour. Mr. Brock disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Walter E. Brock, Jr., Esq. Young Moore and Henderson, PA 3101 Glenwood Ave., Suite 200 Raleigh, NC 27612 Telephone: (919) 861-5119 Email: walter.brock@youngmoorelaw.com About MV Realty PBC MV Realty PBC, LLC, is a real estate brokerage firm based in Boca Raton, Fla. MV Realty and its affiliates filed Chapter 11 petitions (Bankr. S.D. Fla. Lead Case No. 23-17590) on Sept. 22, 2023. In the petitions signed by Antony Mitchell, authorized party, MV Realty disclosed $10 million to $50 million in assets and $50 million to $100 million in liabilities. Judge Erik P. Kimball oversees the cases. The Debtors tapped Seese, PA as bankruptcy counsel; Young Moore and Henderson, PA as local counsel; and Carpenter Lipps LLP and Frascona Joiner Goodman and Greenstein PC as special litigation counsel. NATURALSHRIMP INC: Delays Filing of Q3 Form 10-Q Report ------------------------------------------------------- NaturalShrimp, Inc. disclosed in Form 12b-25 filed with the Securities and Exchange Commission that the Company is unable to file its Quarterly Report on Form 10-Q for the quarter ended September 30, 2023 by the prescribed date of November 14, 2023, without unreasonable effort or expense. According to the Company, it needs additional time to complete certain disclosures and analyses to be included in the Report. In accordance with Rule 12b-25 promulgated under the Securities Exchange Act of 1934, as amended, the Company intends to file the Report on or prior to the fifth calendar day following the prescribed due date. About NaturalShrimp NaturalShrimp, Inc. is a publicly traded aqua-tech Company, headquartered in Dallas, with production facilities located near San Antonio, Texas. The Company has developed a commercially viable system for growing shrimp in enclosed, salt-water systems, using patented technology to produce fresh, never frozen, naturally grown shrimp, without the use of antibiotics or toxic chemicals. NaturalShrimp systems can be located anywhere in the world to produce gourmet-grade Pacific white shrimp. NaturalShrimp reported a net loss of $16 million for the year ended March 31, 2023, compared to a net loss of $86.30 million for the year ended March 31, 2022. As of March 31, 2023, the Company had $32.58 million in total assets, $32.66 million in total liabilities, $2 million in series E redeemable convertible preferred stock, $43.61 million in series F redeemable convertible preferred stock, and a total stockholders' deficit of $45.69 million. Dallas, Texas-based Turner, Stone & Company, L.L.P., the Company's auditor since 2015, issued a "going concern" qualification in its report dated June 26, 2023, citing that the Company has suffered recurring losses from inception and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. NATURALSHRIMP INC: Incurs $2.7 Million Net Loss in Second Quarter ----------------------------------------------------------------- NaturalShrimp Incorporated filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $2.65 million on $7,010 of net revenue for the three months ended Sept. 30, 2023, compared to a net loss of $24.53 million on $51,725 of net revenue for the three months ended Sept. 30, 2022. For the six months ended Sept. 30, 2023, the Company reported a net loss of $4.94 million on $163,141 of net revenue compared to a net loss of $26.73 million on $88,061 of net revenue for the same period during the prior year. As of Sept. 30, 2023, the Company had $29.42 million in total assets, $32.37 million in total liabilities, $1.96 million in series E redeemable convertible preferred stock, $43.61 million in series F redeemable convertible preferred stock, and a total stockholders' deficit of $48.52 million. The Company stated, "For the six months ended September 30, 2023, the Company had a net loss available for common stockholders of approximately $5,418,000. As of September 30, 2023, the Company had an accumulated deficit of approximately $172,952,000 and a working capital deficit of approximately $10,257,000. These factors raise substantial doubt about the Company's ability to continue as a going concern, within one year from the issuance date of this filing. The Company's ability to continue as a going concern is dependent on its ability to raise the required additional capital or debt financing to meet short and long-term operating requirements. During the six months ended September 30, 2023, the Company received net cash proceeds of approximately $1,865,000 from the sale of common shares. "Management believes that private placements of equity capital will be needed to fund the Company's long-term operating requirements. The Company may also encounter business endeavors that require significant cash commitments or unanticipated problems or expenses that could result in a requirement for additional cash. If the Company raises additional funds through the issuance of equity, the percentage ownership of its current shareholders could be reduced, and such securities might have rights, preferences or privileges senior to its common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, the Company may not be able to take advantage of prospective business endeavors or opportunities, which could significantly and materially restrict its operations. The Company continues to pursue external financing alternatives to improve its working capital position. If the Company is unable to obtain the necessary capital, the Company may be unable to develop its future planned facilities and, concomitantly, increase its shrimp production." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/0001465470/000149315223042141/form10-q.htm About NaturalShrimp NaturalShrimp, Inc. is a publicly traded aqua-tech Company, headquartered in Dallas, with production facilities located near San Antonio, Texas. The Company has developed a commercially viable system for growing shrimp in enclosed, salt-water systems, using patented technology to produce fresh, never frozen, naturally grown shrimp, without the use of antibiotics or toxic chemicals. NaturalShrimp systems can be located anywhere in the world to produce gourmet-grade Pacific white shrimp. NaturalShrimp reported a net loss of $16 million for the year ended March 31, 2023, compared to a net loss of $86.30 million for the year ended March 31, 2022. As of June 30, 2023, the Company had $31.71 million in total assets, $32.55 million in total liabilities, $1.8 million in series E redeemable convertible preferred stock, $43.61 million in series F redeemable convertible preferred stock, and a total stockholders' deficit of $46.26 million. Dallas, Texas-based Turner, Stone & Company, L.L.P., the Company's auditor since 2015, issued a "going concern" qualification in its report dated June 26, 2023, citing that the Company has suffered recurring losses from inception and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. NEW JERUSALEM: Court Approves Disclosure Statement -------------------------------------------------- Judge Jimmy L. Croom has entered an order approving the Disclosure Statement filed by New Jerusalem Faith Apostolic Church, Inc., on August 30, 2023. Dec. 5, 2023, is fixed as the last day for filing written objections to the plan, and for filing written acceptances or rejections of the Plan. A pretrial conference on confirmation of the Plan is set for Dec. 14, 2023, at 9:30 a.m., in Courtroom Number 342, at 111 South Highland Avenue, Jackson, TN. About New Jerusalem Faith Apostolic Church New Jerusalem Faith Apostolic Church, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tenn. Case No. 23-10574) on May 8, 2023, with up to $1 million in assets and up to $500,000 in liabilities. Ferdinand Gant, president of New Jerusalem Faith Apostolic Church, signed the petition. C. Jerome Teel, Jr., Esq., at Teel & Gay, PLC, is the Debtor's legal counsel. NORTHEAST GROCERY: Fitch Assigns 'B+' LongTerm IDR, Outlook Stable ------------------------------------------------------------------ Fitch Ratings has assigned a first-time 'B+' Long-Term Issuer Default Rating (IDR) to Northeast Grocery, Inc. and its subsidiaries Tops Market Corporation (Tops) and The Golub Corporation. Fitch has also assigned a 'BB+'/'RR1(EXP)' to Northeast Grocery's proposed $550 million senior secured term loan and a 'BB+'/'RR1' to the company's ABL credit facility, which is co-issued by Tops and Golub. The Rating Outlook is Stable. Northeast Grocery's ratings reflect the company's moderate scale, with revenue and EBITDA in the mid-$6 billion and low-$300 million ranges, respectively. Although the company has good market shares in its key markets in New York and neighboring states, its limited size and cash flow leave it somewhat vulnerable to strengthening competition from scaled, national players in the grocery and general merchandise space. These concerns are mitigated by the company's good local positioning and merger-driven synergy achievement which support positive FCF generation over the rating horizon. The rating also considers the company's reasonable leverage which Fitch projects to be approximately 4x in 2023 (fiscal year ending April 2024) and in the high-3x range beginning 2024. KEY RATING DRIVERS Small Scale: Northeast Grocery's rating is constrained by its moderate size, with 273 stores and $6.7 billion in revenue across six states, primarily in New York. This compares to close to $250 billion in U.S. grocery revenue for in-market competitors Walmart Inc. (AA/Stable) excluding Sam's Club, and around $60 billion for Ahold Delhaize N.V. The company is also significantly smaller than national players The Kroger Company (nearly $150 billion in revenue) and Albertsons Companies (over $75 billion in revenue). Scaled food retailers have advantaged negotiating positions with inventory suppliers and other vendors and relatively greater ability to invest in revenue driving initiatives like healthy physical infrastructure, robust omnichannel models and marketing. These strengths can help scaled players gain share against smaller competitors over time. For example, Northeast Grocery's predecessor entity Tops Holding II Corporation underwent a bankruptcy in 2018 and cited scale disadvantages with regard to sourcing desired merchandise, vendor pricing, and footprint expansion. Northeast Grocery's geographically concentrated position also leaves it vulnerable to regional activity, including economic swings or weather events. Good Local Market Positioning: Despite its smaller scale, Northeast Grocery has good local market positions with #1/#2 shares in most operating areas, a credit positive. The company's Tops Markets, Price Chopper and Market 32 banners have fortified their leading local positions over time with a good mix of national and private brands, reasonable pricing, and some investments in a digital sales platform. On a pro forma basis, the company's efforts led to stable, albeit stagnant, revenue around $5.9 billion for the three years prior to the pandemic, accelerating to $6.7 billion in 2022 (fiscal year ending April 2023) given consumer behavior shifts and inflation. The company's execution has also led to good customer stickiness, with loyalty program members generating over 80% of sales. Northeast Grocery has paradoxically benefitted from the challenges of Northeast region market entry, which has somewhat limited new competition and remains one of the most fragmented markets in the U.S. For example, while the company does compete with Walmart, Ahold banners, and strong regional players like Wegmans, it has thusfar avoided significant direct competition from Kroger and Albertsons who have focused their expansion and M&A activity elsewhere. Net new competitive store openings in Northeast Grocery's operating areas is expected to be minimal over the medium term. Merger Synergy Drives EBITDA: Tops and Price Chopper/Market 32 merged in November 2021 with plans to execute over $120 million of cost synergies on a combined sales and EBITDA base of approximately $6.3 billion and $230 million, respectively. The company has actioned over $90 million of expense reductions through eliminating redundant expenses and headcount and finding scale efficiencies across business functions. The remaining synergies are planned to be achieved via continued efforts to leverage scale to reduce input costs and merging information technology functions. Fitch expects these synergy efforts can help Northeast Grocery drive EBITDA from pro forma levels around $230 million to above $300 million in 2023 and toward $335 million by 2025. Synergy achievement is projected to be somewhat mitigated by modest sales volume declines over the next 12 to 18 months as consumers shift meal purchases back toward dining out. Fitch also expects the company will need to reinvest some cost savings into revenue-driving business enhancements like marketing efforts and omnichannel initiatives. Reasonable Leverage; Positive FCF: The company has proposed a refinancing in which a new $550 million senior secured term loan will be used to repay a similar amount of first/second lien term loans. The new term loan and approximately $165 million drawn on the company's ABL and FILO tranche will comprise Northeast Grocery's pro forma debt, yielding EBITDAR leverage of approximately 4.0x in 2023 and the high-3x thereafter, assuming some EBITDA growth. The company is targeting gross leverage at or below 2.0x, which roughly equates to Fitch-defined EBITDAR leverage at or below 4.0x. Assuming around $320 million of run-rate EBITDA and cash interest and capex each in the $85 million to $90 million range annually, Fitch projects FCF before any sponsor dividends could trend in the low $100 million range. Fitch views Northeast Grocery's positive cash flow, which could be used to support deleveraging or investment in topline initiatives, as a credit positive. Parent Subsidiary Linkage: Fitch's analysis includes a strong subsidiary/ weak parent approach between the parent, Northeast Grocery, Inc. and its two subsidiaries, Tops Market Corporation and the Golub Corporation. Fitch assesses the quality of the overall linkage as high that results in an equalization of IDRs across the capital structure; consequently, the subsidiaries are rated in line with the parent. DERIVATION SUMMARY Northeast Grocery's 'B+'/Stable ratings reflect the company's modest scale and footprint relative to peers, somewhat offset by its good local market share positions. The recent merger of the Tops and Price Chopper/Market 32 banners has provided significant cost synergies, yielding EBITDA growth and positive cash flow. The rating assumes EBITDAR leverage trends below 4.0x over time. Northeast Grocery's rating compares to its highly rated food retail peers Walmart Inc. (AA/Stable) and Target Corporation (A/Stable), which have meaningfully larger scale, national - and in Walmart's case international - presence, strong relationships with counterparties like product manufacturers, and the ability to invest billions of dollars of capital into revenue-driving initiatives across its physical and digital platform. Ratings for these food retail leaders incorporate expectations of EBITDAR leverage well below that of Northeast Grocery in the low-2x for Walmart and high-1x for Target. A similarly rated non-food retail peer is LSF9 Atlantis Holdings, LLC (Victra; B/Positive), a leading authorized Verizon retailer of cellular telephony and related consumer electronics. Fitch expects Victra's EBITDA and FCF before any sponsor dividends to modestly trail those of Northeast Grocery, although Victra has greater geographic presence and strong ties with leading cellular service provider Verizon, which somewhat limits competitive incursion. Victra's Positive Outlook reflects a potential upgrade to 'B+' should EBITDAR leverage sustain below 5.5x. KEY ASSUMPTIONS - Fitch expects Northeast Grocery's 2023 (year ended April 2024) revenue to be approximately $6.6 billion, modestly below the $6.7 billion recorded in 2022 given some moderation to consumer spending and ongoing consumer behavior shifts after several years of strength in the grocery sector. Beginning 2024, revenue could grow modestly in the 0% to 2% range annually, assuming modest growth in the underlying food retail segment and flattish store count around 275. - EBITDA in 2023 could be in the $320 million range, above the approximately $285 million recorded in 2022 given ongoing synergy achievement, modestly mitigated by slightly negative revenue growth. EBITDA could grow slightly ahead of sales thereafter to the $335 million to $340 million range, assuming continued synergy achievement. EBITDA margins, which were around 4.3% in 2022, could expand toward 5%. - Cash flow prior to dividends, which was approximately $75 million in 2022, could trend in the low $100 million range beginning 2023 given EBITDA growth. The company's ABL facility has a floating rate structure and Fitch assumes base rates of around 5% over the forecast horizon, given the recently higher interest rate environment. Northeast Grocery's new senior secured term loan will have a variable rate structure and around $40 million in required amortization annually. Excess cash could be used for reinvestment into the business or dividends, with some restrictions on magnitude per the term loan credit agreement. - EBITDAR leverage, which was 4.2x in 2022, is projected to be approximately 4x in 2023 and in the high-3x range thereafter, assuming debt levels of $715 million in 2023, including $550 million of new term loans and approximately $165 million of ABL borrowings (including the FILO tranche); debt could decline around $40 million annually beginning 2024 given required amortization. RECOVERY ANALYSIS Fitch's recovery assumes Northeast Grocery is maximized as a going concern in a post default scenario, given a going-concern valuation of approximately $1 billion compared with around $600 million in value from a liquidation of assets. Fitch's going concern value is derived from a projected EBITDA of around $225 million. The scenario incorporates revenue of approximately $5.4 billion, around 20% below revenue for the year ended April 30, 2023, assuming closing of around 25 lower-revenue stores and around 10% sales declines at the remaining base. EBITDA margins could trend around 4.2% in a recovery scenario, below Fitch's 5% forecast given some fixed-cost deleverage. A going concern multiple of 4.5x was selected, at the lower end of the 4x-8x range observed for North American corporates and 4x-6x observed for North American retailers, given traditionally lower exit multiples achieved in the food retail space. For example, Tops Market exited its 2018 bankruptcy at an approximately 4.2x multiple. Fitch's projected multiple of 4.5x is slightly higher given the company's greater scale post 2021 merger with Price Chopper/Market 32 and better EBITDA and FCF conversion following cost synergy achievement. The approximately $900 million in value available to service debt, after deducting 10% for administrative claims, yields full recovery for the $325 million ABL, which is limited by a borrowing base including eligible inventory, pharmaceutical prescription files and receivables and is assumed to be 70% drawn at default, and the $25 million FILO tranche which is assumed to be fully drawn. The ABL, which is co-borrowed by The Golub Corporation and Tops Market Corporation, is therefore assigned a 'BB+'/'RR1' rating. The $550 million proposed senior secured term loan, which will have a second lien on ABL collateral and a first lien on Northeast Grocery's remaining assets, is expected to have outstanding recovery prospects and is therefore also assigned a 'BB+'/'RR1(EXP)' rating. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: - Upward rating action is constrained by Northeast Grocery's EBITDA scale and its geographical concentration in a highly competitive region. An upgrade could result from significant expansion leading to EBITDA close to $500 million (or EBITDAR near $750 million), while maintaining EBITDAR leverage (capitalizing leases at 8x) below 4.0x. Factors that could, individually or collectively, lead to negative rating action/downgrade: - A downgrade could result from total EBITDAR leverage (capitalizing leases at 8x) sustained above 4.5x on lower-than-expected operating results or debt-financed shareholder friendly activity. A significant moderation in FCF toward breakeven would also be a rating concern. LIQUIDITY AND DEBT STRUCTURE As of April 30, 2023, Northeast Grocery had $63.5 million of cash and equivalents and $219.6 million of availability on its $350 million ABL revolving credit facility (including $25 million FILO tranche) due May 2026 after accounting for $65 million outstanding balance on the revolving credit facility, the full $25 million outstanding on the FILO tranche and $40.4 letters of credit outstanding. Availability on the ABL revolving credit facility is based on a borrowing base whose collateral includes certain inventory, receivables and pharmaceutical prescription files. The company is proposing a new $550 million senior secured term loan, whose proceeds will be used to repay the company's existing $277 million in first lien term loans and $236 million in second lien term loans. Assuming a successful close and refinancing, the term loan and ABL/FILO will comprise the company's pro forma debt. Northeast Grocery's ratings are supported by Fitch's expectations of positive FCF through the forecast period. Unlike many retail segments, the food retail industry exhibits limited operating seasonality and consequently limited seasonal working capital swings. ISSUER PROFILE Northeast Grocery, Inc. operates 273 grocery-focused stores, primarily in New York state, under the Tops, Price Chopper, and Market 32 brands. The company generates approximately $6.7 billion in revenue and holds leading shares in most of its primary local markets. SUMMARY OF FINANCIAL ADJUSTMENTS - Fitch adjusts for one-time charges and stock-based compensation; - Rent expense capitalized by 8.0x to calculate historical and projected adjusted debt. 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 ----------- ------ -------- The Golub Corporation LT IDR B+ New Rating senior secured LT BB+ New Rating RR1 Northeast Grocery, Inc. LT IDR B+ New Rating senior secured LT BB+(EXP) Expected Rating RR1 Tops Markets Corporation LT IDR B+ New Rating senior secured LT BB+ New Rating RR1 NOVA ACADEMY: S&P Lowers 2015 Rev. Refunding Bonds Rating to 'BB-' ------------------------------------------------------------------ S&P Global Ratings lowered its long-term rating and underlying ratings for credit program on Clyde Education Facilities Corp., Texas' series 2015 education revenue refunding bonds issued for Nova Academy (Nova or the school) to 'BB-' from 'BB'. The outlook is negative. "The rating action reflects our view of Nova's persistent and accelerating enrollment decreases and negative operations for fiscal years 2022 and 2023," said S&P Global Ratings credit analyst Alexander Enriquez. Nova has experienced enrollment decreases in seven of the last eight years, with enrollment of 450 students in November 2023, down from a high of 962 in fiscal 2016. S&P said, "The negative outlook reflects our view of Nova's weakened enterprise profile, with decreasing enrollment pressuring the school's budget, which, combined with the expiration of Elementary and Secondary School Emergency Relief (ESSER) funds, have led to reductions in force. The school has limited remaining capacity to adjust its operating budget should enrollment continue to decline, which could further deplete financial resources. "We could lower the rating during the outlook period if enrollment or demand metrics continue to weaken, if the school posts material operating deficits, or if liquidity deteriorates significantly. We would also view negatively any instability in the management team. "We could revise the outlook to stable if the school demonstrates a reverse in its long-term trend of enrollment decreases, with the school meeting all state and authorizer academic standards, producing positive operating surpluses, and maintaining liquidity near current levels." NXT ENERGY: To Raise $2.5MM in Convertible Debenture Offering ------------------------------------------------------------- NXT Energy Solutions Inc. said it has received conditional approval from the Toronto Stock Exchange to offer a multi-tranche convertible debenture under which the subscribers will be able to purchase a principal amount of up to $2,500,000. The Debentures bear interest at 10% per annum, paid quarterly, and are due and payable two years after issuance of the Debenture. The Debentures are convertible into common shares in the capital of NXT at a conversion price of $0.1808 (CAD$0.25) per Common Share which provides the subscribers with the right to obtain up to 13,827,433 common shares in the capital of NXT. The proceeds from the Debenture will be used to support the working capital needs of the upcoming SFD survey in Turkiye, and other general and administrative costs, which include business development and marketing activities required to transform the existing pipeline of SFD opportunities into firm contracts. As of November 8, 2023, the Company has issued an aggregate principal amount of $1,000,000 (approximately CAD$1,379,000) of the Debenture to MCAPM, LP and Michael P. Mork. Mork Capital will now have the right to obtain an additional 5,530,973 Common Shares upon the conversion of the Debentures. However, due to the current shareholdings of Mork Capital in NXT, no conversion of the Debentures can occur until shareholder approval of NXT's shareholders is obtained. Mork Capital currently owns an aggregate of 14,921,233 Common Shares, representing 19.13% of the currently issued and outstanding Common Shares of NXT. With the acquisition of the Debentures, Mork Capital will have the right to own, after conversion of the Debentures, 20,452,206 Common Shares, representing approximately 24.48% of the issued and outstanding Common Shares (after giving effect to the conversion of the full amount of Debentures). In addition, the Company has agreed to appoint a representative from Mork Capital to its board of directors in the near future. The Company intends to complete the remaining US$1,500,000 of the Debenture offering on or before December 15, 2023. Commenting on the Debenture offering, Bruce G. Wilcox, Interim CEO of NXT said, "Proceeds from this financing are critical in providing NXT with the capital necessary to complete its SFD contract in Turkiye and continue with other negotiations for the deployment of our SFD technology in other regions. Mork Capital has been a significant shareholder of the Company for over 20 years and we appreciate their confidence in the potential of NXT. We look forward to their active participation on the Board of Directors and continuing our partnership with them." About NXT Energy NXT Energy Solutions Inc. is a Calgary-based technology company whose proprietary SFD survey system utilizes quantum-scale sensors to detect gravity field perturbations in an airborne survey method which can be used both onshore and offshore to remotely identify areas with exploration potential for traps and reservoirs. The SFD survey system enables the Company's clients to focus their hydrocarbon exploration decisions concerning land commitments, data acquisition expenditures and prospect prioritization on areas with the greatest potential. SFD is environmentally friendly and unaffected by ground security issues or difficult terrain and is the registered trademark of NXT Energy Solutions Inc. NXT Energy Solutions provides its clients with an effective and reliable method to reduce time, costs, and risks related to exploration. NXT Energy a net loss and comprehensive loss of C$6.73 million in 2022, a net loss and comprehensive loss of C$3.12 million in 2021, a net loss and comprehensive loss of C$6.03 million in 2020. Calgary, Canada-based KPMG LLP, the Company's auditor since 2006, issued a "going concern" qualification in its report dated March 31, 2023, citing that the Company's current and forecasted cash and cash equivalents and short-term investments position are not expected to be sufficient to meet its obligations which raises substantial doubt about its ability to continue as a going concern. OMNIQ CORP: Niv Nissenson Steps Down as CFO ------------------------------------------- OmniQ Corp. disclosed in a Current Report on Form 8-K filed with the Securities and Exchange Commission that effective Nov. 17, 2023, Niv Nissenson, the Company's chief financial officer, resigned from his position for personal reasons. During resignation, Mr. Nissenson indicated he had no disagreements with the Company's accounting policies or procedures. The interim CFO will be the Company's CEO, Shai Lustgarten. Margo Goodrich, the Company's corporate controller will be designated as the Company's principal accounting officer. In addition, the Company appointed Mr. Guy Elhanani and Professor Mina Teicher to the Company's Nomination and Corporate Governance Committees to fill the vacancy created by Andrew MacMillan's recent death. About omniQ Corp. Headquartered in Salt Lake City, Utah, omniQ Corp. (OTCQB: OMQS) -- http://www.omniq.com-- provides computerized and machine vision image processing solutions that use patented and proprietary AI technology to deliver data collection, real time surveillance and monitoring for supply chain management, homeland security, public safety, traffic and parking management and access control applications. The technology and services provided by the Company help clients move people, assets and data safely and securely through airports, warehouses, schools, national borders, and many other applications and environments. Omniq Corp reported a net loss of $13.61 million for the year ended Dec. 31, 2022, compared to a net loss of $13.14 million for the year ended Dec. 31, 2021. As of March 31, 2023, the Company had $68.47 million in total assets, $81.31 million in total liabilities, and a total stockholders' deficit of $12.84 million. Salt Lake City, Utah-based Haynie & Company, the Company's auditor since 2019, issued a "going concern" qualification in its report dated March 30, 2023, citing that the Company has a deficit in stockholders' equity, and has sustained recurring losses from operations. This raises substantial doubt about the Company's ability to continue as a going concern. ONE DREAM: Seeks to Hire Hester Baker Krebs as Bankruptcy Counsel ----------------------------------------------------------------- ONE Dream, Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of Indiana to employ Hester Baker Krebs, LLC as its counsel. The Debtor requires legal counsel to: (a) give advice with respect to the powers and duties of the Debtor in the management of its property; (b) take necessary action to avoid the attachment of any lien against the Debtor's property threatened by secured creditors holding liens; (c) prepare legal papers; and (d) perform all other legal services for the Debtor. The Debtor paid the firm an initial retainer in the amount of $4,238, including the filing fee of $1,738. David Krebs, Esq., an attorney at Hester Baker Krebs, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: David R. Krebs, Esq. Hester Baker Krebs LLC One Indiana Sq. Suite 1330 Indianapolis IN 46204 Telephone: (317) 833-3030 Email: dkrebs@hnkfirm.com About ONE Dream ONE Dream, Inc. filed a voluntary petition for Chapter 11 protection (Bankr. S.D. Ind. Case No. 23-04948) on Nov. 7, 2023, with as much as $1 million in both assets and liabilities. John Wischmeier, owner, signed the petition. Judge Jeffrey J. Graham oversees the case. David R. Krebs, Esq., at Hester Baker Krebs LLC serves as the Debtor's legal counsel. PELICAN POINT: Seeks to Hire J.M. Cook as Bankruptcy Counsel ------------------------------------------------------------ Pelican Point Commons Town Homes, LLC seeks approval from the U.S. Bankruptcy Court for the Eastern District of North Carolina to employ J.M. Cook, PA as its counsel. The Debtor requires legal counsel to: (a) assist in evaluating the legal basis for, and effect of, the various pleadings that will be filed in the Chapter 11 case by the Debtor and other parties in interest; (b) prepare legal papers; (c) perform all necessary legal services in connection with the Debtor's reorganization; (d) assist the Debtor in preparing the monthly operating reports and evaluating and negotiating the Debtor's or any other party's Plan of Reorganization and any associated disclosure statement; (e) commence and prosecute any and all necessary and appropriate actions or proceedings on behalf of the Debtor; and (f) perform all other legal services for the Debtor which may be necessary and proper in these proceedings and in keeping with its fiduciary duty. The hourly rates of the firm's counsel and staff are as follows: Attorneys $300 Paralegal $75 The Debtor deposited $5,100 with counsel in connection with the Chapter 11 filing. J.M. Cook disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: J.M. Cook, Esq. J.M. Cook, PA 5886 Faringdon Place, Suite 100 Raleigh, NC 27609 Telephone: (919) 675-2411 Facsimile: (919) 882-1719 Email: J.M.Cook@jmcookesq.com About Pelican Point Commons Town Homes Pelican Point Commons Town Homes, LLC filed Chapter 11 petition (Bankr. E.D.N.C. Case No. 23-03221) on Nov. 6, 2023, with as much as $1 million in both assets and liabilities. Sainte Robinson, manager, signed the petition. Judge David M. Warren oversees the case. J.M. Cook, PA serves as the Debtor's legal counsel. PIXELLE SPECIALTY: S&P Downgrades ICR to 'B-' on Elevated Leverage ------------------------------------------------------------------ S&P Global Ratings lowered its issuer credit rating on Pixelle Specialty Solutions LLC to 'B-' from 'B'. The negative outlook indicates that S&P could lower its ratings if the company's earnings remain weak, leading to constrained liquidity and sustained high debt leverage. The downgrade reflects the deterioration in Pixelle's credit metrics due to its weak demand and operational inefficiencies. The company generated S&P Global Ratings-adjusted EBITDA of $12 million for the first nine months of 2023 (compared with our expectation for about $86 million) and S&P Global Ratings-adjusted EBITDA margins of close to 1%. S&P said, "Therefore, we now expect its S&P Global Ratings-adjusted debt leverage will spike to near 19x for full-year 2023 before falling to the mid-8x area in 2024 (assuming a rebound in its earnings next year), which is a level that we do not view as commensurate with the 'B' rating. This is a material deviation from our previous base-case forecast for leverage of 3x-4x in both years." S&P said, "While we expect a material recovery in Pixelle's profitability in 2024, it has limited headroom at the 'B-' rating for an underperformance. We do not believe the elevated maintenance costs and other operational inefficiencies that negatively affected the company's performance in the first half of 2023 will persist in 2024. We also anticipate Pixelle's S&P Global Ratings-adjusted EBITDA will improve to roughly $70 million (5% S&P Global Ratings-adjusted EBITDA margin) as its operating performance recovers from the disruptions in the first half of 2023 and its fixed-cost absorption improves on a modest uptick in shipped volumes. Therefore, we expect the company will reduce its S&P Global Ratings-adjusted debt leverage to the mid-8x area. However, we note that Pixelle's revenue visibility remains limited and believe lower shipped volumes and constrained EBITDA will lead to sustained elevated debt leverage, which increases the likelihood we will lower our rating. "The negative outlook reflects the potential that we will lower our rating in the next 6-12 months if Pixelle's operating trends do not improve materially from current levels. This would likey cause its S&P Global Ratings-adjusted debt leverage to remain elevated, further constrain its liquidity, and lead us to view its capital structure as unsustainable." S&P could lower its rating on Pixelle if: -- Persistent weak profitability leads us to view its capital structure as unstainable. Specifically, this would occur if its leverage remains above 9x with limited prospects for improvement; or -- The company's liquidity position weakens, increasing its reliance on its revolver such that it triggers the leverage covenant. S&P could revise its outlook on Pixelle to stable if its operating performance improves such that it generates sufficient earnings to improve and maintain its S&P Global Ratings-adjusted debt leverage well below 9x and resolves all of its liquidity pressures. S&P said, "Environmental factors are a moderately negative consideration in our credit analysis of Pixelle. The products in its specialty papers and engineered products segments (carbonless and non-carbonless forms, envelope and converting, food contact papers, high speed inkjet papers, greeting cards, playing cards, and book publishing) are chemical-intensive to produce. Its products also face end-of-life waste issues. Governance is a moderately negative consideration. Our highly leveraged assessment of the company's financial risk profile reflects that its corporate decision making prioritizes the interests of its controlling owners, in line with our view of most rated entities owned by private-equity sponsors. Our assessment also reflects private-equity owners' generally finite holding periods and focus on maximizing shareholder returns." PODS LLC: S&P Alters Outlook to Negative, Affirms 'B' ICR --------------------------------------------------------- S&P Global Ratings revised its outlook on PODS LLC to negative from stable and affirmed its 'B' issuer credit rating. S&P said, "The negative outlook reflects our view that the company's credit metrics will continue to be negatively affected by subdued moving and storage activity amid uncertain macroeconomic conditions, as well as higher interest rates, through 2024. "We believe unfavorable market conditions will continue to affect PODS' financial performance through 2024. The U.S. housing market has experienced significant weakness over the last 18-20 months (beginning mid-2022), with existing home sales dropping to a 13-year-low in September 2023. High mortgage rates have discouraged current homeowners (with much lower rates on their existing mortgages) from listing their homes, keeping inventory constrained. The resulting high home prices (due to low inventory), combined with elevated mortgage rates, are deterring prospective new buyers from purchasing homes and relocating. We don't expect market conditions will improve significantly in 2024 as current trends persist and home affordability remains weak. S&P Global Ratings forecasts residential investment will decline by 11.1% in 2023 before expanding marginally by 0.7% in 2024. Therefore, we estimate PODS' revenue will decrease by about 14%-18% in 2023 before increasing modestly by 0%-5% in 2024. "We also expect the company's profitability through 2024 will be weaker than in 2021 and 2022 because it has had to increase its advertising spending and pursue targeted pricing initiatives to maintain its volumes and market share amid competitive market conditions. While we expect PODS will undertake various measures to reduce its costs and improve efficiencies to somewhat offset its weaker revenue performance, we expect its profitability margins will remain below historical levels through 2024. "We expect PODS' credit metrics will remain relatively weak for the rating through 2024. In addition to its weaker operating performance, the company's credit metrics is being negatively affected by elevated interest rates because its debt is largely variable rate. PODS doesn't hedge its interest-rate exposure. "The company incurred sizeable capital expenditure (capex) over the last two to three years as it focused on expanding its fleet amid strong demand conditions. We now expect PODS will cut back on its capex in 2024 due to the weaker demand environment, thus we forecast capex of about $60 million-$70 million in 2024, down from an estimated $130 million in 2023 (and close to $180 million in 2022). Nevertheless, its sizeable recent fleet expansion and the subsequent weakness in its demand have led to some operating inefficiencies, causing its fleet utilization to decline to about 66% as of September 2023 from 80%-90% under strong market conditions in 2021. "We forecast PODS' funds from operations (FFO) to debt will decline to close to 10% in 2023 (from 19.7% in 2022) before improving modestly to the low-teens percent area in 2024. We also expect the company's EBIT interest coverage will remain below 1.1x (compared with 2.2x in 2022) while it maintains debt to capital of above 90% (similar to 2022) through 2024. "PODS' liquidity position remains adequate. We expect the company's liquidity position will remain adequate over the next 12 months, supported by its comfortable cash position and revolver availability. PODS' cash position benefitted from the $100 million add-on to its term loan in early 2023. Major uses of liquidity include expected outflows toward capex, debt and interest payments, and moderate working capital outflows. "However, while we consider its current liquidity position to be adequate, we believe it has limited avenues to raise additional liquidity in case of protracted operating weakness. "The negative outlook reflects our view that the company's credit metrics will continue to be negatively affected by subdued moving and storage activity amid uncertain macroeconomic conditions, as well as higher interest rates, through 2024. We forecast PODS' FFO to debt will decline to close to 10% in 2023 (from 19.7% in 2022) before improving modestly to the low-teens percent area in 2024. We also expect its EBIT interest coverage will remain below 1.1x (compared with 2.2x in 2022) while it sustains debt to capital of more than 90% (similar to 2022) through 2024. "We could lower our ratings on PODS over the next year if its financial profile weakens such that its EBIT interest coverage remains below 1.1x and we expect its FFO to debt will remain well below 12% on a sustained basis. We could also lower our ratings if operational weakness results in sustained cash burn, pressuring the company's liquidity position." This could occur if: -- Its revenue and cash flow generation remain pressured by unfavorable market conditions and high interest rates; -- It faces higher-than-anticipated labor or freight cost pressures; or -- It pursues another large debt-financed dividend or acquisition. S&P said, "We could revise our outlook on PODS to stable if its operating performance improves such that we expect its FFO to debt will rise to at least 12% on a sustained basis and we continue to view its liquidity as adequate. This could occur if it improves its revenue and cash flow supported by more favorable market conditions or lower interest rates." POMONA VALLEY: Unsecureds Owed $87K to Get Full Payment in Plan --------------------------------------------------------------- Pomona Valley Home Care, Inc., submitted a Third Amended Chapter 11 Plan of Reorganization. The Debtor's business was impacted during the pandemic as the costs of health care providers increased. The Debtor's business was beginning to improve when a former employee filed a wrongful termination lawsuit. The costs of litigation severely impacted Debtor's cash flow necessitation the filing of this case. Under the Plan, Class 3a - Classes of Allowed General Unsecured Claims total $87,927. Class 3a will be paid pro rata over 60 monthly with an estimated monthly payment of $1,465. The Debtor's projected disposable income for the 36 months after the effective date of the Plan is $37,247. Estimated administrative expenses total $35,000. The Debtor's counsel has $10,991 in trust, reducing the administrative fee balance to $24,009. Therefore, a total of $13,328 is projected to be available to be distributed to Class 3 allowed claims. However, Debtor's President has agreed to a temporary reduction in compensation in order to provide a 100% distribution to Class 3a general unsecured creditors. Payments to Class 3a will not commence until administrative claims have been paid in full. Class 3a is impaired. Class 3b - Separately Classified General Unsecured Claims are impaired. Sharine Forbes settled her claim directly with Debtor's insider Shehzad Ahmed. Mr. Ahmed has agreed to pay Ms. Forbes a total of $150,000 in full satisfaction of Ms. Forbes claim by making monthly payments of $10,000. Ms. Forbes will only look to Mr. Ahmed for compensation and her claim against Debtor is waived. The Plan will be funded from Debtor's continued operations. The Plan confirmation hearing will be held on December 20, 2023 at 11:00 a.m. in Courtroom 1539, 255 Temple Street, Los Angeles, CA 90012 Attorney for Chapter 11 Debtor: Thomas B. Ure, Esq. URE LAW FIRM 8280 Florence Ave., Suite 200 Downey, CA 90240 Tel: (213) 202-6070 Fax: (213) 202-6075 E-mail: tom@urelawfirm.com A copy of the Plan of Reorganization dated November 10, 2023, is available at https://tinyurl.ph/Cxhxd from PacerMonitor.com. About Pomona Valley Pomona Valley Home Care, Inc., filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 23-12116) on April 7, 2023, with $100,001 to $500,000 in both assets and liabilities. Susan K. Seflin has been appointed as Subchapter V trustee. Judge Sheri Bluebond oversees the case. The Debtor is represented by Thomas B. Ure, Esq., at Ure Law Firm. Tamar Terzian is the patient care ombudsman appointed in the Debtor's Chapter 11 case. PRESSURE BIOSCIENCES: Incurs $5.6 Million Net Loss in Third Quarter ------------------------------------------------------------------- Pressure Biosciences, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $5.63 million on $413,009 of total revenue for the three months ended Sept. 30, 2023, compared to a net loss of $4.46 million on $144,032 of total revenue for the three months ended Sept. 30, 2022. For the nine months ended Sept. 30, 2023, the Company reported a net loss of $19.41 million on $1.66 million of total revenue compared to a net loss of $11.62 million on $1.12 million of total revenue for the nine months ended Sept. 30, 2022. As of Sept. 30, 2023, the Company had $1.60 million in total assets, $30.20 million in total liabilities, and a total stockholders' deficit of $28.60 million. Pressure Biosciences stated, "The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. However, we have experienced losses from operations and negative cash flows from operationing business since our inception. As of September 30, 2023, we do not have adequate working capital resources to satisfy our current liabilities and as a result, there is substantial doubt regarding our ability to continue as a going concern. We have been successful in raising debt and equity capital in the past...In addition, we raised debt and equity capital after September 30, 2023...We have financing efforts in place to continue to raise cash through debt and equity offerings. Although we have successfully completed financings and reduced expenses in the past, we cannot assure you that our plans to address these matters in the future will be successful. These financial statements do not include any adjustments that might result from this uncertainty." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/830656/000149315223042131/form10-q.htm About Pressure Biosciences South Easton, Mass.-based, Pressure Biosciences Inc. -- http://www.pressurebiosciences.com-- develops and sells innovative, broadly enabling, high pressure-based platform technologies and related consumables for the worldwide life sciences, agriculture, food and beverage, and other keyindustries. Pressure Biosciences reported a net loss of $16.08 million for the year ended Dec. 31, 2022, compared to a net loss of $20.15 million for the year ended Dec. 31, 2021. As of June 30, 2023, the Company had $1.67 million in total assets, $26.79 million in total liabilities, and a total stockholders' deficit of $25.11 million. Houston, Texas-based MaloneBailey, LLP, the Company's auditor since 2015, issued a "going concern" qualification in its report dated April 12, 2023, citing that the Company has suffered recurring negative cash flows from operations and has a working capital deficit that raises substantial doubt about its ability to continue as a going concern. PRIMARY PRODUCTS: Moody's Alters Outlook on 'B1' CFR to Negative ---------------------------------------------------------------- Moody's Investors Service changed Primary Products Finance LLC's outlook to negative from stable. At the same time, Moody's affirmed Primary Products' B1 Corporate Family Rating, B1-PD Probability of Default Rating and the B1 ratings on the company's senior secured first lien revolving credit facility and senior secured first lien term loan. The outlook change to negative from stable reflects Moody's concern that Primary Product's discretionary dividend payments will cause the company to incur negative free cash flow in the next 12 to 18 months. The company's distribution practices have been consistently more aggressive than Moody's expected when assigning the ratings at the end of 2021, and are leading to less cash available to reduce debt and reinvest in the business. The reinvestment is important given the meaningful share of earnings generated from high fructose corn syrup products that are steadily declining and shortfall in EBITDA relative to expectations at the time of the leveraged buyout in April 2022. In the fiscal year ended March 31, 2023, Primary Products' $160 million in dividends contributed to a free cash flow deficit of $75 million. In the current fiscal year-to-date, Moody's estimates that the company has already paid $108 million in dividends and will likely incur another free cash flow deficit in fiscal 2024. Primary Products negative free cash flow in the fiscal year ended March 31, 2023 and likely negative free cash flow generation in the next 12 to 18 months is leading to higher net debt than originally anticipated. As a result of elevated debt and earnings declines, the company's credit metrics are likely to remain weak for the rating. Moody's affirmed the existing ratings because the company maintains adequate liquidity including an undrawn $100 million revolving credit facility, $189 million of availability on a $400 million asset-based revolving credit facility due April 1, 2027, and no meaningful debt maturities through 2026. In addition, Moody's expects some improvement in operating performance in the second half of fiscal 2024 as a result of operational investments that management made last year to update the manufacturing equipment that was acquired from Tate & Lyle PLC ("Tate & Lyle") in 2022. Furthermore, Primary Product's free cash flow generation could improve in fiscal 2025 if earnings continue to improve and capital expenditures decline. RATINGS RATIONALE Primary Products' B1 CFR reflects the company's position as a leading provider of nutritive sweeteners, industrial starches, acidulants and other corn-derived products in North America and Brazil with long-standing blue-chip customer relationships. Sweetener products represent roughly 65% of revenue and are used as ingredients in end markets such as food and beverage that are relatively stable through economic cycles. Other end markets are somewhat more cyclical such as paper, packaging and building products. The ratings also reflect the company's ability to effectively pass through commodity price volatility through its contractual material pass throughs (majority of volume) and stringent hedging procedures. Offsetting these factors are the company's high 3.8x debt-to-EBITDA leverage as of the 12 month period ended September 30, 2023 and negative free cash flow including dividend distributions. The company's limited stand-alone operating history also presents risk because it diminishes visibility into the sustainable cost structure as a stand-alone entity. The declining high fructose corn syrup ("HFCS") market is contributing to lower earnings, and aggressive financial policies under controlling interest by a private equity sponsor and minority owner Tate & Lyle are also a credit negative. The corn wet milling industry in the US is concentrated with Primary Products representing one of four players that supply over 95% of the volume of HFCS and industrial starches. High barriers to entry, such as the high costs of a new production facility (+$800 million) and low growth prospects, are likely to insulate the market from new entrants. In addition to limited competition, Primary Products also benefits from the high price of sugar in the US, a result of the USDA's Sugar Program that places tariffs on sugar imports and provides domestic price support for sugar. Given the high price of sugar, many well-known food and beverage companies use sweeteners such as high fructose corn syrup, corn syrup, and dextrose as alternatives to sugar in the formulation and manufacturing of their brands. Primary Products derives over 50% of its operating profit from these sweeteners and thus indirectly benefits from the US Sugar Program. If the USDA were to repeal this program, Primary Products could be negatively impacted. Primary Products has adequate liquidity based on cash, modest projected free cash flow and unused revolver capacity. The company had a cash balance of $55 million as of September 30, 2003, and Moody's projects approximately -$100 million in free cash flow in the fiscal year ending March 2024 with an improvement to approximately $15-20 million in the fiscal year ending March 2025 when capital spending is expected to decline to $120 million from an elevated fiscal 2024 level of $160 million. Primary Products has full capacity on an undrawn $100 million revolving credit facility due April 1, 2027, $189 million of availability on a $400 million asset-based revolving credit facility due April 1, 2027, and no meaningful debt maturities through 2026. The cash sources provide ample resources for the $10.6 million of required annual term loan amortization and reinvestment needs. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if the company diversifies its product profile, demonstrates financial policies consistent with maintaining lower leverage, sustains debt to EBITDA below 3.0x, and generates strong and consistent free cash flow while maintaining good liquidity. Alternatively, the ratings could be downgraded if operating profits decline due to market share losses, lower volumes, or cost increases, adverse change in key regulations relating to corn or sugar, free cash flow to debt is below 5% or the company pays a discretionary dividend, debt to EBITDA is above 4.5x, or liquidity deteriorates. Primary Products (dba Primient) is a provider of nutritive sweeteners, industrial starches, acidulants and other corn derived products for food, beverage and industrial end markets. Annual sales were approximately $3.1 billion for the fiscal year ended March 31, 2023. The company is 50.1% owned by KPS Capital Partners, LP and 49.9% owned by Tate & Lyle following an April 1, 2022 leveraged buyout transaction from Tate & Lyle. The principal methodology used in these ratings was Protein and Agriculture published in November 2021. PUERTO RICO: PREPA Plan Okayed to Start Voting Process ------------------------------------------------------ Michelle Kaske of Bloomberg News reports that US District Court Judge Laura Taylor Swain ruled a debt plan for Puerto Rico's bankrupt power utility that would slash $10 billion of claims by about 75% can move forward, subject to certain modifications. Judge Swain determined that Puerto Rico Electric Power Authority's most up-to-date disclosure statement for the plan provides enough information for bondholders to weigh in on it, although the island's financial oversight board, which is managing the bankruptcy, will need to make some adjustments, she said. On March 1, 2023, the Puerto Rico Electric Power Authority filed its Plan of Adjustment and the Disclosure Statement related thereto. On March 3, 2023, the Title III Court entered an order approving the adequacy of the information contained in the Disclosure Statement. On November 16, 2023, the Puerto Rico Electric Power Authority filed its amended Plan of Adjustment and the Supplemental Disclosure Statement related thereto The Court on Nov. 17, 2023, granted a motion by PREPA, by and through the Financial Oversight and Management Board for Puerto Rico, for an order: (i) approving the proposed Supplemental Disclosure Statement, (ii) fixing a Voting Record Date for voting on the Fifth Modified Third Amended Plan, (iii) approving the Confirmation Hearing Notice, (iv) approving the proposed contents of the Solicitation Package and procedures for distribution thereof, (v) approving the forms of ballots and election notice, and establishing solicitation, voting, election, and balloting procedures, (vi) approving the form and manner of notice of non-voting status, (vii) fixing a Voting Deadline and Election Deadline, (viii) approving procedures for tabulating creditor votes, and (ix) related relief. The Plan confirmation hearing will be held on March 4-15, 2024, at 9:30 a.m. (Atlantic Standard Time). Objections to confirmation and the ballots are due January 26, 2024 at 5:00 p.m. (Atlantic Standard Time). Ballots to vote to accept or reject the Fifth Modified Third Amended Plan are to be provided to: a. Assured Guaranty Corp. and Assured Guaranty Municipal Corp. on account of Assured Insured Bonds & Interest Rate Swap Secured Claims in Class 4 and Assured Insured Bonds & Interest Rate Swap Unsecured Claims in Class 5; b. Syncora Guarantee Inc. on account of Syncora Insured Bonds Secured Claims in Class 6 and Syncora Insured Bonds Unsecured Claims in Class 7; c. National Public Finance Guarantee Corporation on account of National Insured Bonds Secured Claims in Class 8 and National Insured Bonds Unsecured Claims in Class 9; and d. Holders of Claims in Class 1 (First Settlement Bondholder Claims), Class 2 (Uninsured Bondholder Secured Claims), Class 3 (Uninsured Bondholder Unsecured Claims), Class 10 (Pension Claim),6 Class 11 (Fuel Line Loan Claims), Class 12 (General Unsecured Claims), Class 13 (Vitol Claims), and Class 16 (Federal Claims). Ballots won't be provided to the Holders of Claims in Class 14 (Ordinary Course Customer Claims), Class 15 (Eminent Domain/Inverse Condemnation Claims), and Class 17 (Convenience Claims), because the Holders of these Claims are unimpaired. Ballots also won't be provided to the Holders of Claims in Class 18 (Section 510(b) Subordinated Claims), because such Holders will receive no distributions pursuant to the Fifth Modified Third Amended Plan and are deemed to reject the Plan. About Puerto Rico Puerto Rico is a self-governing commonwealth in association with the United States. The chief of state is the President of the United States of America. The head of government is an elected Governor. There are two legislative chambers: the House of Representatives, 51 seats, and the Senate, 27 seats. In 2016, the U.S. Congress passed PROMESA, which, among other things, created the Financial Oversight and Management Board and imposed an automatic stay on creditor lawsuits against the government, which expired May 1, 2017. The members of the oversight board are: (i) Andrew G. Biggs, (ii) Jose B. Carrion III, (iii) Carlos M. Garcia, (iv) Arthur J. Gonzalez, (v) Jose R. Gonzalez, (vi) Ana. J. Matosantos, and (vii) David A. Skeel Jr. On May 3, 2017, the Commonwealth of Puerto Rico filed a petition for relief under Title III of the Puerto Rico Oversight, Management, and Economic Stability Act ("PROMESA"). The case is pending in the United States District Court for the District of Puerto Rico under case number 17-cv-01578. A copy of Puerto Rico's PROMESA petition is available at http://bankrupt.com/misc/17-01578-00001.pdf On May 5, 2017, the Puerto Rico Sales Tax Financing Corporation (COFINA) commenced a case under Title III of PROMESA (D.P.R. Case No. 17-01599). Joint administration has been sought for the Title III cases. On May 21, 2017, two more agencies -- Employees Retirement System of the Government of the Commonwealth of Puerto Rico and Puerto Rico Highways and Transportation Authority (Case Nos. 17-01685 and 17-01686) -- commenced Title III cases. U.S. Chief Justice John Roberts named U.S. District Judge Laura Taylor Swain to preside over the Title III cases. The Oversight Board has hired as advisors, Proskauer Rose LLP and O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic consultant, Citigroup Global Markets as municipal investment banker, and Ernst & Young, as financial advisor. Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M. Abelson, Esq., of Proskauer Rose LLP; and Hermann D. Bauer, Esq., at O'Neill & Borges LLC are onboard as attorneys. Prime Clerk LLC is the claims and noticing agent. Prime Clerk maintains the case Website https://cases.primeclerk.com/puertorico Jones Day is serving as counsel to certain ERS bondholders. Paul Weiss is counsel to the Ad Hoc Group of Puerto Rico General Obligation Bondholders. RADIO FREE: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: Radio Free Red Hook LLC 347 Van Brunt Street Brooklyn, NY 11231 Chapter 11 Petition Date: November 21, 2023 Court: United States Bankruptcy Court Eastern District of New York Case No.: 23-44252 Debtor's Counsel: Lawrence Morrison, Esq. 87 Walker Street Floor 2 New York, NY 10013 Phone: 212-620-0938 Email: lmorrison@m-t-law.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $100,000 to $500,000 The petition was signed by St. John Frizell, managing member. REMARK HOLDINGS: Delays Filing of Q3 Form 10-Q Report ----------------------------------------------------- Remark Holdings, Inc. disclosed in Form 12b-25 filed with the Securities and Exchange Commission that it is unable to file its Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, without unreasonable effort or expense due to delays in obtaining and compiling information for inclusion in the Report. According to the Company, it expects to be able to file the Report on or before the fifth calendar day following its original prescribed due date. About Remark Holdings Remark Holdings, Inc. (NASDAQ: MARK) -- http://www.remarkholdings.com-- delivers an integrated suite of AI solutions that help organizations monitor, understand, and act on threats in real-time. Remark consists of an international team of sector-experienced professionals that have created video analytics. The Company's GDPR-compliant and CCPA-compliant solutions focus on market sectors including retail, federal and state governmental entities, public safety, hospitality, and transportation. The company's headquarters are in Las Vegas, Nevada, with operational offices in New York and international offices in London, England. Remark Holdings reported a net loss of $55.48 million for the year ended Dec. 31, 2022, compared to net income of $27.47 million for the year ended Dec. 31, 2021. As of March 31, 2023, the Company had $14.17 million in total assets, $39.95 million in total liabilities, and a total stockholders' deficit of $25.78 million. Los Angeles, California-based Weinberg & Company, P.A., the Company's auditor since 2020, issued a "going concern" qualification in its report dated April 17, 2023, citing that the Company has suffered recurring losses from operations and negative cash flows from operating activities and has a negative working capital and a stockholders' deficit that raise substantial doubt about its ability to continue as a going concern. REMARK HOLDINGS: Incurs $7.2 Million Net Loss in Third Quarter -------------------------------------------------------------- Remark Holdings, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q reporting a net loss of $7.17 million on $183,000 of revenue (including amounts from China business partner) for the three months ended Sept. 30, 2023, compared to a net loss of $8.92 million on $2.81 million of revenue (including amounts from China business partner) for the three months ended Sept. 30, 2022. For the nine months ended Sept. 30, 2023, the Company reported a net loss of $21.21 million on $4.17 million of revenue (including amounts from China business partner), compared to a net loss of $46.88 million on $10.04 million of revenue (including amounts from China business partner), for the nine months ended Sept. 30, 2022. As of Sept. 30, 2023, the Company had $12.40 million in total assets, $45.32 million in total liabilities, and a total stockholders' deficit of $32.92 million. Remark stated, "Our history of recurring operating losses, working capital deficiencies and negative cash flows from operating activities give rise to, and management has concluded that there is, substantial doubt regarding our ability to continue as a going concern. Our independent registered public accounting firm, in its report on our consolidated financial statements for the year ended December 31, 2022, has also expressed substantial doubt about our ability to continue as a going concern. Our consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. "We intend to fund our future operations and meet our financial obligations through revenue growth from our AI and data analytics offerings. We cannot, however, provide assurance that revenue, income and cash flows generated from our businesses will be sufficient to sustain our operations in the twelve months following the filing of this Form 10-Q. As a result, we are actively evaluating strategic alternatives including debt and equity financings." Management Commentary "During the third quarter of 2023, our team continued its tireless efforts to develop strategic relationships with top-level channel partners and with the best systems integrators -- relationships that will position Remark to both geographically diversify and then quickly scale up business," said Kai-Shing Tao, chairman and chief executive officer of Remark Holdings. "During the past fiscal quarter, we have signed contracts with customers or with systems integrators in at least five countries in Central and South America, as well as in Malaysia and India. Additionally, we are currently engaged in discussions with one of the top cloud computing companies in the world. We expect to be able to announce an agreement from these discussions shortly that will result in our AI computer vision solutions being added to one of the top cloud marketplaces and having the cloud computing partner's salesforce positioning our product to IT departments of top corporations around the globe. The world is clamoring for the functionalities and capabilities that we believe only our solutions can currently provide." Mr. Tao continued, "Our team, along with NVIDIA and PNY, presented at Smart City Expo World Congress in Barcelona and Gartner IT Symposium | Expo. We also announced a Sales and Marketing collaboration with Arrow Electronics and Intel which has already led to numerous opportunities for new customers which we will pursue in the upcoming quarters." "While the lingering effects of COVID-19 preventative measures and geopolitical tensions, including the tensions between the U.S. and China that have been increasing in recent months, have muted our current operating results, we are confident that the behind-the-scenes work we have been doing to reduce reliance on one geographic market and allow us to diversify and scale up our business will soon meet with success," concluded Mr. Tao A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/1368365/000136836523000100/mark-20230930.htm About Remark Holdings Remark Holdings, Inc. (NASDAQ: MARK) -- http://www.remarkholdings.com-- delivers an integrated suite of AI solutions that help organizations monitor, understand, and act on threats in real-time. Remark consists of an international team of sector-experienced professionals that have created video analytics. The Company's GDPR-compliant and CCPA-compliant solutions focus on market sectors including retail, federal and state governmental entities, public safety, hospitality, and transportation. The company's headquarters are in Las Vegas, Nevada, USA, with operational offices in New York and international offices in London, England. Remark Holdings reported a net loss of $55.48 million for the year ended Dec. 31, 2022, compared to net income of $27.47 million for the year ended Dec. 31, 2021. As of June 30, 2023, the Company had $12.86 million in total assets, $41.28 million in total liabilities, and a total stockholders' deficit of $28.43 million. Los Angeles, California-based Weinberg & Company, P.A., the Company's auditor since 2020, issued a "going concern" qualification in its report dated April 17, 2023, citing that the Company has suffered recurring losses from operations and negative cash flows from operating activities and has a negative working capital and a stockholders' deficit that raise substantial doubt about its ability to continue as a going concern. REMARKABLE HEALTHCARE: Court OKs Interim Cash Collateral -------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of Texas, Sherman Division, authorized Remarkable Healthcare of Carrollton, LP and affiliates to use cash collateral on an interim basis in accordance with the budget, with a 10% variance. The Debtors require the use of cash collateral to pay post-petition operating expenses and obtain goods and services needed to carry on their businesses in a manner that will avoid irreparable harm to their estates. The following parties have asserted or may assert liens in the Debtors' deposit accounts and cash: 1. Alleon Capital Partners 2. Comerica Bank 3. PeopleFund 4. Glazier Foods Company 5. Gordon Food Service, Inc. As of the Petition Date, (a) the Prepetition Facility Obligations of Alleon are legal, valid, binding, fully perfected, and non-avoidable obligations in the estimated aggregate liquidated amount of not less than $3.435 million as of the Petition Date; and (b) the Prepetition Facility Obligations constitute legal, valid, binding, fully perfected, and non-avoidable senior first-priority obligations of the Debtors, enforceable in accordance with the terms and conditions of Debtors' and Alleon's prepetition written agreements. As partial adequate protection for the use of cash collateral, the Secured Creditors are granted a valid, binding, enforceable, and automatically perfected lien co-extensive with the Secured Creditors' perfected pre-petition liens, in all currently owned or hereafter acquired property and assets of the Debtors. Unless specifically waived in writing by the Secured Creditors (which waiver will not be implied from any unwritten action, inaction, course of conduct or acquiescence by the Secured Creditors), the Debtors' right and authority to use cash collateral will immediately terminate upon the occurrence of any of the following: a. Conversion of the Chapter 11 case to a case under Chapter 7 of the Bankruptcy Code; or b. The lifting of the automatic stay for any other party other than the Secured Creditors authorizing such party to proceed directly against the cash collateral, or entry of a final order by the bankruptcy court authorizing any party to foreclose or otherwise enforce any lien or other right such other party may have in and to the Property and/or any part of the Collateral. Unless otherwise agreed to in writing by the Secured Creditors, the Debtors' right to use cash collateral will expire on the earlier of: (a) the Termination Date, unless extended by the terms of the Order; (b) an Event of Default; or (c) the Court entering a subsequent order terminating the Debtors' rights to use cash collateral. A final hearing on the matter is set for November 28, 2023. A copy of the order is available at https://urlcurt.com/u?l=Vc32L3 from PacerMonitor.com. About Remarkable Healthcare of Carrollton, LP Remarkable Healthcare of Carrollton, LP and affiliates own and operate nursing home facilities. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. Tex. Case No. 23-42098) on November 2, 2023. In the petition signed by Laurie Beth McPike, CEO, the Debtor disclosed up to $10 million in both assets and liabilities. Judge Brenda T. Rhoades oversees the case. Mark Castillo, Esq., at Carrington, Coleman, Sloman & Blumental, LLP, represents the Debtor as legal counsel. RISKON INTERNATIONAL: Posts $15.3 Million Net Loss in 2nd Quarter ----------------------------------------------------------------- RiskOn International, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $15.26 million on $17,700 of hospitality and VIP experience revenue for the three months ended Sept. 30, 2023, compared to a net loss of $24.73 million on $0 of hospitality and VIP experience revenue for the three months ended Sept. 30, 2022. For the six months ended Sept. 30, 2023, the Company had a net loss of $9.80 million on $62,850 of hospitality and VIP experience revenue, compared to a net loss of $35.46 million on $0 of hospitality and VIP experience revenue for the same period during the prior year. As of Sept. 30, 2023, the Company had $16.80 million in total assets, $35.86 million in total liabilities, and a total shareholders' deficit of $19.05 million. RiskOn stated, "The Company believes that the current cash on hand is not sufficient to conduct planned operations for one year from the issuance of the condensed consolidated financial statements, and it needs to raise capital to support its operations, raising substantial doubt about its ability to continue as a going concern. The accompanying financial statements for the three and six month periods ended September 30, 2023 have been prepared assuming the Company will continue as a going concern, but the ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it establishes continued revenue streams and becomes profitable. Management's plans to continue as a going concern include raising additional capital through sales of equity securities and borrowing. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans. If the Company is not able to obtain the necessary additional financing on a timely basis, the Company will be required to delay, reduce or perhaps even cease the operation of its business. The ability of the Company to continue as a going concern is dependent upon its ability to successfully secure other sources of financing and attain profitable operations. The Company raised approximately $3,500,000 in an At-the-Market capital raise during the fourth fiscal quarter of the year ended March 31, 2023 and the six months ended September 30, 2023. In addition, on April 27, 2023, the Company sold $6.875 million of principal face amount senior secured convertible notes with an original issue discount to sophisticated investors for gross proceeds to the Company of $5.5 million. The notes mature on April 27, 2024 and are secured by all of the assets of the Company and certain of its subsidiaries, including BNC." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/1437491/000121390023088761/f10q0923_riskoninter.htm About RiskOn International Founded in 2011, RiskOn International, Inc. (formerly known as BitNile Metaverse, Inc.) owns 100% of BNC, including the BitNile.com metaverse platform. The Platform, which went live to the public on March 1, 2023, allows users to engage with a new social networking community and purchase both digital and physical products while playing 3D immersive games. In addition to BNC, the Company also owns two non-core subsidiaries: approximately 66% of Wolf Energy Services Inc. (OTCQB: WOEN) indirectly and approximately 89% of Agora Digital Holdings, Inc. directly. RiskOn also owns approximately 70% of White River Energy Corp (OTCQB: WTRV). RiskOn reported a net loss of $87.36 million on zero revenue for the year ended March 31, 2023, compared to a net loss of $10.55 million on $27,182 of revenues for the year ended March 31, 2022. As of June 30, 2023, the Company had $22.66 million in total assets, $28.17 million in total liabilities, and a total stockholders' deficit of $5.51 million. New York, New York-based RBSM LLP, the Company's auditor since 2019, issued a "going concern" qualification in its report dated July 14, 2023, citing that the Company has suffered recurring losses from operations and had an accumulated deficit that raises substantial doubt about its ability to continue as a going concern. RISKON INTERNATIONAL: Raising $15MM in Securities Purchase Deal --------------------------------------------------------------- RiskOn International has executed a Securities Purchase Agreement with Ault Alliance, Inc. pursuant to which the Company will sell to AAI 603.44 shares of newly designated Series D Convertible Preferred Stock for a total purchase price of $15,085,930.69. The purchase price will be paid by the cancellation of $15,085,930.69 of cash advances made by AAI to the Company between January 1 and November 9, 2023. AAI is an affiliate of the Company. Each Preferred Share has a stated value of $25,000.00 per share and is convertible at AAI's option into shares of the Company's common stock at a fixed conversion price of $0.51 per share, which Conversion Price represents a 46% premium to the closing price of $0.349 per share of Common Stock. The Conversion Price is subject to standard anti-dilution provisions in connection with any stock split, stock dividend, subdivision or similar reclassification of the Common Stock. The Preferred shares also have "full ratchet" price protection in the event the Company issues securities at a lower price than the Conversion Price. The Preferred Stock shall pay a dividend at an annual rate of 10%, which the Company may, during the first two years, pay in additional Preferred Shares. The Transaction is expected to close on November 15, 2023, after the filing of the Certificates of Designations of the Rights, Preferences and Limitations of the Preferred Shares. The Company allocated the Advances to multiple subsidiaries to fund growth and new initiatives, specifically at BitNile.com, Inc. and GuyCare, Inc. The strategic investment from AAI underscores the support the Company has received from AAI since its initial investment in a separate series of preferred stock in June 2022. AAI continues to demonstrate its support for the Company and its initiatives. RiskOn CEO Randy May stated, "We are pleased to sign this Agreement with AAI and continue to enjoy our mutually beneficial working relationship. Since June 2022, AAI and its management has provided the Company with unwavering support. We look forward to strengthening the working relationship as we embark on new ventures within the Company." A full-text copy of the Company's report filed on Form 8-K with the Securities and Exchange Commission is available at https://tinyurl.com/6fs63nka About RiskOn International Founded in 2011, RiskOn International, Inc. (formerly known as BitNile Metaverse, Inc.) owns 100% of BNC, including the BitNile.com metaverse platform. The Platform, which went live to the public on March 1, 2023, allows users to engage with a new social networking community and purchase both digital and physical products while playing 3D immersive games. In addition to BNC, the Company also owns two non-core subsidiaries: approximately 66% of Wolf Energy Services Inc. (OTCQB: WOEN) indirectly and approximately 89% of Agora Digital Holdings, Inc. directly. RiskOn also owns approximately 70% of White River Energy Corp (OTCQB: WTRV). RiskOn reported a net loss of $87.36 million on zero revenue for the year ended March 31, 2023, compared to a net loss of $10.55 million on $27,182 of revenues for the year ended March 31, 2022. As of March 31, 2023, the Company had $23.77 million in total assets, $37.72 million in total liabilities, and a total stockholders' deficit of $13.94 million. New York, New York-based RBSM LLP, the Company's auditor since 2019, issued a "going concern" qualification in its report dated July 14, 2023, citing that the Company has suffered recurring losses from operations and had an accumulated deficit that raises substantial doubt about its ability to continue as a going concern. RITE AID: Seeks to Bar U.S. From Reopening Ohio Opioid Case ----------------------------------------------------------- Rite Aid Corp. is asking a New Jersey bankruptcy judge to issue an injunction blocking the federal government from litigating a whistleblower suit in Ohio over the filling of illegal opioid prescriptions until the bankruptcy court can approve a reorganization plan. On Oct. 17, 2023, two days after the Debtors filed voluntary petitions for chapter 11 relief, Rite Aid Corporation filed a Suggestion of Bankruptcy in United States ex rel. White v. Rite Aid Corp., Case No. 1:21-CV-1239 (N.D. Ohio) ("White Litigation"), a False Claims Act lawsuit against certain of the Debtors arising from the United States's investigation of the sale and marketing of opioid drugs. The Northern District of Ohio subsequently stayed the White Litigation, citing its "inherent power to stay proceedings . . . ." United States ex rel. White v. Rite Aid Corp., Case No. 1:21-CV-1239, Doc. No. 71 at 1 (N.D. Ohio). Immediately, the United States demanded the Debtors agree to the withdrawal of that stay and the entry of an order that explicitly held the automatic stay (11 U.S.C. Sec. 362(a)) did not apply to the White Litigation because the United States's case was within the police and regulatory power exception (11 U.S.C. Sec. 362(b)(4)). In response, the Debtors sought to negotiate a replacement stipulated stay in which the parties would reserve rights as to the application of the automatic stay. While the Debtors and the United States agreed in principle that the White Litigation should be stayed, and even reached an agreement as to the length and details of that stay, the U.S. rejected any reservation of rights and instead demanded the stay include an explicit finding that the automatic stay did not apply and that the police power exception did. Immediately after negotiations broke down on the afternoon of Nov. 14, the United States filed a motion to lift the Northern District of Ohio's stay in the White Litigation within 45 days, and asked the Northern District of Ohio to determine that the automatic stay does not apply to the White Litigation. Accordingly, Rite Aid filed in Bankruptcy Court a complaint against United States of America, seeking a declaratory judgment and injunctive relief in Rite Aid Corporation, et al. vs. UNITED STATES OF AMERICA, Adv. Pro. No. 23-01350 (Bankr. D.N.J. Lead Case No. 23-18993). "This adversary proceeding results from the United States's decision to disturb the indefinite stay of litigation entered by the United States District Court for the Northern District of Ohio under its inherent power to control its docket in a prepetition False Claims Act ("FCA"), Controlled Substance Act ("CSA"), and common law claims lawsuit brought against Debtor Rite Aid Corporation and several of its subsidiaries, all Debtors. Notably, throughout weeks of negotiations, the United States agreed with the Debtors that a stay of the lawsuit is appropriate, but nonetheless demanded the Debtors stipulate that the Bankruptcy Code's automatic stay does not apply to any aspect of the United States's case. When the Debtors would not capitulate to that unreasonable demand, which is both unnecessary under the circumstances and wrong as a matter of law, the United States filed a motion to have the current stay expire in 45 days, while the Debtors would still be in the thick of their reorganization efforts . The risk of irreparable harm that the United States's request could have on the Debtors and their creditors, if granted, leaves the Debtors with no choice but to file this adversary proceeding," Rite Aid said in its complaint. "The Debtors now seek a preliminary injunction enjoining the United States from continuing to prosecute its lawsuit, including its pending motion to modify the District Court's stay order. That relief is necessary to prevent irreparable harm to the Debtors and their estates, as the continued prosecution of the United States's case threatens to undermine the Debtors' restructuring efforts. By contrast, neither the United States (nor the public it represents) will suffer any harm from the requested injunctive relief: to the contrary, it is in the best interest of the public that the Court grant the requested relief to facilitate the Debtors' timely and successful restructuring, which would inure to the benefit of all creditors and continue the critical supply of prescription medication at more than 1,900 pharmacies, employing more than 6,000 pharmacists in 17 states." About Rite Aid Corp. Rite Aid -- http://www.riteaid.com-- is a full-service pharmacy that improves health outcomes. Rite Aid is defining the modern pharmacy by meeting customer needs with a wide range of vehicles that offer convenience, including retail and delivery pharmacy, as well as services offered through our wholly owned subsidiaries, Elixir, Bartell Drugs and Health Dialog. Elixir, Rite Aid's pharmacy benefits and services company, consists of accredited mail and specialty pharmacies, prescription discount programs and an industry leading adjudication platform to offer superior member experience and cost savings. Health Dialog provides healthcare coaching and disease management services via live online and phone health services. Regional chain Bartell Drugs has supported the health and wellness needs in the Seattle area for more than 130 years. Rite Aid employs more than 6,100 pharmacists and operates more than 2,100 retail pharmacy locations across 17 states. The Debtors sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.N.J. Lead Case No. 23-18993) on Oct. 15, 2023. In the petition signed by Jeffrey S. Stein, chief executive officer and chief restructuring officer, Rite Aid disclosed $7,650,418,000 in total assets and $8,597,866,000 in total liabilities. Judge Michael B. Kaplan oversees the cases. The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis International LLP as general bankruptcy counsel, Cole Schotz, P.C., as local bankruptcy counsel, Guggenheim Partners as investment banker, Alvarez & Marsal North America, LLC as financial, tax and restructuring advisor, and Kroll Restructuring Administration as claims and noticing agent. ROBBIN'S NEST: Unsecureds to Get $50K in Plan --------------------------------------------- Robbin's Nest For Children, LLC, submitted a Fourth Amended Plan of Reorganization. Under the Plan, Class 4 General Unsecured Claims will receive $50,040 on a pro rata basis over 60 months in equal monthly installments of $834 with the first monthly payments being due and payable on the 15th day of the first full calendar month following 60 days after the effective date of the plan. Any payment less than $5.00 will be held until the payment equals more than $5.00 and then it will be sent to the respective general unsecured creditor. Once the $50,040 is paid in full pro rata to the general unsecured creditors, Robbin's Nest for Children, LLC, will be discharged from the balance owed to these general unsecured creditors. The liquidation analysis reflects that these general unsecured creditors would receive 5.87% of $413,054.41 in a chapter 7 bankruptcy case. In this chapter 11 case they will be receiving $50,040 of $413,054.41 which is approximately 12.11% and meets the "best interest of the creditors test." This class is impaired. From and after the date the confirmation order becomes final, the Reorganized Debtor is authorized to continue normal business operations and enter into such transactions as it deems advisable, free of any restriction or limitation imposed under any provision of the Bankruptcy Code, except to the extent otherwise provided in the Plan. Attorney for Debtor: Margaret M. McClure, Esq. 25420 Kuykendahl, Suite B300-1043 The Woodlands, TX 77375 Tel: (713) 659 1333 Fax: (713) 658 0334 E-mail: margaret@mmmcclurelaw.com A copy of the Disclosure Statement dated November 8, 2023, is available at https://tinyurl.ph/ryMFu from PacerMonitor.com. About Robbin's Nest for Children Robbin's Nest for Children, LLC, was established in 2017 by Robbin Kemp, which did well in housing youths while giving them the servicesthat were needed to create normalcy. The Debtor filed a Chapter 11 bankruptcy petition (Bankr. S.D. Texas Case No. 23-30735) on March 3, 2023, with as much as $1 million in both assets and liabilities. Judge Jeffrey P. Norman oversees the case. The Debtor tapped Margaret M. McClure, Esq., as legal counsel and Karyn Andersen of Total Sum, LLC as bookkeeper. RUNNER BUYER: S&P Downgrades ICR to 'CCC+', Outlook Negative ------------------------------------------------------------ S&P Global Ratings lowered its issuer credit rating on E-commerce rug retailer Runner Buyer Inc. (doing business as [d/b/a] RugsUSA) to 'CCC+' from 'B-' and its issue-level rating on its revolving credit facility and term loan to 'CCC+' from 'B-'. The negative outlook reflects the risk of a downgrade if liquidity deteriorates and we anticipate a default scenario in the subsequent 12 months. The downgrade reflects highly leveraged credit metrics and thin free cash flow generation due primarily to weaker-than-expected consumer demand. The company's revenue decline accelerated to the double-digit percent area on a pro forma basis in the past four quarters due to weak consumer demand for home-related products. Revenue declines and high interest expenses significantly affected the company's free operating cash flow generation. S&P said, "While we forecast synergy benefits from the Fresh American LLC acquisition (completed in March 2023) over the next year, we believe current EBITDA and free cash flow levels could prove insufficient to support the company's high debt burden. In addition, we expect the company to draw on its revolving credit facility because we forecast scarce free cash flow generation in 2023 and 2024." S&P said, "We view the company's capital structure as potentially unsustainable because of insufficient credit metrics cushion. The company's interest expenses increased to about $15 million in the third quarter, leading to adjusted EBITDA interest coverage of 0.9x. We expect adjusted EBITDA interest coverage of about 1x in fiscal 2023. At the same time, we expect adjusted leverage to decrease to the mid-9x area in 2023 and further to the low- to mid-8x area in 2024. Despite that, we believe the company has limited capacity to absorb further weakness in consumer demand and setbacks in its operating initiatives. "We expect S&P Global Ratings' adjusted EBITDA margin will remain meaningfully below its pandemic levels over the next two years. S&P Global Ratings' adjusted EBITDA margins decreased to the mid-teens percent area in the third quarter partially due to sales deleveraging, partially offset by supply chain improvement. We forecast adjusted EBITDA margin will improve by 270 basis points to the high-16% area in 2023, well below the almost 25% experienced during the peak-demand pandemic period. "In addition, we expect modest free cash flow over the next year. Free operating cash flow year to date decreased by about $15 million compared with last year, ending the quarter slightly negative. To partially offset that, the company has focused on improving inventory management, which generated working capital inflow of about $15 million in the current year. However, we believe revenue volatility, declining margins, and elevated interest expenses will limit free operating cash flow improvement in the short term. "We expect revenue to continue to decline in pro forma basis as consumer cut back on discretionary spending. Runner Buyer's revenue declined the low- to mid-teens percent area on a pro forma basis in the third quarter. We believe there are numerous headwinds for the home furnishing market following the pandemic period, including dwindling household savings and moderating but high inflation. To partially offset that, the company has focused on launching new products, adding more marketplace partners to its network, and improving its website experience. However, we expect revenue volatility to continue due to changes in consumer behavior, macroeconomic uncertainties, and highly competitive market conditions." The negative outlook reflects the risk of liquidity deterioration due to a cash flow deficit from weak consumer demand and macroeconomic headwinds. S&P could lower its ratings on Runner Buyer over the next 12 months if we envisioned a specific default scenario over the subsequent 12 months. This could occur if the company were unable to generate free operating cash flow and its liquidity deteriorated. S&P could raise the rating on Runner Buyer if it expected: -- The company to show positive pro forma revenue growth due to strengthening consumer demand or increasing new marketplace partnerships, and -- The company to generate meaningful free operating cash flow and increasing liquidity cushion to support its capital structure. S-EVERGREEN HOLDING: S&P Upgrades ICR to 'B+' on Debt Reduction --------------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on Bellevue, Wash.-based thrift retailer S-Evergreen Holding Corp. (Savers) to 'B+' from 'B'. S&P said, "We also raised our issue-level rating on its senior secured debt to 'B+' from 'B'. We also raised our rounded estimate for recovery to 65% from 50% to reflect the lower amount of funded debt. The '3' recovery rating is unchanged. "The stable outlook reflects our expectation that Savers will maintain its good performance, leading to modest EBITDA expansion and sustained leverage at low-3x." The upgrade reflects improvement in Savers' credit metrics after paying down debt with IPO proceeds. The company generated total net proceeds of $295 million from the IPO and used a portion, along with cash on balance sheet, to partially repay $252 million of its senior secured first-lien term loan and $55 million of notes. This represents a 28% decrease in Savers' total funded debt, which improved S&P Global Ratings-adjusted leverage by roughly one turn. S&P now forecasts the company's leverage will be about 3x by the end of fiscal-year 2023 (ending December 2023). This is higher than the company's stated net leverage target of 1x-2x, as it includes leases and does not net cash in its adjusted debt calculation. Given the substantial improvement in Savers' leverage and its belief that the company will sustain it, S&P revised its assessment of its financial risk profile to aggressive from highly leveraged. S&P said, "Following the IPO, the company remains roughly 84% owned by financial sponsor Ares. Given the sponsor maintains a majority ownership stake, we consider Savers to be at greater risk of a future leveraging event or potential reversal in its financial policies to a more-aggressive stance than peers not owned by sponsors. However, we believe there is minimal likelihood that such an event would increase leverage by more than one turn. Therefore, we revised our financial policy assessment on the company to FS-5 from FS-6. "Favorable sector trends and a compelling value proposition support Savers' performance prospects over the next 12 months. The company reported sales growth of 3.8%, including comparable sales growth of 3.3% and 4.3% in its U.S. and Canadian segments, respectively, for its third fiscal quarter (ended Sept. 30, 2023) relative to the prior-year period. We believe the moderate sales growth reflects consumers' increasing adoption of thrift, as well as the company's compelling value proposition. As such, we expect consolidated revenue to increase a low- to mid-single-digit percent annually through fiscal 2024, with support from consumer demand for value-oriented offerings, favorable secular trends, and mid-single-digit percent net unit growth at existing banners. "In addition, quarterly S&P Global-Ratings adjusted EBITDA margin improved 50 basis points (bps) to 29% relative to the prior-year quarter. Savers reported a marked expansion in profitability since prior to the pandemic, including our expectation for S&P Global Ratings-adjusted EBITDA margins of about 27% in fiscal 2023 compared with 14.4% in fiscal 2019. Notably, the company remains somewhat insulated from broader retail challenges such as supply chain constraints and excess inventory given its domestic supply chain consisting of secondhand goods. We forecast margins will remain around 25%-27% over the next two years as operating efficiencies and sales leverage offset rising labor costs and a moderation in on-site donations (OSD) mix. "We forecast good annual free operating cash flow (FOCF) of about $75 million-$100 million even as Savers heightens capital spending for growth and business improvement. We anticipate the company will use excess cash for growth initiatives. Specifically, we expect the company to open about 15-20 stores annually, balanced across banners and geographies. We also anticipate Savers will continue to prioritize building centralized processing centers (CPCs) and other offsite processing capabilities, while meaningfully expanding its network of GreenDrop donation sites. "The stable outlook reflects our expectation that performance will remain positive with modest EBITDA expansion on growing sales and consistent margins. This leads to leverage sustained at low-3x." S&P could lower the rating if: -- The company does not demonstrate continued organic growth and there is a meaningful decline in profitability, including EBITDA margins contracting more than 300 bps. This could occur due to operational setbacks, a less favorable shift in donation mix, or inflationary pressures; or -- The company adopts a more-aggressive financial policy. Although unlikely over the near term, S&P could raise the raising if: -- Savers demonstrates continued strong operating performance, including adjusted EBITDA margin sustained at low- to mid-20%. This could occur from continued positive sales trends, sustained OSD growth, and execution of strategic initiatives; -- The company meaningfully expands its scale and breadth of operations so that it reduces the risk of profit volatility in pressured macroeconomic and operating environments; and -- Its financial sponsor further reduces its ownership stake, leading us to believe that risk of a releveraging event is minimal. ESG factors have had no material influence on S&P's credit rating analysis. It believes the company has benefited from consumers increasing focus on sustainability and adoption of thrift while its position as a for-profit enterprise competing with many large non-profits is a relative weakness. SAGO VENTURES: Claims to Get Paid From Loan or Liquidation Proceeds ------------------------------------------------------------------- Sago Ventures, LLC, filed with the U.S. Bankruptcy Court for the Middle District of Florida a Chapter 11 Plan for Small Business dated November 13, 2023. The Debtor is a Florida limited liability company organized on August 20, 2004. The Debtor operates the Happy Homes Mobile Park located at 2900 Highway 92 in Plant City, Florida (the "Mobile Home Park") pursuant to that certain Property Management Agreement by and between Land Trust Services Corporation as Trustee of the St Thomas of St Petersburg of Lake Wales, Florida ("LTSC") and the Debtor dated May 21, 2020 (the "Agreement"). The Debtor filed this Chapter 11, Subchapter V case to propose a plan to assume the Agreement, exercise the Purchase Option, close on the purchase of the Mobile Home Park utilizing loan proceeds from one of several already identified lending sources (the "Loan Proceeds"), and make distributions to creditors. Distributions to creditors under the Plan will be funded by: (i) Loan Proceeds or (ii) proceeds from the liquidation of the Debtor's assets. Litigation is currently pending between the Debtor and LTSC regarding the Debtor's ability to assume the Agreement and exercise the Purchase Option. Based upon the court's Amended Differentiated Case Management Order, the Debtor anticipates that the trial will occur in November 2024. If the Debtor prevails and the Debtor is authorized to assume the Agreement, exercise the Purchase Option, and obtain the Loan Proceeds, the Loan Proceeds will provide for payment of the following: (i) the Option Price, (ii) closing costs associated with closing on the Purchase Option; (iii) allowed administrative expense claims; (iv) allowed priority tax claims, (v) allowed priority claims, and (vi) allowed unsecured claims, with the claims referenced in (iii) through (vi) being paid in full within 15 days of closing on the Purchase Option of the Mobile Home Park. If LTSC prevails and the Debtor is not authorized to assume the Agreement and exercise the Purchase Option, the Debtor's assets will be liquidated and distributed to creditors with allowed claims in accordance with the priority scheme set forth in the Bankruptcy Code. Class 2 consists of All NonPriority Unsecured Claims. If the Debtor prevails and the Debtor is authorized to assume the Agreement, exercise the Purchase Option, and obtain the Loan Proceeds, each holder of an allowed Class 2 claim will be paid in full within 15 days of closing on the Purchase Option of the Mobile Home Park, or on such other terms as may be agreed on by the holder of the claim and the Debtor. If LTSC prevails and the Debtor is not authorized to assume the Agreement and exercise the Purchase Option, each holder of an allowed Class 2 claim will be paid pro-rata from the proceeds from the liquidation of the Debtor's assets in accordance with the priority scheme set forth in the Bankruptcy Code. The liquidated, scheduled and filed Class 2 unsecured claims total $357,731.28. Class 2 is impaired by the Plan. Class 3 is comprised of all membership interests in the Debtor, which are owned by Glenn T. Goff (50%) and George Allen Spearman (50%). Existing members will retain their membership interests in the Debtor, however, no distributions (except for salaries, benefits, and pass-through distributions for tax attributable to income earned by the Debtor to the extent that the Debtor is operating) will be made during the Plan term to Class 3 until all senior claims have been paid in full. Payments required under the Plan will be funded from: (i) Loan Proceeds or (ii) proceeds from the liquidation of the Debtor's assets. A full-text copy of the Chapter 11 Plan dated November 13, 2023 is available at https://urlcurt.com/u?l=sVXCxC from PacerMonitor.com at no charge. Attorneys for Debtor: Amy Denton Mayer, Esq. STICHTER, RIEDEL, BLAIN & POSTLER, P.A. 110 East Madison Street, Suite 200 Tampa, Florida 33602 Telephone: (813) 229-0144 Facsimile: (813) 229-1811 Email: amayer(srbp.com About Sago Venture Sago Ventures, LLC, operates the Happy Homes Mobile Park located at 2900 Highway 92 in Plant City, Florida. The Debtor filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 23-03489) on Aug. 14, 2023, with $50,001 to $100,000 in assets and $500,001 to $1 million in liabilities. Judge Catherine Peek Mcewen oversees the case. Amy Denton Mayer, Esq., at Stichter Riedel Blain & Postler, P.A., is the Debtor's legal counsel. SAN MARINO CAFE: Court OKs Cash Collateral Access ------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California, Los Angeles Division, authorized San Marino Cafe & Marketplace, LLC to use cash collateral in accordance with the budget. The parties that assert an interest in the Debtor's cash collateral are Reliable Fast Cash, LLC, U.S. Small Business Administration, CT Corporation System, as Representative, and WebBank-Salt Lake City, Utah. As adequate protection for the use of cash collateral, all secured creditors will receive replacement liens on p The Debtor is authorized to provide adequate protection payments to the US Small Business Administration in the amount of $500 per month through date of confirmation of a Subchapter V plan of reorganization. A copy of the order is available at https://urlcurt.com/u?l=41HBof from PacerMonitor.com. About San Marino Cafe and Marketplace LLC San Marino Cafe and Marketplace LLC operates a bakery and tortilla manufacturing business. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No. 23-15814) on September 7, 2023. In the petition signed by Linda Grace Zadoian, managing member, the Debtor disclosed $26,845 in assets and $1,184,311 in liabilities. Judge Vincent P. Zurzolo oversees the case. Tamar Terzian, Esq., at Terzian Law Group, PC, represents the Debtor as legal counsel. SCHIERHOLZ AND ASSOCIATES: Taps Fredrikson & Byron as Counsel ------------------------------------------------------------- Schierholz and Associates, Inc. seeks approval from the U.S. Bankruptcy Court for the District of Colorado to employ Fredrikson & Byron, PA as special counsel. The Debtor requires a special counsel to represent its interests in: (a) any landlord-tenant disputes; (b) sale transactions; (c) secured transactions; (d) contract negotiations; (e) municipal law issues; (f) grants it was awarded pre-petition or may be awarded post-petition; (g) litigation with the State of Minnesota; and (h) and any other legal matters common to a business of its size and type. The hourly rates of the firm's attorneys are as follows: Jodie C. McDougal $575 Alethea M. Huyser $540 The retainer fee is $100,000. Alethea Huyser, Esq., a shareholder of Fredrikson & Byron, disclosed in a court filing that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Alethea M. Huyser, Esq. Fredrikson & Byron, PA 60 South Sixth Street, Suite 1500 Minneapolis, MN 55402 Telephone: (612) 492-7000 Facsimile: (612) 492-7077 Email: ahuyser@fredlaw.com About Schierholz and Associates Schierholz and Associates, Inc., owns and operates the Broadmoor Valley Manufactured Housing Community, rents and sells used and new manufactured homes, and operates or leases 20.79 acres of farmland. Schierholz and Associates filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. D. Colo. Case No. 23-10183) on Jan. 18, 2013, with $1 million to $10 million in both assets and liabilities. Judge Thomas B. McNamara oversees the case. The Debtor tapped David J. Warner, Esq., at Wadsworth Garber Warner Conrardy, PC, as legal counsel and Alethea M. Huyser, Esq., at Fredrikson & Byron, PA as special counsel. SHOWFIELDS INC: Court OKs Cash Collateral Access Thru Jan 2024 -------------------------------------------------------------- The U.S. Bankruptcy Court for the Eastern District of New York authorized Showfields, Inc. and affiliates to use cash collateral on a final basis in accordance with the budget, with a 15% variance, through and including January 31, 2024. As adequate protection for any post-petition diminution in the value of the prepetition Collateral from the Petition Date to the Termination Date, the Secured Parties are granted a post-petition replacement lien, to the extent of the Secured Parties' actual interest in cash collateral, in and to all property presently securing the Secured Parties' claims, together with any post-petition proceeds thereof. The Replacement Lien will attach to and be enforceable against the same property and any post-petition proceeds thereof, to the same extent, and in the same order of priority as any prepetition lien. If the Replacement Lien proves inadequate to protect the interests of the Secured Parties in the cash collateral as the result of the use of the cash collateral or from a diminution in value of the Debtors' assets, the Secured Parties' claims in the Chapter 11 case will have priority under 11 U.S.C. Section 507(b) to the extent, if any, that the adequate protection for the Debtors' use of the cash collateral proves to be inadequate. The Debtors' authority to use cash collateral will terminate upon the occurrence of any of the following events, unless waived by the Secured Parties in writing: a. the Debtors' failure to perform any of its obligations under the Order, provided, however, that the Debtors will have a five day grace period following notice from the Secured Parties for delivery to the Secured Parties of any report required by this Order; or b. dismissal of the chapter 11 cases, conversion of the cases to cases under chapter 7 of the Bankruptcy Code, or the appointment of a chapter 11 trustee. A copy of the order is available at https://urlcurt.com/u?l=L7koVg from PacerMonitor.com. About Showfields, Inc Showfields Inc. filed Chapter 11 Petition (Bankr. E.D.N.Y. Case No. 23-43643) on Oct. 6, 2023, with $8,117 in assets and $2,725,810 in liabilities. Tal Zvi Nathanel, chief executive officer, signed the petition. Judge Jil Mazer-Marino oversees the case. Rachel S. Blumenfeld, Esq., at the Law Office of Rachel S. Blumenfeld, PLLC represents the Debtor as bankruptcy counsel. SK SPEC 1: Seeks to Hire Spector & Cox as Bankruptcy Counsel ------------------------------------------------------------ SK Spec 1, LLC seeks approval from the U.S. Bankruptcy Court for the Northern District of Texas to employ Spector & Cox, PLLC to handle its Chapter 11 case. The hourly rates of the firm's counsel and staff are as follows: Howard Marc Spector $435 Sarah M. Cox $395 Paralegals $145 The firm received a retainer of $14,238 from the Debtor. Sarah Cox, Esq., a member of Spector & Cox, disclosed in a court filing that her firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Howard Marc Spector, Esq. Sarah M. Cox, Esq. Spector & Cox, PLLC 12770 Coit Road, Suite 850 Dallas, TX 75251 Telephone: (214) 365-5377 Facsimile: (214) 237-3380 Email: hspector@spectorcox.com sarah@spectorcox.com About SK Spec 1 SK SPEC 1, LLC, a company in Irving, Texas, filed Chapter 11 petition (Bankr. N.D. Texas Case No. 23-32348) on Oct. 13, 2023, with up to $50,000 in assets and up to $10 million in liabilities. Steven Kennedy, member-manager, signed the petition. Judge Stacey G. Jernigan oversees the case. Spector & Cox, PLLC represents the Debtor as legal counsel. SKILLZ INC: Chessen Resigns from Board, Lento Named New Controller ------------------------------------------------------------------ Skillz Inc. disclosed in a Form 8-K Report filed with the Securities and Exchange Commission that on November 7, 2023, Kevin Chessen notified the Company of his decision to resign from the Company's Board of Directors, effective immediately. Chessen's resignation did not result from any disagreement with the Company on any matter relating to the Company's operations, policies or practices. Additionally, on November 2, 2023, the Company appointed Salvatore Lento, Jr. as its Controller, effective as of November 13. Lento, 52, previously served as the Vice President of Technical and Acquisition Accounting at Ingenovis Health, Inc., a company that provides a full array of clinical support staff to major hospital systems and medical organizations across the U.S., from July 2022 until October 2023. From February 2021 to July 2022, Lento served as the Vice President of Accounting of P3 Health Partners, Inc., a population health management company. From February 2019 to February 2021, Lento served as the Independent/Fractional CFO and Corporate Controller for Enavate, Inc., a SaaS/professional services partner for Microsoft. From December of 2012 to November of 2018, Lento served as the CFO/Global Controller & Co-Founder of ComFreight Holdings, LLC, a commercial logistics fintech platform. Lento received his Bachelor of Business Administration: Finance from Western Connecticut State University. Under an offer letter that Lento entered into with the Company, and approved by the Board on November 10, 2023, he will be paid a salary of $275,000 per year. He will also be eligible to receive annual target incentive compensation of $175,000 (pro-rated for 2023), subject to achievement of certain performance goals. The Company will also annually grant Lento a restricted stock unit award covering shares of the Company's Class A common stock with a grant date value equal to $50,000. Such grants vest on the first anniversary of Lento's start date, subject to continuous service with the Company through the vesting date. In addition, the Company will also annually grant to Lento a performance stock unit award covering shares of the Company's Class A common stock with a grant date value equal to $50,000, with pro-rata vesting for the first and last performance periods, in each case subject to continuous service with the Company through each applicable vesting date and the attainment of certain corporate performance goals. There are no family relationships between Lento and any of the directors or executive officers of the Company, and there are no transactions in which Lento has an interest requiring disclosure under Item 404(a) of Regulation S-K. There is no arrangement or understanding between Lento and any other person pursuant to which Lento was appointed as an officer of the Company. About Skillz Inc. Headquartered in San Francisco, California, Skillz Inc. -- www.skillz.com -- is a mobile games platform dedicated to bringing out the best in everyone through competition. The Skillz platform helps developers create multi-million dollar franchises by enabling social competition in their games. Leveraging its patented technology, Skillz hosts billions of casual eSports tournaments for millions of mobile players worldwide, with the goal of building the home of competition for all. Skillz reported a net loss of $438.87 million in 2022, a net loss of $187.92 million in 2021, and a net loss of $149.08 million in 2020. As of March 31, 2023, the Company had $612.16 million in total assets, $357.77 million in total liabilities, and $254.38 million in total stockholders' equity. * * * As reported by the TCR on April 28, 2023, Moody's Investors Service downgraded Skillz Inc.'s corporate family rating to Caa2 from Caa1 following the company's recent repurchase of more than 50% of its outstanding debt at sizable discount to par, reducing available liquidity to fund projected cash flow deficits. Moody's said the Caa2 CFR reflects the increased risk that Skillz's debt capital structure is unsustainable due to reduced liquidity to fund projected cash flow deficits. Also in April 2023, S&P Global Ratings raised its issuer credit rating to 'CCC+' from 'SD' (selective default). The negative outlook reflects uncertainty around the Company's ability to turn its substantially negative cash flow positive over the next three years given ongoing challenges in right-sizing its operations and its unproven business model. SMART EARTH: Wins Interim Cash Collateral Access ------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware authorized Smart Earth Technologies LLC and Smart Water Services LLC to use cash collateral on an interim basis in accordance with the budget. SET, as Borrower, and CrescoNet (Aus) Pty Ltd, a company constituted under the laws of New South Wales, Australia are parties to the Facility Agreement dated as of August 25, 2023, pursuant to which Prepetition Secured Party made loans to SET. As of the Petition Date, the Junior Facility has an outstanding balance of approximately $6.919 million. Additionally, the Debtors, collectively as Borrower, and Prepetition Secured Party are parties to the Secured Promissory Note and Security Agreement dated as of October 17, 2023, as amended by the First Amendment to Secured Promissory Note and Security Agreement dated as of November 8, 2023, pursuant to which Prepetition Secured Party made loans to the Debtors. As of the Petition Date, the Senior Facility has an outstanding balance of approximately $1.772 million. As adequate protection, the Prepetition Secured Party is granted a valid, binding, continuing, enforceable, fully perfected first priority lien and mortgage on, and security interest in all Prepetition Collateral and all other tangible and intangible prepetition and postpetition property in which either of the Debtors has an interest, whether existing on or as of the Petition Date or thereafter acquired. The Adequate Protection Liens will be valid, binding and enforceable against any trustee or other estate representative appointed in any case, upon the conversion of the Chapter 11 Cases to cases under chapter 7 of the Bankruptcy Code and/or upon the dismissal of the Chapter 11 Cases or Successor Cases. These events constitute an "Event of Default": (a) the Debtors fail to perform any of its obligations in accordance with the terms of the Interim Order (including adherence to the Budget); (b) the occurrence of a default under the Senior Facility or the Junior Facility; (c) the Debtors fail to file a chapter 11 plan within the time required by 11 U.S.C. Section 1189(b); (d) either of the Debtors supports, commences, or joins as an adverse party in any suit or other proceeding against Prepetition Secured Party relating to the Prepetition Obligations, the Senior Facility, the Junior Facility, or the Prepetition Collateral, including any proceeding seeking to avoid or require repayment of any payments to Prepetition Secured Party; (e) the Debtors file a motion seeking to create any postpetition liens or security interests, other than those granted or permitted pursuant to the Interim Order; (f) the Court will enter an order approving any claims for recovery of amounts surcharging any of the Collateral, or otherwise approving any claim or surcharge relating to or arising from the preservation of any Collateral, in each case, under 11 U.S.C. Section 552(b) or Section 506(c); (g) the entry of an order in any court reversing, staying, vacating or modifying the terms of the Interim Order; (h) the Subchapter V Trustee is given powers under 11 U.S.C. Section 1183(b)(2); (i) entry of an order removing either Debtor as a debtor in possession pursuant to 11 U.S.C. Section 1185(a); (j) the Chapter 11 Cases are dismissed; or (k) the Chapter 11 Cases are converted to a case under chapter 7. A final hearing on the matter is set for December 14, 2023 at 2 p.m. A copy of the order is available at https://urlcurt.com/u?l=aM9NZW from PacerMonitor.com. About Smart Earth Technologies LLC Smart Earth Technologies LLC is a provider of utility management solutions for water utilities. SET's customers are primarily utility companies, many of which are owned and operated by municipalities or other governmental bodies. The Debtors sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Dela. Lead Case No. 23-11866) on November 14, 2023. In the petition signed by Don Van der Wiel, chief restructuring officer, Smart Earth disclosed up to $10 million in assets and up to $50 million in liabilities. Judge Karen B. Owens oversees the case. The Debtors tapped Gregory A. Taylor, Esq., at ASHBY & GEDDES, P.A., as local bankruptcy counsel, Matthew G. Bouslog, Esq., at ALLEN MATKINS LEEK GAMBLE MALLORY & NATSIS LLP, as bankruptcy counsel, G2 CAPITAL ADVISORS, LLC as financial advisor, and VERDOLINO & LOWEY, P.C. as accountant. SPIKE BODY: Taps Crane, Simon, Clar & Goodman as Legal Counsel -------------------------------------------------------------- Spike Body Werks, Inc. seeks approval from the U.S. Bankruptcy Court for the Northern District of Illinois to employ the law firm of Crane, Simon, Clar & Goodman to handle its Chapter 11 case. The firm was paid $17,504 as an advance payment retainer by the Debtor for its representation in this bankruptcy case. The hourly rates of the firm's counsel and staff are as follows: Arthur G. Simon $520 Scott R. Clar $520 Karen R. Goodman $520 John H. Redfield $400 Scott Clar, Esq., an attorney at Crane, Simon, Clar & Goodman, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Scott R. Clar, Esq. Crane, Simon, Clar & Goodman 135 S. LaSalle St., Suite 3950 Chicago, IL 60603 Telephone: (312) 641-6777 Facsimile: (312) 641-7114 Email: sclar@cranesimon.com About Spike Body Spike Body Werks, Inc. filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. N.D. Ill. Case No. 23-13885) on Oct. 17, 2023, with $1 million to $10 million in both assets and liabilities. Pasquale Roppo, president, signed the petition. Judge Donald R. Cassling oversees the case. Scott R. Clar, Esq., at Crane, Simon, Clar & Goodman represents the Debtor as legal counsel. SPIRIT AIRLINES: Maturity of Revolving Facility Extended Thru 2025 ------------------------------------------------------------------ Spirit Airlines, Inc. disclosed in a Form 8-K report filed with the Securities and Exchange Commission that the company has entered into the Third Amendment to Credit and Guaranty Agreement for its Revolving Credit Facility. On March 30, 2020, Spirit Airlines, Inc. entered into a senior secured revolving credit facility with the lenders party thereto, Citibank, N.A. acting as the administrative agent, and Wilmington Trust, National Association, acting as the collateral agent. On November 10, 2023, the Company entered into the Third Amendment to Credit and Guaranty Agreement, which modifies the Revolving Credit Facility to, among other things, extend the final maturity of the Revolving Credit Facility to September 30, 2025, increase the minimum liquidity covenant to $450,000,000, and include a provision that, in the event the merger with JetBlue Airways Corporation is consummated, each lender under the Revolving Credit Facility has the right to require the Company to repay any outstanding loan that it has made under the Revolving Credit Facility. About Spirit Airlines Spirit Airlines Inc. is a major United States ultra-low cost airline headquartered in Miramar, Florida, in the Miami metropolitan area. In September 2023, Fitch Ratings has revised the Rating Outlook for Spirit Airlines to Negative from Stable and affirmed Spirit's Long-term Issuer Default Rating at 'B+'. Fitch has also affirmed Spirit IP Cayman Ltd.'s and Spirit Loyalty Cayman Ltd.'s senior secured debt at 'BB+'/'RR1'. The Outlook revision incorporates Fitch's view that various headwinds may drive profitability and leverage metrics to remain outside of Fitch's negative sensitivities through YE 2024 or longer. Aircraft availability and air traffic control issues are having a greater impact on Spirit relative to some competitors, limiting the company's post-pandemic margin recovery. Longer-term, Fitch believes that Spirit's low-cost structure and its ability to stimulate demand will drive margins closer to pre-pandemic levels. However, the timeline for improvement is uncertain given various industry headwinds. Should Spirit exhibit improving aircraft utilization and margin trends over the next 6-12 months, the Outlook may be revised to Stable, whereas continued underperformance may drive a downgrade. Spirit's rating is independent of its pending acquisition by JetBlue. Should the acquisition close, Fitch will likely equalize the two ratings. JetBlue is currently rated 'BB-'/Negative. The Spirit acquisition may drive a downgrade of JetBlue's rating, likely by one notch. Also in September 2023, Egan-Jones Ratings Company maintained its 'CCC+' foreign currency and local currency senior unsecured ratings on debt issued by Spirit Airlines, Inc. SPITFIRE ENERGY: Taps Energy Capital Solutions as Investment Banker ------------------------------------------------------------------- Spitfire Energy Group LLC seeks approval from the U.S. Bankruptcy Court for the Northern District of Texas to employ Energy Capital Solutions, LLC as investment banker. The Debtor requires an investment banker to: (a) give advice on the formulation of a strategy and the development of procedures and timetables for marketing the Debtor's saltwater disposal (SWD) assets to potential purchasers; (b) prepare, with the assistance of the Debtor, a management presentation or executive summary describing Spitfire; (c) market the assets and coordinate due diligence investigations of the Debtor's SWD Assets by potential counterparties; and (d) assist the Debtor in the evaluation of all bids and proposals from potential counterparties regarding the sale of the Debtor's assets or equity, formulation of negotiation strategies, and negotiation of all financial matters related to the transaction. The firm will be compensated as follows: (a) a monthly fee of $25,000 for marketing services; (b) a success fee of 4 percent of the "transaction value" of any sale of the SWD assets with a minimum success fee of $250,000; (c) an hourly fee of $500 for deposition and testimony services; and (d) reimbursement for expenses incurred. Scott Trulock, a managing director at Energy Capital Solutions, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in section 101(14) of the Bankruptcy Code. The firm can be reached through: Scott S. Trulock Energy Capital Solutions, LLC 2651 N. Harwood, Suite 410 Dallas, TX 75201 Email: strulock@nrgcap.com About Spitfire Energy Group Spitfire Energy Group, LLC is a strategic midstream and water management provider and currently operates commercial saltwater disposal facilities in the Texas panhandle with over 165 miles of pipeline gathering and a disposal capacity of over 100,000 barrels per day. Such facilities are primarily located in Hemphill County and Wheeler County, Texas. The Debtor filed Chapter 11 petition (Bankr. N.D. Texas Case No. 23-20186) on Sept. 1, 2023, with $10 million to $50 million in both assets and liabilities. David D. Le Norman, manager, signed the petition. Judge Robert L. Jones oversees the case. The Debtor tapped Clayton D. Ketter, Esq., at Phillips Murrah PC as legal counsel and Energy Capital Solutions, LLC as investment banker. STRUCTURLAM MASS: Class 3A Unsecureds Owed $99.8M Get 21% in Plan ----------------------------------------------------------------- Structurlam Mass Timber U.S., Inc., et al., submitted a First Amended Combined Disclosure Statement and Chapter 11 Plan of Liquidation. The Combined Disclosure Statement and Plan is a liquidating chapter 11 plan. The Combined Disclosure Statement and Plan provides that upon the Effective Date: (i) Liquidating Trust Assets will be transferred to the Liquidating Trust; and (ii) after completing all of their fiduciary obligations, the Debtors will be dissolved. Thereafter, the Liquidating Trust Assets will be administered and distributed as soon as practicable pursuant to the terms of the Combined Disclosure Statement and Plan and the Liquidating Trust Agreement. Important dates in connection with the solicitation of votes and confirmation of the Plan: * Voting Procedures and Interim Disclosure Statement Hearing will be on Nov. 14, 2023, at 3:30 p.m. (ET). * Deadline for Creditors to File Rule 3018 Motions will be on Dec. 1, 2023, at 4:00 p.m. (ET). * Deadline for Debtors to Respond to Rule 3018 Motions will be on Dec. 8, 2023, at 4:00 p.m. (ET). * Voting Deadline for the Combined Disclosure Statement and Plan will be on Dec. 12, 2023, at 4:00 p.m. (ET). * Combined Disclosure Statement and Plan Objection Deadline will be on Dec. 12, 2023, at 4:00 p.m. (ET). * Deadline to File Confirmation Brief and Other Evidence Supporting the Combined Disclosure Statement and Plan will be on December 14, 2023, at 4:00 p.m. (ET). * Deadline to File Voting Tabulation Affidavit will be on December 14, 2023, at 4:00 p.m. (ET). * Combined Hearing will be on December 19, 2023, at 11:00 a.m. (ET). Promptly following its prepetition retention, Miller Buckfire launched a process for the purpose of soliciting offers for the sale or recapitalization of the Company. By March 8, 2023, five prospective buyers provided non-binding indications of interest. On March 24, 2023, Miller Buckfire received two bids and provided them to the Company. Following the receipt of the two second round bids, the Company and its advisors worked with initial bidders to evaluate, solidify, and improve the initial bids received. Ultimately, after such evaluation and analysis, the bid by the Stalking Horse Bidder was determined as the highest or otherwise best initial offer and the Company and its advisors engaged with the Stalking Horse Bidder concerning the terms of a purchase agreement. On April 21, 2023, the Debtors and Mercer International Inc. (the Stalking Horse Bidder) entered into an Asset Purchase Agreement. The Stalking Horse Purchase Agreement provided, among other things, for the purchase of the Debtors' US and Canadian Assets, along with assumption of certain assumed liabilities, as set forth in the Stalking Horse Purchase Agreement, for a purchase price of $60 million. The Agreement was also subject to certain bid protections in favor of Mercer, subject to Court approval, consisting of a breakup fee of $1.8 million and an expense reimbursement not to exceed $600,000. Promptly following the Petition Date, Miller Buckfire continued soliciting offers for a potential overbid of the Stalking Horse Purchase Agreement. On April 25, 2023, Miller Buckfire reached out to all previously solicited prospective parties that had executed a non-disclosure agreement and on April 28, 2023, Miller Buckfire reached out to all previously solicited prospective parties that had not executed a non-disclosure agreement. In addition, on May 1, 2023, Miller Buckfire followed up directly with certain parties that had previously expressed interest in some or all of the Debtors' assets. Also, during the postpetition period, Miller Buckfire continued to solicit new potential parties, contacting 24 incremental parties, of which seven executed non-disclosure agreements, for a total of 114 parties contacted, of which 50 executed a non-disclosure agreement. On May 8, 2023, the Bankruptcy Court entered an order approving the bidding procedures for the sale of the Debtors' assets. Pursuant to the Bidding Procedures, potential bidders that wanted to make a qualified bid for the Debtors' assets were required to transmit a qualified bid so as to be actually received on or before May 23, 2023. Prior to the Bid Deadline, the Debtors received what they determined to be a qualified overbid from the Weyerhaeuser Company ("Weyerhaeuser") in the amount of $70 million to acquire substantially all assets of the Debtors related to their United States operations (the "Weyerhaeuser Bid"). Given the receipt of the Weyerhaeuser Bid, on May 24, 2023, the Debtors conducted an auction (the "Auction") pursuant to the Bidding Procedures. After several rounds of bidding between the Stalking Horse Bidder and Weyerhaeuser during the Auction, the Debtors determined that: (i) that the highest and best value for the Debtors' Estates was offered by the Stalking Horse Bidder in the amount of $83.5 million USD, representing a cash bid of $81.1 million USD and breakup fee and expense reimbursement credits totaling $2.4 million USD; (ii) the Stalking Horse Bidder's bid was the winning bid at the Auction; and (iii) Weyerhaeuser Company, with a bid in the amount of $80 million USD, would be designated as the backup bidder and its bid to acquire substantially all assets of the Debtors related to their United States operations was the "Back-Up Bid" under the Bidding Procedures Order. After the Sale Hearing on May 30, 2023, the Bankruptcy Court subsequently entered the Sale Order approving the sale of substantially all of the Debtors' assets to Purchaser. The Sale to Purchaser closed on June 15, 2023. Under the Plan, Class 3A – SMTU General Unsecured Claims total $99,780,470 and will recover 21.1% of their claims. Each Holder of an Allowed SMTU General Unsecured Claim will receive such Holder's Pro Rata share of the SMTU Beneficial Interest in the Liquidating Trust and as beneficiary of the Liquidating Trust will receive, on a Distribution date, its Pro Rata share of net Cash derived from the SMTU Beneficial Interest available for Distribution from the Liquidating Trust on each such Distribution date as provided under the Combined Disclosure Statement and Plan and Liquidating Trust Agreement, as full and complete satisfaction of the Claims against the Liquidating Trust. Class 3A is impaired. "SMTU Beneficial Interest" means the value of Trust Funding assets attributable to SMTU, including the total of the Sale Proceeds attributable to SMTU contributed to the Liquidating Trust as set forth in the attached Liquidation Analysis, plus Estate Causes of Action and any recoveries on Estate Causes of Action belonging to SMTU transferred to the Liquidating Trust. Class 3B – SLP General Unsecured Claims total $80,687,555 and will recover 0% of their claims. Each Holder of an Allowed SLP General Unsecured Claim will receive such Holder's Pro Rata share of the SLP Beneficial Interest in the Liquidating Trust and as beneficiary of the Liquidating Trust will receive, on a Distribution date, its Pro Rata share of net Cash derived from the SLP Beneficial Interest available for Distribution from the Liquidating Trust on each such distribution date as provided under the Combined Disclosure Statement and Plan and Liquidating Trust Agreement, as full and complete satisfaction of the Claims against the Liquidating Trust. Class 3B is impaired. "SLP Beneficial Interest" means the value of Trust Funding assets attributable to SLP, including the total of the Sale Proceeds attributable to SLP contributed to the Liquidating Trust as set forth in the attached Liquidation Analysis, plus Estate Causes of Action and any recoveries on Estate Causes of Action belonging to SLP transferred to the Liquidating Trust, plus any remaining SMTU Beneficial Interest after SMTU General Unsecured Claims are paid in full, plus any remaining SMTC Beneficial Interest after SMTC General Unsecured Claims are paid in full. Class 3C – SMTC General Unsecured Claims total $19,010,126 and will recover 21.2% of their claims. Each Holder of an Allowed SMTC General Unsecured Claim will receive such Holder's Pro Rata share of the SMTC Beneficial Interest in the Liquidating Trust and as beneficiary of the Liquidating Trust will receive, on a Distribution date, its Pro Rata share of net Cash derived from the SMTC Beneficial Interest available for Distribution from the Liquidating Trust on each such distribution date as provided under the Combined Disclosure Statement and Plan and Liquidating Trust Agreement, as full and complete satisfaction of the Claims against the Liquidating Trust. Class 3C is impaired. "SMTC Beneficial Interest" means the value of Trust Funding assets attributable to SMTC, including the total of the Sale Proceeds attributable to SMTC contributed to the Liquidating Trust as set forth in the attached Liquidation Analysis, plus Estate Causes of Action and any recoveries on Estate Causes of Action belonging to SMTC transferred to the Liquidating Trust. The Combined Disclosure Statement and Plan provides for the liquidation and distribution of all of the Debtors' assets. The Debtors will be providing to the Liquidating Trust in excess of $20 million dollars in cash on the Effective Date for distributions to creditors and for funding the Liquidating Trust to pursue all Causes of Action. Accordingly, the Debtors believe all chapter 11 plan obligations will be satisfied without the need for further reorganization of the Debtors. Counsel to Debtors: William E. Chipman, Jr., Esq. Robert A. Weber, Esq. Mark L. Desgrosseilliers, Esq. Mark D. Olivere, Esq. CHIPMAN BROWN CICERO & COLE, LLP Hercules Plaza 1313 North Market Street, Suite 5400 Wilmington, DE 19801 Telephone: (302) 295-0191 Email: chipman@chipmanbrown.com weber@chipmanbrown.com desgross@chipmanbrown.com olivere@chipmanbrown.com A copy of the First Amended Combined Disclosure Statement and Chapter 11 Plan of Liquidation dated November 8, 2023, is available at https://tinyurl.ph/OtpNd from KCC, the claims agent. About Structurlam Mass Timber U.S. Structurlam Mass Timber U.S., Inc. -- http://structurlam.com/-- is a North American provider of mass timber solutions for construction and industrial markets in Canada and the U.S. Established in 1962, Structurlam is based in Penticton, British Columbia and has mass timber production facilities in Canada and the U.S. After reaching a deal with Mercer International Inc. to sell assets in British Columbia and Arkansas for US$60 million, Structurlam and certain of its affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 23-10497) on April 21, 2023. The Debtors also have sought recognition of the Chapter 11 proceedings in the Supreme Court of British Columbia. Structurlam Mass Timber estimated assets and debt of $100 million to $500 million as of the bankruptcy filing. Judge Craig T. Goldblatt oversees the Debtors' Chapter 11 cases. The Debtors tapped Chipman Brown Cicero & Cole, LLP and Potter Anderson Corroon, LLP as bankruptcy counsels; Paul Hastings, LLP as special counsel; Gowling WLG as Canadian counsel; Alvarez & Marsal Canada, Inc. as financial advisor; and Stifel, Nicolaus & Company, Incorporated and Miller Buckfire & Co., LLC as investment bankers. Kurtzman Carson Consultants, LLC is the claims and noticing agent and administrative advisor. The U.S. Trustee for Regions 3 and 9 appointed an official committee of unsecured creditors in the Debtors' Chapter 11 cases. The committee hired Buchalter, P.C. and Morris, Nichols, Arsht & Tunnell, LLP as bankruptcy counsels; Goodmans, LLP as Canadian counsel; and Dundon Advisers, LLC as financial advisor. SUNLAND MEDICAL: Seeks to Hire Eide Bailly as Tax Advisor --------------------------------------------------------- Sunland Medical Foundation and 4750 GHW Bush Land Holdings, LLC seek approval from the U.S. Bankruptcy Court for the Northern District of Texas to employ Eide Bailly, LLP as tax advisor. The firm's services include: (a) preparation of the Return of Organization Exempt from Income Tax (Form 990) with supporting schedules; and (b) preparation of certain state tax returns, as requested. Eide Bailly's customer rates range from $150 to $550 per hour, which vary depending upon the level of staff involved. Eide Bailly estimates its fees will be $5,500 for the preparation of the December 31, 2022, tax return based on its current understanding of operations. Kim Hunwardsen, a partner at Eide Bailly, provided the following information in response to the request for additional information set forth in Paragraph D.1 of the Fee Guidelines. Question: Did you agree to any variations from, or alternatives to, your standard or customary billing arrangements for this engagement? Response: Eide Bailly has not agreed to a variation of its standard or customary billing arrangements for this engagement. Question: Do any of the professionals included in this engagement vary their rate based on the geographic location of the bankruptcy case? Response: Eide Bailly has not varied any of its fees based on the geographic location of these Chapter 11 cases. Question: If you represented the client in the 12 months prepetition, disclose your billing rates and material financial terms for the prepetition engagement, including any adjustments during the 12 months prepetition. If your billing rates and material financial terms have changed post-petition, explain the difference and the reasons for the difference. Response: Eide Bailly was retained by the Debtors pursuant to the Engagement Letter, and the (i) material terms of the prepetition engagement are the same as the terms described in the Application and this declaration and (ii) the fees have not changed. Ms. Hunwardsen disclosed in a court filing that her firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Kim C. Hunwardsen Eide Bailly LLP 800 Nicollet Mall, Ste. 1300 Minneapolis, MN 55402 Telephone: (612) 253-6517 Email: khunwardsen@eidebailly.com About Sunland Medical Foundation Sunland Medical Foundation and 4750 GHW Bush Land Holdings, LLC are owners of Trinity Regional Hospital Sachse, a full-service hospital and emergency room near Dallas, Texas. Trinity is a not-for-profit, 32-bed, community-focused acute care hospital providing care to the residents of Sachse, Murphy, Wylie, Rowlett, Garland, Plano, Richardson, and surrounding communities. The Debtors sought Chapter 11 protection (Bankr. N.D. Texas Lead Case No. 23-80000) on Aug. 29, 2023. Both estimated $50 million to $100 million in assets and $100 million to $500 million in liabilities as of the bankruptcy filing. The Hon. Michelle V. Larson is the case judge. The Debtors tapped McDermott Will & Emery, LLP as legal counsel; Meadowlark Advisors, LLC as financial advisor; and Eide Bailly LLP as tax advisor. Stretto Inc. is the claims agent. The U.S. Trustee for Region 6 appointed an official committee to represent unsecured creditors in the Debtors' Chapter 11 cases. The committee tapped Dickinson Wright, PLLC as counsel and Caliber Advisors, LLC as financial advisor. SURGERY PARTNERS: S&P Upgrades ICR to 'B' on Improved Cash Flow --------------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on ambulatory surgical facilities operator Surgery Partners Inc. to 'B' from 'B-'. S&P said, "At the same time, we also raised our issue-level rating on the company's senior secured first lien debt to 'B'. The '3' recovery rating is unchanged. We also raised our issue-level ratings on the company's second-lien senior secured debt to 'CCC+' from 'CCC'. The '6' recovery rating is unchanged. "Our stable outlook reflects our expectation for revenue growth in the high-single-digit percent area over the next two years, with cash flow after capex and distributions to noncontrolling interests remaining above 3% of debt." Surgery Partners maintained its profitability through a challenging inflationary environment that is now improving. We expect Surgery Partners to grow its revenue over 8% in 2023 and maintain its EBITDA margin at about 15% through 2025. The company continues to benefit from a favorable mix of higher-acuity musculoskeletal surgical procedures and pain management that result in a higher EBITDA margin than peers. Additionally, with moderating wage inflation, we are increasingly confident the company's EBITDA margin will remain at current levels or expand as it grows, which will drive incremental cash flow generation. S&P said, "Further, we expect the company's ability to provide a diverse range of surgical procedures to fuel revenue and EBITDA growth as the Centers for Medicare and Medicaid Services (CMS) continue to approve more complex procedures to be performed in outpatient ambulatory surgery center (ASC) settings. These procedures typically generate higher revenue and margins and are primarily in orthopedics and cardiology. 'We now expect Surgery Partners to maintain leverage of about 7x and generate discretionary cash flow (DCF) to debt of over 3% going forward. With the proceeds from the November 2022 common stock issuance used primarily to pay down about $720 million of debt, we expect Surgery Partners to maintain leverage in the 7x area going forward. While the company has mostly hedged its variable interest rates through 2025, the substantial reduction in debt reduced its cash interest expense by $46 million in 2023. "Further, Surgery Partners' working capital was burdened with Medicare Accelerated Payments in fiscal 2022, which we no longer expect the company to pay, resulting in working capital improvements in 2023. We expect revenue and EBITDA growth to continue to contribute to incremental cash flow generation going forward. Thus, we now expect the company to generate DCF to debt of about 3.4% in 2023, improving slightly to 3.6% in 2024, before increasing above 4% in 2025. "We expect Surgery Partners to prioritize its cash flows toward growth over debt repayment. The company continues to supplement its same-center revenue growth with acquisitions and de novos. While we expect the company to generate positive cash flow in general, we believe it is more likely to use its surplus cash flow to fund further tuck-in acquisitions or de novos as opposed to debt repayments. We expect acquisitions to enhance Surgery Partners' ability to provide surgical offerings as more and more new surgical procedures get approved by CMS for outpatient ASC settings. "Our stable outlook reflects our expectation that Surgery Partners will grow revenue in the high-single-digit percent area over the next two years, with S&P Global Ratings-adjusted cash flow after capex and distributions to noncontrolling interests remaining above 3% of debt. "We could lower the rating to 'B-' if we believe Surgery Partners cannot generate S&P Global Ratings-adjusted cash flow after capex and distribution to noncontrolling interest of above 3% of debt on a sustained basis." This could happen if: -- The company's organic revenue growth stagnates combined with a material increase in operating costs due to wage inflation; -- There is a material increase in interest expense; -- It receives lower reimbursement rates from Medicare; or -- It cannot successfully integrate acquired businesses. S&P said, "We could consider a higher rating if Surgery Partners continues to generate solid EBITDA growth, mainly via higher acuity cases, resulting in sustained leverage well below 5x. In addition, we would need to gain greater comfort in management's commitment to lower leverage, despite the potential for future acquisitions or shareholder-friendly actions. "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." TENABLE HOLDINGS: S&P Upgrades ICR to 'BB-', Outlook Stable ----------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on Tenable Holdings Inc. to 'BB-' from 'B+' and its issue-level rating on Tenable Inc.'s first-lien term loan to 'BB-' from 'B+'. The '3' recovery rating is unchanged. The stable outlook reflects S&P's view that the company's S&P Global Ratings-adjusted EBITDA margins in the mid-teens percent area will likely support its ability to generate healthy FOCF and maintain leverage of less than 4x as it continues to complete tuck-in acquisitions. S&P said, "We expect Tenable will maintain leverage of below 4x despite the weakening corporate spending environment and macroeconomic uncertainties over the near term. The company has expanded its EBITDA margins considerably year-to-date in 2023, mostly due to its improving operating efficiency stemming from its increasing scale and focus on prudent cost controls. Tenable's S&P Global Ratings-adjusted EBITDA margin was about 14.9% for the 12 months ended Sept. 30, 2023, which represents a more than 400 basis point (bps) increase from its average margin of about 10.6% over the last three fiscal years. Compared with those of its cybersecurity peers, the company's EBITDA margins are still slightly below average. Therefore, we believe there will likely be opportunities to further improve its margin as it continues to expand its scale. The company's S&P Global Ratings-adjusted leverage was about 3.6x for the 12 months ended Sept. 30, 2023, which representing a remarkable improvement from 5.8x and 6.9x as of the end of 2022 and 2021, respectively. "We expect Tenable's leverage will be about 3.9x and its EBITDA margin will decline slightly to about 14% by the end of 2023, primarily due to the costs related to its Ermetic acquisition in the fourth quarter (we do not add back acquisition-related expenses in our EBITDA calculation). We believe the company will continue to increase its revenue (albeit at a slower pace than in 2024) while maintaining EBITDA margins in the mid-teens percent area, which will likely enable it to sustain leverage of below 4x even as it completes tuck-in acquisitions amid the weakening corporate spending environment and macroeconomic uncertainties over the next 6-12 months. "Tenable's improving profitability and rising FOCF generation provide it with the flexibility to pursue its tuck-in acquisition strategy and expand its product capabilities. While the pace of the company's margin improvement may slow while it integrates its acquired businesses, which usually takes about 12-18 months, we believe strong market tailwind for its VM and adjacent cybersecurity solutions will likely enable it to cross-/up-sell its offerings and incrementally improve its overall profitability. This belief is supported by Tenable's track record of acquiring and integrating its targets over the last three years. Furthermore, based on our forecast for FOCF generation of at least $130 million over the next 12-18 months and pro forma liquidity of about $450 million as of Sept. 30, 2023, we expect the company would have a sufficient cushion to continue its acquisition strategy without relying on external financing, including new debt. "Tenable has benefited from strong market tailwind over the last couple years, which we expect will continue--albeit at a slower rate--in 2024 given the macroeconomic uncertainties. The company has increased its revenue and calculated current billings (CCB) by more than 20% over the last three years. Although we expect the pace of its expansion will slow to about 16% this year, due to macroeconomic uncertainties and soft corporate information technology (IT) spending (especially in the mid-market segment), the company reported strong momentum and traction in its platform offering (Tenable One), OT product, and the government sector during the first nine months of 2023. Furthermore, Tenable closed its acquisition of Ermetic, a cloud-native application protection platform (CNAPP) company and a provider of cloud infrastructure entitlement management (CIEM), in October. This acquisition will add capabilities to both the company's Tenable One platform and its stand-alone Tenable Cloud Security solution. "We believe Tenable's position as a market leadership sets it up to benefit from further tailwinds in the broader cybersecurity market, especially in the VM space as digitalization and workload transformations continue to expand the IT/OT environment. We also expect it to benefit from the increasing occurrence of cyber incidents, due to geopolitical unrest, as corporates and governments realize the need to shed more light on their attack surfaces, including accurately identifying all the assets in their environment, assessing potential vulnerabilities, prioritizing which areas are more at risk, and generating remediation strategies. Absent a more significant macroeconomic slowdown, we expect Tenable will continue to increase its revenue by the mid-teens percent area in 2024. "The stable outlook reflects Tenable's good revenue growth prospects, improving profitability, and strong expected FOCF to debt. We expect the company will continue to deleverage while maintaining strong FOCF to debt of over 20%." S&P could lower its rating on Tenable if: -- S&P expects it will sustain S&P Global Ratings-adjusted leverage of 4.0x or more for longer than a year. This could occur if the company undertakes larger acquisitions that require additional debt or take longer to transition to a positive EBITDA position; or -- The company adopts an aggressive financial policy, including shareholder returns, such that it sustains S&P Global Ratings-adjusted leverage of more than 4.0x. S&P could raise its rating on Tenable if: -- S&P expects it will sustain leverage of less than 3.0x even after accounting for acquisitions or shareholder returns; and -- The company sustains improved EBITDA margins while continuing to expand its scale and product diversity. ESG factors have no material influence on S&P's credit rating analysis of Tenable Holdings Inc. TGPC PROPERTIES: Says Unsecureds Unimpaired in Plan --------------------------------------------------- TGPC Properties, LLC, an Arizona limited liability company, submitted a First Amended Plan of Reorganization. The Debtor is an Arizona limited liability company whose sole member is The Gathering Place Church (the "Church"). The Debtor owns the real property located at 5536 N. 6th St., Phoenix, 85012 (the "Property"), which it leases to the Church. The Church had previously owned the Property and conveyed it to Debtor by Warranty Deed recorded in the Office of the Maricopa County Recorder on May 17, 2017 at Document No. 2017-0356690. Aside from the funds in its debtor-in-possession account and a claim against the Church for delinquent rent in the amount of $48,937.01, the Property is Debtor's sole asset, and the rent that Debtor receives from the Church (along with any other contributions voluntarily made by the Church) are Debtor's sole source of income. The lease between Debtor and the Church requires the Church to pay $20,564.30 per month on the 1st day of each month. The lease requires the Church to pay for all utilities and maintenance costs. The term of the lease expires on May 31, 2027. The Debtor has listed the Property for sale at $3,500,000, and believes that to be equal to its fair market value. The Property is insured under a policy underwritten by USLI, with a policy limit of $1,995,000. The policy is effective until May 2, 2024. The Debtor has obtained a commitment for a loan, to be secured by a deed of trust on the Property and the Café, in the principal amount of up to $2,100,000. Although proposal contained in the original term sheet has expired, Debtor understands that the lender is still willing to fund the proposed loan on the same terms. Debtor expects that the proceeds from the loan will be sufficient to cover all payments required by this Plan. For the reasons set forth in the 4 LLC Claim Objection, Debtor believes that the allowable amount of 4 LLC's Claim, which will be paid in full, is substantially less than the amount that 4 LLC has claimed to be owed in its proof of claim. It is Debtor's goal to retain title to both the Property and the Café. However, as set forth above, Debtor is also actively marketing both properties for sale at amounts that Debtor believes to be reflective of their fair market value. In the event Debtor consummates such a sale on or prior to the Effective Date, Debtor expects that the proceeds from any such sale would also be sufficient to cover all payments required by this Plan. Such a sale would negate the need for any refinancing. In addition to the proceeds from any refinancing or sale, funding for this Plan may also come from the following sources: 1. Rent payments received from the Church. 2. Contributions received from the Church, which may be funded in whole or in part from a settlement or successful prosecution of the Insurance Litigation or revenues derived from operation of the Café once construction has been completed. Class 4 – Priority Unsecured Claims are unimpaired. Class 4 is comprised of the holders of any Allowed Priority Unsecured Claims. While Debtor is not aware of any such Claims, to the extent there are any, Class 4 Allowed Claims will be paid in full on the later of: (1) the Effective Date; (2) the date on which such Claim becomes an Allowed Claim; or (3) the date that payment of such Allowed Claim is due under applicable non-bankruptcy law. Class 5 – General Unsecured Claims are unimpaired. Class 5 is comprised of all Allowed Claims that are not classified within any other Class under this Plan. While Debtor is not aware of any such Claims, to the extent there are any, Class 5 Allowed Claims will be paid in full on the later of: (1) the Effective Date; (2) the date on which such Claim becomes an Allowed Claim; or (3) the date that payment of such Allowed Claim is due under applicable non-bankruptcy law. Attorneys for Debtor: Bradley D. Pack, Esq. ENGELMAN BERGER, P.C. 2800 North Central Ave., Suite 1200 Phoenix, AR 85004 Tel: (602) 271-9090 Fax: (602) 222-4999 E-mail: bdp@eblawyers.com A copy of the Plan of Reorganization dated November 10, 2023, is available at https://tinyurl.ph/webvv from PacerMonitor.com. About TGPC Properties TGPC Properties, LLC, is primarily engaged in renting and leasing real estate properties. TGPC Properties filed a petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No. 22-08374) on Dec. 19, 2022, with $1 million to $10 million in both assets and liabilities. Paul Johnson, manager, signed the petition. Judge Madeleine C. Wanslee oversees the case. The Debtor is represented by D. Lamar Hawkins, Esq., at Guidant Law, PLC as legal counsel and Carel Marbry of The Gathering Place Church as bookkeeper. TIMBER PHARMACEUTICALS: Hits Chapter 11 Bankruptcy Protection ------------------------------------------------------------- Jeremy Hill of Bloomberg News reports that Timber Pharmaceuticals LLC and affiliate Timber Pharmaceuticals Inc. filed for Chapter 11 protection from creditors in Delaware on Friday, November 16, 3034. The publicly traded medical dermatology company was founded in 2019 and focuses on rare skin diseases, according to its website. Timber Pharmaceuticals LLC listed assets of no more than $10 million and liabilities of at least that amount in its bankruptcy petition. About Timber Pharmaceuticals Timber Pharmaceuticals, Inc. f/k/a BioPharmX Corporation -- http://www.timberpharma.com-- is a biopharmaceutical company focused on the development and commercialization of treatments for orphan dermatologic diseases. The Company's investigational therapies have proven mechanisms-of-action backed by decades of clinical experience and well-established CMC (chemistry, manufacturing and control) and safety profiles. The Company is initially focused on developing non-systemic treatments for rare dermatologic diseases including congenital ichthyosis (CI), facial angiofibromas (FAs) in tuberous sclerosis complex (TSC), and localized scleroderma. Timber Pharmaceuticals sought relief under Chapter 11 of the U.S Bankruptcy Code (Bankr.D. Del.) on November 16, 2023. In its petition, it listed assets of no more than $10 million and liabilities. TRANSPLANT SYSTEMS: Bid to Use Cash Collateral Denied ----------------------------------------------------- The U.S. Bankruptcy Court for the Middle District of North Carolina, Greensboro Division, denied the motion to use cash collateral on a final basis filed by Transplant Systems LLC. The court said no further use of cash collateral is authorized, however the Debtor is directed to pay $4,000 to the trust account of Jennifer B. Lyday, the trustee, which may be available for payment of her fees and expenses subject to further application to and approval by the court. As previously reported by the Troubled Company Reporter, the Debtor's main source of sales is through Amazon.com. With this Amazon.com account, the Debtor took out a small loan with Amazon Capital Services, Inc. for business expenses. The loan through Amazon is secured by certain property through the UCC-1 filing. Amazon asserts a first priority security interest in the cash collateral. With respect to the secured claim held by the Amazon, the amount outstanding as of the Petition Date is approximately $11,000. A copy of the court's order is available at https://rb.gy/1ukcsc from PacerMonitor.com. About Transplant Systems LLC Transplant Systems LLC sells kits for plants to be grown in a household. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. M.D. N.C. Case No. 23-10531) on September 28, 2023. In the petition signed by Thurman Ray De Bruhl, managing member, the Debtor disclosed up to $50,000 in assets and up to $500,000 in liabilities. Judge Lena Mansori James oversees the case. Erik M. Harvey, Esq., at Bennett Guthrie PLLC, represents the Debtor as legal counsel. UPHEALTH HOLDINGS: Will Sell Cloudbreak Health to GTCR in Ch. 11 ---------------------------------------------------------------- Bankrupt telehealth company UpHealth Holdings Inc. has inked a deal to sell its nonbankrupt subsidiary Cloudbreak Health LLC to private equity firm GTCR for $180 million, the company told a Delaware bankruptcy judge Friday, November 16, 2023. UpHealth (NYSE: UPH) announced Nov. 16, 2023, that it has entered into a definitive agreement to sell its wholly-owned subsidiary Cloudbreak Health, LLC, best known for its Martti translation offering, to GTCR for $180 million in cash. GTCR is a leading private equity firm that partners with management leaders to identify, acquire and build market-leading companies through organic growth and strategic acquisitions. UpHealth will utilize the proceeds from the sale for payment in full or in part of the Company's 2026 Unsecured and 2025 Secured Notes, as well as other expenses related to the transaction. The sale of Cloudbreak is expected to close during the first half of 2024, following the receipt of customary regulatory and stockholder approvals and closing conditions, and will allow UpHealth, Inc. to pursue a more simplified strategy that focuses on TTC Healthcare, Inc., a growing, cash flow positive, behavioral health business. "This agreement enables Cloudbreak's leading telehealth and video remote interpretation solutions to continue to reach customers and patients who rely on them, while providing UpHealth with significant liquidity to substantially reduce its existing debt and drive the business forward with a much healthier capital structure," said Martin Beck, Chief Executive Officer of UpHealth. "At the same time, this transaction sharpens our focus on TTC Healthcare, a profitable and cash generating behavioral health business, as a growth platform." Cloudbreak is recognized through its core solution, Martti, "My Accessible Real-Time Trusted Interpreter" and has constituted the entirety of the Company's Virtual Care Infrastructure segment since July 1, 2022. The Martti solution provides medical interpreters in over 250 languages, which are delivered through custom Martti devices, such as tablets and smartphones. As part of the transaction, GTCR will acquire complete equity ownership of Cloudbreak, including the aggregate Cloudbreak employee base. Dr. Avi Katz, Chairman of the Board of UpHealth, commented, "As the Chair of UpHealth since the combination with GigCapital2 in June 2021 and overseeing the executive team over the last three years of restructuring and financing, I commend Andy Panos and the team for leading Cloudbreak’s strategic expansion and growth, more than doubling revenue in this period, providing a superior customer service experience, while improving considerably the bottom line of the business. Additionally, UpHealth is executing on paying down majority of its debt to our noteholders, with the goal of freeing capital to grow our behavioral health business." DLA Piper LLP (US) is serving as legal counsel to UpHealth for this transaction. About UpHealth Holdings UpHealth Holdings Inc. is a global digital health company delivering technology platforms, infrastructure and services to modernize care delivery and health management. UpHealth Holdings sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 23-11476) on Sept. 19, 2023. In the petition filed by Samuel J. Meckey, as chief executive officer, the Debtor reports estimated assets and liabilities between $100 million and $500 million each. Stuart M. Brown, Esq., at DLA Piper LLP (US), is the Debtor's counsel. UPHEALTH HOLDINGS: Wins Interim Cash Collateral Access ------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware authorized Uphealth Holdings, Inc. and affiliates to use cash collateral on an interim basis in accordance with the budget, with a 15% variance. The Debtor requires the use of cash collateral (i) to satisfy in full the costs and expenses of administering the Cases and preserving the value of the estates during the Cases; and (ii) to fund all expenses of the Debtors, as set forth in the Budget. Under the Indenture, dated as of August 18, 2022, for variable rate convertible senior secured notes due 2025, by and among UpHealth, Inc., the guarantors party thereto from time to time, including the Debtors, Wilmington Trust, National Association, as indenture trustee, and as collateral agent, and the noteholders party thereto from time to time, the Debtors issued certain 2025 Notes. As of the applicable Petition Date, the 2025 Notes Parties were indebted to the Noteholder Secured Parties pursuant to the Senior Secured Notes Documents in the aggregate principal amount of $57.227 million plus accrued and unpaid interest. In connection with the Senior Secured Notes Indenture, the Debtors and certain Affiliates entered into a security and pledge agreement, dated August 18, 2022. As adequate protection, the Noteholder Secured Parties are granted valid, binding, continuing, enforceable, fully perfected, nonavoidable, first-priority senior, additional and replacement security interests in and liens on all of the Debtor's assets. As further adequate protection, each of the Secured Parties, for the benefit of themselves and the 2025 Noteholders, are granted allowed superpriority administrative expense claims in the Cases ahead of and senior to any and all other administrative expense claims in the Cases to the extent of, and in an aggregate amount equal to, any Diminution in Value, but junior to the Carve Out. A final hearing on the matter is set for December 12, 2023 at 10 a.m. A copy of the order is available at https://urlcurt.com/u?l=9nrTOx from PacerMonitor.com. About UpHealth Holdings UpHealth Holdings Inc. is a global digital health company delivering technology platforms, infrastructure and services to modernize care delivery and health management. UpHealth Holdings sought relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 23-11476) on Sept. 19, 2023. In the petition filed by Samuel J. Meckey, as chief executive officer, the Debtor reports estimated assets and liabilities between $100 million and $500 million each. Judge Laurie Selber Silverstein oversees the case. Stuart M. Brown, Esq., at DLA Piper LLP (US), is the Debtor's counsel. VELO3D INC: To Issue Going Concern Warning, Sees Default -------------------------------------------------------- Velo3D Inc. said it plans to issue a going concern warning following an expected default on its debt. On Nov. 15, 2023, Velo3D filed a Form 12b-25 with the U.S. Securities and Exchange Commission in connection with the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2023. The Company previously furnished a Current Report on Form 8-K with the SEC on Nov. 6, 2023 with the Company's results for the three and nine months ended September 30, 2023 compared to the three and nine months ended September 30, 2022. Subsequent to the Earnings 8-K, in connection with the preparation of the Quarterly Report, the Company determined that approximately $200,000 of revenues previously reported in the Earnings 8-K should have been deferred. As a result of the expected corresponding reduction in the third quarter revenues previously reported in the Earnings 8-K, the Company expects the Quarterly Report to report for the quarter ended September 30, 2023 revenues of $23.8 million, gross profit of $1.5 million, gross margin of 6.3%, and a net loss of $(17.4 million) million, or $(0.09) per diluted share. The Company does not expect any additional changes to the results reported in the Earnings 8-K other than those resulting from the $200,000 of revenues; however, results may be subject to change after the completion of the Company’s condensed consolidated financial statements as of and for the periods ended September 30, 2023. Further, as a result, the Company, according to its Nov. 15, 2023 Form 8-K filing, expects that it will not satisfy the minimum revenue covenant for the quarter ended Sept. 30, 2023 in the Company's senior secured convertible notes due 2026 (the "Notes") when the Company finalizes its condensed consolidated financial statements as of and for the periods ended September 30, 2023 in connection with the filing of the Quarterly Report, which, if not waived, would result in an event of default under the Notes and allow the holders of the Notes to declare the Notes due and payable in cash in an amount equal to the Event of Default Acceleration Amount. Since discovering the issue, the Company has been negotiating a proposed amendment to the Notes with the holders thereof, although the Company does not expect that a waiver or an amendment will be obtained within the extension period provided for by Rule 12b-25. As such, the Company will present the debt as current on the consolidated balance sheet and will include disclosure that the Company has substantial doubt about its ability to continue as a going concern. The Company expects to continue discussions with the holders of the Notes subsequent to filing the Quarterly Report; however, the Company may not be able to obtain a waiver or an amendment on favorable terms or at all. If a waiver or amendment is not agreed to by the holders of the Notes, the Company does not have sufficient capital to satisfy the outstanding principal and interest due. About Velo3D Inc. Velo3D, Inc., produces metal additive three dimensional printers. The company's printers enable the production of components for space rockets, jet engines, fuel delivery systems, and other high value metal parts, which it sells or leases to customers for use in their businesses. It offers Flow, a proprietary software platform, which scans part designs for geometrical features; Sapphire and Sapphire XC printers; and Assure, a quality control system software platform that includes closed loop process metrologies. Its customers range from small- and medium-sized enterprises to Fortune 500 companies in the space, aviation, defense, energy, and industrial markets. Velo3D was founded in 2014 and is headquartered in Campbell, California. VEREGY INTERMEDIATE:S&P Affirms 'B-' ICR, Alters Outlook to Stable ------------------------------------------------------------------ S&P Global Ratings revised its outlook on Veregy Intermediate Inc., a Phoenix-based provider of energy efficiency solutions to stable from negative. S&P affirmed all its ratings on the company, including the 'B-' issuer credit rating. The stable outlook reflects S&P's expectation that Veregy will expand and convert its signed backlog, contributing to mid-single-digit percent annual revenue and earnings growth, about $5 million-$10 million in unadjusted free operating cash flow (FOCF), and adequate liquidity over the next 12 months. S&P said, "Healthy backlog growth and improved project conversion support our expectation that Veregy will sustain adequate liquidity over the next 12 months. As of Sept. 30, 2023, Veregy had expanded its adjusted EBITDA by 25% year on year through solid execution against projects delayed by supply chain constraints and easing labor market pressure. We expect steady mid-single-digit percent revenue and EBITDA growth in 2024 as labor and equipment cost pressures ease and lead times steadily normalize. Increased salesforce investments will likely limit margin expansion in 2024 and 2025. Under our updated base-case forecast, we expect Veregy will generate $5 million-$10 million in annual free cash flow and maintain adequate total liquidity with balance sheet cash and revolver availability of about $75 million in 2024, absent acquisitions or dividends. "Positive industry trends underpin strong new bookings growth and improved visibility into 2024 cash flow. We believe Veregy will increase its signed backlog 30% in 2023. While project revenue recognition and EBITDA can be lumpy given seasonal demand and lingering supply chain difficulties, we believe this provides clarity for our base-case revenue and EBITDA growth forecast. It demonstrates the company's ability to capture increasing demand in new growth markets, including California and Texas where regulation has made energy efficiency projects more affordable through government subsidies. We view Veregy's incremental salesforce investments favorably, though this will temporarily weigh on margins in the near term. "Large acquisitions that deplete Veregy's liquidity could increase ratings pressure. Veregy has a track record of complementing organic growth with acquisitions, completing six since 2017. We expect acquisition EBITDA multiples for targets that enhance Veregy's energy services in the mid-single-digit area. The company's cushion at the 'B-' rating could weaken if it completes further acquisitions and they erode liquidity without strong integration execution and earnings accretion. "The stable outlook reflects our expectation Veregy will increase and convert its signed backlog, contributing to mid-single-digit percent annual revenue and earnings growth, about $5 million-$10 million in unadjusted FOCF, and adequate liquidity over the next 12 months. "Governance is a moderately negative consideration in our credit analysis of Veregy, as it is 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 its controlling owners. This also reflects private-equity sponsors' generally finite holding periods and focus on maximizing shareholder returns." VERITAS FARMS: Delays Filing of Q3 Form 10-Q Report --------------------------------------------------- Veritas Farms, Inc. disclosed in Form 12b-25 filed with the Securities and Exchange Commission that the Company is unable to file its Quarterly Report on Form 10-Q for the period ended September 30, 2023 within the prescribed time period. According to the Company, it is unable to file its Quarterly Report for the period ended September 30, 2023, within the prescribed time period without unreasonable effort or expense as the Company needs additional time to provide information to its independent registered public accounting firm necessary to complete the review of the financial statements for the period ended September 30. In accordance with Rule 12b-25 of the Securities Exchange Act of 1934, the Company anticipates filing its Quarterly Report on Form 10-Q for the period ended September 30, 2023 within the applicable five calendar-day period. About Veritas Fort Lauderdale, Florida-based Veritas Farms, Inc. -- www.TheVeritasFarms.com -- is a vertically-integrated agribusiness focused on growing, producing, marketing, and distributing superior quality, whole plant, full spectrum hemp oils and extracts containing naturally occurring phytocannabinoids. Veritas Farms owns and operates a 140-acre farm in Pueblo, Colorado, capable of producing over 200,000 proprietary full spectrum hemp plants which can potentially yield a minimum annual harvest of 250,000 to 300,000 pounds of outdoor-grown industrial hemp. Veritas Farms reported a net loss of $5.14 million for the year ended Dec. 31, 2022, compared to a net loss of $7.07 million for the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had $6.79 million in total assets, $7.40 million in total liabilities, and a total shareholders' deficit of $606,277. Hackensack, NJ-based Prager Metis CPAs LLC, the Company's auditor since 2018, issued a "going concern" qualification in its report dated April 17, 2023, citing that the Company has sustained substantial losses from operations since its inception. As of and for the year ended Dec. 31, 2022, the Company had an accumulated deficit of $39,474,622, and a net loss of $5,543,908. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern within a year from the date the financial statements are issued. Continuation as a going concern is dependent on the ability to raise additional capital and financing, though there is no assurance of success. VITAL ENERGY: S&P Affirms 'B' ICR, Off CreditWatch Negative ----------------------------------------------------------- S&P Global Ratings affirmed its 'B' issuer credit and issue-level ratings on Vital Energy Inc., an Oklahoma-based crude oil and natural gas exploration and production (E&P) company, and removed them from CreditWatch, where they were placed with negative implications on Sept. 1, 2023. S&P said, "The outlook is positive, reflecting Vital's increased scale and our expectation that credit measures will strengthen, supported by positive free operating cash flow (FOCF). We expect average funds from operations (FFO) to debt of about 60% over the next 12-24 months." The removal of the ratings from CreditWatch negative reflects Vital's improved liquidity. The Sept. 1, 2023, placement of the ratings on CreditWatch with negative implications reflected the risk that liquidity could deteriorate materially if the company were unable to refinance its $456 million of 9.5% senior unsecured notes maturing on Jan. 15, 2025 before they became current, which would have triggered the maturity date on its RBL to spring forward to July 29, 2024. At that time, Vital had $575 million outstanding on its RBL. However, following recent financing transactions outlined below, the company now has funds held to fully repay the 2025 notes and any accrued interest, which satisfies and eliminates the springing maturity. Although the notes currently remain outstanding, S&P's anticipate the company will redeem the notes ahead of them becoming current on Jan. 15, 2024. Recent acquisitions improve Vital's scale in the Permian Basin. On Sept. 13, 2023, the company announced it would acquire three asset packages in the Midland and Delaware Basins for a combined transaction value of about $1.2 billion. The assets were sold by privately held Henry Energy L.P. and Henry Resources LLC, Tall City Property Holdings III LLC, and Maple Energy Holdings LLC. On a combined basis, the acquired assets had proved reserves of about 250 million barrels of oil equivalent (boe), as of Dec. 31, 2022, and production of about 35,000 boe per day (boe/d), increasing Vital's stand-alone proved reserves (as of Dec. 31, 2022) and production by about 80% and 30%, respectively. The transactions were financed with a combination of debt and equity and closed in November 2023. Recent debt and equity issuances fund the transactions and improve liquidity. Vital issued $900 million of senior unsecured notes in September 2023, $250 million of preferred convertible equity directly to Henry, and about $665 million of common equity (a portion of which was issued directly to Henry, Tall City, and Maple), which funded the acquisitions, secured the funds to repay the 2025 notes, and enabled Vital to repay borrowings on its RBL. In addition, with the closing of the transactions, the elected commitment on the RBL was increased to $1.25 billion from $1.0 billion, and the maturity was extended to September 2027. S&P anticipates Vital will end 2023 with $150 million-$200 million drawn on its RBL and expect it will prioritize repayment of this amount in 2024 using FOCF. S&P said, "We expect credit measures to strengthen in 2024, supported by increased production.We expect FFO to debt will average about 60% over the next 12 months, based on our assumptions that production will average about 110,000 boe/d in 2024, $800 million in capital expenditures, and positive FOCF of about $290 million. Under our methodology, we treat the company's $250 million of convertible preferred equity as 100% debt, and therefore the potential conversion of this into common equity would further strengthen our credit measures. "The positive outlook reflects our expectation that Vital Energy will generate positive FOCF and credit measures will strengthen over the next 12 months, underpinned by a moderate drilling program as it focuses on the integration of its recent acquisitions. We anticipate average FFO to debt of about 60% over the next 12-24 months. "We could revise our outlook to stable if credit measures weakened such that we no longer expected FFO to debt to be sustained above 45% or if we did not expect Vital to generate positive FOCF on a sustained basis. This would most likely occur if commodity prices declined well below our current expectations or from a debt-financed acquisition that didn't add near-term cash flow. "We could raise our rating on Vital if credit measures remained comfortably above 45% and the company showed a track record of generating positive FOCF that we expect to be applied to reduce any RBL borrowings, and if the company integrated its recent acquisitions and demonstrated a track record of operating with production at levels in line with higher-rated peers." WESTJET AIRLINES: Fitch Hikes LongTerm IDR to 'B', Outlook Stable ----------------------------------------------------------------- Fitch Ratings has upgraded the Long-Term Issuer Default Ratings of WestJet and WestJet Airlines, Ltd. to 'B' from 'B-'. The Rating Outlook is Stable. The upgrade reflects continuing improvement in demand for Canadian air travel that is driving top line growth and improved profit margins for WestJet. Results year to date have outperformed Fitch's prior expectations, and the agency now anticipates that EBITDAR leverage and coverage metrics will be consistent with 'B' rating tolerances in the 2024-2025 timeframe. The upgrade also incorporates prospective EBITDA growth from WestJet's acquisition of Sunwing, which was completed in May 2023, and benefits of the company's strategic re-orientation. The rating is also supported by WestJet's healthy liquidity balance, it's low cost structure, and its established business position in the duopolistic Canadian market. KEY RATING DRIVERS Solid Recovery in Traffic: Canadian air traffic has shown solid momentum thus far in 2023, driving much improved financial results for WestJet. Traffic first rebounded sharply in 2022 after initially lagging the recovery in the U.S. relative to 2019 levels. The Canadian recovery is now largely in line with the U.S. Fitch's prior forecasts anticipated some weakness, with persistent inflation dampening consumer demand. However, air travel demand continues to hold. Fitch expects Canadian air traffic growth to slow from its recent pace but to remain positive based on expectations for modest macroeconomic growth, potential improvement in business travel, and positive impacts driven by sizeable levels of migration into Canada. Air Canada, WestJet's largest competitor, also recently reported solid underlying travel demand for the fourth quarter. Credit Metrics Improving: Fitch calculates WestJet's gross EBITDAR leverage at 6.4x at June 30, 2023, which remains elevated from pre-pandemic levels, but is better than prior expectations. Fitch anticipates that leverage will decline further as operating margins continue to improve, driven by relatively stable demand and the benefits of the company's strategic network reconfiguration. WestJet also benefits from additional EBITDA acquired through its integration of Sunwing, following the close of the acquisition in May 2023. Fitch expects these improvements to drive leverage below its positive rating sensitivity of 5x in the 2024-2025 timeframe. EBITDAR fixed-charge coverage, which had also been depressed post-pandemic, is expected to rise toward 2x within the forecast period, from below 1x in 2022. Wages Headwind: WestJet reached an agreement with its pilot union in May 2023 for a new contract that included significant wage increases. Pilots will reportedly receive pay increases of 24% over four years along with quality of life improvements. As part of the negotiations, WestJet also agreed to fold its low-cost subsidiary, Swoop, into its mainline operations. Although higher wages will pressure unit costs, the issue is not unique to WestJet. Most U.S. carriers have ratified labor deals with major wage increases over the past year. Air Canada is in negotiations with its pilots now and is likely to experience wage increases consistent with peers. As such, airlines will be forced to make rational capacity decisions to support yields and offset higher cost structures. Fitch also views the integration of Swoop into the mainline as a strategic positive as it simplifies operations. Strategic Re-Set: Fitch expects the company's re-focused strategy to be credit positive over time as the company plays to its network strengths and focuses on the markets where it has the most relevance. First announced in 2022, WestJet has re-focused its route network in western Canada where it has historically had a stronger presence, and has de-emphasized flying between destinations in the eastern part of the country. This allows WestJet to prioritize more profitable routes and to shift away from routes with heavier competition from Air Canada. The company is also bolstering its leisure and sun-market presence with the addition of Sunwing to its portfolio. Sunwing will bolster the WestJet vacations business and grow the company's currently strong share of travel to places like Mexico and the Caribbean. Sale-Leasebacks Support Capex, Fleet: WestJet has a manageable number of aircraft deliveries scheduled for 2024 before deliveries step up in 2025 and 2026. Gross capital spending may keep FCF neutral to modestly negative over the next several years. Fitch believes that WestJet will continue to tap the sale-leaseback market to finance new deliveries. Sale-leasebacks will limit upfront demands on cash but create a drag on operating expenses in future years versus paying for aircraft up-front with cash. WestJet's orderbook consists of roughly 60 737 MAX's including 48 MAX-10s (per IBA). Timing for delivery of the 737 MAX 10s is uncertain given that the aircraft is yet to be certified. The MAX 10s are expected to drive efficient growth, as the aircraft will operate with better seat costs than WestJet's existing 737-800s. However, larger gauge aircraft come with some risks as they necessitate sufficient demand to fill the extra seats. DERIVATION SUMMARY WestJet's 'B' rating is one notch below its primary domestic competitor, Air Canada. The difference reflects WestJet's higher near-term leverage prospects and smaller relative size. WestJet's liquidity position is also not as strong as Air Canada's, and Air Canada likely has better access to funds given its size and unencumbered assets. These factors are partially offset by WestJet's favorable cost structure, and relative exposure to business demand, which is taking longer to recover from the pandemic. Relative to U.S. airlines, WestJet's 'B' rating is one notch above Hawaiian Holdings and in line with Spirit Airlines. WestJet's balance sheet is relatively stronger than both companies and WestJet faces less refinancing risk. KEY ASSUMPTIONS - Rebounding traffic in 2023, leaving total RPMs down in the single digits below 2019 levels; - Traffic continues to grow modestly in 2024 despite softer economic conditions; - Operating margins improve sequentially but remain below pre-pandemic levels through Fitch's forecast period, reflecting higher operating costs and modest assumptions about unit revenues. RECOVERY ANALYSIS KEY RECOVERY RATING ASSUMPTIONS The recovery analysis assumes that WestJet would be reorganized as a going concern in bankruptcy rather than liquidated. Fitch has assumed a 10% administrative claim. Going-Concern (GC) Approach Fitch has assumed a going-concern EBITDA of CAD600 million The GC EBITDA estimate reflects Fitch's view of a sustainable, post-reorganization EBITDA level upon which Fitch bases the enterprise valuation. Fitch's EBITDA estimate is well above levels generated through the pandemic trough, but remains conservative to the base case 2024 assumption, as well as to actual EBITDA levels generated in 2019 and prior. The GC is driven by a scenario in which demand for air travel effectively stalls amid an era of structurally higher operating costs driven by inflationary pressures, particularly on wages, leading operating margins to remain persistently below historical levels. An EV multiple of 5.0x EBITDA is applied to the GC EBITDA to calculate a post-reorganization enterprise value. The choice of this multiple considers the historical bankruptcy case study exit multiples for peer companies ranged from 3.1x to 6.8x, as well as the GC EBITDA multiples used for B-category rated peers. These assumptions lead to an estimated recovery of 'BB-'/'RR2' for the senior secured term loan with a WGRC in the 71%-90% range. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: - Total adjusted debt/EBITDAR below 4.5x; - Operating EBITDAR/gross interest + rent above 2x; - EBIT margins sustained in the mid-single digits or higher; - Evidence of increasing financial flexibility, potentially including an increasing base of unencumbered assets. Factors that could, individually or collectively, lead to negative rating action/downgrade: - Operating EBITDAR/gross interest + rent toward 1.5x; - Total adjusted debt/EBITDAR sustained above 5.5x; - Heightened liquidity risks, including cash + revolver availability falling toward $800 million and/or decreasing likelihood of ability to access contingent liability options. LIQUIDITY AND DEBT STRUCTURE Solid Liquidity: Fitch views Westjet's liquidity as supportive. The company ended the third quarter with CAD1.5 billion in cash and cash equivalents and full availability on its USD350 million revolver. Maturities are manageable, largely consisting of the 2026 maturity of the company's term loan B. Capital spending will step up over the forecast period, but capex primarily consists of financeable aircraft. Debt Structure: WestJet reported CAD2.9 billion of debt and CAD2.7 billion in lease obligations at June 30, 2023, up modestly through the first six months of the year, primarily due to increasing lease liabilities. The debt structure consists of a USD350 million revolver due Dec. 11, 2024 and a USD1.95 billion term loan B due Dec. 11, 2026. ISSUER PROFILE WestJet Airlines, Ltd. is Canada's second largest airline. 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 ----------- ------ -------- ----- WestJet Airlines Ltd. LT IDR B Upgrade B- senior secured LT BB- Upgrade RR2 B+ WestJet LT IDR B Upgrade B- senior secured LT BB- Upgrade RR2 B+ WHAT ABOUT US: Case Summary & 13 Unsecured Creditors ---------------------------------------------------- Debtor: What About Us In Home Health Care, Inc. 645 E. Georgia Ave. Memphis, TN 38126 Chapter 11 Petition Date: November 21, 2023 Court: United States Bankruptcy Court Western District of Tennessee Case No.: 23-25733 Judge: Hon. Denise E. Barnett Debtor's Counsel: Toni Campbell Parker, Esq. LAW FIRM OF TONI CAMPBELL PARKER 45 N. Third Ave., Ste. 201 Memphis, TN 38103 Tel: 901-683-0099 Fax: 866-489-7938 Email: tparker002@att.net Estimated Assets: $0 to $50,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Nakita Cannady as president and CEO. A full-text copy of the petition containing, among other items, a list of the Debtor's 13 unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/XXV6IZA/What_About_Us_In_Home_Health_Care__tnwbke-23-25733__0001.0.pdf?mcid=tGE4TAMA WHOLE COFFEE: Seeks to Hire Agentis as Bankruptcy Counsel --------------------------------------------------------- The Whole Coffee Company, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of Florida to employ Agentis PLLC as its bankruptcy counsel. The firm's services include: (a) advising the Debtor with respect to its powers and duties in the continued management of its affairs; (b) advising the Debtor with respect to its responsibilities in complying with the U.S. Trustee's Operating Guidelines and Reporting Requirements and with the rules of the court; (c) preparing legal documents; (d) protecting the interests of the Debtor and the estate in all matters pending before the court; and (e) representing the Debtor in negotiations with its creditors in the preparation of a Chapter 11 plan. The hourly rates of the firm's counsel and staff are as follows: Attorneys $350 - $660 Paralegals $100 - $245 In addition, the firm will seek reimbursement for expenses incurred. Jacqueline Calderin, Esq., shareholder at Agentis, disclosed in a court filing that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Jacqueline Calderin, Esq. Agentis PLLC 45 Almeria Avenue Coral Gables, FL 33134 Telephone: (305) 722-2002 Email: jc@agentislaw.com About The Whole Coffee Company The Whole Coffee Company, LLC, a Miami-based company, filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 23-19263) on Nov. 9, 2023. In the petition signed by its chief executive officer, Michelle Armbrustmacher, the Debtor disclosed up to $10 million in both assets and liabilities. Judge Corali Lopez-Castro oversees the case. Jacqueline Calderin, Esq., at Agentis PLLC represents the Debtor as legal counsel. ZYMERGEN INC: Chapter 11 Bidding Procedures Okayed -------------------------------------------------- Emily Lever of Law360 reports that a Delaware bankruptcy judge has approved bidding procedures for the sale of Zymergen's assets, including a stalking horse agreement from its corporate parent Gingko Bioworks, after the biotechnology company reached a resolution with objecting unsecured creditors. Under the Court-approved bidding procedures, Dec. 5, 2023 at 4:00 p.m. (Prevailing Eastern Time) is the deadline by which all qualified bids must be actually received by the Debtors. If qualified bids are received, an auction will be conducted on Dec. 13, 2023 at 10:00 a.m. (Prevailing Eastern Time) at the offices of Morris Nichols Arsht & Tunnell LLP 1201 North Market Street, Wilmington, DE 19801. The sale hearing will take place in this Court on December 19, 2023 at 11:00 a.m. (Prevailing Eastern Time). Absent higher and better offers, Ginkgo Bioworks, Inc., as stalking horse bidder, has signed a deal to purchase the Debtors' assets for $5 million plus the assumption of liabilities. The consideration contemplated by the Stalking Horse Agreement provides significant value to the Debtors' estates and will be used to repay obligations of the Debtors. About Zymergen Inc. Zymergen, Inc., which was founded in April 2013, is a science and material innovation company focused on designing, developing and commercializing bio-based products for use in a variety of industries. It is based in Emeryville, Calif. Zymergen and its affiliates filed Chapter 11 petitions (Bankr. D. Del. Lead Case No. 23-11661) on Oct. 3, 2023. At the time of the filing, Zymergen reported $100 million to $500 million in both assets and liabilities. Judge Karen B. Owens oversees the cases. The Debtors tapped Morris, Nichols, Arsht & Tunnell, LLP as legal counsel and Epiq Corporate Restructuring, LLC, as claims and noticing agent. The Official Committee of Unsecured Creditors retained Simpson Thacher & Bartlett LLP as lead counsel, Landis Rath & Cobb LLP as co-counsel, and Berkeley Research Group, LLC, as financial advisor. [^] Recent Small-Dollar & Individual Chapter 11 Filings ------------------------------------------------------- In re Wael N. Abdo Bankr. C.D. Cal. Case No. 23-17593 Chapter 11 Petition filed November 15, 2023 represented by: Robert Goe, Esq. In re Laura Louise Gottlieb Bankr. C.D. Cal. Case No. 23-11068 Chapter 11 Petition filed November 14, 2023 In re Malibu's United, L.L.C Bankr. N.D. Cal. Case No. 23-41482 Chapter 11 Petition filed November 14, 2023 See https://www.pacermonitor.com/view/O7TDR2Q/Malibus_United_LLC__canbke-23-41482__0001.0.pdf?mcid=tGE4TAMA Filed Pro Se In re Alarbesh / Fernandez LLC Bankr. N.D. Cal. Case No. 23-41481 Chapter 11 Petition filed November 14, 2023 See https://www.pacermonitor.com/view/DVCJGTQ/Alarbesh__Fernandez_LLC__canbke-23-41481__0001.0.pdf?mcid=tGE4TAMA Filed Pro Se In re LSDS Business Service Corporation Bankr. S.D. Fla. Case No. 23-19368 Chapter 11 Petition filed November 14, 2023 See https://www.pacermonitor.com/view/VA3TUGI/LSDS_Business_Service_Corporation__flsbke-23-19368__0001.0.pdf?mcid=tGE4TAMA represented by: Chad Van Horn, Esq. VAN HORN LAW GROUP, P.A. E-mail: chad@cvhlawgroup.com In re Kenneth D. Crooks Bankr. W.D. La. Case No. 23-20512 Chapter 11 Petition filed November 14, 2023 represented by: Conner Dillon, Esq. In re Eckford - Greenpoint LLC Bankr. E.D.N.Y. Case No. 23-44135 Chapter 11 Petition filed November 14, 2023 See https://www.pacermonitor.com/view/ILYTNDQ/ECKFORD_-_GREENPOINT_LLC__nyebke-23-44135__0001.0.pdf?mcid=tGE4TAMA represented by: Avrum J. Rosen, Esq. LAW OFFICES OF AVRUM J. ROSEN, PLLC E-mail: arosen@ajrlawny.com In re Ding Trans Corp. Bankr. E.D.N.Y. Case No. 23-44155 Chapter 11 Petition filed November 14, 2023 See https://www.pacermonitor.com/view/IS3X4QQ/Ding_Trans_Corp__nyebke-23-44155__0001.0.pdf?mcid=tGE4TAMA represented by: Alla Kachan, Esq. LAW OFFICES OF ALLA KACHAN, P.C. E-mail: alla@kachanlaw.com In re Durand Land Holdings, LLC Bankr. W.D. Wisc. Case No. 23-12045 Chapter 11 Petition filed November 14, 2023 See https://www.pacermonitor.com/view/3Q36CJI/Durand_Land_Holdings_LLC__wiwbke-23-12045__0001.0.pdf?mcid=tGE4TAMA represented by: Joshua D. Christianson, Esq. CHRISTIANSON & FREUND, LLC E-mail: lawfirm@cf.legal In re Bruce Charles Durand (Eau Claire) Bankr. W.D. Wisc. Case No. 23-12043 Chapter 11 Petition filed November 14, 2023 represented by: Joshua Christianson, Esq. In re Seineyard at Wildwood, Inc. Bankr. N.D. Fla. Case No. 23-40439 Chapter 11 Petition filed November 15, 2023 See https://www.pacermonitor.com/view/KADB7ZI/Seineyard_at_Wildwood_Inc__flnbke-23-40439__0001.0.pdf?mcid=tGE4TAMA represented by: Samantha Kelley, Esq. BRUNER WRIGHT, P.A. E-mail: skelley@brunerwright.com In re Area Code Logistics Inc. Bankr. S.D. Fla. Case No. 23-19387 Chapter 11 Petition filed November 15, 2023 See https://www.pacermonitor.com/view/2WYOSHI/Area_Code_Logistics_Inc__flsbke-23-19387__0001.0.pdf?mcid=tGE4TAMA represented by: Peter Spindel, Esq. PETER SPINDEL, ESQ., P.A. E-mail: peterspindel@gmail.com In re Dawn M. Plourde Bankr. D.N.H. Case No. 23-10628 Chapter 11 Petition filed November 15, 2023 represented by: William Gannon, Esq. In re Atlantic Grand Ventures, LLC Bankr. E.D.N.Y. Case No. 23-44183 Chapter 11 Petition filed November 15, 2023 See https://www.pacermonitor.com/view/MVLTM6A/Atlantic_Grand_Ventures_LLC__nyebke-23-44183__0001.0.pdf?mcid=tGE4TAMA Filed Pro Se In re Jose Serrano Viera Bankr. D.P.R. Case No. 23-03750 Chapter 11 Petition filed November 15, 2023 represented by: Carmen Conde Torres, Esq. C. CONDE & ASSOC. In re Brady Reynolds Baxter Bankr. N.D. Tex. Case No. 23-32675 Chapter 11 Petition filed November 15, 2023 represented by: Patrick Schurr, Esq. In re Yolked LLC Bankr. N.D. Tex. Case No. 23-43508 Chapter 11 Petition filed November 15, 2023 See https://www.pacermonitor.com/view/JPEWDZA/Yolked_LLC__txnbke-23-43508__0001.0.pdf?mcid=tGE4TAMA represented by: Joyce W. Lindauer, Esq. JOYCE W. LINDAUER ATTORNEY, PLLC E-mail: joyce@joycelindauer.com In re Hi Tork Power, Inc. Bankr. S.D. Tex. Case No. 23-34503 Chapter 11 Petition filed November 15, 2023 See https://www.pacermonitor.com/view/YPY3RCA/Hi_Tork_Power_Inc__txsbke-23-34503__0001.0.pdf?mcid=tGE4TAMA Filed Pro Se In re Italian Grille and Deli, LLC Bankr. S.D. W.Va. Case No. 23-30290 Chapter 11 Petition filed November 15, 2023 See https://www.pacermonitor.com/view/JFACQCQ/Italian_Grille_and_Deli_LLC__wvsbke-23-30290__0001.0.pdf?mcid=tGE4TAMA represented by: Joseph W. Caldwell, Esq. CALDWELL & RIFFEE E-mail: jcaldwell@caldwellandriffee.com In re GP, Inc. Bankr. D. Colo. Case No. 23-15319 Chapter 11 Petition filed November 16, 2023 See https://www.pacermonitor.com/view/TBM7XDI/GP_Inc__cobke-23-15319__0001.0.pdf?mcid=tGE4TAMA represented by: Jeffrey A. Weinman, Esq. ALLEN VELLONE WOLF HELFRICH & FACTOR, P.C. E-mail: jweinman@allen-vellone.com In re Daniel Khesin Bankr. S.D. Fla. Case No. 23-19432 Chapter 11 Petition filed November 16, 2023 represented by: Hebe Montygierd, Esq. In re BJW Construction Management Bankr. M.D. La. Case No. 23-10797 Chapter 11 Petition filed November 15, 2023 See https://www.pacermonitor.com/view/52OQNSQ/BJW_CONSTRUCTION_MANAGEMENT__lambke-23-10797__0001.0.pdf?mcid=tGE4TAMA represented by: Kathleen Wilson, Esq. WILSON LAW FIRM, LLC E-mail: wilsonlawfirmllc@gmail.com In re Brennco Enterprises LLC Bankr. D. Md. Case No. 23-18324 Chapter 11 Petition filed November 16, 2023 See https://www.pacermonitor.com/view/GWYKEBY/Brennco_Enterprises_LLC__mdbke-23-18324__0001.0.pdf?mcid=tGE4TAMA represented by: Daniel Staeven, Esq. FROST LAW E-mail: ann.jordan@askfrost.com In re 178 Wyona Owner, LLC Bankr. E.D.N.Y. Case No. 23-44199 Chapter 11 Petition filed November 16, 2023 See https://www.pacermonitor.com/view/56ZU23Y/178_WYONA_OWNER_LLC__nyebke-23-44199__0001.0.pdf?mcid=tGE4TAMA represented by: Solomon Rosengarten, Esq. E-mail: vokma@aol.com In re Fitzroy McGowan Bankr. E.D.N.Y. Case No. 23-44196 Chapter 11 Petition filed November 16, 2023 represented by: Roy Lester, Esq. In re 2159 57 Street Unit 1A LLC Bankr. E.D.N.Y. Case No. 23-44194 Chapter 11 Petition filed November 16, 2023 See https://www.pacermonitor.com/view/5ALLTWQ/2159_57_STREET_UNIT_1A_LLC__nyebke-23-44194__0001.0.pdf?mcid=tGE4TAMA represented by: Charles Wertman, Esq. THE LAW OFFICES OF CHARLES WERTMAN E-mail: charles@cwertmanlaw.com In re The Avenue DC, LLC Bankr. D.D.C. Case No. 23-00339 Chapter 11 Petition filed November 17, 2023 See https://www.pacermonitor.com/view/TB3GFEY/The_Avenue_DC_LLC__dcbke-23-00339__0001.0.pdf?mcid=tGE4TAMA represented by: Craig M. Palik, Esq. MCNAMEE HOSEA, P.A. E-mail: cpalik@mhlawyers.com In re Investment Properties Corp. Bankr. D. Hawaii Case No. 23-00934 Chapter 11 Petition filed November 17, 2023 See https://www.pacermonitor.com/view/GNJOCLI/Investment_Properties_Corp__hibke-23-00934__0001.0.pdf?mcid=tGE4TAMA represented by: Jerrold K. Guben, Esq. O'CONNOR PLAYDON GUBEN & INOUYE LLP E-mail: JKG@opgilaw.com In re Robert William Noffsinger Bankr. N.D. Iowa Case No. 23-00962 Chapter 11 Petition filed November 17, 2023 In re Hunter Cole-Alan Durham Bankr. D.P.R. Case No. 23-03788 Chapter 11 Petition filed November 17, 2023 represented by: Jesus Enrique Batista Sanchez, Esq. In re Expertus Health, LLC Bankr. W.D. Tenn. Case No. 23-11523 Chapter 11 Petition filed November 17, 2023 See https://www.pacermonitor.com/view/6ZQXAYA/Expertus_Health_LLC__tnwbke-23-11523__0001.0.pdf?mcid=tGE4TAMA Filed Pro Se In re Barbara L. Nilson and Henry A. Nilson Bankr. S.D. Cal. Case No. 23-03619 Chapter 11 Petition filed November 18, 2023 represented by: Martin Eliopulos, Esq. HIGGS FLETCHER & MACK LLP Email: elio@higgslaw.com In re Optiview 360 Tours L.L.C. Bankr. M.D. Fla. Case No. 23-04900 Chapter 11 Petition filed November 20, 2023 See https://www.pacermonitor.com/view/DV2LJYI/Optiview_360_Tours_LLC__flmbke-23-04900__0001.0.pdf?mcid=tGE4TAMA represented by: Daniel A. Velasquez, Esq. LATHAM LUNA EDEN & BEAUDINE LLP E-mail: dvelasquez@lathamluna.com In re Mirnes Muminovic and Mirsada Muminovic Bankr. W.D. Ky. Case No. 23-10858 Chapter 11 Petition filed November 20, 2023 In re Gbomai Louise Bestman Bankr. D. Md. Case No. 23-18441 Chapter 11 Petition filed November 20, 2023 represented by: Richard Rosenblatt, Esq. In re Merlot Associates, LLC Bankr. D.N.J. Case No. 23-20847 Chapter 11 Petition filed November 20, 2023 See https://www.pacermonitor.com/view/3NNF32A/Merlot_Associates_LLC__njbke-23-20847__0001.0.pdf?mcid=tGE4TAMA represented by: Carl M. Ippolito, Esq. CARL M. IPPOLITO, ESQUIRE E-mail: info@cmippolitolaw.com In re Greek Star Tax Inc. Bankr. E.D.N.Y. Case No. 23-44222 Chapter 11 Petition filed November 20, 2023 See https://www.pacermonitor.com/view/46VZYKY/GREEK_STAR_TAX_INC__nyebke-23-44222__0001.0.pdf?mcid=tGE4TAMA represented by: Karamvir Dahiya, Esq. DAHIYA LAW OFFICES LLC E-mail: karam@bankruptcypundit.com In re Kisavos Taxi Inc. Bankr. E.D.N.Y. Case No. 23-44221 Chapter 11 Petition filed November 20, 2023 See https://www.pacermonitor.com/view/4QY7OTI/KISAVOS_TAXI_INC__nyebke-23-44221__0001.0.pdf?mcid=tGE4TAMA represented by: Karamvir Dahiya, Esq. DAHIYA LAW OFFICES LLC E-mail: karam@bankruptcypundit.com In re Milltoo, LLC Bankr. N.D. Ohio Case No. 23-51617 Chapter 11 Petition filed November 20, 2023 See https://www.pacermonitor.com/view/2DSUSAI/Milltoo_LLC__ohnbke-23-51617__0001.0.pdf?mcid=tGE4TAMA represented by: Michael A. Steel, Esq. STEEL & COMPANY, LTD. E-mail: msteel@steelcolaw.com In re Ariston Logistics, LLC Bankr. W.D. Tenn. Case No. 23-25702 Chapter 11 Petition filed November 20, 2023 See https://www.pacermonitor.com/view/DZ47EOY/Ariston_Logistics_LLC__tnwbke-23-25702__0001.0.pdf?mcid=tGE4TAMA represented by: Toni Campbell Parker, Esq. LAW FIRM OF TONI CAMPBELL PARKER E-mail: tparker002@att.net ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. TCR subscribers have free access to our on-line news archive. Point your Web browser to http://TCRresources.bankrupt.com/and use the e-mail address to which your TCR is delivered to login. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Philadelphia, Pa., USA. Randy Antoni, Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Joel Anthony G. Lopez, Psyche A. Castillon, Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2023. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $975 for 6 months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Peter A. Chapman at 215-945-7000. *** End of Transmission ***