/raid1/www/Hosts/bankrupt/TCR_Public/231211.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, December 11, 2023, Vol. 27, No. 344
Headlines
13111 WESTHEIMER: Hires Tran Singh LLP as Counsel
1560 VOLUNTOWN: Hires Novak Law Office P.C. as Counsel
2ND CHANCE: Seeks Court Nod to Sell San Bernardino Property
9250 BIG HORN: Hires Law Offices of Gabriel Liberman as Counsel
AEMETIS INC: Registers 126K Shares for Potential Resale
AGILE THERAPEUTICS: Reaches Deal with Holder to Revise Warrants
AIR INDUSTRIES: Covenant Breach Raises Going Concern Doubt
AKOYA BIOSCIENCES: Midcap Financial Marks $22.5MM Loan at 15% Off
ALLIANT HOLDINGS: Moody's Rates New $750MM Sr. Secured Notes 'B2'
AMERICAN ROOFING: Files for Chapter 11 Bankruptcy
AMERICAN TIRE: S&P Alters Outlook to Negative, Affirms 'B-' ICR
AMERIFIRST FINANCIAL: Hires Glenn Agre Bergman as Special Counsel
AMI US HOLDINGS: Midcap Financial Marks $2.9MM Loan at 88% Off
ANAGRAM HOLDINGS: Hires Howley Law PLLC as Local Counsel
APPLIED DNA: Marcum LLP Raises Going Concern Doubt
ATLAS LITHIUM: Grosses $9.9 Million From Registered Direct Offering
BACKFORTY VENTURES: Seeks to Hire Michael D. O'Brien as Counsel
BARRETTS MINERALS: Fights to Keep Chapter 11 Case in Texas
BOULDER CANYON: Jan. 5 Disclosures and Plan Hearing Set
BRICK BY BRICK: Voluntary Chapter 11 Case Summary
BRISTOL SPRINGS: Hires Albright Crumbacker & Itell as Accountant
CAN B CORP: Arena Plans to Auction Substantially All Assets
CAPREF LLOYD: Dec. 13 Deadline Set for Panel Questionnaires
CARBON6 TECH: Midcap Financial Marks $12.5MM Loan at 81% Off
CELERION BUYER: Midcap Financial Marks $9.3MM Loan at 15% Off
CERUS CORP: Midcap Financial Marks $6MM Loan at 75% Off
CHIC NAILS: Hires Honey Law Firm P.A. as Attorney
CIRCUSTRIX HOLDING: Midcap Financial Marks $4MM Loan at 77% Off
CLINE DESIGN: Voluntary Chapter 11 Case Summary
COMMERCIAL METALS: Fitch Affirms BB+ LongTerm IDR, Outlook Positive
COMMSCOPE HOLDING: Board Adopts Sixth Amended Bylaws
COMTECH TELECOM: Liquidity Concerns Raise Going Concern Doubt
CONSTRUCTION ALL STARS: Mark Weisbart Named Subchapter V Trustee
CONTINENTAL AMERICAN: Hires B. Riley as Financial Advisor
COSMOS GROUP: Olayinka Oyebola & Co. Raises Going Concern Doubt
CRISSCROSS CENTER: Voluntary Chapter 11 Case Summary
CSC 1 LLC: Court OKs Appointment of Chapter 11 Trustee
CVR ENERGY: Moody's Gives B1 Rating on New Senior Unsecured Notes
CVR ENERGY: S&P Rates New $600MM Senior Unsecured Notes 'B+'
CWGS ENTERPRISES: S&P Alters Outlook to Negative, Affirms 'B+' ICR
DADDIO'S PIZZERIA: Unsecureds Will Get 10% of Claims in Plan
DAWG'S SPORTS: Unsecureds Will Get 2% of Claims over 60 Months
DELIVERY & DISTRIBUTION: Case Summary & 17 Unsecured Creditors
DEPENDABLE LAWN: Unsecureds to Get $2K per Month for 60 Months
DERMATOLOGY INTERMEDIATE: Moody's Alters Outlook on B2 CFR to Neg.
DERMATOLOGY INTERMEDIATE: Moody's Rates New $100MM 1st Lien Loan B2
DIGITAL.AI SOFTWARE: Midcap Financial Marks $2.4MM Loan at 82% Off
DIOCESE OF PHOENIX: Moody's Affirms 'Ba2' Rating on Revenue Bonds
DIOCESE OF ROCKVILLE: Proposes $200-Mil. Abuse Claims Settlement
DIVERSIFIED PANELS: Hires Nelson Comis as Bankruptcy Counsel
DMK PHARMACEUTICALS: Further Adjourns Annual Meeting to Dec. 28
ECONOMY TREE: Voluntary Chapter 11 Case Summary
ELEMENT CONSTRUCTION: Seeks to Sell Boise Property by Auction
EQUALTOX LLC: Hires Grobstein Teeple LLP as Financial Advisors
EXELA TECHNOLOGIES: Adjourns Annual Meeting Until Dec. 29
FANNIE MAE & FREDDIE MAC: Request for Judicial Conference to Act
FEILITECH US: Unsecureds' Recovery "Unknown" in Liquidating Plan
FGH LLC: Hires Beall & Burkhardt APC as Bankruptcy Counsel
FREEDOM FACILITY: Gerard Luckman Named Subchapter V Trustee
FWAK LLC: Case Summary & Four Unsecured Creditors
G TREASURY SS: 91% Markdown for $2.2MM Midcap Financial Loan
GAUCHO GROUP: Welcomes Michael Koh to Advisory Board
GB001 INC: 89% Markdown for Midcap Financial $27.09MM Loan
GIRARDI & KEESE: $3-Mil. Trustee Fee Okayed Despite Feds Objection
GLOBAL DISCOVERY: Former CEOs Must Face IP Claims
GO CAR WASH: Midcap Financial Marks $23.7MM Loan at 55% Off
GOLD STAR EXPRESS: Taps Harlin Parker Attorneys at Law as Counsel
GREEN HYGIENICS: Unsecureds to be Paid in Full in Sale Plan
GRO-MOR PLANT: Case Summary & 20 Largest Unsecured Creditors
GUR MEAT: Unsecureds to Recover 4% to 5% in Reorganizaion Plan
GUREEV LLC: Hires Law Offices of Alla Kachan P.C. as Counsel
GUREEV LLC: Hires Wisdom Professional Services Inc. as Accountant
HEALTHCHANNELS INTERMEDIATE: S&P Upgrades ICR to 'CCC'
HEARTLAND CABINETRY: Case Summary & 20 Top Unsecured Creditors
HELIX ENERGY: Issues $300M Senior Notes Due 2029
HENIFF HOLDCO: Midcap Financial Marks $3.9MM Loan at 52% Off
HIGH VALLEY INVESTMENTS: $3.5MM DIP Loan from DJL Wins Final OK
HIGHTOWER HOLDING: Moody's Affirms 'B3' CFR, Outlook Stable
HOG FATHER'S: Unsecured Creditors to Get 0% in Liquidating Plan
HOLY GROUND: Updates Priority Unsecureds & Unsecured Claims Pay
HOMERENEW BUYER: Midcap Financial Marks $1.9MM Loan at 23% Off
IHEARTCOMMUNICATIONS INC: Moody's Lowers CFR to Caa1, Outlook Neg.
INGEVITY CORP: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable
INNOVATION PHARMACEUTICALS: Alfasigma Terminates License Agreement
INVERSIONES LATIN AMERICA: Unsecureds be Paid in Full or Reinstated
IQ DENTAL: Case Summary & 20 Largest Unsecured Creditors
IRONCLAD PRESSURE: Case Summary & 20 Largest Unsecured Creditors
ISLAND ROOFING: Ruediger Mueller of TCMI Named Subchapter V Trustee
JIN YUAN GROUP: Voluntary Chapter 11 Case Summary
JOANN INC: Posts $21.6 Million Net Loss in Third Quarter
JUPITER FINANCE 2008-003: Fitch Lowers Rating on CLN Notes to BB+sf
KASPIEN HOLDINGS: To Lay Off Most Employees
KAUFFMAN INTERMEDIATE: 95% Markdown for $1.2MM Midcap Loan
KAUFFMAN INTERMEDIATE: Midcap Marks $78,000 Loan at 28% Off
LBU FRANCHISES: Has Interim OK on Cash Access, DIP Loan from Fox
LEGACY CARES: Gets Court Nod to Sell Assets to Burke for $25.7MM
LENDINGTREE INC: S&P Cuts ICR to 'SD on Distressed Debt Repurchase
LIVINGSTON TOWNSHIP: Selling Flora Property to E&N for $1.125MM
LOUISVILLE LUSH: Unsecureds Will Get 93% in Subchapter V Plan
LTL MANAGEMENT: J&J Cites 'Progress' in Resolving Talc Cases
MALLINCKRODT PLC: Inks Deal to Resolve SEC Probe
MALLINCKRODT PLC: Silver Point, 2 Others Report 6.1% Equity Stake
MALLINCKRODT PLC: Squarepoint Ops Reports 6.6% of Ordinary Shares
MEDICAL GUARDIAN: Midcap Financial Marks $3.8MM Loan at 82% Off
MEGNA REAL ESTATE: Gets OK to Sell Property to W&Z for $2MM
MERCURITY FINTECH: Adopts Compensation Recovery Policy
MERCURITY FINTECH: Raises $6M From Private Placement Financing
MH SUB I: S&P Affirms 'B' ICR on Cost Savings Initiatives
MICHIGAN MEDICAL: Deborah Fish Named Subchapter V Trustee
MICROTEK: Case Summary & 20 Largest Unsecured Creditors
MILLSTONE MEDICAL: Goldman MML Marks $259,000 Loan at 86% Off
MILLTOO LLC: M. Colette Gibbons Named Subchapter V Trustee
MINIM INC: Receives Noncompliance Notice From Nasdaq
MP PPH LLC: Seeks to Hire Pillsbury Winthrop as Counsel
MY CITY BUILDERS: Raises Going Concern Doubt
NAVIGA INC: Midcap Financial Marks $500,000 Loan at 32% Off
NEAR INTELLIGENCE: Case Summary & 30 Largest Unsecured Creditors
NEAR INTELLIGENCE: Files for Chapter 11 to Sell Business
NEXUS BUYER: Moody's Rates New $500MM 1st Lien Incremental Loan B2
NOGIN INC: Case Summary & 30 Largest Unsecured Creditors
NOGIN INC: Dec. 13 Deadline Set for Panel Questionnaires
NOVVI LLC: Unsecured Creditors Unimpaired in Debt-for-Equity Plan
OMADA HEALTH: 96% Markdown for $100,000 Midcap Financial Loan
OMADA HEALTH: Midcap Financial Marks $2.9MM Loan at 51% Off
ORIGINCLEAR INC: Incurs $8.3MM Net Loss in Q3 2023
OUTERSTUFF LLC: Moody's Ups CFR to Caa1 & Alters Outlook to Stable
OXFORD FINANCE: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable
P&L DEVELOPMENT: Moody's Cuts CFR to Caa2 & Alters Outlook to Neg.
PALATIN TECHNOLOGIES: Registers 2.5M Shares for Possible Resale
PARAGON 28: Midcap Financial Marks $10MM Loan at 25% Off
PARTS ID: Taps Canaccord and DLA Piper to Explore Options
PEACE EQUIPMENT: Amends Several Secured Claims Pay Details
PENNYMAC FINANCIAL: Fitch Gives BB-(EXP) Rating on $650MM Notes
PHS BUYER: Midcap Financial Marks $2MM Loan at 47% Off
PLATINUM BEAUTY: Unsecureds Will Get 100% of Claims over 5 Years
POTRERO MEDICAL: Jami Nimeroff Named Subchapter V Trustee
PREMIER KINGS: Seeks to Hire Hyperams LLC as Consultant
PRINCESS PORT: Gina Klump Named Subchapter V Trustee
PURDUE PHARMA: S.C. Decision Could Affect Other Bankruptcy Cases
R1 RCM: Fitch Alters Outlook on 'BB' LongTerm IDR to Stable
R1 RCM: Moody's Lowers CFR to 'Ba3', Outlook Negative
RA CUSTOM DESIGN: Unsecureds to be Paid in Full over 5 Years
RHI ACQUISITION: Midcap Financial Marks $9.2MM Loan at 32% Off
RITE AID CORP: Closes Stores in Pittsburgh in Bankruptcy
RMCNV HOLDINGS: Hires Lefkovitz & Lefkovitz PLLC as Counsel
ROSCOE MEDICAL: Midcap Financial Marks $1.3MM Loan at 33% Off
ROSIE LABS: Hires Phocus Law as Special Corporate Counsel
RV RETAILER: S&P Alters Outlook to Negative, Affirms 'B+' ICR
SECURUS TECHNOLOGIES: Midcap Marks $7.1MM Loan at 15% Off
SELECTIS HEALTH: Enters Deals to Sell 4 Georgia Nursing Facilities
SI HOLDINGS: Midcap Financial Marks $3.4MM Loan at 34% Off
SIMEIO GROUP: Midcap Financial Marks $1.7MM Loan at 35% Off
SIMPLEDIRECTCLUB: In Talks With Creditors, Founders to Save Co.
SMILEDIRECTCLUB: Align Says Additional Facts Should be Disclosed
SOLARPLICITY UK: Midcap Financial Marks $5.5MM Loan at 65% Off
SOUTHERN NEW YORK: Unsecureds to Get 30 Cents on Dollar in Plan
STAR US: Moody's Lowers Secured Bank Loans to 'B3', Outlook Stable
SUNLIGHT FINANCIAL: Judge Walrath to Approve Acquisition
SUPERIOR INDUSTRIES: S&P Alters Outlook to Neg., Affirms 'B-' ICR
SURF OPCO: Midcap Financial Marks $20MM Loan at 32% Off
SYSTEM1 INC: Sells Total Security Limited for $340M
TASEKO MINES: Moody's Affirms 'B3' CFR, Outlook Remains Stable
TELA BIO: Midcap Financial Marks $16.6MM Loan at 20% Off
TELESOFT HOLDINGS: 93% Markdown for $2.2MM Midcap Loan
THREE DELUNA: Hires Stichter Riedel Blain & Postler as Counsel
TISSUETECH INC: Midcap Financial Marks $17.5MM Loan at 30% Off
TONAWANDA COKE: United States Trustee Says Disclosures Inadequate
TREACE MEDICAL: 90% Markdown for Midcap Financial $3MM Loan
TREACE MEDICAL: Midcap Financial Marks $35MM Loan at 61% Off
TS INVESTORS: Midcap Financial Marks $2.3MM Loan at 18% Off
TYP MANAGEMENT: Unsecureds Will Get 30.10% of Claims over 36 Months
VENUS CONCEPT: Registers 1.09M Common Shares For Possible Resale
VERDE BIO: Sells Properties to Carolina Natural Resource for $150K
VIALTO PARTNERS: Moody's Affirms 'B3' CFR & Alters Outlook to Neg.
VIAVI SOLUTIONS: S&P Downgrades ICR to 'BB', Outlook Stable
VIEWRAY INC: Midcap Financial Marks $9.5MM Loan at 37% Off
VIVAKOR INC: Falls Short of Nasdaq's Minimum Bid Price Requirement
WASTEPLACE LLC: Cash Infusion & Continued Operations to Fund Plan
WHAT ABOUT US: Craig Geno Named Subchapter V Trustee
YELLOW CORP: Amends Credit Agreements With Alter Domus Products
YOLKED LLC: Areya Aurzada of Holder Law Named Subchapter V Trustee
*********
13111 WESTHEIMER: Hires Tran Singh LLP as Counsel
-------------------------------------------------
13111 Westheimer, LLC seeks approval from the U.S. Bankruptcy Court
for the Southern District of Texas to employ Tran Singh LLP as
counsel.
The firm will provide these services:
a. preparation of the filing for Chapter 11/Subchapter V
bankruptcy; and
b. representation of the Debtor in Chapter 11/Subchapter V
bankruptcy as general bankruptcy counsel.
The firm will be paid at these rates:
Partners $400 to $650 per hour
Paraprofessionals $85 per hour
The firm received a retainer in the amount of $25,000.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Susan Tran Adams, a partner at Tran Singh LLP, disclosed in a court
filing that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Susan Tran, Esq.
Brendon Singh, Esq.
TRAN SINGH LLP
2502 La Branch Street
Houston, TX 77004
Tel: (832) 975-7300
Fax: (832) 975-7301
Email: bsingh@ts-llp.com
About 13111 Westheimer
13111 Westheimer, LLC, a company in Houston, Texas, filed Chapter
11 petition (Bankr. S.D. Texas Case No. 23-34448) on Nov. 9, 2023,
with up to $10 million in both assets and liabilities. Nik
Lavrinoff, chief restructuring officer, signed the petition.
Judge Eduardo V. Rodriguez oversees the case.
The Debtor tapped Susan Tran Adams, Esq., at Tran Singh, LLP as its
legal counsel and End Litigation Advisors, LLC as financial
advisor. Nik Lavrinoff, End Litigation Advisors' managing member,
serves as the Debtor's chief restructuring officer.
1560 VOLUNTOWN: Hires Novak Law Office P.C. as Counsel
------------------------------------------------------
1560 Voluntown Road LLC seeks approval from the U.S. Bankruptcy
Court for the District of Connecticut to employ Novak Law Office
P.C. as counsel.
The firm's services include:
a. advising the Debtor of its rights, powers and duties as
debtor and debtor-in-possession;
b. advising and assisting the Debtor with respect to the
negotiation and documentation of financing agreements, debt
restructuring, sales orders, and related transactions;
c. reviewing the nature and validity of liens asserted against
the property of the Debtor and advising the Debtor concerning the
enforceability of such liens;
d. advising the Debtor concerning the actions that it might take
to collect and to recover property for the benefit of the Debtor's
estate;
e. preparing on behalf of the Debtor certain necessary and
appropriate applications, motions, pleadings, draft orders,
notices, schedules, and other documents, and reviewing all
financial and other reports to be filed in the Chapter 11 case;
f. advising the Debtor concerning, and preparing responses to,
applications, motions, pleadings, notices and other papers which
may be filed and served in the Chapter 11 case;
g. counseling the Debtor in connection with the formulation,
negotiation, and promulgation of a plan of reorganization and
related documents; and
h. performing all other legal services for the Debtor which will
be necessary or appropriate in the administration of the Chapter 11
case.
Anthony S. Novak, Esq., the attorney of the firm handling the
Chapter 11 case will be paid at the rate of $425 per hour.
The firm received from the Debtor a retainer of $8,000.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Anthony S. Novak, Esq., a partner at Novak Law Office P.C.,
disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
Anthony S. Novak, Esq.
Novak Law Office P.C.
280 Adams Street
Manchester, CT 06042
Tel: (860) 432-7710
Email: Anthonysnovak@aol.com
About 1560 Voluntown Road LLC
1560 Voluntown Road, LLC, filed a Chapter 11 bankruptcy petition
(Bankr. D. Conn. Case No. 23-20921) on November 13, 2023,
disclosing under $1 million in both assets and liabilities.
The Debtor is represented by NOVAK LAW OFFICE, PC.
2ND CHANCE: Seeks Court Nod to Sell San Bernardino Property
-----------------------------------------------------------
2ND Chance Investment Group, LLC asked the U.S. Bankruptcy Court
for the Central District of California for approval to sell its
real property to Cobra 28 No. 8, LP or another buyer with a better
offer.
Cobra 28, a California limited partnership, offered $250,000 for
the property located at 3025 Glenview Avenue, San Bernardino,
Calif. The proposed buyer made an initial deposit of $10,000.
The property is being sold "free and clear" of liens, claims, and
interests.
"The proposed transaction has a legitimate business justification
and is in the best interest of the estate because it will generate
proceeds for the benefit of creditors," Richard Sturdevant, Esq.,
attorney for 2ND Chance, said in a motion filed in court.
The sale is expected to generate net proceeds of $21,000 after
payment of Loan Funder, LLC's claim, broker's commission, and other
charges.
The sale is subject to overbid to ensure that the property is sold
for "the best possible price," according to Mr. Sturdevant.
The overbid process requires prospective buyers to submit their
bids by no later than 4:00 p.m. (Pacific Standard Time) two
business days before the hearing on the motion scheduled for Dec.
13. The bid amount must be at least $260,000, which includes a
$20,000 cash deposit.
Any incremental bid must be at least $5,000 higher than the prior
bid.
At the Dec. 13 hearing and upon conclusion of the bidding process,
2ND Chance will select the winning bid, subject to court approval.
About 2ND Chance Investment Group
2ND Chance Investment Group, LLC owns in fee simple title 13 real
properties located in various locations in California and
Washington having an aggregate value of $7.02 million.
2ND Chance Investment Group sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. C.D. Calif. Case No. 22-12142) on
Dec. 21, 2022. In the petition signed by its managing member,
Rayshon A. Foster, the Debtor disclosed $7,221,261 in assets and
$11,002,949 in liabilities.
Judge Scott C. Clarkson oversees the case.
Financial Relief Law Center, APC and Grobstein Teeple, LLP serve as
the Debtor's bankruptcy counsel and financial advisor,
respectively.
The U.S. Trustee for Region 16 appointed an official committee to
represent unsecured creditors in the Debtor's Chapter 11 case. The
committee is represented by Goe Forsythe & Hodges, LLP.
9250 BIG HORN: Hires Law Offices of Gabriel Liberman as Counsel
---------------------------------------------------------------
9250 Big Horn Holdings, Inc. seeks approval from the U.S.
Bankruptcy Court for the Eastern District of California to employ
Law Offices of Gabriel Liberman, APC as counsel.
The firm will render its services to enable Debtor to execute its
duties as debtor and debtor-in-possession faithfully and to
implement the restructuring and reorganization of the Debtor.
The firm will be paid at these rates:
Gabriel E. Liberman $385 per hour
Paraprofessionals $150 per hour
The firm will be paid a retainer in the amount of $16,000.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Gabriel E. Liberman, Esq., at Law Offices of Gabriel Liberman, APC,
disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
Gabriel E. Liberman, Esq.
Law Offices Of Gabriel Liberman, APC
1545 River Park Drive, Suite 530
Sacramento, CA 95815
Telephone/Facsimile: (916) 485-1111
Email: Gabe@4851111.com
About 9250 Big Horn Holdings, Inc.
9250 Big Horn Holdings, Inc. in Elk Grove, CA, filed its voluntary
petition for Chapter 11 protection (Bankr. E.D. Cal. Case No.
23-23996) on November 7, 2023, listing as much as $1 million to $10
million in both assets and liabilities. Mahmoud Khattab as
president, signed the petition.
LAW OFFICES OF GABRIEL LIBERMAN, APC serve as the Debtor's legal
counsel.
AEMETIS INC: Registers 126K Shares for Potential Resale
-------------------------------------------------------
Aemetis, Inc. filed a Form S-1 registration statement with the
Securities and Exchange Commission relating to the offer and sale
from time to time by certain selling stockholders of 126,008 shares
of common stock, par value $0.001 per share, of the Company that
are issuable upon the conversion of all issued and outstanding
shares of the Company's Series B Preferred Stock, par value $0.001
per share. The Series B Preferred were issued in private placement
transactions in 2006 and 2007, pursuant to which one of the
Company's predecessor companies sold such shares to the selling
stockholders.
Pursuant to the Certificate of Designation governing the Series B
Preferred, the Series B Preferred shall automatically convert into
Common Stock upon the effectiveness of the registration statement
of which this prospectus forms a part. The Company is registering
the offer and sale of the shares of Common Stock to effect the
Automatic Conversion. Following the Automatic Conversion, there
will be no shares of Series B Preferred issued and outstanding.
The Company has agreed to bear all of the expenses incurred in
connection with the registration of the sale of shares of Common
Stock covered by this prospectus other than those expenses related
to transfer taxes, underwriting or brokerage commissions or
discounts associated with the sale of shares of Common Stock
pursuant to this prospectus. The Company is not selling any shares
of Common Stock under this prospectus and will not receive any
proceeds from the sale of shares of Common Stock by the selling
stockholders. The shares of Common Stock to which this prospectus
relates may be offered and sold from time to time directly by the
selling stockholders or alternatively through underwriters,
broker-dealers or agents. The selling stockholders will determine
at what price they may sell the shares of Common Stock offered by
this prospectus, and such sales may be made at fixed prices, at
prevailing market prices at the time of the sale, at varying prices
determined at the time of sale, or at negotiated prices.
The Company's Common Stock is listed on the Nasdaq Global Market
under the symbol "AMTX." On Dec. 1, 2023, the last reported sale
price of the Common Stock on the Nasdaq Global Market was $4.70 per
share.
A full-text copy of the Registration Statement is available for
free at:
https://www.sec.gov/Archives/edgar/data/738214/000094787123001128/ss2776879_s1.htm#a_007
About Aemetis
Headquartered in Cupertino, California, Aemetis, Inc. --
http://www.aemetis.com-- is an international renewable natural
gas, renewable fuels and byproducts company focused on the
acquisition, development and commercialization of innovative
technologies that replace traditional petroleum-based products.
The Company operates in two reportable geographic segments: "North
America" and "India."
Aemetis reported a net loss of $107.76 million for the year ended
Dec. 31, 2022, compared to a net loss of $47.15 million for the
year ended Dec. 31, 2021. As of Sept. 30, 2023, the Company had
$277.44 million in total assets, $114.37 million in total current
liabilities, $363.06 million in total long-term liabilities, and a
total stockholders' deficit of $199.99 million.
Aemetis said in its Quarterly Report on Form 10-Q for the period
ended Sept. 30,, 2023, that "As a result of negative capital,
negative market conditions resulting in prolonged idling of the
Keyes Plant, negative operating results, and collateralization of
substantially all of the company assets, the Company has been
reliant on its senior secured lender to provide additional funding
and has been required to remit substantially all excess cash from
operations to the senior secured lender. In order to meet its
obligations during the next twelve months, the Company will need to
either refinance the Company's debt or receive the continued
cooperation of its senior lender. This dependence on the senior
lender raises substantial doubt about the Company's ability to
continue as a going concern. The Company plans to pursue the
following strategies to improve the course of the business."
AGILE THERAPEUTICS: Reaches Deal with Holder to Revise Warrants
---------------------------------------------------------------
Agile Therapeutics, Inc. disclosed in a Form 8-K filed with the
Securities and Exchange Commission that it entered into a Warrant
Amendment and Additional Issuance Agreement relating to the
amendment of warrants to purchase shares of common stock, par value
$0.0001 per share, that were issued in transactions on March 14,
2022, April 25, 2022, and May 25, 2023. Collectively, the Warrants
represent the right to purchase approximately 3.8 million shares of
Common stock.
Under the terms of the Warrant Amendment and Additional Issuance
Agreement, the holder agreed to revise provisions related to the
use of a Black-Scholes model to value the Warrants in the event of
a change of control transaction. The holder also agreed to revise
provisions related to the cashless exercise of the Warrants. In
exchange for the holder's agreement to amend the Warrants, the
Company agreed to issue an additional new warrant to purchase
1,005,560 shares of Common Stock.
The New Warrant has an exercise price of $2.09 per share of Common
Stock. The New Warrant is exercisable six months after issuance
and will expire five years from the date that the New Warrant is
initially exercisable. The exercise price of the New Warrant is
subject to adjustment for stock splits, reverse splits, and similar
capital transactions as described in the New Warrant. The New
Warrant was issued pursuant to the exemption from registration
contained in Section 4(a)(2) of the Securities Act of 1933, as
amended.
The Company intends to use the revisions to the Warrants to support
the reclassification of the Warrants from a liability and to
account for the Warrants as a component of stockholders' equity on
the Company's balance sheet. The Company also intends to use the
reclassification of the Warrants as part of its plan to regain
compliance with the Nasdaq listing requirements relating to minimum
shareholders' equity.
About Agile Therapeutics Inc.
Agile Therapeutics, Inc. is a women's healthcare company dedicated
to fulfilling the unmet health needs of today's women. The
Company's product and product candidates are designed to provide
women with contraceptive options that offer freedom from taking a
daily pill, without committing to a longer-acting method. Its
initial product, Twirla, (levonorgestrel and ethinyl estradiol), a
transdermal system, is a non-daily prescription contraceptive.
Agile reported a net loss of $25.41 million for the year ended Dec.
31, 2022, compared to a net loss of $71.07 million for the year
ended Dec. 31, 2021.
Iselin, New Jersey-based Ernst & Young LLP, the Company's auditor
since 2010, issued a "going concern" qualification in its report
dated March 22, 2023, citing that the Company has generated losses
since inception, used substantial cash in operations, anticipates
it will continue to incur net losses for the foreseeable future,
requires additional capital to fund its operating needs and has
stated that substantial doubt exists about the Company's ability to
continue as a going concern.
AIR INDUSTRIES: Covenant Breach Raises Going Concern Doubt
----------------------------------------------------------
Air Industries Group filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $1,299,000 on $12,293,000 of net sales for the three months
ended September 30, 2023. This compares to a net loss of $142,000
on $13,278,000 of net sales for the same period ended September 30,
2022.
For the nine months ended September 30, 2023, the Company reported
a net loss of $2,312,000 on $38,047,000 of net sales, compared to a
net loss of $177,000 on $39,348,000 of net sales for the nine
months ended September 30, 2022.
As of September 30, 2023, Air Industries have debt service
requirements related to:
1) Webster Facility of $13,719,000 consisting of a Revolving
Loan of $8,444,000 and a term loan in the amount of $5,275,000.
During the remainder of fiscal 2023, The Company is required to pay
$236,000 of principal under the term loan.
2) Related party debt consisting of convertible subordinated
note payables of $4,812,000 and subordinated note payables of
$1,350,000. This debt is not due until July 1, 2026. Under the
Webster Facility, the Company is permitted to make principal
payments against this debt in the amount of $250,000 per quarter,
as long as certain conditions are met.
3) Various equipment leases and contractual obligations
related to Air Industries' normal business, including advances
under the facility with Connecticut Green Bank for the installation
of solar energy systems, including the replacement of the existing
roof at its Sterling Facility.
According to the Company, "We meet our cash requirements with funds
provided by a combination of cash generated from operating
activities and from our Webster credit facility. Based on our
current revenue visibility and strength of our backlog, we believe
that we have sufficient liquidity to meet our short-term cash
requirements over the next twelve months. On May 17, 2022, we
entered into the Fourth Amendment to the Loan and Security
Agreement with Webster Bank. The purpose of the amendment was to
increase the Term Loan to $5,000,000, reduce the monthly principal
installments to be made in respect to the term loan and establish a
capital expenditure line of credit in the amount of $2,000,000
which we can draw upon from time to time to finance purchases of
machinery and equipment, thereby increasing the amount of capital
expenditures we may make each year. During December 2022, we
borrowed $878,000 for a capital expenditure and again in January
2023 we borrowed $739,500 for an additional capital expenditure."
"For so long as the Webster term loan remains outstanding, if
Excess Cash Flow is a positive amount for any Fiscal Year, we are
obligated to pay Webster an amount equal to the lesser of (i) 25%
of the Excess Cash Flow and (ii) the outstanding principal balance
of the term loan. Such payment shall be made to Webster and applied
to the outstanding principal balance of the term loan, on or prior
to the April 15 immediately following such Fiscal Year. As
required, we provided the calculation for the Excess Cash Flow
payment of $195,000 for fiscal year ended December 31, 2022 to
Webster prior to the April 15, 2023 deadline and authorized such
payment to be made from the Revolving Loan. On June 13, Webster
applied this payment to the term loan.
"On August 4, 2023, we entered into the Fifth Amendment to the
Webster Facility. The purpose of the amendment was to waive the
default caused by the failure to achieve the required Fixed
Coverage Charge Ratio for the Fiscal Quarter ended March 31, and
decrease the required Fixed Coverage Charge Ratio to 0.95 to 1.00
for the Fiscal Quarters ending June 30, and September 30, 2023.
Additionally, the Fifth Amendment increased the amount of purchase
money secured debt (finance leases) the Company is allowed to have
outstanding at any time to $2,000,000. In connection with these
changes, we paid an amendment fee of $10,000.
"On November 20, 2023, we entered into the Sixth Amendment to the
Webster Facility. The amendment waived the default caused by the
failure to achieve the required Fixed Charge Coverage Ratio for the
Fiscal Quarter ended September 30, 2023 and the fact that our
Capital Expenditures were in excess of the amount permitted in the
Webster Facility. The Sixth Amendment allows for the Fixed Charge
Coverage Ratio to be calculated on a rolling basis (w) for the
Fiscal Quarter Ending December 31, 2023, three month basis, (x) for
the Fiscal Quarter Ending March 31, 2024, six month basis, (y) for
the Fiscal Quarter Ending June 30, 2024, nine month basis, and (z)
for all other Fiscal Quarters, twelve month basis. Additionally,
the Fixed Charge Coverage Ratio shall not be less than (i) 0.95 to
1.00 for the Fiscal Quarters ending June 30, 2023, September 30,
2023, and December 31, 2023, (ii) 1.10 to 1.00 for the Fiscal
Quarter ending March 31, 2024, (iii) 1.20 to 1.00 for the Fiscal
Quarter ending June 30, 2024, and (iv) 1.25 to 1.00 for all other
Fiscal Quarters. The Sixth Amendment has increased the Capital
Expenditure limit to $2,500,000 in any Fiscal Year. In connection
with these changes, the Company paid an amendment fee of $20,000.
"As a result of recent increases in the federal funds and prime
borrowing rates, interest rates and related expense under our
Webster Facility increased in 2023 compared to 2022 and if rates
remain stable or increase in 2023, our interest expense will
further increase in 2023 due to the timing of rate increases in
2022. However, such increases are not expected to materially impact
our liquidity. Nevertheless, our liquidity may be adversely
impacted by various risks and uncertainties, including, but not
limited to future and current impacts of global events such as a
widespread health crisis, the continuation of the war in Ukraine,
or the conflict in Israel, the outbreak of another conflict or the
expansion of the conflict in Israel to other countries, the ongoing
tensions between the United States and China, the Russian
Federation and certain countries in the Middle East, increases in
inflation, disruptions in the labor market and other risks.
"Navigating the current business landscape poses significant
challenges. Accurately projecting future financial periods and
ensuring covenant compliance has become extremely difficult. We are
grappling with supply chain issues, particularly in securing
critical inventory essential for fulfilling specific orders.
Additionally, the recent Middle East war has heightened
geopolitical instability that we expect will cause fluctuations in
our future business results," the Company explained.
"Our future liquidity may be adversely impacted by various risks
and uncertainties, including but not limited to the ongoing wars in
Ukraine and Israel, other geopolitical volatility, deterioration in
the financial markets or defense industries and other macroeconomic
events.
"While we are presently in full compliance with our Webster
Facility, we have failed to meet our covenants, as amended, during
two out of three of the last fiscal quarters. Additionally, it is
possible, that we may not meet our financial covenants in one of
the upcoming fiscal quarters over the next twelve months due to
either future losses and /or raising interest rates. Therefore, due
to the aforementioned issues, we have classified the term loan that
expires on December 30, 2025 as current as of September 30, 2023,
in accordance with the guidance in ASC 470-10-45 related to the
classification of callable debt. Failure to meet the revised
covenants in future periods and secure any necessary waivers raises
substantial doubt about the Company's ability to continue as a
going concern within one year after the issuance date of this
report. The Company is required to maintain a collection account
with Webster Bank into which substantially all of the Company's
cash receipts are remitted. If Webster were to cease lending and
keep the funds remitted to the collection account, the Company
would lack the funds to continue its operations."
A full-text copy of the Form 10-Q Report is available at
https://tinyurl.com/v7rj9y9s
About Air Industries
Bay Shore, New York-based Air Industries Group is a manufacturer of
aerospace components primarily for the defense industry. It became
a public company in 2005. Air Industries Group is a holding company
with three subsidiaries, AIM, NTW, and SEC.
As of September 30, 2023, Air Industries has $49,719,000 in total
assets, $34,770,000 in total liabilities, and 14,949,000 in total
stockholders' equity.
AKOYA BIOSCIENCES: Midcap Financial Marks $22.5MM Loan at 15% Off
-----------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $22,500,000
loan extended to to market at $19,071,000 or 85% of the outstanding
amount, as of September 30, 2023, according to Midcap Financial's
Form 10-Q Report for the Quarterly period ended September 30, 2023,
filed with the Securities and Exchange Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to Carbon6 Technologies, Inc. The loan accrues interest at a rate
of 2.50% (SOFR+691) per annum. The loan matures on November 1,
2027.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Akoya Biosciences, Inc. provides spatial biology solutions. The
Company offers end-to-end solutions for high-parameter tissue
analysis from discovery through clinical and translational
research, enabling the development of more precise therapies for
immuno-oncology and other drug development applications.
ALLIANT HOLDINGS: Moody's Rates New $750MM Sr. Secured Notes 'B2'
-----------------------------------------------------------------
Moody's Investors Service has assigned a B2 rating to $750 million
of senior secured notes due January 2031 that are being issued by
Alliant Holdings Intermediate, LLC, a subsidiary of Alliant
Holdings, L.P. (together with its subsidiaries, Alliant). The
rating agency also assigned a B2 rating to a pending $2.4 billion
seven-year senior secured term loan. Alliant will use the proceeds
from these offerings to refinance $3.1 billion of its existing term
loans maturing in 2027 and pay related fees and expenses. Moody's
also assigned a B2 rating to the company's amended and extended
$550 million revolving credit facility (maturing in November 2028).
The rating outlook for Alliant is unchanged at stable.
RATINGS RATIONALE
Alliant's ratings reflect its leading position in several niche
markets, steady organic revenue growth and historically strong
operating margins, said Moody's. Alliant's emphasis on specialty
programs has been a successful strategy. The company has built its
specialty and middle market insurance business by expanding through
a mix of organic growth, lateral hires (seasoned producers, mostly
with specialty books of business) and acquisitions. Alliant
generates strong revenue growth, healthy adjusted EBITDA margins,
and good free-cash-flow-to-debt metrics.
These strengths are offset by Alliant's high financial leverage,
contingent/legal risk related to lateral hires, integration risk
associated with acquisitions, and potential liabilities from errors
and omissions, a risk inherent in professional services.
Alliant reported revenue of $2.9 billion for the first nine months
of 2023, up 19% versus the prior year period, reflecting new
business generated from lateral hires and organic growth,
especially in the company's specialty property and casualty
operations. Moody's expects the company's organic growth to slow
over the next year based on weaker economic growth offset by
continuing rate increases in many lines of commercial property &
casualty insurance. Alliant has maintained strong EBITDA margins,
excluding the large goodwill impairment charge in 2022 related its
acquisition of Confie.
Following the transaction, Moody's estimates that Alliant will have
pro forma debt-to-EBITDA below 8x, (EBITDA – capex) interest
coverage of around 1.5x, and free-cash-flow-to-debt in the
low-to-mid-single digits. These pro forma metrics reflect Moody's
accounting adjustments for operating leases, contingent earnout
obligations, certain non-recurring items and run-rate EBITDA from
acquisitions. The rating agency views Alliant's leverage as
aggressive for its rating category but expects the company to
reduce leverage over the next several quarters consistent with past
practices. Alliant's capital structure includes $589 million of
preferred equity that could be subject to refinancing via debt in
the future.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to an upgrade of Alliant's ratings include:
(i) debt-to-EBITDA ratio consistently below 7x, (ii) (EBITDA -
capex) coverage of interest consistently exceeding 2x, and (iii)
free-cash-flow-to-debt ratio exceeding 5%.
Factors that could lead to a ratings downgrade include: (i)
debt-to-EBITDA ratio above 8x, (ii) (EBITDA - capex) coverage of
interest below 1.2x, or (iii) free-cash-flow-to-debt ratio below
2%.
The principal methodology used in these ratings was Insurance
Brokers and Service Companies published in June 2018.
Alliant, based in Newport Beach, California, is a
specialty-oriented insurance broker providing property and casualty
and employee benefits products and services to middle-market
clients across the US. The company generated revenue of $3.7
billion for the 12 months through September 2023.
AMERICAN ROOFING: Files for Chapter 11 Bankruptcy
-------------------------------------------------
American Roofing Products LLC filed for chapter 11 protection in
the Southern District of West Virginia without stating a reason.
According to court filings, the Debtor reported between $1 million
and $10 million in debt owed to 1 and 49 creditors. The petition
states funds will be available to unsecured creditors.
Two Brothers Capital, LLC, owns 75% of the equity while Other
Brothers Capital LLC owns the remaining 25%.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
Jan. 10, 2024, at 11:00 AM at UST-LA3, TELEPHONIC MEETING.
About American Roofing Products
American Roofing Products LLC is a merchant wholesaler of lumber
and other construction materials.
American Roofing Products LLC sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. S.D. W.Va. Case No. 23-20211) on Nov.
30, 2023. In the petition filed by John Blaker, as member, the
Debtor estimated assets and liabilities between $1 million and $10
million each.
The Honorable Bankruptcy Judge B Mckay Mignault oversees the case.
The Debtor is represented by:
Joe M. Supple, Esq.
Shari Collias
P.O. Box 188
Dunbart, WV 25064
Tel: 304-675-6249
Fax: 304-675-4372
E-mail: info@supplelawoffice.com
AMERICAN TIRE: S&P Alters Outlook to Negative, Affirms 'B-' ICR
---------------------------------------------------------------
S&P Global Ratings revised its outlook to negative from stable and
affirmed its 'B-' issuer credit rating on American Tire
Distributors Inc. (ATD).
S&P's 'B-' issue-level rating and '4' average recovery (30%-50%,
rounded estimate: 30%) assigned to ATD's first-lien term loan are
unchanged.
The negative outlook reflects at least a one-in-three likelihood
that S&P could lower its rating on ATD over the next 12 months if
leverage remains unsustainably high or cash burn persists, causing
its liquidity sources to quickly erode. This could potentially be
due to margins remaining lower for longer or higher working capital
outflows.
S&P said, "The negative outlook reflects our expectation that
credit metrics and cash flows will remain weaker than previously
expected and the risk that they could weaken further if margins do
not swiftly recover. S&P Global Ratings-adjusted EBITDA margins
through the first three quarters of 2023 fell below 3% from 4.8% in
2022. Margins have been lower in 2023 relative to our prior
forecast primarily due to the mix shift to lower margin passenger
and light truck tires , as well as the impact of higher cost
inventory now being sold at more modest prices, despite some
benefit from lower freight costs and earlier restructuring actions.
We now expect leverage of more than 13x this year, up from around
9x in 2022. We view this level as unsustainable and believe the
company will need to show margin recovery over the next year for
leverage to improve to more reasonable levels.
While we expect ATD will generate near breakeven FOCF in 2023, the
cash flows are being supported by a working capital reversal and
more sustainable free cash flow will depend on further margin
recovery. In 2022, the company generated a $415 million free cash
flow deficit due to a greater-than-expected working capital
investment, lower sales volumes, and higher unit costs. This year
working capital is improving and we expect a further inventory
unwind in the fourth quarter that results in full-year breakeven
FOCF in 2023. Assuming margins sequentially improve in the fourth
quarter as seasonal sales trends related to end of year orders and
winter tire replacement result in better operating leverage, the
company should be able to generate at least breakeven FOCF.
However, if product mix remains poor and margins remain near recent
levels, cash flows could be negative this year, straining liquidity
sources.
"Beyond 2023, we expect ATD's performance to moderately improve as
unit volumes recover, mix is better managed, and it realizes some
of the savings related to recent restructuring actions. We forecast
EBITDA margins between 4.0% and 5% in 2024 and improving toward
5%-6% thereafter, in line with longer-term historical performance.
As profitability recovers, we expect leverage to step down from the
peak of more than 13x in 2023 to around 8x in 2024 and 6x-7x in
2025 combined with ATD generating positive FOCF in each period.
However, given the very weak year-to-date results and our
expectations that consumer spending could weaken over the next
year, ATD must show a swift and significant increase in margins
over the next few quarters to support our base case.
"We expect its liquidity sources to remain adequate in our base
case. Total liquidity at the end of ATD's third quarter ended Sept.
30, 2023, exceeded $225 million, consisting of $28.6 million of
cash on balance sheet and $209.6 million of excess revolver
availability (net $120 million excess availability trigger).
Additionally, the company has no near-term debt maturities until
its ABL revolver comes due in October 2026 followed by its
first-lien term loan in October 2028.
"The negative outlook reflects the more than one-in-three
likelihood that we could lower our rating on ATD within the next 12
months if leverage remains unsustainably high or cash burn
persists, causing its liquidity sources to quickly erode. This
could potentially be due to margins remaining lower for longer or
higher working capital outflows.
"We could lower our ratings if leverage remains unsustainably high
or its cash burn persists, significantly reducing its liquidity
sources. This could potentially be due to margins remaining lower
for longer or higher use of net working capital.
"We could revise our outlook to stable if ATD can reduce its
leverage from recent unsustainable levels and consistently generate
positive FOCF. This could occur if mix shift can be better managed
to preserve margins across tire categories along with better
inventory management."
AMERIFIRST FINANCIAL: Hires Glenn Agre Bergman as Special Counsel
-----------------------------------------------------------------
The official committee of unsecured creditors of Amerifirst
Financial, Inc. and its affiliates seeks approval from the U.S.
Bankruptcy Court for the District of Delaware to employ Glenn Agre
Bergman & Fuentes LLP as special litigation counsel.
The firm will provide these services:
a. advise the Committee in connection with its rights, powers
and duties under the Bankruptcy Code, the Bankruptcy Rules, and the
Local Rules;
b. assist and advise the Committee in its examination and
analysis of potential claims against non-Debtor third parties and
the pursuit of recoveries in connection therewith;
c. assist the Committee in its investigation into the Debtors'
valuation, assets, liabilities and financial condition, the
propriety of any restructuring transaction, the Debtors'
prepetition and post-petition management, and any other issues
concerning the Debtors;
d. advise the Committee on the review, analysis, and
negotiation of any Chapter 11 plan(s) of reorganization that may be
filed and assist the Committee in the review, analysis, and
negotiation of the disclosure statement(s) accompanying any such
plan(s);
e. take all necessary action to protect and preserve the
interests of the Committee, including, if appropriate, by (i)
pursuing a stand-alone Chapter 11 plan of reorganization; (ii)
prosecuting actions against third parties; (iii) negotiating the
resolution of any litigation in which the Debtors are involved;
and(iv) reviewing and analyzing claims filed against the Debtors'
estates;
f. appear, as appropriate, before this Court and any other
court to protect the interests of the Committee;
g. communicate with the Committee's constituents in
furtherance of its responsibilities, including, but not limited to,
communications required under Section 1102 of the Bankruptcy Code;
h. perform all of the Committee's duties and powers under the
Bankruptcy Code and the Bankruptcy Rules and performing such other
services as are in the interests of those represented by the
Committee; and
i. perform all other necessary legal services on behalf of the
Committee in the Chapter 11 Cases
The firm will be paid at these rates:
Partners $1,000 to $1,500
per hour
Of Counsel $800 to $925 per
hour
Associates $500 to $1,075 per
hour
Senior Analysts & Litigation Managers $375 per hour
Paralegals $250 to $325 per
hour
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Andrew K. Glenn, Esq., a partner at Glenn Agre Bergman & Fuentes
LLP, disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
Andrew K. Glenn, Esq.
Kurt A. Mayr, Esq.
Malak S. Doss, Esq.
Glenn Agre Bergman & Fuentes LLP
1185 Avenue of the Americas, 22nd Floor
New York, NY 10036
Tel: (212) 970-1600
Email: aglenn@glennagre.com
kmayr@glennagre.com
mdoss@glennagre.com
About AmeriFirst Financial
AmeriFirst Financial, Inc. is a mid-sized independent mortgage
company in Mesa, Ariz.
AmeriFirst and its affiliate Phoenix 1040, LLC filed Chapter 11
petitions (Bankr. D. Del. Lead Case No. 23-11240) on Aug. 24, 2023.
In the petitions signed by T. Scott Avila, chief restructuring
officer, each Debtor disclosed between $50 million and $100 million
in both assets and liabilities.
Judge Thomas M. Horan oversees the cases.
The Debtors tapped Laura Davis Jones, Esq., at Pachulski Stang
Ziehl & Jones, LLP as bankruptcy counsel; Paladin Management Group,
LLC as restructuring advisor; and Omni Agent Solutions, Inc. as
claims, noticing and administrative agent.
On September 15, 2023, the Office of the United States Trustee
appointed an official committee of unsecured creditors in these
Chapter 11 cases. The committee tapped Morris, Nichols, Arsht &
Tunnell LLP as its counsel.
AMI US HOLDINGS: Midcap Financial Marks $2.9MM Loan at 88% Off
--------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $2,907,000
loan extended to AMI US Holdings Inc to market at $349,000 or 12%
of the outstanding amount, as of September 30, 2023, according to
Midcap Financial's Form 10-Q Report for the Quarterly period ended,
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver Loan to AMI US Holdings Inc. The loan accrues
interest at a rate of 0% (SOFR + 535%) per annum. The loan matures
on April 1, 2024.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
AMI Group Inc. operates as an environmental consulting company. The
Company offers industrial hygiene, environmental investigation,
remediation, and demolition.
ANAGRAM HOLDINGS: Hires Howley Law PLLC as Local Counsel
--------------------------------------------------------
Anagram Holdings, LLC and its affiliate seek approval from the U.S.
Bankruptcy Court for the Southern District of Florida to employ
Howley Law PLLC as local counsel.
The firm's services include:
a. providing legal advice and services regarding local rules,
practices, and procedures, including Fifth Circuit and Southern
District of Texas law;
b. providing certain services in connection with the
administration of the chapter 11 cases, including assisting with
and/or preparing agendas, hearing notices and witness and exhibit
lists;
c. reviewing and commenting on proposed drafts of pleadings to
be filed with the Court;
d. providing certain services with respect to the Debtors'
rights, powers and duties as debtors and debtors in possession in
the continued operation of their business, and in the areas of
federal bankruptcy law;
e. advising the Debtors regarding pending matters, the general
status of the Chapter 11 Cases and on any necessary or appropriate
steps;
f. taking necessary or appropriate action to protect and
preserve the Debtors' estates during the pendency of the Chapter 11
Cases, including the prosecution of any actions on the Debtors'
behalf, the defense of any actions commenced against the Debtors,
the negotiation of disputes in which the Debtors are involved and
the preparation of objections to any claims filed against the
Debtors' estates;
g. at the request of STB and the Debtors, preparing on behalf
of the Debtors, necessary or appropriate motions, applications,
responses, orders, reports and other pleadings and documents in
connection with the administration of the Debtors' estates;
h. communicating with the Debtors' creditors and other parties
in interest;
i. taking necessary or appropriate action on behalf of the
Debtors in connection with the sale process (the "Sale Process") in
accordance with the Order (I) Approving (A) the Bidding Procedures,
(B) the Bid Protections Granted to the Stalking Horse Bidder, (C)
Assumption and Assignment Procedures, and (II) Granting Related
Relief (the "Bidding Procedures Order") and all related documents
and such further actions as may be required or advisable in
connection with the implementation of the Sale Process;
j. taking necessary or appropriate action on behalf of the
Debtors in connection with a chapter 11 plan and disclosure
statement, and all related documents and such further actions as
may be required or advisable in connection with the implementation
of a chapter 11 plan and a contemplated restructuring;
k. attending court hearings and meeting on behalf of the
Debtors as their local counsel; and
l. performing all other necessary legal services.
The firm will be paid at these rates:
Tom A. Howley $750 per hour
Eric Terry $750 per hour
Roland G. Rodriguez, Paralegal $350 per hour
The firm received from the Debtors the amount of $129,084.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Tom A. Howley, a partner at Howley Law PLLC, disclosed in a court
filing that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Tom Howley, Esq.
Howley Law, PLLC
711 Louisiana Street, Suite 1850
Houston, TX 77002
Telephone: (713) 333-9120
Email: tom@howley-law.com
About Anagram Holdings
Anagram Holdings LLC is a manufacturer of foil balloons and
inflated decor, distributing and selling its products both
domestically and internationally. Its customers include party
supply specialty stores, grocers, mass marketers, parks, drugstores
and discount variety stores. The company is based in Eden Prairie,
Minn.
Anagram Holdings and two affiliates filed Chapter 11 petitions
(Bankr. S.D. Texas Lead Case No. 23-90901) on Nov. 8, 2023. In the
petition signed by its chief restructuring officer, Adrian Frankum,
Anagram Holdings reported $100 million to $500 million in both
assets and liabilities.
Judge Marvin Isgur oversees the cases.
The Debtors tapped Howley Law, PLLC and Simpson Thacher & Bartlett,
LLP as legal counsel; Ankura Consulting Group, LLC as restructuring
advisor; and Robert W. Baird & Co. as investment banker. Kurtzman
Carson Consultants, LLC is the claims agent.
APPLIED DNA: Marcum LLP Raises Going Concern Doubt
--------------------------------------------------
Applied DNA Sciences, Inc. disclosed in a Form 10-K Report filed
with the U.S. Securities and Exchange Commission for the fiscal
year ended September 30, 2023, that the Company's Auditor, Marcum
LLP, expressed that there is substantial doubt about the Company's
ability to continue as a going concern.
In the Report of Independent Registered Public Accounting Firm,
Marcum LLP said, "We have audited the accompanying consolidated
balance sheets of Applied DNA Sciences, Inc. and Subsidiaries as of
September 30, 2023, and 2022, the related consolidated statements
of operations, equity and cash flows for each of the two years in
the period ended September 30, 2023, and the related notes. In our
opinion, the financial statements present fairly, in all material
respects, the financial position of the Company as of September 30,
2023 and 2022, and the results of its operations and its cash flows
for each of the two years in the period ended September 30, 2023,
in conformity with accounting principles generally accepted in the
United States of America.
"The Company 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."
The Company stated, "We have recurring net losses, which have
resulted in an accumulated deficit of $302,447,147 as of September
30, 2023. We have incurred a net loss of $10,022,916 for the twelve
months ended September 30, 2023 compared to a net loss of
$8,270,059 for the same period in 2022. At September 30, 2023, we
had cash and cash equivalents of $7,151,800. We have concluded that
these factors raise substantial doubt about our ability to continue
as a going concern for one year from the issuance of the financial
statements. We will continue to seek to raise additional working
capital through public equity, private equity or debt financings.
If we fail to raise additional working capital, or do so on
commercially unfavorable terms, it would materially and adversely
affect our business, prospects, financial condition and results of
operations, and we may be unable to continue as a going concern.
If we seek additional financing to fund our business activities in
the future and there remains substantial doubt about our ability to
continue as a going concern, investors or other financing sources
may be unwilling to provide additional funding to us on
commercially reasonable terms, if at all."
A full-text copy of the 10-K Report is available at
https://tinyurl.com/2f8up84x
About Applied DNA
Applied DNA Sciences, Inc. -- http//www.adnas.com/ -- is a
biotechnology company developing technologies to produce and detect
deoxyribonucleic acid ("DNA"). Using the polymerase chain reaction
("PCR") to enable both the production and detection of DNA, the
Company operates in three primary business markets: (i) the
manufacture of synthetic DNA for use in nucleic acid-based
therapeutics; (ii) the detection of DNA in molecular diagnostics
testing services; and (iii) the manufacture and detection of DNA
for industrial supply chain security services.
As of September 30, 2023, Applied DNA has $13,651,577 in total
assets and $8,779,165 in total liabilities.
ATLAS LITHIUM: Grosses $9.9 Million From Registered Direct Offering
-------------------------------------------------------------------
Atlas Lithium Corporation disclosed in a Form 8-K filed with the
Securities and Exchange Commission that on Dec. 5, 2023, it closed
a previously announced registered direct offering of 335,908 shares
of its common stock to certain accredited investors at a purchase
price of $29.77 per share. The gross proceeds from the Registered
Offering were approximately $9.9 million after deducting offering
expenses paid by the Company. The net proceeds received by the
Company from the Registered Offering will be used for general
corporate purposes, including the development and commercialization
of the Company's products, general and administrative expenses, and
working capital and capital expenditures.
The Registered Shares were offered pursuant to a prospectus
supplement dated Dec. 1, 2023, and a base prospectus dated Sept.
18, 2023, which is part of a registration statement on Form S-3
(Registration No. 333-274223) that was declared effective by the
Securities and Exchange Commission on Sept. 18, 2023. Copies of
the prospectus supplement and the accompanying prospectus relating
to the Registered Shares may be obtained for free by visiting the
SEC's website at www.sec.gov.
About Atlas Lithium
Atlas Lithium Corporations formerly Brazil Minerals, Inc. is a
mineral exploration and development company with lithium projects
and exploration properties in other critical and battery minerals,
including nickel, rare earths, graphite, and titanium, to power the
increased demand for electrification. The Company's current focus
is on developing its hard-rock lithium project located in Minas
Gerais State in Brazil at a well-known, premier pegmatitic district
in Brazil. The Company intends to produce and sell lithium
concentrate, a key ingredient for the global battery supply chain.
Atlas Lithium reported a net loss of $5.66 million in 2022, a net
loss of $4.03 million in 2021, a net loss of $1.55 million in 2020,
a net loss of $2.08 million in 2019, a net loss of $1.85 million in
2018, a net loss of $1.89 million in 2017, a net loss of $1.74
million in 2016, and a net loss of $1.88 million in 2015. For the
nine months ended Sept. 30, 2023, the Company reported a net loss
of $25.60 million.
BACKFORTY VENTURES: Seeks to Hire Michael D. O'Brien as Counsel
---------------------------------------------------------------
Backforty Ventures, LLC seeks approval from the U.S. Bankruptcy
Court for the District of Oregon to employ Michael D. O'Brien &
Associates P.C. as counsel.
The firm's services include negotiating financing orders, seeking
authorization for use of cash collateral, reviewing and evaluating
the status and validity of secured claims, and formulating a
Chapter 11 plan of reorganization.
The firm will provide these services:
Michael O'Brien, Partner $450 per hour
Theodore Piteo, Partner $400 per hour
Hugo Zollman, Senior Paralegal $185 per hour
Lauren Gary, Paralegal $125 per hour
In addition, the firm will seek reimbursement for out-of-pocket
expenses incurred.
The firm received from the Debtor an advance payment of $25,000.
Michael O'Brien, Esq., a partner at Michael D. O'Brien &
Associates, disclosed in a court filing that his firm is a
"disinterested person" pursuant to Section 101(14) of the
Bankruptcy Code.
The firm can be reached at:
Michael D. O'Brien, Esq.
Theodore J. Piteo, Esq.
Michael D. O'Brien & Associates, P.C.
12909 SW 68th Pkwy, Suite 160
Portland, OR 97223
Tel: (503) 786-3800
Email: enc@pdxlegal.com
About Backforty Ventures, LLC
The Debtor is a beverage manufacturer and co-packer specializing in
beer, spirits, and and non-alcoholic sodas.
Backforty Ventures, LLC in Clackamas, OR, filed its voluntary
petition for Chapter 11 protection (Bankr. Or. Case No. 23-32765)
on November 29, 2023, listing $430,424 in assets and $2,526,995 in
liabilities. Brice Barrett as member, signed the petition.
Judge David W. Hercher oversees the case.
MICHAEL D. O'BRIEN & ASSOCIATES, P.C. serve as the Debtor's legal
counsel.
BARRETTS MINERALS: Fights to Keep Chapter 11 Case in Texas
----------------------------------------------------------
Talc supplier Barretts Minerals won against an effort by creditors,
including tort claimants, to move its chapter 11 bankruptcy case
from Texas to Montana, where the business is based.
The Official Committee of Unsecured Creditors moved to transfer
venue of the case from the U.S. Bankruptcy Court for the Southern
District of Texas to the U.S. Bankruptcy Court for the District of
Montana.
The Court held an evidentiary hearing on venue transfer on Dec. 1,
2023. Supplemental briefing was requested on (1) whether an entity
with no debt obligations can be a debtor under the Bankruptcy Code;
(2) whether a debtor's "principal assets" may be located in more
than one district under 28 U.S.C. Sec. 1408(1); and (3) the level
of access provided by the District of Montana's remote appearance
procedures.
"Because Barretts Minerals' Bay City, Texas, facility is one of its
principal assets, the Southern District of Texas is at least one of
the proper venues for this case under Sec. 1408. The Committee's
evidence does not demonstrate that the District of Montana is a
more convenient venue than the Southern District of Texas. Venue
will not be transferred," Judge Marvin Isgur said in his ruling.
After considering the factors considered by the Fifth Circuit when
determining venue transfer in a bankruptcy proceeding, the Court
said it cannot conclude that the District of Montana is a clearly
more convenient forum.
"It is important to note that BMI's main creditors in this case --
those with the primary economic interest in BMI's estate -- are the
asbestos tort claimants. There are currently no tort claimants in
Montana. Texas has a greater distribution of asbestos litigants,
with six lawsuits currently pending in state. Of the twenty-six
law firms with the most significant representations of parties
asserting talc claims, none are located in Montana, and four are
located in Texas. Although a number of BMI's other creditors are
located in Montana, it does not appear that those creditor's
interests will be adversely affected by this bankruptcy case. It
is undisputed that this case was filed to resolve asbestos tort
claims. This factor weighs toward retaining venue in this
District."
Bloomberg recounts that facing hundreds of personal injury
lawsuits, the former Pfizer minerals business filed for bankruptcy
protection in October 2023 in the U.S. Bankruptcy Court in Houston.
Barretts supplied talc for cosmetic products alleged to have
caused injuries primarily from exposure to asbestos supposedly
contained in the products.
About Barretts Minerals
Barretts Minerals Inc. current operations are focused on the
mining, beneficiating, processing, and sale of industrial talc.
BMI historically supplied a relatively minor percentage of its
sales into cosmetic applications. BMI's talc is sold to
distributors and third-party manufacturers for use in such parties'
products, which are then incorporated into downstream products
eventually sold to consumers.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 23-90794) on Oct.
2, 2023. In the petition signed by David J. Gordon, chief
restructuring officer, BMI disclosed up to $100 million in assets
and up to $50 million in liabilities.
Judge David R. Jones oversees the cases.
The Debtors tapped Porter Hedges LLP and Latham& Watkins LLP as
legal counsel, M3 Partners, LP, as financial advisor, Jefferies LLC
as investment banker, and Stretto, Inc., as claims, noticing, and
solicitation agent and administrative advisor.
BOULDER CANYON: Jan. 5 Disclosures and Plan Hearing Set
-------------------------------------------------------
Judge Elisabetta G. M. Gasparini has entered an order that the
Disclosure Statement filed by Boulder Canyon, LLC, is conditionally
approved.
On or before Dec. 29, 2023, all creditors and other parties in
interest entitled to vote on the Plan must file their written
acceptance or rejection of the Plan.
The Court will convene a hearing to consider final approval of the
disclosure statement and confirmation of the Plan on Jan. 5, 2024
at 10:00 a.m. at the Clement F. Haynsworth Federal Building and
U.S. Courthouse, 300 East Washington Street Greenville, South
Carolina 29601.
On or before Dec. 29, 2023, any creditor or party in interest that
wishes to object to confirmation of the Plan must file and serve
the objection.
About Boulder Canyon
Boulder Canyon, LLC, is a limited liability company in the business
of purchasing and rehabilitating residential real estate. Boulder
Canyon was formed by Dan Ray Kiely and Jason May. Boulder was
formed in 2017 as a Florida limited liability company. Kiely is an
individual who began investing in Florida real estate in 1970.
Boulder Canyon, LLC, sought protection for relief under Chapter 11
of the Bankruptcy Code (Bankr. D.S.C. Case No. 23-00258) on Jan.
27, 2023, with $50,001 to $100,000 in assets and $500,001 to $1
million in liabilities. Judge Elisabetta G.M. Gasparini oversees
the case.
The Debtor tapped Randy A. Skinner, Esq., at Skinner Law Firm, LLC,
as bankruptcy counsel and William McKibbon, III, Esq., an attorney
serving Greenville, S.C., as special counsel.
BRICK BY BRICK: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Brick By Brick Builds, Inc.
2729 State Road 580
Clearwater, FL 33761
Chapter 11 Petition Date: December 7, 2023
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 23-05564
Judge: Hon. Roberta A. Colton
Debtor's Counsel: Stephanie B. Anthony, Esq.
ANTHONY AND PARTNERS
100 S. Ashley
Tampa, FL 33602
Tel: 813-273-5616
Email: santhony@anthonyandpartners.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Robin Goris as president.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/E5GFRRY/Brick_By_Brick_Builds_Inc__flmbke-23-05564__0001.0.pdf?mcid=tGE4TAMA
BRISTOL SPRINGS: Hires Albright Crumbacker & Itell as Accountant
----------------------------------------------------------------
Bristol Springs Custom Homes LLC, seeks approval from the U.S.
Bankruptcy Court for the Northern District of West Virginia to
employ Albright Crumbacker & Itell as accountant.
The firm will provide monthly bookkeeping, tax advice, tax
preparation and overall financial management services.
The firm will be paid at these rates:
Kert Shipway $275 per hour
Professionals $255 per hour
Staff billing $105 to $140 per hour
Administrative staff $90 per hour
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Kert Shipway, a partner at Albright Crumbacker Moul & Itell,
disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
Kert Shipway
Albright Crumbacker Moul & Itell
1110 Professional Court, Suite 300
Hagerstown, MD 21740
Tel: (301) 739-5300
About Bristol Springs Custom Homes, LLC
Bristol Springs Custom Homes, LLC filed its voluntary petition for
relief under Chapter 11 of the Bankruptcy Court (Bankr. N.D. W.Va.
Case No. 23-00537) on November 6, 2023.
Aaron C. Amore, Esq. at AMORE LAW, PLLC represents the Debtor as
counsel.
CAN B CORP: Arena Plans to Auction Substantially All Assets
-----------------------------------------------------------
Can B Corp. disclosed in a Form 8-K filed with the Securities and
Exchange Commission that the Company received a notice from Arena
Special Opportunities Partners I, LP, Arena Special Opportunities
Fund, LP and Arena Investors, LP advising that by virtue of
defaults in the performance of the obligations of the Company and
its subsidiaries to the Arena Entities, the Arena Entities intend
to conduct a public auction of all or substantially all of the
assets of the Company and its subsidiaries under Article 9 of the
Uniform Commercial Code on Dec. 28, 2023. The Company's equity
interest in Nascent Pharma, LLC, a 67% owned subsidiary, and the
assets of Nascent Pharma, will be excluded from the sale.
The Arena Entities collectively hold approximately $3,838,770
aggregate principal amount of Convertible Notes issued by the
Company. The Arena Entities previously notified the Company and
its subsidiaries that they were in default of certain obligations
under the Forbearance Agreement dated Feb. 27, 2023 among the
Company, its subsidiaries and the Arena Entities pursuant to which
the Arena Entities agreed to forbear from exercising remedies under
the Notes until Dec. 31, 2024 provided that no defaults occurred
under the Notes or Forbearance Agreement. The alleged defaults
include a failure to deliver account control agreements, failure to
enter into a servicing agreement, failure to timely make certain
payments and the unauthorized use and misuse of receivables
assigned to the Arena Entities.
The Company plans to seek a further forbearance from the Arena
Entities. No assurance can be given that the Arena Entities will
agree to a forbearance.
About Can B Corp
Headquartered in Hicksville New York, Can B Corp (f/k/a Canbiola,
Inc.) -- http://www.canbiola.com-- is a health & wellness company
providing hemp derived cannabinoid products, including under its
own brands of Canbiola, Seven Chakras, NuWellness, Pure Leaf Oil
and Duramed. Can B utilizes multi-channel distribution to reach
consumers, including medical facilities, doctor offices, retailers,
online and direct. Can B Corp. operates R&D and production
facilities in Lacey, WA, and Florida.
Can B Corp. reported a net loss of $14.92 million for the year
ended Dec. 31, 2022, compared to a net loss of $12.17 million for
the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had
$15.56 million in total assets, $12.86 million in total
liabilities, and $2.70 million in total stockholders' equity.
Lakewood, CO-based BF Borgers CPA PC, the Company's auditor since
2021, issued a "going concern" qualification in its report dated
April 17, 2023, citing that the Company's significant operating
losses raise substantial doubt about its ability to continue as a
going concern.
CAPREF LLOYD: Dec. 13 Deadline Set for Panel Questionnaires
-----------------------------------------------------------
The United States Trustee is soliciting members for committee of
unsecured creditors in the bankruptcy case of CAPREF Lloyd Center
East LLC.
If a party wishes to be considered for membership on any official
committee that is appointed, it must complete a questionnaire
available at https://tinyurl.com/3mytkmr5 and return by email it to
Erin Schmidt - erin.schmidt2@usdoj.gov - at the Office of the
United States Trustee so that it is received no later than 4:00
p.m., on Wednesday, Dec. 13, 2023.
If the U.S. Trustee receives sufficient creditor interest in the
solicitation, it may schedule a meeting or telephone conference for
the purpose of forming a committee.
About CAPREF Lloyd
CAPREF Lloyd Center East LLC sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. ND Tex Lead Case No. 23-11942) on
Dec. 4, 2023. In the petition signed by Todd Minnis as authorized
representative, the Debtors disclosed up to $1 million to $10
million in assets and up to $10 million to $50 million in
liabilities.
Hon. John T. Dorsey oversees the case.
The Debtor tapped Ashby & Geddes, P.A. as bankruptcy counsel, and
Lane Powell PC as corporate counsel.
CARBON6 TECH: Midcap Financial Marks $12.5MM Loan at 81% Off
------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $12,500,000
loan extended to Carbon6 Technologies, Inc to market at $2,413,000
or 19% of the outstanding amount, as of September 30, 2023,
according to Midcap Financial's Form 10-Q Report for the Quarterly
period ended September 30, 2023, filed with the Securities and
Exchange Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to Carbon6 Technologies, Inc. The loan accrues interest at a rate
of 1% (SOFR+685) per annum. The loan matures on August 1, 2027.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Carbon6 Technologies, Inc. is a developer of e-commerce software
bundle technology designed to simplify operational success for
online entrepreneurs. The company acquires, builds, and integrates
software technologies for e-commerce merchants selling on Amazon,
and offers educational programs, support, and research tools for
merchandise and product listing online, enabling e-commerce
businesses around the globe to exceed their goals and helping them
to grow their business.
CELERION BUYER: Midcap Financial Marks $9.3MM Loan at 15% Off
-------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $9,300,000
loan Celerion Buyer, Inc to market at $7,882,000 or 85% of the
outstanding amount, as of September 30, 2023, according to Midcap
Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to Celerion Buyer, Inc. The loan accrues interest at a rate of .75%
(SOFR+650) per annum. The loan matures on November 5, 2029.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Celerion provides research and healthcare solutions. The Company
offers clinical research, bioanalytical services, drug development
consultancy, first-in-human studies, and medical writing and
reporting.
CERUS CORP: Midcap Financial Marks $6MM Loan at 75% Off
-------------------------------------------------------
MidCap Financial Investment Corporation has marked its $600,000,000
loan to Cerus Corporation to market at $1,500,000 or 25% of the
outstanding amount, as of September 30, 2023, according to Midcap
Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to Cerus Corporation. The loan accrues interest at a rate of 1%
(SOFR+660) per annum. The loan matures on March 1, 2028.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Cerus Corporation is an American multinational biotechnology
company headquartered in Concord, California that develops and
provides a treatment system to pathogen-reduce human blood products
for the healthcare industry.
CHIC NAILS: Hires Honey Law Firm P.A. as Attorney
-------------------------------------------------
Chic Nails, Inc. seeks approval from the U.S. Bankruptcy Court for
the Western District of Arkansas to employ Honey Law Firm, P.A. as
attorney.
The firm will render these legal services:
(a) advise and consult with the Debtor concerning questions
arising in the conduct of the administration of the estate and
concerning its rights and remedies with regard to the estate's
assets and claims of secured, priority and unsecured creditors and
other parties in interest;
(b) appear for; prosecute, defend, and represent the Debtor's
interest in adversary proceedings and/or contested matters arising
in or related to this case;
(c) investigate and prosecute preference and other actions
arising under the Debtor's avoiding powers;
(d) assist in the preparation of such pleadings, motions,
notices, and orders as are required for the orderly administration
of this estate and to consult with and advise the Debtor in
connection with the operation of or termination of the operation
of
its business;
(e) assist in the preparation of a plan of reorganization and
to present said plan of reorganization to this court for approval
and confirmation; and
(f) undertake all other necessary and appropriate legal
representation of the Debtor in this proceeding.
The firm will be paid at these rates:
Marc Honey $350 per hour
Jennifer Wyse $225 per hour
Alexandra Honey $175 per hour
Paralegal $125 per hour
Prior to the petition date, the Debtor paid the sum of $45,000.
Marc Honey, Esq., an attorney at Honey Law Firm, 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:
Marc Honey, Esq.
Honey Law Firm, PA
P.O. Box 1254
Hot Springs, AR 71902
Telephone: (501) 321-1007
Facsimile: (501) 321-1255
Email: mhoney@honeylawfirm.com
About Chic Nails, Inc.
Chic Nails, Inc. filed a petition under Chapter 11, Subchapter V of
the Bankruptcy Code (Bankr. W.D. Ark. Case No. 23-71690) on Nov.
10, 2023, with up to $50,000 in assets and $100,001 to $500,000 in
liabilities.
Judge Bianca M. Rucker oversees the case.
Marc Honey, Esq., at Honey Law Firm, P.A. represents the Debtor as
bankruptcy counsel.
CIRCUSTRIX HOLDING: Midcap Financial Marks $4MM Loan at 77% Off
---------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $4,000,000
loan extended to CircusTrix Holdings LLC to market at $938,000 or
23% of the outstanding amount, as of September 30, 2023, according
to Midcap Financial's Form 10-Q Report for the Quarterly period
ended September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to CircusTrix Holdings LLC. The loan accrues interest at a rate of
1% (SOFR+675) per annum. The loan matures on July 18, 2028.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Circustrix Holdings, LLC operates as a holding company. The
Company, through its subsidiaries, develops and owns recreation
parks and fitness centers. CircusTrix Holdings serves customers
worldwide.
CLINE DESIGN: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: Cline Design Group, Inc.
11757 W. Ken Caryl Ave., #F-195
Littleton, CO 80127
Chapter 11 Petition Date: December 8, 2023
Court: United States Bankruptcy Court
District of Colorado
Case No.: 23-15657
Debtor's Counsel: Aaron J. Conrardy, Esq.
WADSWORTH GARBER WARNER CONRARDY, P.C.
2580 West Main Street
Suite 200
Littleton, CO 80120
Tel: 303-296-1999
Email: aconrardy@wgwc-law.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Jeffrey A. Cline 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/WICRBTI/Cline_Design_Group_Inc__cobke-23-15657__0001.0.pdf?mcid=tGE4TAMA
COMMERCIAL METALS: Fitch Affirms BB+ LongTerm IDR, Outlook Positive
-------------------------------------------------------------------
Fitch Ratings has affirmed Commercial Metals Company's (CMC)
Long-Term Issuer Default Rating (IDR) at 'BB+'. Fitch has also
affirmed the company's senior secured revolving credit facility at
'BBB-'/'RR2' and affirmed the senior unsecured notes at
'BB+'/'RR4'. The Rating Outlook remains Positive.
The Positive Outlook reflects Fitch's expectation that CMC's EBITDA
leverage, below 2.5x over the past five years, will be sustained
below 2.5x. The Outlook also reflects Fitch's view that EBITDA
margins will be sustained above 8%, supported by a combination of
new, low-cost mills coming online, the 2022 TAC Acquisition Corp.
(Tensar) acquisition, and rebar prices above historical averages.
The Outlook could be stabilized if Fitch believes CMC's growth
strategy could lead to EBITDA leverage sustained in the 2.5x-3.5x
range.
The ratings reflect CMC's low cost position and the flexible
operating structure of its 100% electric arc furnace (EAF) steel
production. The ratings also reflect CMC's vertically integrated
business model, which Fitch views as benefiting capacity
utilization, supporting its low cost position and providing some
protection against price volatility, leading to relatively stable
margins through the cycle compared with majority blast furnace
steel manufacturing peers.
KEY RATING DRIVERS
Conservative Leverage Profile: Fitch expects CMC's EBITDA leverage,
0.7x at fiscal YE23, to remain below 2.5x over the rating horizon
barring any material leveraging acquisitions, despite expectations
for economic weakness in fiscal 2024 and a declining rebar price
environment. CMC has a lengthy history of conservative leverage and
has maintained EBITDA leverage below 2.5x over the last five years,
including through a period of meaningful economic weakness driven
by the pandemic's impact on the economy in 2020. Additionally,
management targets 2.0x net leverage through the cycle, which
supports Fitch view that the company will continue to maintain low
financial leverage.
New Mills Improve Operational Profile: CMC constructed a new
500,000-ton micro mill in Arizona for roughly USD300 million, which
began rebar production in 4Q FY23 and will begin producing merchant
bar in 2024. The new Arizona mill will be the first micro mill
globally with the ability to produce merchant bar quality products
through a continuous production process.
CMC also announced its intention to construct a 500,000-ton micro
mill in West Virginia (WV), which is expected to cost roughly
USD450 million and begin operations in late 2025. Fitch views the
new mills positively, as they will be low-cost facilities, which
Fitch believes provides margin support, in addition to increasing
CMC's size and scale. Fitch expects the WV mill to be funded
primarily with a combination of cash on hand and future cashflow
generation.
Tensar Acquisition Supports Margins: In fiscal 2022, CMC acquired
Tensar, a global provider of engineered solutions for subgrade
reinforcement and soil stabilization used in road, infrastructure
and commercial construction projects, for approximately USD550
million. The acquisition size was significant, but the majority of
earnings continue to be generated from CMC's steel production, with
Tensar accounting for an estimated less than 10% of total EBITDA.
Fitch believes the acquisition will be modestly accretive to
margins given Tensar's standalone business has significantly higher
margins than CMC's core steel business.
Tensar generates approximately 60% of its sales in North America,
with its remaining exposure in EMEA and other parts of the world.
Fitch views the Tensar acquisition as expanding CMC's existing
operational mix while complimenting CMC's end markets and providing
additional geographic diversification. Fitch believes the company
will remain opportunistic on M&A, focusing on complimentary targets
that provide additional value for customers.
Europe Segment Near-Term Weakness: CMC's Europe segment's EBITDA
generation declined significantly in FY23 from FY22 driven by
challenging European market conditions including an approximately
16% decline in CMC's average selling prices, increased energy
costs, inflation, and rising interest rates, which negatively
affected consumer sentiment, industrial production, and delayed
European construction starts. Fitch expects economic weakness in
Europe to continue into CMC's FY24 but for EBITDA margins to
gradually improve through the year and trend closer toward
historical levels through the forecast period.
CMC's operations are concentrated primarily in strong
nonresidential construction demand regions within the U.S. and
secondarily in Central Europe, despite near-term economic weakness
in Europe. CMC's operations in Poland account for approximately 20%
of total mill capacity, and provide diversification from U.S.
construction exposure.
Vertically Integrated Business Model: CMC's vertically integrated
business model and focus on pull-through volumes benefit consistent
capacity utilization and position the company as a low-cost
producer. Approximately 50%-60% of scrap from CMC's recycling
operations is normally sold to CMC's mill operations. Additionally,
nearly 100% of steel supply for its fabrication operations is
typically sourced internally. CMC's recycling facilities are often
located in close proximity to mills, resulting in reduced
transportation costs. Mills also have a steady and captive source
of demand through internal shipments to fabrication facilities,
leading to consistent utilization rates across these segments.
Fitch believes the company's vertically integrated model also
provides some margin resiliency through the cycle. Mills and
fabrication operations tend to have lower margins in periods of
rapidly increasing scrap prices, whereas recycling operations tend
to perform well under the same conditions. The inverse correlation
and timing difference of peak profitability during volatile scrap
and rebar price environments across different segments helps
provide some insulation from price volatility.
Heavily Levered to Rebar/Construction: CMC is the largest producer
of rebar in the U.S., and highly levered to nonresidential
construction demand and rebar prices. Fitch views CMC's heavy
exposure to rebar as partially offset by its low cost position and
its fabrication operations, which provide a steady and consistent
source of demand. Fitch expects nonresidential construction
spending to decline modestly in 2024 at mid-single digit rates,
coming off a strong 2023. However, Fitch believes funding provided
under the U.S. Infrastructure Bill, Inflation Reduction Act, and
CHIPS Act, in addition to reshoring efforts, will support
nonresidential construction and rebar demand over the next several
years.
FCF Provides Flexibility: Fitch believes CMC's stable margin
profile and minimal capex requirements provide the ability to
consistently generate FCF, which allows CMC to fund internal growth
and shareholder returns primarily with cash. CMC announced in
fiscal 1Q22 a USD350 million share repurchase program and
repurchased approximately USD263 million of shares combined in FY22
and FY23, leaving USD87 million remaining under the program. Fitch
expects the program to be exhausted over the next year or two and
for shareholder returns to continue to be part of the company's
capital-allocation framework.
DERIVATION SUMMARY
CMC is smaller in terms of annual shipments compared with EAF steel
producers Nucor Corporation (A-/Stable) and Steel Dynamics, Inc.
(BBB/Positive), and majority blast furnace producers United States
Steel Corporation (BB/Stable) and Cleveland-Cliffs Inc.
(BB-/Stable). However, the flexible operating structure of its EAF
production and CMC's low cost position results in much less
volatile profitability and more consistent leverage metrics
compared with majority blast furnace producers.
CMC has lower product and end market diversification compared with
Nucor, Steel Dynamics, U. S. Steel, and Cleveland-Cliffs given its
concentration in rebar and construction, respectively. However, CMC
has geographic diversification through its European operations. CMC
generally has lower, but more stable through-the-cycle margins and
leverage metrics compared with U. S. Steel and Cleveland-Cliffs,
and less favorable margins compared with Nucor and Steel Dynamics
given CMC's concentration in rebar, a commoditized product.
KEY ASSUMPTIONS
- Declining rebar prices through FY 2027;
- Annual North American external shipments increase to
approximately 3.1 million-3.2 million tons as the new Arizona mill
ramps up in fiscal 2024, increasing to around 3.3 million-3.4
million tons as the West Virginia mill begins operations in fiscal
2026;
- Europe segment earnings remain challenged in FY 2024 before
recovering in FY 2025;
- New West Virginia mill operations begin in 2Q of fiscal 2026;
- EBITDA margins decline in fiscal 2024, then trend to around 11%
thereafter;
- Elevated capex of USD600 million in FY 2024 and USD550 million in
FY 2025 associated with the construction of the new West Virginia
mill, trending toward around USD300 million annually thereafter;
- Steady dividends and no additional acquisitions;
- Excess cash allocated to share repurchases.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Commitment to maintaining a conservative financial policy and
investment-grade credit profile;
- EBITDA leverage sustained below 2.5x;
- EBITDA margins sustained above 8%, representing a sustainably
higher pricing environment for rebar, further cost reduction,
and/or an expansion of its product portfolio into higher value-add
mix.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- EBITDA leverage sustained above 3.5x;
- Prolonged negative FCF driven by a material reduction in steel
demand or an influx of rebar imports causing rebar prices to be
depressed for a significant time period;
- Depressed metal margins leading to overall EBITDA margins
sustained below 6%.
LIQUIDITY AND DEBT STRUCTURE
Solid Liquidity: As of Aug. 31, 2023, CMC had cash and cash
equivalents of USD592 million, and USD599 million available under
its USD600 million secured revolving credit facility due 2027. In
addition, the company has approximately USD61 million under its
PLN288 million (USD70 million as of Aug. 31, 2023) Poland accounts
receivable facility. CMC also has USD129 million of availability
under its Poland credit facilities. CMC has no material maturities
until its $300 million 4.125% senior unsecured notes mature in
2030.
ISSUER PROFILE
CMC manufactures, recycles, and markets steel and metal products,
related materials and services through a network of facilities in
the United States and Poland. The company manufactures long steel
products, primarily rebar, which is particularly tied to
construction demand.
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
----------- ------ -------- -----
Commercial
Metals Company LT IDR BB+ Affirmed BB+
senior unsecured LT BB+ Affirmed RR4 BB+
senior secured LT BBB- Affirmed RR2 BBB-
COMMSCOPE HOLDING: Board Adopts Sixth Amended Bylaws
----------------------------------------------------
Commscope Holding Company, Inc. disclosed in a Form 8-K filed with
the Securities and Exchange Commission that the Board of Directors
of the Company approved and adopted the Sixth Amended and Restated
Bylaws of the Company, effective Nov. 30, 2023. Among other
things, the Sixth Amended and Restated Bylaws include:
* provisions to address the "universal proxy" rules adopted by
the U.S. Securities and Exchange Commission under Rule 14a-19 of
the Securities and Exchange Act, as amended;
* the implementation of a requirement that any stockholders
directly or indirectly soliciting proxies from other stockholders
use a proxy card color other than white, with the white proxy card
being reserved for exclusive use by the Board;
* certain enhancements to procedural mechanics and disclosure
requirements in connection with stockholder nominations of
directors;
* removal of references to the classified Board structure, which
are no longer applicable; and
* certain technical, modernizing and clarifying changes.
About CommScope
CommScope (NASDAQ: COMM) -- www.commscope.com -- is a global
provider of infrastructure solutions for communication, data center
and entertainment networks. The Company's solutions for wired and
wireless networks enable service providers, including cable,
telephone and digital broadcast satellite operators and media
programmers to deliver media, voice, Internet Protocol (IP) data
services and Wi-Fi to their subscribers and allow enterprises to
experience constant wireless and wired connectivity across complex
and varied networking environments.
CommScope reported a net loss of $1.28 billion in 2022, a net loss
of $462.6 million in 2021, and a net loss of $573.4 million in
2020.
For the nine months ended Sept. 30, 2023, the Company incurred a
net loss of $925.7 million. As of Sept. 30, 2023, the Company had
$10.06 billion in total assets, $11.41 billion in total
liabilities, $1.15 billion in series A convertible preferred stock,
and a total stockholders' deficit of $2.49 billion.
* * *
As reported by the TCR on November 22, 2023, S&P Global Ratings
lowered its issuer credit rating on CommScope to 'CCC' from 'B-'
and removed the ratings from CreditWatch with negative
implications, where they were placed on Oct. 31, 2023. S&P revised
the outlook to negative.
COMTECH TELECOM: Liquidity Concerns Raise Going Concern Doubt
-------------------------------------------------------------
Comtech Telecommunications Corp. disclosed in a Form 10-Q Report
filed with the Securities and Exchange Commission for the quarterly
period ended October 31, 2023 that there is substantial doubt about
its ability to continue as a going concern doubt within the next 12
months.
"Our current cash and liquidity projections raise substantial doubt
about our ability to continue as a going concern," stated the
Company.
"We have evaluated whether there are any conditions or events,
considered in the aggregate, that raise substantial doubt about our
ability to continue as a going concern over the next 12 months.
Based on our current business plans, including projected capital
expenditures, we do not believe our current level of cash and cash
equivalents or liquidity expected to be generated from future cash
flows will be sufficient to fund our operations over the next 12
months and repay current obligations under the Credit Facility,
raising substantial doubt about the Company's ability to continue
as a going concern as of the date of this Quarterly Report on Form
10-Q. Although we are actively pursuing strategies to mitigate
these conditions and events and alleviate such substantial doubt
about our ability to continue as a going concern, there can be no
assurance that our plans will be successful."
"Our ability to meet our current obligations as they come due may
be impacted by our ability to remain compliant with the financial
covenants under our Credit Facility or to obtain waivers or
amendments that impact the related financial covenants. If we are
unable to satisfy certain covenants and not able to obtain waivers
or amendments, such event would constitute an Event of Default (as
such term is defined under the Credit Facility) and could cause an
immediate acceleration and repayment of all outstanding principal,
interest and fees due under the Credit Facility. If there is an
Event of Default, there can be no assurances that we will be able
to continue as a going concern, which could force us to delay,
reduce or discontinue certain aspects of our business strategy.
Additionally, our ability to meet future anticipated liquidity
needs will largely depend on our ability to generate positive cash
inflows from operations, as well as refinance our Credit Facility,
and/or secure other sources of outside capital."
"Our ability to generate cash in the future or have sufficient
access to credit from financial institutions and/or financing from
public and/or private debt and equity markets on acceptable terms,
or at all, (i) is subject to (a) general economic, financial,
competitive, legislative, regulatory and other factors that are
beyond our control and (b) a majority vote consent right of the
holders of the Convertible Preferred Stock, and (ii) could (x)
dilute the ownership interest of our stockholders, (y) include
terms that adversely affect the rights of our common stockholders,
or (z) restrict our ability to take specific actions such as
incurring additional debt, making acquisitions or capital
expenditures or declaring dividends. Also, our transition to
sustained profitability is dependent upon the successful completion
of our ongoing One Comtech transformation and integration of
individual businesses into two segments and related restructuring
activities to optimize our cost structure."
"If we are unable to obtain sufficient, timely financial resources,
our business, financial condition and results of operations could
be materially and adversely affected and we may be forced to
terminate, significantly curtail or cease our operations or to
pursue other strategic alternatives, including commencing a case
under the U.S. Bankruptcy Code."
In addition, the perception that we may not be able to continue as
a going concern may cause customers, vendors and others to review
and alter their business relationships and terms with us, and may
affect our credit rating. If we seek additional financing to fund
operations and there remains substantial doubt about our ability to
continue as a going concern, financing sources may be unwilling to
provide such funding to us on commercially reasonable terms, or at
all. Uncertainty regarding our ability to continue as a going
concern could also have a material and adverse impact on the price
of our common stock, which could negatively impact our ability to
obtain additional stock-based financing or enter into strategic
transactions.
For the three months ended October 31, 2023, Comtech reported a net
loss of $1,437,000 compared to a net loss of $11,096,000 for the
same period in 2022.
A full-text copy of the Form 10-Q is available at
https://tinyurl.com/yu769pun
About Comtech Telecommunications
Headquartered in Huntington, New York, Comtech Telecommunications
Corp. designs, develops, and manufactures technology electronic
products and systems.
As of October 31, 2023, the Company has $1,012,543,000 and
$461,703,000 in total liabilities.
Egan-Jones Ratings Company on September 5, 2023, maintained its
'B-' foreign currency and local currency senior unsecured ratings
on debt issued by Comtech Telecommunications Corp. EJR also
withdraws rating on commercial paper issued by the Company.
CONSTRUCTION ALL STARS: Mark Weisbart Named Subchapter V Trustee
----------------------------------------------------------------
The U.S. Trustee for Region 6 appointed Mark Weisbart of Hayward,
PLLC as Subchapter V trustee for Construction All Stars, LLC.
Mr. Weisbart will be paid an hourly fee of $515 for his services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Mr. Weisbart declared that he is a disinterested person according
to Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Mark A. Weisbart
Hayward, PLLC
10501 N Central Expy, Suite 106
Dallas, TX 75231
Phone: (972) 755-7103
Email: MWeisbart@HaywardFirm.com
About Construction All Stars
Construction All Stars, LLC sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. N.D. Texas Case No. 23-32446) on
Oct. 26, 2023, with $500,001 to $1 million in assets and $1,000,001
to $10 million in liabilities. The petition was filed pro se.
Judge Scott W. Everett oversees the case.
CONTINENTAL AMERICAN: Hires B. Riley as Financial Advisor
---------------------------------------------------------
Continental American Corporation, seeks approval from the U.S.
Bankruptcy Court for the District of Kansas to employ B. Riley
Advisory Services as financial advisor.
The firm will provide these services:
a. providing transaction advisory services ("Advisory
Services") in connection with a section 363 bankruptcy sale of the
Debtors' assets as a going-concern business ("Sale Process") to
potential buyers previously identified by the Debtors and/or its
advisors ("Designated Buyers");
b. performing investment banking services to market a sale of
the Debtors' assets to a wider population of potential buyers ("IB
Services");
c. providing research and developing a list of potential
financial and strategic buyers ("Targeted Buyers");
d. contacting Targeted Buyers and maintaining an active buyer
tracking list;
e. leading and managing the 363 sale process;
f. delivering to, and obtaining from Designated and Targeted
Buyers, an executed nondisclosure agreement ("NDA") prior to the
dissemination of the Debtors' confidential information;
g. populating and maintaining an electronic data room
containing the Debtors' confidential information;
h. collecting and responding to various diligence requests
made by the Designated and Targeted Buyers;
i. maintaining communications with the Designated and Targeted
Buyers;
j. analyzing and comparing Indications of Interest ("IOIs")
submitted by Designated and Targeted Buyers;
k. coordinating due diligence meetings with the Debtors'
management and representatives of the Designated and Targeted
Buyers;
l. managing term sheets and Letters of Intent ("LOIs");
m. working with Debtors' management and legal counsel, David
Eron of Prelle Eron & Bailey, P.A. ("Counsel") to compare purchase
offers submitted by Designated and Targeted Buyers;
n. conducting a live auction on-site, if necessary, following
the submission of acceptable bids;
o. providing escrow services as necessary for the closing of
the sale; and
p. working with Counsel on any related matter as necessary.
The firm will be paid at these rates:
Senior Managing Directors $525 to $675
Managing Directors $450 to $500
Managers and Directors $395 to $435
Staff $250 to $375
The firm will be paid a retainer in the amount of $ 30,000
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Richard Peil, a partner at B. Riley Advisory Services, disclosed in
a court filing that his firm is a "disinterested person" as the
term is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Richard Peil
B. Riley Advisory Services
2355 E. Camelback Road, Suite 830
Phoenix, AZ 85016
Tel: (602) 567-2541
Email: rpeil@brileyfin.com
About Continental American Corporation
Continental American Corporation operates a balloon manufacturing
business in Wichita, Kan.
Continental American and its affiliate, Pioneer National Latex,
Inc., filed Chapter 11 petitions (Bankr. D. Kan. Lead Case No.
23-10938) on Sept. 22, 2023. Judge Mitchell L. Herren oversees the
cases.
At the time of the filing, Continental American reported $50
million to $100 million in assets and $10 million to $50 million in
liabilities while Pioneer National Latex reported $1 million to $10
million in assets and $10 million to $50 million in liabilities.
David Prelle Eron, Esq., at Prelle Eron & Bailey, P.A. represents
the Debtors as legal counsel.
COSMOS GROUP: Olayinka Oyebola & Co. Raises Going Concern Doubt
---------------------------------------------------------------
Cosmos Group Holdings Inc. disclosed in a Form 10-K/A Report filed
with the U.S. Securities and Exchange Commission for the fiscal
year ended December 31, 2022,
Cosmos Group Holdings Inc. filed Amendment No. 1 to amend its
Annual Report on Form 10-K for the year ended December 31, 2022,
originally filed with the Securities and Exchange Commission, on
April 17, 2023, to amend and restate the original filing with
modifications as necessary to reflect certain restatements. These
items have been amended to reflect the restatements:
-- Part II, Item 7, Management's Discussion and Analysis of
Financial Condition and Results of Operations
-- Part II, Item 8. Financial Statements and Supplementary
Data
-- Part II, Item 9. Changes in and Disagreements with
Accountants on Accounting and Financial Disclosure
-- Part IV, Item 15. Exhibits and Financial Statement
Schedules
For the 12 months ending December 31, 2022, the Company reported a
net loss of $104,126,076 compared to a net loss of $25,149,399 for
the same period in 2021.
The Company's Auditor Olayinka Oyebola & Co., has expressed that
there is substantial doubt about the Company's ability to continue
as a going concern. In its December 7, 2023 Report of Independent
Registered Public Accounting Firm, the Company's Auditor addressed
the Shareholders and Board of Directors of Good Gaming, Inc.,
stating, "The Company suffered an accumulated deficit of
$130,555,579 and a net loss of $104,126,076. These matters raise
substantial doubt about the Company's ability to continue as a
going concern."
"Our continuation as a going concern is dependent upon improving
our profitability and the continuing financial support from our
stockholders. Our sources of capital in the past have included the
sale of equity securities, which include common stock sold in
private transactions and public offerings, lease liability and
short-term and long-term debts. In addition, with respect to the
ongoing and evolving coronavirus outbreak, which was designated as
a pandemic by the World Health Organization on March 11, 2020, the
outbreak has caused substantial disruption in international
economies and global trades and if repercussions of the outbreak
are prolonged, could have a significant adverse impact on our
business. Given the addition political and public health
challenges, our ability to obtain external financing or financing
from existing shareholders to fund our working capital needs has
been materially and adversely impacted, and there can be no
assurance that we will be able to raise such additional capital
resources on satisfactory terms. We believe that our current cash
and other sources of liquidity discussed below are adequate to
support general operations for at least the next 12 months,"
explained the Company.
"We require additional funding to meet its ongoing obligations and
to fund anticipated operating losses. Our auditor has expressed
substantial doubt about our ability to continue as a going concern.
Our ability to continue as a going concern is dependent on raising
capital to fund its initial business plan and ultimately to attain
profitable operations."
"We expect to incur marketing and professional and administrative
expenses as well expenses associated with maintaining our filings
with the Commission. We will require additional funds during this
time and will seek to raise the necessary additional capital. If we
are unable to obtain additional financing, we may be required to
reduce the scope of our business development activities, which
could harm our business plans, financial condition and operating
results. Additional funding may not be available on favorable
terms, if at all. We intend to continue to fund its business by way
of equity or debt financing and advances from related parties. Any
inability to raise capital as needed would have a material adverse
effect on our business, financial condition and results of
operations."
"If we cannot raise additional funds, we will have to cease
business operations. As a result, our common stock investors might
lose all of their investment."
A full-text copy of the Form 10-K/A is available at
https://tinyurl.com/ycx7jj3y
About Cosmos Group
COSG is a Nevada holding company with operations conducted through
our subsidiaries based in Singapore and Hong Kong. The Company,
through its subsidiaries, is engaged in two business segments: (i)
the physical arts and collectibles business, and (ii) the
financing/money lending business.
As of December 31, 2022, Cosmos Group has $36,681,644 in total
assets and $32,722,316 in total liabilities.
CRISSCROSS CENTER: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Debtor: CrissCross Center, Co
2729 S.R. 580
Clearwater, FL 33761
Chapter 11 Petition Date: December 7, 2023
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 23-05565
Judge: Hon. Roberta A. Colton
Debtor's Counsel: Stephanie B. Anthony, Esq.
ANTHONY AND PARTNERS
100 S. Ashley
Tampa, FL 33602
Tel: 813-273-5616
Email: santhony@anthonyandpartners.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Robin Goris as president and CEO.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/EYZNEEI/CrissCross_Center_Co__flmbke-23-05565__0001.0.pdf?mcid=tGE4TAMA
CSC 1 LLC: Court OKs Appointment of Chapter 11 Trustee
------------------------------------------------------
Judge Lisa Beckerman of the U.S. Bankruptcy Court for the Southern
District of New York approved the appointment of Marianne O'Toole
as Chapter 11 trustee for CSC 1, LLC.
The appointment comes upon the application filed by William
Harrington, the U.S. Trustee for Region 2, to appoint a bankruptcy
trustee in the company's Chapter 11 case.
Ms. O'Toole disclosed in a court filing that she is a
"disinterested person" pursuant to Section 101(14) of the
Bankruptcy Code.
About CSC 1 LLC
CSC 1, LLC operates a retail sandwich deli located at 99-103 Third
Avenue in New York, serving drug free meats, nitrate-free north
country smokehouse bacon, cage-free brown eggs, and Balthazar
croissants.
The Debtor filed Chapter 11 petition (Bankr. S.D.N.Y. Case No.
23-10943) on June 16, 2023, with up to $500,000 in both assets and
liabilities. Judge Lisa G. Beckerman oversees the case.
H. Bruce Bronson, Esq., at Bronson Law Office, P.C. represents the
Debtor as bankruptcy counsel.
CVR ENERGY: Moody's Gives B1 Rating on New Senior Unsecured Notes
-----------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to CVR Energy,
Inc.'s (CVI) proposed senior unsecured notes. CVI's other ratings,
including its Ba3 Corporate Family Rating and existing senior
unsecured notes rating of B1, and negative outlook remain
unchanged.
CVI will use net proceeds from its proposed bond offering to
refinance its $600 million of senior unsecured notes due February
2025.
"CVR Energy's bond refinancing benefits the company's credit
profile by extending its debt maturities," commented Jonathan
Teitel, a Moody's Senior Analyst.
RATINGS RATIONALE
CVI's senior unsecured notes are rated B1, one notch below the CFR,
reflecting the effective seniority of the revolver's secured
claims. The notes are guaranteed on an unsecured basis by the
wholly owned subsidiaries of CVI with the exception of CVR
Partners, LP (CVRP, B1 stable) and CVRP's subsidiaries, and certain
immaterial wholly owned subsidiaries of CVI.
CVI's Ba3 CFR reflects the company's solid operating track record,
strong regional market position offset by modest scale, and Moody's
expectation for CVI's refining business to maintain low leverage
despite decreasing refining margins through 2024. CVI's debt
capacity is largely supported by the refining business, which is
exposed to the cyclicality of the sector. CVI has large open
positions for renewable identification numbers (RINs) and related
liabilities related to its refineries (excluding the impact of any
small refinery exemptions). With respect to CVI's Wynnewood
refinery, CVI disputed the US Environmental Protection Agency's
(EPA) denial of small refinery exemptions for certain years. In
November 2023, a US court ruled in CVI's favor, sending CVI's
petition for relief under small refinery exemptions back to the
EPA. This is a positive development for CVI, but the EPA has legal
recourse to appeal the ruling and its next steps are not yet known.
Earlier, a US court stayed the EPA's ability to enforce the
Renewable Fuel Standard (RFS) against Wynnewood relating to
Wynnewood's 2020, 2021 and 2022 obligations until conclusion of the
litigation. CVI started up a renewable diesel unit in 2022 at its
Wynnewood refinery complex and is constructing a pre-treatment unit
at the site that it expects to be mechanically complete in the
fourth quarter of 2023. Production of renewable diesel generates
RINs which would reduce the number of RINs that CVI needs to
purchase in the open market or which CVI could sell.
CVI's SGL-2 Speculative Grade Liquidity Rating reflects Moody's
expectation for the company to maintain good liquidity through 2024
owing to its large cash balance supplemented by available borrowing
capacity on its committed credit facility and continued crude oil
supply agreement. As of September 30, 2023, CVI had about $800
million of cash, which excludes the $89 million at CVRP. Also, as
of September 30, 2023, CVI's refining business had $251 million
available under its undrawn $275 million ABL revolving credit
facility due June 2027 ($24 million in letters of credit were
outstanding). The revolver has a springing minimum fixed charge
coverage ratio covenant, with springing based on availability under
the facility. Moody's views it as unlikely that this covenant would
become operational and if it did, the company should have
significant compliance headroom. CVI relies on a crude oil supply
agreement to meet working capital needs. The current agreement
terminates on December 31, 2023, and a new agreement begins on
January 1, 2024, and has a 2-year term, subject to automatic
one-year renewals thereafter so long as neither party provides
notice of termination 180 days in advance.
CVI's negative outlook reflects Moody's concerns regarding the
potential for future changes in financial policies around return of
capital to shareholders and maintenance of ample liquidity to
manage its RINs liabilities, particularly given the controlled
nature of the business.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Factors that could lead to a downgrade include more aggressive
financial policies; leverage relating to the refining business
above 3x; or weakening liquidity.
Factors that could lead to an upgrade include increased scale and
diversification of refining assets while reducing leverage related
to the refining business, and maintenance of good liquidity and
conservative financial policies.
CVI, headquartered in Sugar Land, Texas, is a publicly traded
holding company focused on refining and renewable biofuels
production at its CVR Refining subsidiaries, and it owns the
general partner and 37% of the common units of CVRP, a producer of
nitrogen fertilizers. As of September 30, 2023, Icahn Enterprises
L.P. (Ba3 stable) and its affiliates owned about 66% of CVI's
outstanding common stock.
The principal methodology used in this rating was Refining and
Marketing published in August 2021.
CVR ENERGY: S&P Rates New $600MM Senior Unsecured Notes 'B+'
------------------------------------------------------------
S&P Global Ratings assigned its 'B+' issue-level rating to CVR
Energy Inc.'s proposed issuance of $600 million senior unsecured
notes due 2029. S&P's recovery rating on the unsecured notes is
'4', reflecting its expectation for average (30%-50%; rounded
estimate 45%) recovery in the event of a payment default. The
proceeds from the notes will be used to redeem the outstanding $600
million 5.25% notes due 2025.
S&P said, "We note that the company expects to complete the notes
issuance within the month, and then repay the existing unsecured
notes in mid-February. During this period, leverage will be
modestly elevated from previous levels but remain well below our
downside trigger. Furthermore, we do not anticipate a scenario
where the company would be unable to repay the existing notes with
issuance proceeds. Our recovery analysis reflects this expectation,
and to the extent that the notes are not repaid in line with this
scenario we would reassess our recovery analysis and issue-level
ratings."
CVR Energy (CVI) is a petroleum refining, marketing, and renewables
business based in the U.S. The company also has exposure to the
nitrogen fertilizer manufacturing business through its 37%
ownership of CVR Partners L.P.
CVI owns two refineries in Coffeyville, Kan., and Wynnewood, Okla.,
as well as supporting logistic assets in the region. The
Coffeyville refinery has a nameplate crude oil capacity of 132,000
barrels per day (bpd), while the Wynnewood refinery has a nameplate
capacity of 74,500 bpd, including a renewable diesel unit with a
nameplate capacity of 7,500 bpd.
Issuer Ratings – Recovery Analysis
Key analytical factors
-- S&P said, "We base our recovery analysis for refinery companies
on our view that the sector is capital-intensive and highly
competitive. Our analysis also reflects our view that refineries'
profitability can fluctuate because of high fixed costs and
potentially turbulent and constantly shifting commodity input and
output prices."
-- S&P's simulated default assumes that a default occurs during a
downturn in the sector, when refinery margins are low and cash flow
is constrained.
-- S&P's recovery analysis assumes that the refinancing
transaction will close and the existing $600 million of notes due
in 2025 will be fully repaid in early 2024.
Simulated default assumptions
-- Simulated year of default: 2027
-- There are no parent guarantees or cross guarantees with the
fertilizer subsidiaries.
-- CVI's debt is an unsecured obligation guaranteed by CVR
Refining.
-- All debt claims have six months' worth of accrued but unpaid
interest outstanding at default.
-- The ABL facility is refinanced. Given the structural
protections in the ABL facility, S&P assumes that working capital
will satisfy the ABL debt obligations, thus leaving no deficiency
claims and no excess value.
-- S&P uses a DAV approach in our recovery analysis. To value the
two refining assets, S&P applied a valuation of around $2,400 per
bpd for the Coffeyville (132,000 bpd) and Wynnewood (74,500 bpd)
refineries. This valuation incorporates their complexity and
favorable Midwest location.
Simplified waterfall
-- Net enterprise value at default (after 5% administrative
costs): About $470 million (based on DAV valuation)
-- Total senior unsecured debt: $1,035 million
--Recovery expectations: 30%-50% (rounded estimate: 45%)
Note: All debt amounts include six months of prepetition interest.
CWGS ENTERPRISES: S&P Alters Outlook to Negative, Affirms 'B+' ICR
------------------------------------------------------------------
S&P Global Ratings revised its rating outlook on CWGS Enterprises
LLC to negative from stable. S&P also affirmed all ratings,
including its 'B+' issuer credit rating on the company.
S&P said, "The negative outlook reflects our forecast for S&P
Global Ratings-adjusted debt to EBITDA to remain above our 5x
downgrade threshold for the next several quarters following steep
declines in retail sales and margin compression in 2023. We could
lower the ratings if we no longer believed the company would be
able to generate adjusted EBITDA such that leverage were reduced
back to within our threshold by year-end 2024.
"We revised the outlook to negative due to a spike in leverage
above our 5x downgrade threshold over the next several quarters.
"Our forecast for revenue and adjusted EBITDA improvement in 2024
relies on a recovery in retail RV demand in the second half of
2024. The RV industry is vulnerable to economic cyclicality and
fluctuations in interest rates. Although we are not forecasting a
recession over the next 12 months, S&P Global economists forecast
that U.S. GDP growth will slow in 2024 to about 1.5% and real
consumer growth to about 1.4% in 2025, down from about 2.4%,
expected in 2023. Notably, the pressure is expected to be driven by
weaker real consumer spending growth and a modest increase in
unemployment over the next two years. Consumer spending is expected
to align with real wage growth in 2024 (which has been muted for
the past year) as consumers have used up a significant portion of
excess savings that had built up during the pandemic; meanwhile,
higher costs of capital and slower growth result in slower hiring
and an uptick in unemployment. While the expected developments
could result in incremental disinflation in 2024, our economists
still expect another 25-basis point interest rate hike in December
2023 and that rates will not come down until the second half of
2024. The resulting macroeconomic backdrop poses downside risks to
our base case forecast for CWGS as RVs are a highly discretionary
purchase that are typically financed over 10-20 years. If consumers
are uncomfortable with the state of the U.S. economy or if they
cannot abide high interest rate loans, then buyers may continue to
stay on the sidelines through 2024. The interest rate equation for
those trading in used RVs is also affected by the fact that the
vehicle the consumer currently owns was likely financed at a much
more attractive interest rate.
"Our leverage forecast is based on our expectation of stabilizing
retail demand for RVs in the second half of 2024, a modest increase
in gross margin and reduced sales general and administrative (SG&A)
expense, as a percent of revenue, in 2024. We expect modest
increases in same-store unit sales on both new and used RVs and for
mid-single-digit percent decreases in average selling prices
compared with 2023. While the level of discounting required to
clear out aged inventory throughout 2023 should not repeat itself
in 2024, we expect the company to focus its efforts on lower-priced
models in order to expand its consumer base in an attempt to gain
market share. In addition, we believe that the rapid increases in
consumer financing rates and abnormally high inflation, as well as
a pull forward of demand during the pandemic, led to an exaggerated
decline in retail demand in 2023. There are macroeconomic downside
risks to our base case, but we expect retail demand to normalize,
albeit at lower levels, in 2024, as inflation eases and consumers
adjust to the new interest rate environment." Retail sales of new
RVs fell precipitously through the third quarter of 2023. CWGS'
same-store new unit sales were down 20% and were only partially
offset by strength in used unit sales, which were up approximately
15%. At the same time, gross profit per unit deteriorated
meaningfully by about 31% and 16% for new and used sales,
respectively, as the company took measures to clear out its aged
inventory of 2022 models and reduce its model year 2023 mix of
product.
Lastly, on its third quarter earnings call, the company announced a
7% reduction in its workforce, or approximately 1,000 employees.
The company expects the headcount reduction to save approximately
$60 million in annualized SG&A costs.
CWGS' aggressive acquisition strategy and investment spending are
risk factors.
CWGS has an ambitious expansion and investment plan, which includes
store acquisitions, new store openings, and real estate purchases.
CWGS has indicated publicly that it intends to take advantage of
the current difficult retail environment to negotiate acquisitions.
According to comments from management, the company intends to
expand its store count by 50% within the next five years. S&P
believes this plan will materially expand CWGS' footprint and
EBITDA base. This sizable investment plan is a material source of
risk, particularly if it makes these acquisitions during a time of
worse-than-expected RV demand or if the company encounters
difficulties integrating acquired stores.
S&P assumes CWGS acquires 20-30 dealerships in 2023, with the pace
of store additions slowing slightly in 2024. Over the next several
years, the expansion could complement the Good Sam, parts and
service, and finance and insurance revenue streams, which are a
relatively high-margin businesses, and lay the foundation for
partnerships in electric vehicles, which S&P believes could benefit
long-term growth prospects.
CWGS operates in a competitive and highly fragmented industry.
In the industry, manufacturing supplier relationships are highly
concentrated, which is typical for RV dealerships, and dealers
typically vie for inventory when buying behavior is strong. In
turn, RV original equipment manufacturers compete to manufacture
and deliver inventory to satisfy dealers. In 2019, wholesale
shipments outpaced retail demand and contributed to an industrywide
correction and surplus inventory at dealerships, which led to
discounting and temporarily pressured dealer margins. Such dynamics
could introduce variability in revenue, EBITDA margin, and working
capital if the industry does not match supply with demand. With an
S&P Global Ratings-adjusted EBITDA margin historically in the
mid-single-digit to low-double-digit percent area, the company's
profitability also ranks lower than most other rated leisure
companies. Business risks are partly offset by less volatile demand
for vehicle parts and services, high margins from finance and
insurance, and the company's increasing scale. CWGS will
increasingly benefit from scale efficiencies as it expands, if
scale enhances its ability to manage inventory, extract cost
savings, and efficiently raise capital to make acquisitions.
S&P said, "The negative outlook reflects our forecast for S&P
Global Ratings-adjusted debt to EBITDA to remain above our 5x
downgrade threshold for the next several quarters following steep
declines in retail sales and margin compression in 2023. We could
lower the ratings if we no longer believed the company would be
able to generate adjusted EBITDA such that leverage were reduced
back within our threshold by year-end 2024.
"We could lower our rating on CWGS if we anticipated that S&P
Global Ratings-adjusted leverage would increase above its current
level or if we forecast leverage to remain above 5x beyond fiscal
2024. Such a scenario would likely be the result of a combination
of further declines in retail unit sales and a lack of improvement
in gross and EBITDA margins. In addition, CWGS remains committed to
expansion through acquisition and intends to expand its dealership
count by 50% over the next five years. We could lower the rating if
the company used its cash and excess revolver capacity for
acquisitions in a way that weakened the company's liquidity.
"Although unlikely over the next 12 months, we could raise the
rating on CWGS if we believed it could sustain S&P Global
Ratings-adjusted debt to EBITDA below 4x with a sufficient cushion
to absorb volatility and acquisition activity over an economic
cycle. Such a scenario would depend on whether we believed RV
demand were sufficiently sustainable to enable CWGS to manage costs
and maintain leverage below 4x. The RV business is highly cyclical;
therefore, we would like to see an at least 1x sustained cushion
compared with our upgrade threshold during times of economic and
consumer spending growth.
"ESG factors have a neutral influence on our credit rating analysis
of CWGS. CWGS is the leading retailer of recreational vehicles and
can shift its mix of sales to address potential incremental future
regulation or changes in consumer preferences related to greenhouse
gas emissions. Most of the company's sales volumes are towable RVs,
which are increasingly lightweight and partly address environmental
considerations related to fuel efficiency. CWGS also plans to
increase investments in its servicing and repair capabilities,
which are intended to complement electrification over time. While
the company's products, Good Sam memberships, and campgrounds
offerings benefited from increased interest in outdoor recreation
activities, such as RVing and camping, during the pandemic, as
expect some of the excess demand has moderated in 2023 causing a
decline in retail unit sales."
DADDIO'S PIZZERIA: Unsecureds Will Get 10% of Claims in Plan
------------------------------------------------------------
Daddio's Pizzeria, Inc., filed with the U.S. Bankruptcy Court for
the Western District of New York a Plan of Reorganization for Small
Business.
The Debtor is a privately-owned sub-chapter S Corporation, with its
principal place of business in Buffalo, New York and its principal
assets located in Erie County. The Debtor is in the business of
owning and operating a pizzeria.
The primary reason for the instant case is to propose a plan to
reinstate certain tax arrears to the IRS & NYS.
Between or about 2016 and Covid, the Debtor operated with limited
issue and managed to pay its tax obligations as they came due. In
the wake of the Covid epidemic, however, the Debtor experienced
many hardships including operating restrictions, followed by, so
called "Yellow Zone" capacity restrictions, restaurant hours were
trimmed by Executive Order, labor shortages, and higher costs.
Despite every effort, the Debtor cannot paying current taxes, prior
to filing NYS intermittently liquidated the Debtor's payroll and
operating accounts making transaction of business very challenging,
ultimately leading to the instant bankruptcy.
The Plan Proponent's financial projections show that the Debtor
will have projected disposable income of $45,000/year. The final
Plan payment is expected to be paid on or about March 31, 2029.
This Plan of Reorganization proposes to pay creditors the Debtor
from the cash flow generated from the operation of his restaurant
d/b/a Shango Bistro.
Allowed nonpriority unsecured claims that are not separately
classified will be paid, pro rata 10.00% of the total amount of
these claims, an estimated payment of $12,500.00. This Plan also
provides for the payment of administrative and priority claims.
Class 3 consists of Allowed Nonpriority unsecured creditors. Each
holder of a Class 3a Claim is impaired by this Plan, and (a) will
be paid upon the effective date in one installment consisting of
10.00 % of the total amount of their claims; (b) with the exception
of the NYSWCB.
Class 4 consists of Equity security holders of the Debtor. Class 4
is unimpaired by this Plan, and each holder of a Class 4 Equity
Security interest will retain said interest; said interest will
vest upon the Effective Date.
A full-text copy of the Plan of Reorganization dated November 30,
2023 is available at https://urlcurt.com/u?l=b49MtC from
PacerMonitor.com at no charge.
Attorney for the Plan Proponent:
Michael A. Weishaar, Esq.
GLEICHENHAUS, MARCHESE & WEISHAAR, PC
930 Convention Tower
43 Court Street
Buffalo, NY 14202
Telephone: (716) 845-6446
About Daddio's Pizzeria
Daddio's Pizzeria, Inc., is in the business of owning and operating
a pizzeria.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. W.D.N.Y. Case No. 23-10848) on Sept. 1,
2023, with as much as $50,000 in assets and $100,001 to $500,000 in
liabilities.
Judge Carl L. Bucki oversees the case.
Robert B. Gleichenhaus, Esq., at Gleichenhaus, Marchese & Weishaar,
P.C., is the Debtor's legal counsel.
DAWG'S SPORTS: Unsecureds Will Get 2% of Claims over 60 Months
--------------------------------------------------------------
Dawg's Sports Bar & Grill, LLC, filed with the U.S. Bankruptcy
Court for the Western District of Pennsylvania a Plan of
Reorganization for Small Business dated November 30, 2023.
The Debtor operates as a sports bar/restaurant in Belle Vernon,
Pennsylvania. The Debtor is a single member LLC owned by Martin
Sivic. The Debtor operates one location and began operating in
2022.
Due to the filing the Debtor was able to halt collections on a
significant amount of unsecured debt and begin making payments to
its landlord and secured creditors. Due to the filing, the Debtor
is projecting enough profit to fund this Plan.
Class 2 General unsecured Claims that will receive distributions
pursuant to the Plan total $522,446.30. The Debtor shall make a
distribution of $175.00 per month that shall be divided and paid
pro-rata to all allowed Class 2 claims. Payments shall begin on or
before the last day of the month of the month following the
effective date of the Plan. Subsequent payments shall be made by
the Debtor on or before the last day of the month every month
thereafter for a total of 60 payments. Total payment to Class 2
creditors shall be $10,500.00, which will pay all allowed General
Unsecured Creditors approximately 2% of their allowed claims.
Martin Sivic will continue to own 100% of the membership interest
of the Debtor.
The Plan will be funded through ongoing operations of the Debtor's
sports bar/restaurant business.
The Debtor's financial projections demonstrate the Debtor's ability
to make all future Plan payments in the aggregate amount of
$370,461.00 during the Plan term (the "Plan Funding"). Plan Funding
is in an amount equal to the Debtor's disposable income as defined
in Section 1191(d) of the Bankruptcy Code.
The final Plan payment is expected to be paid approximately 61
months after Plan confirmation.
A full-text copy of the Plan of Reorganization dated November 30,
2023 is available at https://urlcurt.com/u?l=bcIMA9 from
PacerMonitor.com at no charge.
Attorney for the Debtor:
Christopher M. Frye, Esq.
STEIDL & STEINBERG, PC
2830 Gulf Tower
707 Grant Street
Pittsburgh, PA 15219
Telephone: (412) 391-8000
Email: chris.frye@steidl-steinberg.com
About Dawg's Sports Bar & Grill
Dawg's Sports Bar & Grill, LLC, operates as a sports bar/restaurant
in Belle Vernon, Pennsylvania.
The Debtor sought protection for relief under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Pa. Case No. 23-21874) on Sep. 1,
2023, listing $50,001 to $100,000 in assets and $500,001 to $1
million in liabilities.
Judge Gregory L. Taddonio oversees the case.
Christopher M. Frye, Esq. at Steidl & Steinberg, is the Debtor's
counsel.
DELIVERY & DISTRIBUTION: Case Summary & 17 Unsecured Creditors
--------------------------------------------------------------
Debtor: Delivery & Distribution Solutions, LLC
16 W 251 S Frontage Road
Burr Ridge, IL 60527
Business Description: The Debtor is a full-service courier and
logistics company.
Chapter 11 Petition Date: December 8, 2023
Court: United States Bankruptcy Court
Northern District of Illinois
Case No.: 23-16492
Debtor's Counsel: Gregory K. Stern, Esq.
GREGORY K. STERN, P.C.
53 West Jackson Boulevard
Suite 1442
Chicago, IL 60604
Tel: (312) 427-1558
Fax: (312) 427-1289
Email: greg@gregstern.com
Total Assets: $296,002
Total Liabilities: $1,275,911
The petition was signed by Denis Monroe as managing member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 17 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/5RCRLWA/Delivery__Distribution_Solutions__ilnbke-23-16492__0001.0.pdf?mcid=tGE4TAMA
DEPENDABLE LAWN: Unsecureds to Get $2K per Month for 60 Months
--------------------------------------------------------------
Dependable Lawn Care, Inc., filed with the U.S. Bankruptcy Court
for the Northern District of Illinois a Small Business Plan of
Reorganization dated November 30, 2023.
The Debtor is in the business of lawn care and snow removal.
The Debtor's Plan provides for payments to be made to allowed
claims from the Debtor's operations.
Class 1A consists of the Secured Claim of Ford Motor Credit Company
LLC. In its Proof of Claims Ford Motor Credit Company, LLC asserts
that it holds a security interest in five of the Debtor's vehicles
which aggregate to $268,572.47. Ford Motor Credit Company LLC will
receive, on account of its secured claims, payment as provided in
the underlying Retail Installment Contracts. Upon payment of the
full of the claim of Ford Motor Credit Company LLC, Ford Motor
Credit Company LLC shall release all security agreements against
property of the Debtor.
Class 1B consists of the Secured Claim of Ally Bank. In its Proof
of Claims Ally Bank asserts that it holds a security interest in
two of the Debtor's vehicles which aggregate to $50,574.02. Ally
will receive, on account of its secured claims, payment as provided
in the underlying Retail Installment Contracts. Upon payment of the
full of the claim of Ally, Ally shall release all security
agreements against property of the Debtor.
Class 1C consists of the Secured Claim of Leaf Capital Funding,
LLC. Leaf Funding will receive, on account of its secured claim,
payment in full of the secured claim $22,500.00 plus 5% interest in
payments beginning the first on the month after the effective date
of $425.00 per month. Upon payment of the full of the secured claim
of Leaf Funding, Leaf Funding shall release all security agreements
against property of the Debtor.
Class 1D consists of the Secured Claim of Western Equipment
Finance. Western will receive, on account of its secured claim,
payment in full of the secured claim $183,329.14 plus 0% interest
in payments beginning the first on the month after the effective
date of $3,055.49 per month. Upon payment of the full of the
secured claim of Western, Western shall release all security
agreements against property of the Debtor.
Class 1E consists of the Secured Claim of Newtek Small Business
Finance, LLC. Upon closing all proceeds from the real estate will
be paid to Newtek to first pay the amounts claimed in Proof of
Claim 14-1 ($754,937.68) in full. Any net proceeds above the payoff
in Proof of Claim 14-1 shall then be applied to Proof of Claim
16-1. Newtek will receive, on account of its secured claim,
payments as agreed in an amount sufficient to cure any arrears in
Proof of Claim 15-1 at the completion of this Plan. Upon payment of
the full of the secured claim of Newtek, Newtek shall release the
related security agreements against property of the Debtor.
Class 1F consists of the Secured Claim of the U.S. Small Business
Administration. In its Proof of Claim, SBA asserts that it holds a
security interest in "all tangible & intangible property." The
security claimed by SBA is claimed by other secured creditors who
are prior in time with the filing of their UCC statement. SBA will
receive, on account of its secured claim, no payment on its secured
claim or $0.00 plus 0% interest and no payments. Upon completion of
this Plan, SBA shall release all security agreements against
property of the Debtor.
Class 2 consists of Allowed General Unsecured Claims. Debtor has 10
general unsecured creditors totaling a balance of $3,509,730.86.
Each Holder of Allowed Class 2 Claims shall be paid a pro rata
share beginning the first of the month after the effective date of
$2,000.00 per month for sixty months. Class 2 is impaired under
this Plan.
All of the assets of the Debtor and this estate shall vest in the
Debtor upon Confirmation of the Plan subject to the liquidation,
terms and conditions of this Plan.
This Plan is self-executing. The Debtor shall not be required to
execute any newly created documents to evidence the claims, liens
or terms of repayment to the holder of any Allowed Claim, except
for the Restructured Promissory Note and all other loan documents.
A full-text copy of the Plan of Reorganization dated November 30,
2023 is available at https://urlcurt.com/u?l=zvX8JW from
PacerMonitor.com at no charge.
Debtor's Counsel:
Paul M. Bach, Esq.
Bach Law Offices, Inc.
P.O. Box 1285
Northbrook, IL 60065
Telephone: (847) 564-0808
Facsimile: (847) 564-0985
Email: pnbach@bachoffices.com
About Dependable Lawn Care
Dependable Lawn Care, Inc., is primarily engaged in performing a
variety of lawn and garden services.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ill. Case No. 23-11667) on Sept. 1,
2023. In the petition signed by Robert D. Walker, president, the
Debtor disclosed up to $50,000 in assets and up to $10 million in
liabilities.
Judge Deborah L. Thorne oversees the case.
Paul M. Bach, Esq., at Bach Law Offices, is the Debtor's legal
counsel.
DERMATOLOGY INTERMEDIATE: Moody's Alters Outlook on B2 CFR to Neg.
------------------------------------------------------------------
Moody's Investors Service affirmed the ratings of Dermatology
Intermediate Holdings III, Inc. (dba Forefront Dermatology)
including the B2 Corporate Family Rating and B2-PD Probability of
Default Rating, B2 ratings on the $95 million senior secured first
lien revolving credit facility, $535 million senior secured first
lien term loan and $100 million senior secured first lien delayed
draw term loan. Moody's revised the outlook to negative from
stable.
The affirmation of the B2 Corporate Family Rating reflects the
company's strong double digit revenue growth as it continues to
expand through new office openings and acquisitions. The new office
practices will contribute to earnings growth as the clinics mature
and ramp up patient visits. There has been some margin decline due
to reimbursement pressures, but Moody's anticipates that
investments in infrastructure will reduce costs and benefit
margins. Additionally, a mix shift toward practices in the higher
margin aesthetic businesses will benefit profits.
The change in outlook to negative reflects a higher degree of debt
being used to fund the company's aggressive growth strategy
relative to Moody's earlier expectations. Moody's considers
liquidity to have deteriorated as the company has relied on its
revolving credit facility in order to fund its growth. While
Forefront Dermatology has been able to convert some of its growth
investments to EBITDA, additional debt incurred over the past
several quarters has caused debt/EBITDA to rise from 6.3x as of
September 30, 2022 to roughly 7.0x LTM September 30, 2023 on a
Moody's adjusted basis. Moody's had previously forecast leverage to
decline below 6.0x by the end of 2023 based on a less aggressive
expansion strategy. There are risks that leverage will remain
elevated if the company continues to debt fund its future growth or
faces unforeseen operating setbacks.
RATINGS RATIONALE
Forefront Dermatology's B2 Corporate Family Rating reflects Moody's
expectation that the company will continue to operate with elevated
financial leverage, but that deleveraging opportunities stem from
the opening of new office practices, cost reduction initiatives and
a mix shift toward practices in the higher margin aesthetic
businesses. Moody's calculates leverage to be roughly 7.0x LTM
September 30, 2023 pro forma for recent acquisitions, on a Moody's
adjusted basis. The rating also reflects the risk associated with
the company's rapid expansion strategy as it grows, through a
combination of new clinic openings and acquisitions. The rating is
also constrained by the low barriers to entry in the dermatology
space given the highly fragmented market. Capital expenditures
required to open new clinics is very low, and on average, new
clinics break-even within three months.
The rating is supported by Forefront Dermatology's leading position
in the dermatology industry, with the number one market share in
the majority of its markets. Forefront Dermatology provides a
comprehensive suite of services including medical, surgical,
cosmetic and pediatric dermatology. The rating also considers
Forefront Dermatology's track record of solid organic growth,
strong retention rates among staff and a seasoned executive team.
Moody's anticipates that Forefront Dermatology will maintain good
liquidity, supported by roughly $55 million of availability on its
$95 million senior secured first lien revolving credit facility and
about $22 million of cash as of September 30, 2023. Moody's
anticipates roughly $25 million in annual free cash flow over the
next 12-18 months, reflecting solid operating cash flow and limited
capital expenditure requirements. Forefront Dermatology has about
$500 million of its $535 million senior secured first lien term
loan hedged, which will protect the company in a rising interest
rate environment.
Forefront Dermatology's $95 million senior secured first lean
revolving credit facility has a springing maximum first lien net
leverage covenant with step-downs over time, that springs at 35%
utilization on the revolver. The company has utilized its revolver
to fund acquisitions and investments in new practices. Moody's
expect that cushion will remain strong, even if the covenant is
tested. Alternate liquidity sources are limited as the company's
assets are encumbered by the first lien credit facilities.
Forefront Dermatology CIS-4 indicates the rating is lower than it
would have been if ESG risk exposures did not exist. Forefront
Dermatology faces social risks related to demographic and societal
trends such as the rising concerns around the access and
affordability of healthcare services. Forefront Dermatology is
mostly reliant on commercial insurance, but still has exposure to
government payors. Any changes to reimbursement rates of Medicare
or Medicaid directly impact revenue and profitability. Forefront
Dermatology is also exposed to labor pressures and human capital
constraints as the company relies on highly specialized labor to
provide its services. From a governance perspective, Forefront
Dermatology's G-4 reflects an aggressive financial strategy to
support the company's rapid expansion strategy as it grows, through
a combination of new clinic openings and acquisitions, along with
its private equity ownership.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be downgraded if Forefront Dermatology's
operating performance deteriorates, or if it experiences material
integration related disruptions. Additionally, the ratings could be
downgraded if Moody's expects debt/EBITDA to be sustained above 6.0
times or if the company's liquidity erodes. Further, debt-funded
shareholder returns or other aggressive financial policies could
also result in a downgrade.
The ratings could be upgraded if Forefront Dermatology's manages
its growth while continuing to generate solid free cash flow. An
upgrade would also be supported by the company adopting more
conservative financial policies and maintaining debt/EBITDA below
5.0 times.
Forefront Dermatology is the largest dermatology physician practice
in the US with 237 clinics in 25 states. Partners Group acquired
Forefront Dermatology in 2022. As of September 30, 2023, revenues
were around $613 million.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
DERMATOLOGY INTERMEDIATE: Moody's Rates New $100MM 1st Lien Loan B2
-------------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to Dermatology
Intermediate Holdings III, Inc.'s (dba Forefront Dermatology)
proposed $100 million incremental senior secured first lien term
loan. There is no change to the company's B2 Corporate Family
Rating, B2-PD Probability of Default Rating, B2 ratings on the $95
million senior secured first lien revolving credit facility, $535
million senior secured first lien term loan and $100 million senior
secured first lien delayed draw term loan. The outlook is
maintained at negative.
Moody's views the incremental term loan as credit positive. This
reflects the additional liquidity provided from the incremental
term loan that the company will use to fully repay outstanding
revolving credit facility borrowings and add roughly $30 million in
cash to the balance sheet to support future growth.
RATINGS RATIONALE
Forefront Dermatology's B2 Corporate Family Rating reflects Moody's
expectation that the company will continue to operate with elevated
financial leverage, but that deleveraging opportunities stem from
the opening of new office practices, cost reduction initiatives and
a mix shift toward practices in the higher margin aesthetic
businesses. Moody's calculates leverage to be roughly 7.0x LTM
September 30, 2023 pro forma for recent acquisitions, on a Moody's
adjusted basis. The rating also reflects the risk associated with
the company's rapid expansion strategy as it grows, through a
combination of new clinic openings and acquisitions. The rating is
also constrained by the low barriers to entry in the dermatology
space given the highly fragmented market. Capital expenditures
required to open new clinics is very low, and on average, new
clinics break-even within three months.
The rating is supported by Forefront Dermatology's leading position
in the dermatology industry, with the number one market share in
the majority of its markets. Forefront Dermatology provides a
comprehensive suite of services including medical, surgical,
cosmetic and pediatric dermatology. The rating also considers
Forefront Dermatology's track record of solid organic growth,
strong retention rates among staff and a seasoned executive team.
Moody's anticipates that Forefront Dermatology will maintain good
liquidity, supported by an undrawn $95 million senior secured first
lien revolving credit facility (pro forma for the proposed
transaction) and about $22 million of cash as of September 30,
2023. Moody's anticipates roughly $25 million in annual free cash
flow over the next 12-18 months, reflecting solid operating cash
flow and limited capital expenditure requirements. Forefront
Dermatology has about $500 million of its $635 million senior
secured first lien term loan hedged, which will protect the company
in a rising interest rate environment.
Forefront Dermatology's $95 million senior secured first lean
revolving credit facility has a springing maximum first lien net
leverage covenant with step-downs over time, that springs at 35%
utilization on the revolver. The company has utilized its revolver
to fund acquisitions and investments in new practices. Moody's
expect that cushion will remain strong, even if the covenant is
tested. Alternate liquidity sources are limited as the company's
assets are encumbered by the first lien credit facilities.
The negative outlook reflects a higher degree of debt being used to
fund the company's aggressive growth strategy relative to Moody's
earlier expectations. There are risks that leverage will remain
elevated over 6.0x if the company continues to debt fund its future
growth or faces unforeseen operating setbacks.
Forefront Dermatology CIS-4 indicates the rating is lower than it
would have been if ESG risk exposures did not exist. Forefront
Dermatology faces social risks related to demographic and societal
trends such as the rising concerns around the access and
affordability of healthcare services. Forefront Dermatology is
mostly reliant on commercial insurance, but still has exposure to
government payors. Any changes to reimbursement rates of Medicare
or Medicaid directly impact revenue and profitability. Forefront
Dermatology is also exposed to labor pressures and human capital
constraints as the company relies on highly specialized labor to
provide its services. From a governance perspective, Forefront
Dermatology's G-4 reflects an aggressive financial strategy to
support the company's rapid expansion strategy as it grows, through
a combination of new clinic openings and acquisitions, along with
its private equity ownership.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
The ratings could be downgraded if Forefront Dermatology's
operating performance deteriorates, or if it experiences material
integration related disruptions. Additionally, the ratings could be
downgraded if Moody's expects debt/EBITDA to be sustained above 6.0
times or if the company's liquidity erodes. Further, debt-funded
shareholder returns or other aggressive financial policies could
also result in a downgrade.
The ratings could be upgraded if Forefront Dermatology's manages
its growth while continuing to generate solid free cash flow. An
upgrade would also be supported by the company adopting more
conservative financial policies and maintaining debt/EBITDA below
5.0 times.
Dermatology Intermediate Holdings III, Inc. is the largest
dermatology physician practice in the US with 237 clinics in 25
states. Partners Group acquired Dermatology Intermediate Holdings
III, Inc. in 2022. As of September 30, 2023, revenues were around
$613 million.
The principal methodology used in this rating was Business and
Consumer Services published in November 2021.
DIGITAL.AI SOFTWARE: Midcap Financial Marks $2.4MM Loan at 82% Off
------------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $2,419,000
loan extended to Digital.ai Software Holdings, Inc to market at
$425,000 or 18% of the outstanding amount, as of September 30,
2023, according to Midcap Financial's Form 10-Q Report for the
Quarterly period ended September 30, 2023, filed with the
Securities and Exchange Commission.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver Loan to Digital.ai Software Holdings, Inc. The loan
accrues interest at a rate of 1% (SOFR + 710%) per annum. The loan
matures on February 10, 2027.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Digital.ai is an industry-leading technology company dedicated to
helping Global 5000 enterprises achieve digital transformation
goals.
DIOCESE OF PHOENIX: Moody's Affirms 'Ba2' Rating on Revenue Bonds
-----------------------------------------------------------------
Moody's Investors Service has affirmed the Ba2 rating on The Roman
Catholic Church of the Diocese of Phoenix's (the diocese, AZ)
revenue bonds. Total debt, inclusive of internally held bonds, was
$24.65 million as of June 30, 2023. The outlook is stable.
RATINGS RATIONALE
The affirmation of the Ba2 rating is driven by the Diocese of
Phoenix's position as a growing Roman Catholic diocese in the
demographically strong Phoenix region, with disciplined financial
management, ample liquidity and balanced core operations,
navigating elevated sector-specific risks and costs around
resolution of outstanding misconduct claims. The diocese reports
that roughly one-fifth of the original 89 cases recorded as of Dec.
30, 2020 are currently outstanding. While current projections of
misconduct claims appear to be manageable, the full impact and
magnitude of claims reflect an element of unpredictability. Moody's
expectation is that, given the recent claim history, the diocese
will be able to maintain adequate financial cushion while resolving
the remaining claims. Fiscal 2023 spendable cash and investments of
$96 million provide a very good cushion to debt, 3.9x, and
expenses, 1.5x, with monthly liquidity of 277 days cash on hand. A
solid 12% EBIDA margin covered annual debt service 13x. Budgeted
fiscal 2024 operations are tracking for slightly less, but still
solid operating performance. Governance and management have been
effective at risk management in recent years, which includes
establishment of specific reserves for its self-insured exposures.
RATING OUTLOOK
The stable outlook reflects Moody's expectation that the level of
litigation against the diocese will not exceed the current moderate
level, and will decline over time as cases and claims are resolved.
The outlook further incorporates the expectation that solid
liquidity will continue to provide a buffer against near term
misconduct uncertainties, and that operations and MADS coverage
will remain at least at the current level. Should downside risks
accelerate, the rating or outlook would likely be negatively
impacted.
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATING
-- Mitigation of litigation exposure and demonstrated ability to
manage potential escalation of self-insurance claims
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATING
-- Increase of sexual misconduct claims and corresponding
uninsured settlement amounts, escalating possibilities of
reorganization
-- Escalation of downside risks associated with the coronavirus
pandemic, including revenue declines as operations of affiliated
entities are disrupted
LEGAL SECURITY
Payments under the bond indenture are a general obligation of the
diocese, the broadest pledge available, strengthened by the
diocese's Canon Law status, which gives the bishop of the diocese
significant input into the governance of all Catholic institutions
operating within the territory of the diocese. Under the bond
indenture, the diocese also maintains a debt service reserve fund
equal to 1.2x the total debt service requirement for the upcoming
year.
PROFILE
The Roman Catholic Church of the Diocese of Phoenix, established in
1969, is one of three dioceses serving the State of Arizona. The
geographic area includes Maricopa, Mohave, Yavapai and Coconino
Counties (excludes Navajo Indian Reservation) and the Pinal County
portion of the Gila River Indian Reservation. The diocese pastoral
and administration services are provided by the Diocesan Pastoral
Center (DPC). The DPC is not responsible for the direct
administration of the 117 parishes and 65 schools across the over 1
million member diocese. The Diocesan Pastoral Center's Moody's
adjusted operating revenue was $76 million for the fiscal year
ending June 30, 2023.
METHODOLOGY
The principal methodology used in this rating was Nonprofit
Organizations (Other Than Healthcare and Higher Education)
published in May 2019.
DIOCESE OF ROCKVILLE: Proposes $200-Mil. Abuse Claims Settlement
----------------------------------------------------------------
Dietrich Knauth of Reuters reports that the Catholic Diocese of
Rockville Centre, New York, proposed a revised $200 million
settlement of sex abuse claims, but faced immediate pushback on
Tuesday from a U.S. bankruptcy judge who demanded more detailed
financial information from the bankrupt Long Island diocese.
The diocese said in a Tuesday, November 28, 2023 statement that its
revised bankruptcy plan filed Monday was its "best and final"
offer. It would pay claimants $200 million in cash, plus the
potential for additional recoveries from the diocese's insurers.
U.S. Bankruptcy Judge Martin Glenn in Manhattan, who is overseeing
the diocese's Chapter 11, and attorneys for abuse survivors called
the proposal a non-starter at a court hearing later Tuesday
morning.
The diocese's attempt to resolve about 600 sex abuse claims has
been stalled for months, and Judge Glenn had warned in July 2023
that he could dismiss the bankruptcy if no progress was made.
Judge Glenn on Tuesday said he would not approve a bankruptcy plan
without detailed financial information from each of the
approximately 130 parishes within the diocese. Abuse claimants who
vote on the plan must be able to weigh the value of their claim
against the resources available to the parish where their abuse
occurred, Judge Glenn said.
About The Roman Catholic Diocese
of Rockville Centre, New York
The Roman Catholic Diocese of Rockville Centre, New York, is the
seat of the Roman Catholic Church on Long Island. The Diocese has
been under the leadership of Bishop John O. Barres since February
2017. The State of New York established the Diocese as a religious
corporation in 1958. The Diocese is one of eight Catholic
dioceses
in New York, including the Archdiocese of New York. The Diocese's
total Catholic population is approximately 1.4 million, roughly
half of Long Island's total population of 3.0 million. The Diocese
is the eighth largest diocese in the United States when measured by
the number of baptized Catholics.
To deal with sexual abuse claims, the Roman Catholic Diocese of
Rockville Centre, New York, filed a Chapter 11 petition (Bankr.
S.D.N.Y. Case No. 20-12345) on Sept. 30, 2020, listing as much as
$500 million in both assets and liabilities. Judge Martin Glenn
oversees the case.
The Diocese tapped Jones Day as legal counsel, Alvarez & Marsal
North America, LLC, as restructuring advisor, and Sitrick and
Company, Inc., as communications consultant. Epiq Corporate
Restructuring, LLC is the claims agent.
The U.S. Trustee for Region 2 appointed an official committee of
unsecured creditors in the Diocese's Chapter 11 case. The
committee tapped Pachulski Stang Ziehl & Jones, LLP and Ruskin
Moscou Faltischek, PC as its bankruptcy counsel and special real
estate counsel, respectively.
Robert E. Gerber, the legal representative for future claimants of
the Diocese, is represented by the law firm of Joseph Hage
Aaronson, LLC.
DIVERSIFIED PANELS: Hires Nelson Comis as Bankruptcy Counsel
------------------------------------------------------------
Diversified Panels Systems, Inc. seeks approval from the U.S.
Bankruptcy Court for the Central District of California to employ
Nelson Comis Kettle & Kinney LLP as bankruptcy counsel.
The firm's services include:
(1) advice and assistance regarding compliance with the
requirements of the Office of the U.S. Trustee;
(2) advice regarding matters of bankruptcy law, including the
rights and remedies of the Debtor in regard to its assets and with
respect to the claims of creditors;
(3) prepare and assist in the preparation of reports, accounts
and pleadings;
(4) advice concerning the requirements of the Bankruptcy Code
and applicable rules;
(5) assist with the negotiation, formulation, confirmation and
implementation of a Chapter 11 liquidating plan; and
(6) make any appearances in the Bankruptcy Court on behalf of
the Debtor, and take such other action and perform such other
services as the Debtor may require.
The firm will be paid at these rates:
Partners $350 to $475 per hour
Paralegals $125 to $175 per hour
Legal Assistants $75 to $100 per hour
Litigation Clerks $60 hour
The firm received from the Debtor an advance fee retainer of
$101,438.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
William Winfield, Esq., a partner at Nelson Comis, disclosed in
court filings that his firm does not have interests materially
adverse to the interests of the Debtor's estate, creditors and
equity security holders.
The firm can be reached through:
William E. Winfield, Esq.
Nelson Comis Kettle & Kinney LLP
300 East Esplanade Dr., Suite 1170
Oxnard, CA 93036
Tel: (805) 604-4106
Email: wwinfield@calattys.com
About Diversified Panels Systems, Inc.
Diversified Panels manufacturers expanded polystyrene (EPS)
insulated metal panels, focusing specifically on cold storage and
agricultural facilities.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Case No. 23-11112) on November
22, 2023. In the petition signed by Richard Charles Bell as CEO,
CFO & secretary, the Debtor disclosed $12,533,166 in assets and
$26,114,847 in liabilities.
Judge Ronald A. Clifford III oversees the case.
William E. Winfield, Esq., at Nelson Comis Kettle & Kinney LLP,
represents the Debtor as legal counsel.
DMK PHARMACEUTICALS: Further Adjourns Annual Meeting to Dec. 28
---------------------------------------------------------------
DMK Pharmaceuticals Corporation disclosed in a Form 8-K filed with
the Securities and Exchange Commission that the 2023 annual meeting
of stockholders of the Company, originally convened on Nov. 9,
2023, was reconvened virtually on Nov. 30, 2023. The Company
adjourned the Annual Meeting again 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 SEC on Oct. 12, 2023.
The adjourned Annual Meeting will reconvene on Dec. 28, 2023, at
9:00 a.m., Pacific Time. 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 Annual 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 Oct. 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.
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.
ECONOMY TREE: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: Economy Tree Service of Northwest Florida, Inc.
f/d/b/a Economy Tree Service, LLC
5241 Crowson Rd.
Pensacola, FL 32526
Chapter 11 Petition Date: December 8, 2023
Court: United States Bankruptcy Court
Northern District of Florida
Case No.: 23-30870
Judge: Hon. Karen K Specie
Debtor's Counsel: Jodi Daniel Dubose, Esq.
STICHTER, RIEDEL, BLAIN & POSTLER, P.C.
41 N. Jefferson St., Suite 111
Pensacola, FL 32502
Tel: 850-637-1836
Email: jdubose@srbp.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by David A. Smith 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/4LFQBXA/Economy_Tree_Service_of_Northwest__flnbke-23-30870__0001.0.pdf?mcid=tGE4TAMA
ELEMENT CONSTRUCTION: Seeks to Sell Boise Property by Auction
-------------------------------------------------------------
Element Construction Corporation asked the U.S. Bankruptcy Court
for the District of Idaho for approval to auction its real property
in Boise, Idaho.
The company plans to sell the property through a public auction on
Dec. 18, at 9:00 a.m. (Mountain Time) via telephone.
Element Construction had earlier accepted an offer from an
interested buyer whose bid of $569,900 will be the opening bid
price at the Dec. 18 auction.
In order to participate at the public auction, competing bidders
must submit certified funds in the amount of $5,000 at least prior
to the start of the auction.
Under the proposed bid procedures, any competing bid must start at
$574,900. Meanwhile, the minimum bid increment is $5,000 although
interested buyers can bid in increments of more than $5,000 if
desired.
Following the auction, a hearing to approve the sale to the winning
bidder will be held on Dec. 18, at 1:30 p.m. (Mountain Time) via
telephone.
The sale is expected to generate net proceeds of $64,962.83 after
payment of claims of lienholders, broker's commission, property
taxes and closing costs.
About Element Construction Corp
Based in Meridian, Idaho, Element Construction Corporation filed
voluntary Chapter 11 petition (Bankr. D. Id. Case No. 23-00602) on
Nov. 9, 2023, with up to $50,000 in assets and $1 million to $10
million in liabilities. Gary L. Rainsdon serves as Subchapter V
trustee.
Judge Noah G. Hillen oversees the case.
Foley Freeman, PLLC is the Debtor's legal counsel.
EQUALTOX LLC: Hires Grobstein Teeple LLP as Financial Advisors
--------------------------------------------------------------
EQUALTOX LLC, seeks approval from the U.S. Bankruptcy Court for the
Central District of California to employ Grobstein Teeple LLP as
financial advisors.
The firm will provide these services:
a. obtain and evaluate financial records;
b. evaluate assets and liabilities of the Debtor and Estate;
c. evaluate tax issues related to the Debtor and Estate;
d. provide post-petition bookkeeping services for the Debtor
and Estate;
e. prepare monthly operating reports;
f. assist with tax compliance issues;
g. assist with the preparation of a plan and disclosure
statement;
h. complete a liquidation analysis and best interest of
creditors test;
i. prepare tax returns;
j. provide litigation consulting if required; and
k. provide accounting and consulting services requested by the
Applicant and their counsel.
The firm will be paid at these rates:
Partners $325 to $595 per hour
Managers/Directors $250 to $405 per hour
Professionals $125 to $275 per hour
The firm received a retainer of $5,900.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Howard B. Grobstein, a partner at Grobstein Teeple LLP, disclosed
in a court filing that the firm is a "disinterested person" as the
term is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Howard B. Grobstein
Grobstein Teeple LLP
6300 Canoga Avenue, Suite 1500W
Woodland Hills, CA 91367
Tel: (818) 532-1020
About Equaltox, LLC
Equaltox, LLC is a full service reference laboratory that can
provide almost any type of blood testing.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Case No. 8:23-bk-12243) on
October 27, 2023. In the petition signed by Sulaiman Masood, member
and manager, the Debtor disclosed up to $10 million in both assets
and liabilities.
Robert S. Marticello, Esq., at Smiley Wang-Ekvall, LLP, represents
the Debtor as legal counsel.
EXELA TECHNOLOGIES: Adjourns Annual Meeting Until Dec. 29
---------------------------------------------------------
Exela Technologies, Inc. announced that it adjourned the Annual
Meeting of Stockholders held on Dec. 5, 2023. The Meeting will
reconvene on Friday, Dec. 29, 2023 at 10:00 a.m. ET/9:00 a.m.
Central Time. Due to lack of required quorum, the Meeting was
adjourned, without any business being conducted, to allow
additional time for the Company's stockholders to vote on the
proposals set forth in the Company's definitive proxy statement
filed with the U.S. Securities and Exchange Commission. The new
date will provide additional time for shareholders to have their
voices heard. The Meeting will be held online at
www.virtualshareholdermeeting.com/XELA2023.
The Company urges all stockholders to exercise their right to vote
their shares by proxy TODAY. A proxy card with instructions was
mailed to all registered stockholders holding shares as of the
close of business on Oct. 9, 2023, the record date for the Meeting.
The methods for voting and submitting proxies are described in the
previously distributed proxy materials for the Meeting.
Stockholders of the Company who previously submitted their proxy or
otherwise voted and who do not want to change their vote do not
need to take any action. No changes have been made in the
proposals to be voted on by stockholders at the Meeting.
The Company asks that all stockholders vote their proxy, no matter
how many shares they own. Each stockholder can vote his or her
proxy by following the easy instructions on the proxy card. Proxy
information is here:
https://www.sec.gov/Archives/edgar/data/1620179/000110465923111798/tm2328451-5_def14a.htm.
If you hold shares at Robinhood, look for an alert in your
Robinhood app or online. For most other shareholders, look for an
email from proxyvote.com.
About Exela Technologies
Headquartered in Irving, Texas, Exela Technologies --
www.exelatech.com -- is a global provider of transaction processing
solutions, enterprise information management, document management
and digital business process services.
Exela reported a net loss of $415.58 million in 2022, a net loss of
$142.39 million in 2021, and a net loss of $178.53 million in 2020.
As of Dec. 31, 2022, the Company had $721.91 million in total
assets, $1.53 billion in total liabilities, and a total
stockholders' deficit of $807.59 million.
Detroit, Michigan-based KPMG LLP, the Company's auditor since 2013,
issued a "going concern" qualification in its report dated April 3,
2023, citing that the Company has a history of net losses, net
operating cash outflows, working capital deficits, significant cash
payments for interest on long-term debt, and significant current
maturities of long-term debt that raise substantial doubt about its
ability to continue as a going concern.
* * *
As reported by the TCR on Aug. 24, 2023, S&P Global Ratings raised
its issuer credit rating on Exela Technologies Inc. to 'CCC' from
'SD' (selective default). S&P said, "Despite improving revenue
trends and cost savings, we forecast limited liquidity cushion in
January and July of 2024."
FANNIE MAE & FREDDIE MAC: Request for Judicial Conference to Act
----------------------------------------------------------------
"Will the Fannie Mae and Freddie Mac shareholders wake Trump up?"
Manuel P. Asensio at Asensio & Company, LLC, asks in a 30-page
document dated Sat., Dec. 9, 2023, addressed to the Judicial
Conference of the United States and filed in U.S. District Court.
Having "reviewed the decisions in the cases filed by the
shareholders of Fannie Mae and Freddie Mac to recover their private
property from the federal government," Mr. Asensio contends the
"decisions are examples of dishonest conduct and deliberate
violations of law that are sanctioned through secret proceedings,
secret associations, and secret oaths that are made at the Judicial
Conference." Mr. Asensio accuses Chief Justice John G. Roberts of
orchestrating those secret proceedings, associations and oaths, "to
make whoever occupies the office of the American presidency
impotent should they oppose his policies." A copy of the document
is available at https://shorturl.at/aqI19 at no charge.
"The DRE Consideration is far-reaching. Its information is
paramount to GSE shareholders," Mr. Asensio emphasized in an e-mail
statement on Sun., Dec. 10. "It provides them with a blueprint to
success. The only realistic strategy for shareholders is to file a
complaint at the US Judicial Council to set up a Consideration at
the US Judicial Conference."
Mr. Asensio is also the founder of Institute of Judicial Conduct,
Inc., and is campaigning to displace Kathryn Christine Cammack as
the U.S. representative for Florida's 3rd congressional district.
For additional information, Mr. Asensio can be reached at
mpa@asensio.com by e-mail and (212) 702-8800 by telephone.
FEILITECH US: Unsecureds' Recovery "Unknown" in Liquidating Plan
----------------------------------------------------------------
Feilitech US, LLC, filed with the U.S. Bankruptcy Court for the
Northern District of Mississippi a Subchapter V Plan of Liquidation
dated November 30, 2023.
On or about September 30, 2015, Weijie Gu and Damon Fisher formed
the Debtor by filing the Mississippi Limited Liability Company
Certificate of Formation with the Mississippi Secretary of State.
The Debtor was in the business of importing, selling and assembling
components for upholstery furniture manufacturers.
In early 2020, the Debtor moved its business operations to a
building located at 2826 Westover Park Street, Belden, Mississippi
(the "Building") that was purchased by Fisher or an entity he owned
and controlled. The Debtor leased the Building pursuant to oral
month-to-month lease. The Debtor owned its operating machinery and
equipment. The Debtor has no secured debt and operated using cash
on hand and receivables collected from its customers.
The Debtor commenced this Chapter 11 Case to preserve and maximize
value for stakeholders through a sale of its assets and from
potential litigation recoveries. The Debtor determined that it was
no longer viable to conduct its business over a long period of time
due to potential liabilities for customs duties and substantial
transfers made to or for the benefit of Fisher. The consequences of
the customs claims and the transfers made by Fisher resulted in the
Debtor seeking relief through the filing of the petition commencing
the Chapter 11 Case.
On April 6, 2023, the Debtor filed the Debtor's Motion for Entry of
an Order: (A) Approving Asset Purchase Agreement; (B) Authorizing
Sale of Estate Assets Free and Clear of Liens, Claims, and
Encumbrances and (C) Granting Related Relief (the "Sale Motion").
In the Sale Motion, the Debtor sought approval to sell
substantially all of its operating assets to Reliable Sleep Design,
LLC ("RSD") on an expedited basis pursuant to the terms of an Asset
Purchase Agreement ("APA") for the amount of $50,000 (the "Purchase
Price"), less certain customary adjustments.
In addition, RSD agreed to assume accrued paid time off for the
Debtor's employees, assist the Debtor in collecting its remaining
accounts receivable, and prorate the monthly rent for its
nonresidential real property lease (the "Assumed Liabilities").
Importantly, the APA specifically excluded the sale of the Debtor's
Avoidance Actions and its accounts receivable, which would be
collected by RDS for the Debtor.
After conducting an in-person evidentiary hearing on the Sale
Motion on April 18, 2023, the Court approved the sale to RSD
pursuant to the Order: (A) Approving Asset Purchase Agreement; (B)
Authorizing Sale of Estate Assets Free and Clear of Liens, Claims,
and Encumbrances Pursuant to Section 363 of the Bankruptcy Code;
and (C) Granting Related Relief, dated April 24, 2023 (the "Sale
Order"). The Debtor closed the sale on April 27, 2023, and the
Debtor received payment in the amount $45,890.86, which represented
the balance of the Purchase Price plus prorated rent and accrued
paid time off for employees. The total sale proceeds received by
the Debtor from Buyer in connection with the sale was $50,890.86.
Additionally, all of the Debtor's current employees as of the sale
were offered employment by RSD.
At the time of the sale to RSD, the Debtor had $115,287.58 in
outstanding accounts receivable. The Debtor has worked with RSD to
collect all of its accounts receivable following the sale. As of
date of this Plan, the Debtor has collected all of its accounts
receivable.
As of the Petition Date, the Debtor's Schedules reflected that it
had no secured debt, an estimated $1,620,000 in unsecured debt
including approximately $400,000 in disputed customs duties, and
$3,058,000 in assets, including interests in surety bonds, cash
deposits with the Customs and certain Causes of Action.
Convenience Class 4 Claims consists of General Unsecured Claims
that are Allowed in an amount less than $25,000.00. Each Holder of
an Allowed Class 4 Claim will be paid an amount equal to 25% of
their Allowed Class 4 Claim from Available Cash as soon as
practical after the Effective Date. Holders of Class 4 Claims are
entitled to vote on the Plan. The Debtor estimates a total of 5
Allowed Class 4 Claims in the aggregate amount of $51,243.89. The
total amount to be paid to Allowed Class 5 Claims in the aggregate
is $13,058.47, which will be paid as soon as practicable after the
Effective Date.
Class 5 consists of General Unsecured Claims. Each Holder of an
Allowed Class 5 Claim will be paid their pro-rata share of their
Allowed Class 5 Claim from Available Cash remaining after payment
of Classes 1 to 4. The estimated percent of recovery is unknown and
will be based on recoveries from the Causes of Action. The only
Class 5 Claim is the Scheduled Claim of Zhejiang Feili Technology
Co., Ltd. in the amount of $1,174,881.75.
As of the Effective Date, all Equity Interests shall be deemed
void, cancelled, and of no further force and effect. On and after
the Effective Date, Holders of Equity Interests shall not be
entitled to, and shall not receive or retain any property or
interest in property under the Plan on account of such Equity
Interests.
The Debtor will have Cash on hand on the Effective Date of the Plan
to pay all the Allowed Claims and expenses that are entitled to be
paid on that date.
The Plan does not contemplate that Debtor will continue in
business. Rather, the Plan proposes how the Debtor's assets will be
distributed to the holders of Allowed Claims. In short, liquidation
of Debtor is already proposed in the Plan.
A full-text copy of the Subchapter V Liquidating Plan dated
November 30, 2023 is available at https://urlcurt.com/u?l=ur6gHE
from PacerMonitor.com at no charge.
Debtor's Counsels:
Robert M. Fishman, Esq.
Allen J. Guon, Esq.
Christina M. Sanfelippo, Esq.
Cozen O'Connor
123 North Wacker Drive, Suite 1800
Chicago, IL 60606
Telephone (312) 382-3100
Telecopy (312) 382-8910
Email: rfishman@cozen. com
aguon@cozen.com
csanfelippo@cozen. Com
- and -
Kristina M. Johnson, Esq.
Jones Walker, LLP
190 East Capitol Street, Suite 800 (39201)
Post Office Box 427
Jackson, MS 39205-0427
Tel: (601) 949-4785
Fax: (601) 949-4804
Email: kjohnson@joneswalker.com
About Feilitech US
Feilitech US, LLC is a manufacturer of spring and wire products in
Belden, Miss.
Feilitech US filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. N.D. Miss. Case No. 23-10599) on Feb. 28,
2023, with $1 million to $10 million in both assets and
liabilities. Judge Selene D. Maddox oversees the case.
Judge Selene D. Maddox oversees the case.
The Debtor tapped Cozen O'Connor and Jones Walker, LLP as legal
counsels and James W. Smith III, CPA, PC as accountant.
FGH LLC: Hires Beall & Burkhardt APC as Bankruptcy Counsel
----------------------------------------------------------
FGH, LLC seeks approval from the U.S. Bankruptcy Court for the
Central District of California to employ Beall & Burkhardt, APC as
counsel.
The firm's services include:
a. advising the Debtor generally concerning its rights, duties
and obligation under the Bankruptcy Code, the Federal Rules of
Bankruptcy Procedure, and the requirements of the Office of the
U.S. Trustee;
b. representing the Debtor in all hearings and meetings before
the bankruptcy court;
c. prosecuting and defending adversary proceedings;
d. prosecuting claims objections;
e. preparing and prosecuting a disclosure statement and
Chapter 11 plan of reorganization; and
f. providing other necessary legal services.
The firm will be paid at these rates:
William C. Beall $575 per hour
Eric W. Burkhadt $450 per hour
Carissa Horowitz $400 per hour
In addition, the firm will receive reimbursement for out-of-pocket
expenses incurred.
The Debtor paid the firm a retainer of $12,559.50.
William Beall, Esq., a partner at Beall & Burkhardt, disclosed in a
court filing that his firm is a "disinterested person" pursuant to
Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
William C. Beall, Esq.
Eric W. Burkhardt, Esq.
Carissa Horowitz, Esq.
Beall & Burkhardt, APC
1114 State Street
La Arcada Building, Suite 200
Santa Barbara, CA 93101
Telephone: (805) 966-6774
Facsimile: (805) 963-5988
Email: will@beallandburkhardt.com
About FGH, LLC
FGH, LLC is a Single Asset Real Estate debtor (as defined in 11
U.S.C. Section 101(51B)). The Debtor is the owner of real property
located at 2320 North Rose Avenue, Oxnard, California having an
appraised value of $5 million.
FGH, LLC in Oxnard, CA, filed its voluntary petition for Chapter 11
protection (Bankr. C.D. Cal. Case No. 23-11095) on November 20,
2023, listing $5,000,000 in assets and $5,999,889 in liabilities.
Vanessa Hernandez of FGH Investors, LLC, managing member of the
Debtor, signed the petition.
Judge Ronald A. Clifford III oversees the case.
BEALL & BURKHARDT, APC serve as the Debtor's legal counsel.
FREEDOM FACILITY: Gerard Luckman Named Subchapter V Trustee
-----------------------------------------------------------
The U.S. Trustee for Region 2 appointed Gerard Luckman, Esq., at
Forchelli Deegan Terrana, LLP as Subchapter V trustee for Freedom
Facility Maintenance, LLC.
Mr. Luckman will be paid an hourly fee of $650 for his services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Mr. Luckman declared that he is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Gerard R. Luckman, Esq.
Forchelli Deegan Terrana, LLP
333 Earle Ovington Blvd., Suite 1010
Uniondale, NY 11553
Tel: (516) 812-6291
Email: gluckman@ForchelliLaw.com
About Freedom Facility
Freedom Facility Maintenance, LLC, filed a petition under Chapter
11, Subchapter V of the Bankruptcy Code (Bankr. E.D.N.Y. Case No.
23-74389) on Nov. 22, 2023, with $100,001 to $500,000 in both
assets and liabilities.
Judge Louis A. Scarcella oversees the case.
Richard S. Feinsilver, Esq., represents the Debtor as legal
counsel.
FWAK LLC: Case Summary & Four Unsecured Creditors
-------------------------------------------------
Debtor: FWAK, LLC
d/b/a Chrimar Apartments
7850 E. Green Lake Dr. N.
Seattle, WA 98103
Business Description: FWAK, LLC is a Single Asset Real Estate
debtor (as defined in 11 U.S.C. Section
101(51B)).
Chapter 11 Petition Date: December 7, 2023
Court: United States Bankruptcy Court
Western District of Washington
Case No.: 23-12376
Judge: Hon. Marc L. Barreca
Debtor's Counsel: Alan Wenokur, Esq.
WENOKUR RIORDAN PLLC
600 Stewart Street
Suite 1300
Seattle, WA 98101
Tel: (206) 682-6224
Email: alan@wrlawgroup.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Anne Marie Kreidler as managing member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's four unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/J7I56AI/FWAK_LLC__wawbke-23-12376__0001.0.pdf?mcid=tGE4TAMA
G TREASURY SS: 91% Markdown for $2.2MM Midcap Financial Loan
------------------------------------------------------------
MidCap Financial Investment Corporation has marked its
$2,2250,000loan extended to G Treasury SS LLC to market at $205,000
or 9% of the outstanding amount, as of September 30, 2023,
according to Midcap Financial's Form 10-Q Report for the Quarterly
period ended September 30, 2023, filed with the Securities and
Exchange Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to G Treasury SS LLC. The loan accrues interest at a rate of 1%
(SOFR+ 600%) per annum. The loan matures on June 29, 2029.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
G Treasury SS, LLC designs and develops cash and treasury
management software that enables account analytics, cash
forecasting, and ledger management. G Treasury SS serves customers
worldwide.
GAUCHO GROUP: Welcomes Michael Koh to Advisory Board
----------------------------------------------------
Gaucho Group Holdings, Inc., announced the appointment of Michael
Koh, founder of one of the most respected real estate property
management and consulting firms in Argentina, to the Advisory Board
of the Company.
Michael Koh is a distinguished figure in the Argentine luxury real
estate sector, recognized for his visionary approach. As the
managing partner and founder of Koh Investments, he established
ApartmentsBA, Argentina's most respected real estate property
management and consulting firm. Under his leadership, ApartmentsBA
thrived until its acquisition by Luxury Retreats in 2010.
Additionally, he co-founded and led fypio, a real estate software
company, showcasing his versatility in real estate development and
technological integration within the sector.
Mr. Koh is currently spearheading the innovative real estate
portal, Casa Libre, set to launch in Q1 of 2024. This platform is
anticipated to revolutionize the Argentine real estate market,
replacing Zona Prop with its advanced features, including
revolutionary software, 3D floor plans, and video walkthroughs.
Post-launch in Argentina, there are plans for expansion into
Mexico. This ambitious project further demonstrates Mr. Koh's
pioneering spirit in the real estate technology space, having
already made a significant impact with fypio, a software that
powered Rocket Homes, a direct competitor to Zillow.
The addition of Mr. Koh to the Advisory Board is expected to
enhance Gaucho Holdings' strategic vision and guide its growth in
the dynamic luxury real estate market of Argentina. His extensive
experience and deep understanding of the Argentine real estate
sector will be invaluable in navigating the new economic landscape
and seizing investment opportunities.
"Reflecting on my years in Buenos Aires, I often imagined living in
Argentina's golden era," commented Michael Koh. "I've experienced
its beauty, got married, and raised Argentine-born children here.
I love this country and am excited about its future. I feel
confident Javier Milei will lead us back towards prosperity. With
rich resources like beef, corn, and lithium, I believe Argentina is
on the cusp of realizing its true potential, offering promising
investment opportunities along the way."
Michael Koh's appointment comes at a crucial time following
Argentina's recent elections, signaling a potential shift and
revitalization in the economy. Gaucho Holdings recognizes this
political change as an opportunity for economic growth and
investment in Argentina, where the Company has been actively
investing since 2007.
Scott Mathis, CEO and founder of Gaucho Holdings, stated: "The
appointment of Michael Koh to our Advisory Board is a strategic
move to bolster our 'Argentina army'. With his guidance, we aim to
build a bridge for U.S. and global investors to participate in the
growth of Argentine assets through our company. We are uniquely
positioned to capitalize on these opportunities, thanks to our
diversified portfolio and established presence in the Argentine
market since 2007. Our synergistic approach across our assets
allows us to streamline operations effectively. With Michael on
board, we are reinforcing our commitment to expanding our footprint
in this promising market."
Gaucho Holdings said it is poised to announce new initiatives in
response to Argentina's evolving economic landscape. With a
history of successful investments and a seasoned management team
familiar with the Argentine market's nuances, the Company is
uniquely positioned to leverage these changes. The addition of
Michael Koh to the Advisory Board is a testament to Gaucho
Holdings' dedication to growth and excellence in the luxury market
of Argentina.
About Gaucho Group
Headquartered in New York, NY, Gaucho Group Holdings, Inc.'s
(gauchoholdings.com) mission has been to source and develop
opportunities in Argentina's undervalued luxury real estate and
consumer marketplace. The Company has positioned itself to take
advantage of the continued and fast growth of global e-commerce
across multiple market sectors, with the goal of becoming a leader
in diversified luxury goods and experiences in sought after
lifestyle industries and retail landscapes.
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.
GB001 INC: 89% Markdown for Midcap Financial $27.09MM Loan
----------------------------------------------------------
MidCap Financial Investment Corporation has marked its $27,097,000
loan to GB001, Inc to market at $3,108,000 or 11% of the
outstanding amount, as of September 30, 2023, according to Midcap
Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to GB001, Inc. The loan accrues interest at a rate of 2% (SOFR+711)
per annum. The loan matures on January 1, 2025.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
GB001, Inc, a wholly owned subsidiary of Gossamer Bio, Inc., which
operates as a biopharmaceutical company. The Company focuses on
discovering, acquiring, and developing therapeutics in the disease
areas of immunology, inflammation, and oncology.
GIRARDI & KEESE: $3-Mil. Trustee Fee Okayed Despite Feds Objection
------------------------------------------------------------------
Craig Clough of Law360 reports that a U.S. bankruptcy judge on
Tuesday, December 5, 2023, approved the Girardi Keese bankruptcy
trustee's bid to pay more than $3 million in fees to herself and
other firms over the U.S. Trustee's Office's objection, pushing
back on the notion that the interim request is "unprecedented" in a
Chapter 7 case.
Elissa D. Miller, the chapter 7 trustee for the estate of the
debtor Girardi Keese, sought approval to pay a total of $3,348,148,
comprised of $1,226,492 in fees owed on account of the second
interim applications, as well as $2,121,656 on account of amounts
previously allowed and awarded when the first interim fee requests
were ruled on earlier this year. The Trustee's professionals
include Development Specialists, Inc., Greenspoon Marder, LLP, and
Smiley Wang-Ekvall, LLP.
The Trustee notes that not a single creditor opposes the fee
requests, and she has submitted incontrovertible evidence
demonstrating that the estate is administratively solvent to the
tune of nearly $14,000,000.
About Girardi & Keese
Girardi and Keese or Girardi & Keese was a Los Angeles-based law
firm founded in 1965 by lawyers Thomas Girardi and Robert Keese.
It served clients in California in a variety of legal areas. It
was known for representing plaintiffs against major corporations.
An involuntary Chapter 7 petition (Bankr. C.D. Cal. Case No.
20-21022) was filed in December 2020 against GIRARDI KEESE by
alleged creditors Jill O'Callahan, Robert M. Keese, John Abassian,
Erika Saldana, Virginia Antonio, and Kimberly Archie.
The petitioners' attorneys:
Andrew Goodman
Goodman Law Offices, Apc
Tel: 818-802-5044
E-mail: agoodman@andyglaw.com
Elissa D. Miller, a member of the firm SulmeyerKupetz, has been
appointed as Chapter 7 trustee for GIRARDI KEESE. The Chapter 7
trustee can be reached at:
Elissa D. Miller
333 South Grand Ave., Suite 3400
Los Angeles, California 90071-1406
Telephone: (213) 626-2311
Facsimile: (213) 629-4520
E-mail: emiller@sulmeyerlaw.com
An involuntary Chapter 7 petition was also filed against Thomas
Vincent Girardi (Case No. 20-21020) on Dec. 18, 2020. The Chapter
7 trustee can be reached at:
Jason M. Rund
Email: trustee@srlawyers.com
840 Apollo Street, Suite 351
El Segundo, CA 90245
GLOBAL DISCOVERY: Former CEOs Must Face IP Claims
-------------------------------------------------
Emlyn Cameron of Law360 reports that two former CEOs of Global
Discovery Biosciences Corp. can't dodge claims that they cost the
company an opportunity to develop new medical tests by siphoning
the resources to another company, a Delaware Chancery Court judge
has said.
About Global Discovery Biosciences
Irvine, Calif.-based Global Discovery Biosciences Corporation --
https://www.gdbiosciences.com/ -- is a fully licensed diagnostic
laboratory running specialized, highly specific and accurate
testing for its clients, domestic and global.
Global Discovery Biosciences filed a voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No.
21-10619) on March 11, 2021. Dan Angress, chief executive officer
and secretary, signed the petition. At the time of the filing, the
Debtor had between $1 million and $10 million in both assets and
liabilities. Judge Mark S. Wallace oversees the case.
Weiland Golden Goodrich, LLP, and Robertson & Culver, LLP, serve as
the Debtor's bankruptcy counsel and special counsel, respectively.
Mark M. Sharf is the Subchapter V trustee appointed in the Debtor's
Chapter 11 case. The trustee is represented by Margulies Faith,
LLP.
GO CAR WASH: Midcap Financial Marks $23.7MM Loan at 55% Off
-----------------------------------------------------------
MidCap Financial Investment Corporation has marked its $23,784,000
loan extended to Go Car Wash Management Corp to market at
$10,628,000 or 45% of the outstanding amount as of September 30,
2023, according to Midcap Financial's Form 10-Q Report for the
Quarterly period ended September 30, 2023, filed with the
Securities and Exchange Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to Go Car Wash Management Corp. The loan accrues interest at a rate
of 1% (SOFR+635) per annum. The loan matures on December 31, 2026.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Go Car Wash Management Corp provides Washing and polishing,
automotive.
GOLD STAR EXPRESS: Taps Harlin Parker Attorneys at Law as Counsel
-----------------------------------------------------------------
Gold Star Express, LLC seeks approval from the U.S. Bankruptcy
Court for the Western District of Kentucky to employ Harlin Parker
Attorneys at Law as its legal counsel.
The firm will render these services:
(a) give legal advise with respect to the Debtor's powers and
duties in the continued operation of the estate' business and
management of its assets;
(b) take all necessary action to protect and preserve the
Debtor's estate;
(c) prepare legal papers; and
(d) perform all other services for the Debtor in connection
with this Chapter 11 case.
The firm will be paid based upon its normal and usual hourly
billing rates. The firm will also be reimbursed for reasonable
out-of-pocket expenses incurred.
The firm received a retainer of $14,000 from the Debtor on November
3, 2023.
Robert Chaudoin, Esq., an attorney at Harlin Parker Attorneys at
Law, 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:
Robert C. Chaudoin, Esq.
Harlin Parker Attorneys at Law
519 East Tenth Avenue
Bowling Green, KY 42102
Telephone: (270) 842-5611
Facsimile: (270) 842-2607
Email: chaudoin@harlinparker.com
About Gold Star Express, LLC
Gold Star Express, LLC is a Kentucky limited liability company that
owns and operates a trucking and transportation business.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Ky. Case No. 23-10846) on November 16,
2023. In the petition signed by Damira Nezic, member, the Debtor
disclosed up to $500,000 in assets and up to $10 million in
liabilities.
Judge Joan A. Lloyd oversees the case.
Robert C. Chaudoin, Esq., at Harlin Parker, represents the Debtor
as legal counsel.
GREEN HYGIENICS: Unsecureds to be Paid in Full in Sale Plan
-----------------------------------------------------------
Green Hygienics Holdings, Inc., filed with the U.S. Bankruptcy
Court for the Southern District of California a Disclosure
Statement in support of Chapter 11 Plan dated November 30, 2023.
The Debtor is a Nevada corporation authorized to conduct business
in California. Todd Mueller is the Debtor's Interim CEO.
Debtor's primary asset is a commercial farm located at 1876 Round
Potrero, Potrero, CA 91963 ("Potrero Property"). The Potrero
Property's value is estimated to be between $17,000,000 to
$18,000,000. Liens against it total $7,259,419, leaving equity of
approximately $9,740,581 to 10,740,581.
The Debtor has suspended its farming operations and is not
currently conducting business. Up until that time, Green Hygienics
was involved with cultivation of industrial hemp for cannabidiol
("CBD").
The Debtor has decided to sell the Potrero Property and has filed
an application to employ Matt Weaver of Lee & Associates Commercial
Real Estate Services to market it with a listing price of
$17,900,000. In addition to listing the Property for sale, Mr.
Weaver will also seek opportunities to enter into a sale with an
option to lease back the Property allowing Green Hygienics to again
engage in farming operations.
Regardless of whether the Debtor sells the Property outright or
sells it with lease back provision, the sale should generate
sufficient net proceeds to pay all creditors, including priority
and general unsecured claims in full.
The length of the Plan is 18 months from the effective date.
Class 4(a) consists of general unsecured claims, other than claims
of insiders. Class 4(a) claims total $2,422,136. The claims are
impaired under the Plan. The allowed amount of each claim will be
paid from the sale of the Potrero Property. Debtor estimates, that
the net proceeds from the sale will be sufficient to pay all Class
4(a) in full.
Class 4(b) consists of claims by general unsecured creditors of
insiders. Class 4(b) total $208,750. The claims are impaired under
the Plan and will be paid from he sale of the Potrero Property
after all other claims are paid in full. Debtor estimates, that the
net proceeds from the sale will be sufficient to pay all Class 4(b)
in full.
The Plan will be funded from the sale of the Potrero Property.
Green Hygienics believes that the sale will provide sufficient net
proceeds to pay all unsecured creditors in full after liens against
the property have been satisfied.
A full-text copy of the Disclosure Statement dated November 30,
2023 is available at https://urlcurt.com/u?l=uQzpgF from
PacerMonitor.com at no charge.
Attorneys for Debtor:
Andrew S. Bisom, Esq.
The Bisom Law Group
300 Spectrum Center Drive, Ste. 1575
Irvine, CA 92618
Tel: (714) 643-8900
Fax: (714) 643-8901
Email: abisom@bisomlaw.com
About Green Hygienics Holdings
Green Hygienics Holdings, Inc., formerly known as Takedown
Entertainment Inc., focuses on the cultivation and processing of
industrial hemp for extracting cannabidiol. It was founded in 2008
and is based in Poway, Calif.
Green Hygienics Holdings filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Calif. Case
No. 23-01998) on July 11, 2023, with $20,250,600 in assets and
$10,291,084 in liabilities. Todd Mueller, chief executive officer,
signed the petition.
Judge Margaret M. Mann oversees the case.
Andrew S. Bisom, Esq., at The Bisom Law Group, is the Debtor's
counsel.
GRO-MOR PLANT: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Gro-Mor Plant Food Company, Inc.
281 Farmland Road
Leola, PA 17540
Business Description: Gro-Mor offers a full line of liquid plant
foods and micronutrients as well as liquid
nitrogen.
Chapter 11 Petition Date: December 8, 2023
Court: United States Bankruptcy Court
Eastern District of Pennsylvania
Case No.: 23-13726
Judge: Hon. Patricia M. Mayer
Debtor's Counsel: Lawrence V. Young, Esq.
CGA LAW FIRM
135 North George Street
York, PA 17401
Tel: 717-848-4900
Fax: 717-843-9039
Email: lyoung@cgalaw.com
Total Assets: $4,450,412
Total Liabilities: $2,884,075
The petition was signed by M. Dwane Moyer as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/B3COGMI/Gro-Mor_Plant_Food_Company_Inc__paebke-23-13726__0001.0.pdf?mcid=tGE4TAMA
GUR MEAT: Unsecureds to Recover 4% to 5% in Reorganizaion Plan
--------------------------------------------------------------
Gur Meat, Inc., submitted a Chapter 11 Plan of Reorganization and a
Disclosure Statement, dated December 1, 2023.
Upon the filing of the instant bankruptcy petition, the Debtor
entered into negotiations with the primary secured creditor for the
use of cash collateral. Moreover, Debtor has executed various
measures and adjustments to its operations to maximize and properly
reorganize its business affairs. Furthermore, the Debtor has
aggressively engaged in the development of new products to expand
its client base and achieve a significant growth in sales. Since
the filing, during the first months of the bankruptcy, there has
been an approximate 40% increase in receivables in five months as
evinced by the Monthly Operating Report Summary.
The Debtor has retained the services of CPA Albert Tamarez, since
June 30, 2023 and the financial advisor is working with Debtor in
pursue of its reorganization efforts.
Since the date of filing, Debtor acts as Debtor-in-possession and
focused all its efforts in developing all available means to fund
its Reorganization Plan to provide for payments to creditors in
such plan.
The following Unsecured claims will be treated as follows:
* Class 4 - General Unsecured Claims under or equal to $50,000:
Class 4 consists of the allowed unsecured claims under or equal to
$50,000. Each claim holder under this class will receive pro-rata
distributions, as per the allowed amounts. The Debtor's plan
proposes a significant lump sum payment of $3,000 on the effective
date. Based on the current allowed amounts, each claimholder in
this class will receive approximately 4.16% of the allowed amount
of their claim.
* Class 5 - General Unsecured Claims over $50,001: Class 5
consists of the allowed unsecured claims over $50,001. Each claim
holder under this class will receive pro-rata distributions, as per
the allowed amounts. Debtor's plan proposes a monthly cash dividend
of $2,000 for 6 months beginning on the effective date. Based on
the current allowed amounts, each claimholder in this class will
receive approximately 4.85% of the allowed amount of their claim.
The Plan will be implemented as required under 11 U.S.C. Sec.
1123(a)(5) with the continued operation of Debtor's endeavors and
business growth.
Counsel for Debtor:
Javier Vilariño, Esq.
VILARIÑO & ASSOCIATES LLC
PO BOX 9022515
San Juan, PR 00902-2515
Tel: (787) 565-9894
E-mail: jvilarino@vilarinolaw.com
A copy of the Disclosure Statement dated December 1, 2023, is
available at https://tinyurl.ph/jyMtN from PacerMonitor.com.
About Gur Meat Inc.
Gur Meat, Inc., is a domestic corporation registered on May 2009
and is engaged in the business of sale of pre-packaged food
products for several types of clients including fast food
restaurants. Its business operation is located at Carr. 682 Km 4.8,
Garrochales, Arecibo, PR.
The Debtor had to seek emergency relief in bankruptcy for the
combination of factors: issues with prior accountants, the region's
earthquakes which affected the clients' facilities, the COVID-19
pandemic, shortage of personal, and aggressive collection actions
by creditors. There combinations of factors triggered a negative
ripple effect of Debtor's finances that led to the filing of the
bankruptcy case.
Vilariño & Associates LLC is the Debtor's legal counsel.
GUREEV LLC: Hires Law Offices of Alla Kachan P.C. as Counsel
------------------------------------------------------------
Gureev LLC, seeks approval from the U.S. Bankruptcy Court for the
Eastern District of New York to employ Law Offices of Alla Kachan,
P.C. as counsel.
The firm will provide these services:
a. assisting Debtor in administering this case;
b. making such motions or taking such action as may be
appropriate or necessary under the Bankruptcy Code;
c. representing Debtor in prosecuting adversary prosecuting to
collect assets of the estate such other actions as Debtor deem
appropriate;
d. taking such steps as may be necessary for Debtor to marshal
and protect the estate's assets;
e. negotiating with Debtor's creditors in formulating a plan
of reorganization for Debtor in this case;
f. drafting and prosecuting the confirmation of Debtor's plan
of reorganization in this case; and
g. rendering such additional services as Debtor may require in
this case.
The firm will be paid at these rates:
Attorney $475 per hour
Clerk and Paraprofessional $250 per hour
The firm will be paid a retainer in the amount of $15,000.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Alla Kachan, a partner at Law Offices of Alla Kachan, P.C.,
disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
Alla Kachan
Law Offices of Alla Kachan, P.C.
2799 Coney Island Avenue., Suite 202
Brooklyn, NY 11235
Telephone: (718) 513-3145
About Gureev LLC
Gureev LLC, filed a Chapter 11 bankruptcy petition (Bankr. E.D.
Case No. 1-23-43421) on September 22, 2023. The Debtor hires Law
Offices of Alla Kachan, P.C. as counsel.
GUREEV LLC: Hires Wisdom Professional Services Inc. as Accountant
-----------------------------------------------------------------
Gureev LLC, seeks approval from the U.S. Bankruptcy Court for the
Eastern District of New York to employ Wisdom Professional Services
Inc. as accountant.
The firm will provide these services:
a. gathering and verifying all pertinent information required
to compile and prepare monthly operating reports; and
b. preparing monthly operating reports for the Debtor.
The firm will be paid at a rate of $375 per report and the expected
estimate monthly cost of services is $375.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Michael Shtarkman, CPA, a member of Wisdom Professional 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:
Michael Shtarkman, CPA
Wisdom Professional Services Inc.
626 Sheepshead Bay Road Suite 640
Brooklyn, NY 11224
Telephone: (718) 554-6672
Email: mshtarkmancpa@gmail.com
About Gureev LLC
Gureev LLC, filed a Chapter 11 bankruptcy petition (Bankr. E.D.
Case No. 1-23-43421) on September 22, 2023. The Debtor hires Law
Offices of Alla Kachan, P.C. as counsel.
HEALTHCHANNELS INTERMEDIATE: S&P Upgrades ICR to 'CCC'
------------------------------------------------------
S&P Global Ratings raised the issuer credit rating on
HealthChannels Intermediate HoldCo LLC to 'CCC' from 'SD'
(selective default).
S&P said, "Our 'D' issue-level rating on the company's $385 million
($333.2 million outstanding) first-lien term loan is 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 operational headwinds
resulting in minimal cash flow generation in 2024 could amplify
refinancing risk for the April 2025 term loan. It also reflects the
heightened risk of further debt repurchases below par within the
next 12 months, which we would likely view as tantamount to
default.
"The 'CCC' rating reflects our expectations that HealthChannels may
struggle to refinance its $385 million ($333.2 million outstanding)
first-lien term loan due in April 2025 in a challenging operating
and macro environment. Although many emergency department volumes
have returned to near pre-pandemic levels, HealthChannels has not
rebounded, partly due to continued headwinds to the financial
conditions in emergency medicine. Nevertheless, we expect the
company to continue to invest in hiring and training, as emergency
departments and outpatient centers continue to right-size their
hours and needs. Combined with the company's high interest expense
in comparison with its EBITDA, we expect cash flow deficits could
continue as the company's debt goes current and HealthChannels
works to refinance it.
"The rating also reflects our expectation that the company will
continue to buy back debt below par, which we would view as
tantamount to default.The company recently repurchased small
amounts ($20 million, cumulatively) of its $385 million ($333.2
million outstanding) senior secured first-lien term loan due April
2025 in multiple transactions. If the company repurchases
additional debt below par debt, we will likely consider them
tantamount to default given current operating trends, trading
levels, the cumulative value of the repurchases, and that lenders
will receive materially less value than originally promised.
"Our negative outlook reflects our view that expected minimal
revenue gains and EBITDA margin expansion in 2024 and a cash flow
deficit could amplify refinancing risk on HealthChannels' 2025 term
loan. It also reflects the heightened risk of further debt
repurchases below par within the next 12 months, which we would
likely view as a default.
"We could lower the ratings on HealthChannels if the company
pursued additional below-par debt repurchases that we deemed as
tantamount to default. We could also lower the rating if a default,
distressed exchange, or redemption appeared to be inevitable within
six months, absent unanticipated significantly favorable changes in
the company's circumstances.
"We view an upgrade as unlikely during the next 12 months, given
the company's intent to repurchase additional debt below par and
its upcoming maturity. We could raise the rating if we no longer
viewed default as likely and the company successfully refinanced
its term loan."
HEARTLAND CABINETRY: Case Summary & 20 Top Unsecured Creditors
--------------------------------------------------------------
Debtor: Heartland Cabinetry and Furniture, Inc.
7900 Valcasi Drive
Arlington, TX 76001
Business Description: The Debtor is a cabinet manufacturer in
Arlington, Texas.
Chapter 11 Petition Date: December 8, 2023
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 23-43797
Judge: Hon. Edward L Morris
Debtor's Counsel: Trey Monsour, Esq.
FOX ROTHSCHILD LLP
2501 N. Harwood St.
Suite 1800
Dallas, TX 75201
Tel: (972) 991-0889
E-mail: tmonsour@foxrothschild.com
Total Assets: $1,027,237
Total Liabilities: $3,483,204
The petition was signed by J. Marcus Scrudder as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/H5LVZTA/HEARTLAND_CABINETRY_AND_FURNITURE__txnbke-23-43797__0001.0.pdf?mcid=tGE4TAMA
HELIX ENERGY: Issues $300M Senior Notes Due 2029
------------------------------------------------
Helix Energy Solutions Group, Inc. disclosed in a Form 8-K Report
filed with the Securities and Exchange Commission that on December
1, 2023, the Company issued $300 million aggregate principal amount
of 9.750% Senior Notes due 2029 under an indenture, dated as of
December 1, 2023, among the Company, as issuer, the guarantors
listed and The Bank of New York Mellon Trust Company, N.A., as
trustee.
The Notes have not been and will not be registered under the
Securities Act of 1933, as amended or any state securities laws
and, unless so registered, may not be offered or sold in the United
States absent registration or an applicable exemption from, or in a
transaction not subject to, the registration requirements of the
Securities Act and other applicable securities laws. The notes and
related guarantees will be offered only to persons reasonably
believed to be qualified institutional buyers in reliance on the
exemption for registration set forth in Rule 144A of the Securities
Act, and outside the United States to non-U.S. persons in reliance
on the exemption from registration set forth in Regulation S Under
the Securities Act.
The Company intends to use the net proceeds from the offering,
together with cash on hand and shares of common stock, as
necessary, to pay the cost of extinguishing its obligations with
respect to its outstanding 6.75% Convertible Senior Notes due 2026,
which may include privately negotiated transactions and payments in
settlement of redemptions or conversions of such notes. The Company
reserves the right to settle and extinguish the 2026 Convertible
Notes in cash, shares of its common stock, or any combination
thereof. The Company intends to use the remainder of the net
proceeds from this offering, if any, for general corporate
purposes, which may include repayment of other indebtedness.
The Notes are initially guaranteed on a senior unsecured basis by
the subsidiaries of the Company that guarantee its secured credit
facility, as well as certain future subsidiaries that guarantee
certain of the Company's indebtedness, including its secured credit
facility. The Notes will bear interest from December 1, 2023, at an
annual rate of 9.750% payable on March 1 and September 1 of each
year, beginning on March 1, 2024.
The Notes will mature on March 1, 2029.
At any time before March 1, 2026, the Company may, at its option,
redeem the Notes, in whole or in part, at a redemption price equal
to 100.0% of the aggregate principal amount of the Notes redeemed
plus a make-whole premium and accrued and unpaid interest thereon,
if any, to, but excluding, the redemption date. The Company may
also, at its option, redeem the Notes, in whole or in part, at the
redemption prices set forth in the Indenture. Additionally, the
Company may, at its option, on any one or more occasions, redeem up
to 40% of the notes at a price equal to 109.750% of the aggregate
principal amount of the notes plus accrued and unpaid interest, if
any, to, but excluding, the redemption date, in an amount not
exceeding the proceeds of certain equity offerings.
The Notes will be the Company's general senior unsecured
obligations and will rank equally in right of payment with all of
its existing and future senior indebtedness that is not
subordinated, including its secured credit facility. The Notes will
be effectively junior to all of the Company's existing and future
secured indebtedness, including indebtedness under its secured
credit facility, to the extent of the value of the assets securing
such indebtedness and structurally subordinated to all existing and
future liabilities of the Company's non-Guarantor subsidiaries,
including trade payables of such non-Guarantor subsidiaries.
About Helix Energy
Headquartered in Houston, Texas, Helix Energy Solutions Group, Inc.
is an American oil and gas services company.
Egan-Jones Ratings Company on June 23, 2023, maintained its 'CCC+'
foreign currency and local currency senior unsecured ratings on
debt issued by Helix Energy Solutions Group, Inc.
As of June 30, 2023, Helix Energy reported $2,423,845,000 in total
assets and $891,917,000 in total liabilities.
HENIFF HOLDCO: Midcap Financial Marks $3.9MM Loan at 52% Off
------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $3,925,000
loan extended to Heniff Holdco, LLC to market at $1,868,000 or 48%
of the outstanding amount, as of September 30, 2023, according to
Midcap Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver Loan to Heniff Holdco, LLC. The loan accrues interest
at a rate of (SOFR+585, 1.00% Floor) per annum. The loan matures on
December 3, 2024.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Heniff's integrated freight network is focused on supply chain
dynamics and solutions providing full service solutions in
transportation, tank cleaning, and railings.
HIGH VALLEY INVESTMENTS: $3.5MM DIP Loan from DJL Wins Final OK
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
High Valley Investments, LLC and its debtor-affiliates to use cash
collateral and obtain postpetition financing, on a final basis.
High Valley is permitted to obtain postpetition secured financing
in an aggregate principal amount not to exceed $3.5 million from
DJL Investments, LLC.
The maturity date of the DIP Agreement will be no later than April
1, 2025.
High Valley is also permitted to enter into a Promissory Note and
Deed of Trust with DJL as lender.
The Debtors are parties to a Loan Agreement dated November 25, 2019
with Bank of America, N.A., as the original lender, with Wells
Fargo Bank, N.A., as the master servicer thereunder, Wilmington
Trust, National Association, as trustee for the benefit of the
registered holders of BANK 2020-BNK25, Commercial Mortgage
Pass-Through Certificates, Series 2020-BNK25, as the current
holder, beneficiary, secured party and/or assignee under all of the
Prepetition Loan Documents, and its special servicer, CWCapital
Asset Management LLC.
The Debtors asserted that an immediate need exists for them to
obtain funds under the DIP Facility to continue operations, fund
operating expenses, and administer and preserve the value of their
estates.
To secure the DIP Obligations, the DIP Lender is granted valid,
enforceable, and fully perfected senior priming liens in and on
those certain parcels of real property known collectively as
"Kimberly Gardens," 14802-14894 36th Avenue Court East, Tacoma,
Washington 98446, owned by Debtor Kimberly Gardens, LLC, which will
be senior to any liens existing pursuant to those deeds of trust
recorded on August 18, 2017 and January 25, 2022.
The DIP Liens are deemed fully perfected liens and security
interests, effective and perfected upon the date of the Interim
Order, without the necessity of execution by the Debtors of
mortgages, security agreements, pledge agreements, financing
agreements, financing statements, account control agreements, or
any other agreements, filings, or instruments.
As adequate protection for the use of cash collateral, the
Prepetition Lenders are granted valid, perfected, postpetition
security interests and liens in and on the Prepetition Cash
Collateral and a superiority administrative claim against the
Prepetition Borrowers' estates, as and to the extent provided in 11
U.S.C. section 507(b).
In addition, the debt service payment, made in the amount of
$60,959 on October 2, 2023 to the Prepetition Lenders, is
approved.
These events constitute an "Event of Default":
(a) The occurrence of an "Event of Default" by the Debtors
pursuant to the DIP Agreement;
(b) Conversion of any of the Chapter 11 Cases to a case under
chapter 7 of the Bankruptcy Code; and
(c) Failure to pay any fees due and payable pursuant to 28
U.S.C. section 1930.
A copy of the order is available at https://urlcurt.com/u?l=DQPb4O
from PacerMonitor.com.
About High Valley Investments
High Valley Investments, LLC and its affiliates sought relief under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No.
23-11616) on Sept. 27, 2023. In the petitions signed by John P.
Madden, chief restructuring officer, High Valley disclosed up to
$100,000 in estimated assets and up to $50 million in estimated
liabilities.
Judge Thomas M. Horan oversees the cases.
The Debtors tapped Young Conaway Stargatt & Taylor, LLP as legal
counsel; Gibson, Dunn & Crutcher LLP as special counsel; and
Emerald Capital Advisors Corp. to provide a chief restructuring
officer (CRO) and additional personnel. Stretto, Inc. is the
administrative advisor.
HIGHTOWER HOLDING: Moody's Affirms 'B3' CFR, Outlook Stable
-----------------------------------------------------------
Moody's Investors Service affirmed Hightower Holding, LLC's B3
corporate family rating, B2 senior secured bank credit facility
rating and Caa2 senior unsecured rating. The rating action follows
Hightower's intention to issue a $150 million add-on to its
existing term loan B due April 2028 and a related $40 million
equity raise. The outlook was maintained at stable.
RATINGS RATIONALE
Moody's said that Hightower's proposed $150 million add-on to its
existing term loan B is planned to be completed alongside a $40
million equity raise from an entity affiliated with its private
equity owner Thomas H. Lee Partners (THL). Hightower plans to use
the net proceeds from these transactions to fund signed
acquisitions, outstanding earnouts and deferred consideration from
prior acquisitions and pay-down a portion of its partially drawn
revolver.
Moody's said the ratings' affirmation reflects the credit benefits
from Hightower's recurring revenue model and revenue tailwinds from
higher financial market levels, offset by the negative effects
higher interest rates are having on its financial profile. Rising
asset valuations in 2023 drove a modest increase in billable assets
under management to $122 billion at June 30, 2023 compared to $108
billion at the end of 2022. This has boosted Hightower's
performance compared to a year ago.
Moody's said Hightower has grown through its strategy of acquiring
Registered Investment Advisors (RIAs), businesses that have
reliable cash flows and flexible cost structures. However,
Hightower has frequently and aggressively issued debt to help
execute and fund this strategy. The $150 million debt increase is
the first upsize since the firm raised $175 million of additional
debt in 2022 and will result in a total Moody's-adjusted debt
balance of about $1.9 billion (including operating lease
liabilities and earnout liabilities). On a proforma basis that
includes the debt transaction and earnings from closed acquisitions
and future acquisitions currently under letters of intent, Moody's
expects Hightower's Debt/EBITDA (Moody's adjusted) leverage ratio
to be around 8x for the year ended December 31, 2023.
Moody's expects Hightower's leverage to remain near its current
level, given the company's growth strategy. This strategy is
dependent on periodic acquisitions which may necessitate
incremental debt issuances. Due to the company's solid track record
of identifying and integrating profitable targets, Moody's believes
that the maintenance of the firms existing debt leverage level for
this purpose is consistent with its B3 CFR rating level and stable
outlook.
Hightower is highly sensitive to interest rates due to its
substantial portion of floating rate debt and its lack of interest
income generation from client cash balances. Its EBITDA / interest
expense coverage ratio has declined each quarter since mid 2022,
when the federal reserve began aggressively raising interest rates.
Moody's expects that the additional debt and higher interest rate
environment will continue to negatively affect Hightower's interest
coverage over the next 12-18 months. However, Moody's says that the
company's liquidity position and cash flow is adequate, and expects
its interest coverage to remain at 1.5x or above. Hightower has
also partially hedged its sensitivity to further rate increases
through an interest rate cap on $500 million of its floating rate
debt. Hightower will also have access to an additional equity
commitment from THL, which has a track record of providing equity
capital to Hightower to fund its growth.
The affirmation of Hightower's B2-rated senior secured term loan B,
delayed draw term loan and revolving credit facility at a notch
above Hightower's B3 CFR is reflective of these instruments'
priority ranking in Hightower's capital structure. Similarly,
Hightower's Caa2-rated $300 million senior unsecured notes is two
notches below Hightower's CFR, reflective of the notes' lower
ranking in Hightower's capital structure.
Hightower's stable outlook reflects Moody's expectation that the
firm's cash flow and liquidity will remain adequate to service its
debt and that the firm's record of successful M&A transactions and
organic growth will provide additional support. The stable outlook
is also predicated on Hightower's debt leverage and interest
coverage not sustainably deteriorating from current levels.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An improvement in profitability and debt reduction that results in
Moody's-adjusted debt leverage being below 6.5x on a sustained
basis could result in an upgrade.
A deterioration in interest coverage from weaker cash flow and
EBITDA resulting in an interest coverage ratio below 1.5x or an
erosion of the company's working capital position could lead to a
downgrade. Revenue deterioration due to a slowdown in organic
growth, client attrition, rising competition and fee compression,
underperformance of acquired firms, or sustained declines in broad
financial markets resulting in lower levels of client assets could
also trigger a downgrade. Moody's could also downgrade Hightower's
ratings if its debt leverage ratio trends sustainably above 8.0x.
The principal methodology used in these ratings was Securities
Industry Service Providers Methodology published in November 2019.
HOG FATHER'S: Unsecured Creditors to Get 0% in Liquidating Plan
---------------------------------------------------------------
Hog Father's Old Fashioned BBQ, LLC filed with the U.S. Bankruptcy
Court for the Western District of Pennsylvania a Chapter 11 Plan of
Liquidation for Small Business dated November 30, 2023.
The Debtor operates as two barbeque restaurants that are two of
three restaurants doing business as "Hog Father's Old Fashioned
BBQ". The business was started in 2007 and currently operates
locations in Washington, PA and Monongahela, PA.
The Debtor a Pennsylvania LLC with 14 members. The majority owner
is Frank Puskarich who owns 54.48% and is the managing member. This
case is being jointly administered with the case of Hog Father's
Old Fashioned BBQ of Canonsburg, LLC with Case No. 23-21873 JCM,
which operates the other restaurant.
Due a downturn in business, the Debtor fell behind on sales taxes
and was sued by Reinhart Foodservice, LLC. The Chapter 11 halted
collections and allowed the Debtor to operate without the burden of
past debt. The Debtor is unable to operate profitably and will
liquidate assets pursuant to this Plan.
The Plan proposes to pay administrative, secured. and priority
claims in in the order of their priority from sale proceeds. The
Debtor estimates approximately 0% will be paid on account of
general unsecured claims pursuant to the Plan.
Undisputed, known, allowed Class 2 General unsecured Claims total
$356,685.64. It is not anticipated that any funds will be available
from the sale of assets for General Unsecured Claims. In the event
that sale proceeds are sufficient to pay Administrative, Secured,
and Priority Claims in full, then General Unsecured Creditors would
get a pro-rata share of any remaining sale proceeds.
Membership interest of equity interest holders will terminate upon
successful liquidation.
The Plan will be funded through sale of substantially all of the
Debtor's assets.
The Debtor will wind down business operations and terminate
operations on or before January 31, 2024. The Debtor will file a
motion requesting court approval of a broker who will list and
market the substantially all of the assets of the Debtor for sale
(including the Debtor's liquor license) on or before January 31,
2024. The Debtor anticipates that the sale will be pursuant to
Section 363 of the Bankruptcy Code and will welcome higher and
better offers at hearing on sale. Bidding procedures will be
dictated by interest shown in the Debtor's assets and how many
potential bidders show interest. Based on the assets to be sold,
the Debtor anticipates that a sale will occur within 120 days of
confirmation of the Plan. Sale proceeds will be distributed in
order of priority pursuant to the Bankruptcy Code and the terms of
this Plan.
A full-text copy of the Liquidating Plan dated November 30, 2023 is
available at https://urlcurt.com/u?l=LepZGb from PacerMonitor.com
at no charge.
Attorney for the Debtor:
Christopher M. Frye, Esq.
STEIDL & STEINBERG, PC
2830 Gulf Tower
707 Grant Street
Pittsburgh, PA 15219
Telephone: (412) 391-8000
Email: chris.frye@steidl-steinberg.com
About Hog Father's Old Fashioned BBQ
Hog Father's Old Fashioned BBQ, LLC, is a chain of barbeque
restaurants in Western Pennsylvania.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Pa. Case No. 23-21872) on Sept. 1,
2023. In the petition signed by Frank Puskarich, managing member,
the Debtor disclosed $500,000 in total assets and $1 million in
total liabilities.
Christopher M. Frye, Esq., at Steidl & Steinberg, P.C., is the
Debtor's legal counsel.
HOLY GROUND: Updates Priority Unsecureds & Unsecured Claims Pay
---------------------------------------------------------------
Holy Ground Tiny Homes LLC and Revelations in Christ Ministries
submitted a First Amended Subchapter V Plan of Reorganization dated
November 30, 2023.
During the Chapter 11 cases, Holy Ground transferred its assets
back to Revelations and ceased operations. Revelations continues
to manufacture tiny homes and has expanded its business into
manufacturing sheds, operating a sandwich shop, and repairing and
selling used motor vehicles.
Priority Claims are defined in the Plan as any pre-petition Claim
entitled to a priority payment under Section 507(a) of the
Bankruptcy Code, excluding any Administrative Claim or Tax Claims.
Revelations has 181 Priority Claims pursuant to Section 507(a)(7)
of the Bankruptcy Code for customer deposits in the total amount of
$606,350. Holy Ground has 8 Priority Claims pursuant to Section
507(a)(7) of the Bankruptcy Code for customer deposits in the total
amount of $26,800.
Tax Claims are any Claim of a governmental unit for taxes entitled
to priority pursuant to Section 507(a)(8) of the Bankruptcy Code.
The Colorado Department of Revenue filed a claim against
Revelations in the amount of $76,702 and against Holy Ground in the
amount of $24,444 for unpaid sales taxes. Based on recent sales
tax filings, Debtors anticipate that the Colorado Department of
Revenue will file amended proofs of claim in the amount of $0.00.
Revelations scheduled 185 general unsecured creditors. Excluding
the Priority Claims, the general unsecured claims total $5,186,805.
Holy Ground scheduled 8 general unsecured creditors. Excluding the
Priority Claims, the general unsecured claims total $275,694.
Mr. Sowash has a 100% interest in Holy Ground and Mr. Sowash is the
sole principal of Revelations.
Class 1 consists of the Allowed Claims of Section 507(a)(7)
priority unsecured creditors. Class 1 shall receive all of the
Debtors' actual Disposable Income for a five-year period beginning
on the Effective Date until paid in full. Class 1 Claims shall be
paid on a Pro Rata basis in quarterly installments beginning the
15th day of the month following each calendar quarter after the
Effective Date (the "Quarterly Payment"), e.g. the first Quarterly
Payment shall be due on April 15, 2024 (except such date shall be
recalculated to the extent that a stay was in place).
Class 4 consists of the Allowed Claims of unsecured creditors.
Class 4 shall receive all of the Debtors' actual Disposable Income
following payment in full of Class 1 Claims. Class 4 Claims shall
be paid on a Pro Rata basis in quarterly installments beginning the
15th day of the first full calendar quarter following payment in
full of Class 1 Claims (the "Quarterly Payment") and concluding on
the fifth anniversary of the Effective Date.
Funding for the Plan will come from the Debtors' continued
operations.
The Reorganized Debtors shall be empowered to take such action as
may be necessary to perform its obligations under this Plan.
On the Effective Date, the Reorganized Debtors shall open a new
deposit account with a FDIC insured bank for its business
operations (the "Operating Account"). The Reorganized Debtors shall
make the required plan payments to Allowed Administrative Claims,
Allowed Tax Claims and Class 2 Fusion Claim directly from the
Operating Account. Upon receipt of the first Quarterly Payment
required to be made on the Class 1, Section 507(a)(7) Claims, the
Subchapter V Trustee shall open a new deposit account with a FDIC
insured bank which shall be deemed the Creditor Account.
The Subchapter V Trustee shall deposit all Quarterly Payments in
the Creditor Account. The Subchapter V Trustee shall make the pro
rata plan payments to the holders of Allowed Class 1 and Class 4
Claims from the Creditor Account.
A full-text copy of the First Amended Subchapter V Plan dated
November 30, 2023 is available at https://urlcurt.com/u?l=ENtUPk
from PacerMonitor.com at no charge.
Attorneys for Revelations:
David V. Wadsworth, Esq.
Aaron J. Conrardy, Esq.
Wadsworth Garber Warner Conrardy, PC
2580 West Main Street, Suite 200
Littleton, CO 80120
Telephone: (303) 296-1999
Facsimile: (303) 296-7600
Email: dwadsworth@wgwc-law.com
aconrardy@wgwc-law.com
Attorneys for Holy Ground:
Jonathan M. Dickey, Esq.
Kutner Brinen Dickey Riley, PC
1660 Lincoln Street, Suite 1720
Denver, CO 80264
Telephone: (303) 832-3047
Email: jmd@kutnerlaw.com
About Holy Ground Tiny Homes
Holy Ground Tiny Homes, LLC sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. D. Colo. Case No. 22-13918) on
Oct. 10, 2022, while Revelations in Christ Ministries filed for
Chapter 11 protection (Bankr. D. Colo. Case No. 22-13919) on Oct.
7, 2022. The cases are jointly administered under Case No.
22-13918.
At the time of the filing, Holy Ground Tiny Homes listed as much as
$1 million in both assets and liabilities while Revelations in
Christ Ministries listed up to $500,000 in assets and up to $10
million in liabilities.
Judge Elizabeth E. Brown oversees the cases.
Wadsworth Garber Warner Conrardy, PC, serves as the Debtors' legal
counsel.
HOMERENEW BUYER: Midcap Financial Marks $1.9MM Loan at 23% Off
--------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $1,958,000
loan extended to HomeRenew Buyer, Inc to market at $1,517,000 or
77% of the outstanding amount, as of September 30, 2023, according
to Midcap Financial's Form 10-Q Report for the Quarterly period
ended September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver Loan to HomeRenew Buyer, Inc. The loan accrues
interest at a rate of 1% (SOFR+665) per annum. The loan matures on
November 23, 2027.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
HomeRenew Buyer, Inc. is an installer of kitchen siding, roofing
windows tech difficult clients communication materials
troubleshooting vinyl, vinyl siding, carpentry.
IHEARTCOMMUNICATIONS INC: Moody's Lowers CFR to Caa1, Outlook Neg.
------------------------------------------------------------------
Moody's Investors Service downgraded iHeartCommunications, Inc.'s
Corporate Family Rating to Caa1 from B2, the Probability of Default
Rating to Caa1-PD from B2-PD, the backed senior secured term loan B
and backed senior secured notes to Caa1 from B1, and the backed
senior unsecured notes to Caa3 from Caa1. The company's speculative
grade liquidity rating remains unchanged at SGL-2. The outlook
remains negative.
The downgrade of the CFR to Caa1 reflects iHeart's increasing
refinancing risks and elevated financial leverage resulting from a
decline in radio advertising demand due to economic weakness and
secular pressures. The company faces approximately $3.1 billion of
debt maturities in 2026 and approximately $1.7 billion in 2027.
Moody's expects iHeart will continue to focus on cost and debt
reduction to partially offset the impact on leverage. In addition,
iHeart faces social risks arising from negative secular pressures
in broadcast radio due to competition from advertising alternatives
and digital music offerings. These risks raise the possibility of
distressed debt exchanges, especially given iHeart's weak equity
valuation (market capitalization of $400 million) and low debt
trading levels. Social considerations, as reflected in the
company's credit impact score of CIS-4 and social issuer profile
score (IPS) of S-4, were a key driver of the rating action.
RATINGS RATIONALE
iHeart's Caa1 CFR reflects elevated financial leverage due to weak
radio advertising demand and negative secular pressures due to
competition from advertising alternatives and digital music
offerings. Moody's adjusted debt to EBITDA (excluding Moody's
standard lease adjustments) remains high and rose to 7.2x as of the
twelve months ended September 2023. Moody's expects leverage to
further increase to 8.2x in 2023 as advertisers remain cautious
about deploying marketing spend and the company incurs additional
expenses related to its events business in Q4 2023. In 2024, iHeart
will benefit from the US presidential election as it has presence
in every market with the exception of Buffalo and Kansas City.
Moody's projects revenue growth in the mid-single digits in 2024
largely driven by political ad dollars and continued growth in
podcasting and digital services. As the company remains cautious in
cost management and political revenue is highly profitable, the
adjusted EBITDA margin is projected to expand to low-20% in 2024.
However, there is limited visibility into the operating performance
in 2025 as political revenue rolls off and the radio industry
continue to face challenges to maintain listenership. Moody's
expects the company to continue to focus on leverage reduction
through cost cutting measures and debt repurchases by utilizing
excess free cash flow.
iHeart benefits from its size as the largest radio operator in the
US as well as its geographic diversity and leading market positions
in most of the approximately 160 markets in which it operates. The
company also derives significant strength from its diversified
service offering including podcasting, the iHeartRadio service,
live events, syndicated network, and data analytics services.
The SGL-2 rating reflects Moody's expectation that iHeart will
maintain good liquidity over the next 12 months supported by $213
million of cash on the balance sheet as of September 2023 and
borrowing base availability of $411.8 million of the $450 million
ABL revolving credit facility due May 2027 (not rated by Moody's).
Moody's expects free cash flow as a percentage of debt to expand to
4.5% in 2024 from 1.7% in 2023 driven by political revenues and
constrained by the company's transition to being a full taxpayer.
Moody's expects capital expenditures to remain approximately $100
million, similar to that in 2023 and lower compared to $161 million
in 2022 following the completion of the consolidation of its real
estate footprint. In addition, iHeart is expected to receive
approximately $100 million in proceeds from the sale of its equity
interest in Broadcast Music, Inc. (BMI) to a shareholder group led
by New Mountain Capital, LLC. Along with the proceeds received in
either Q1 or Q2 2024 and excess free cash flow, Moody's expects
iHeart to reduce debt in 2024. iHeart has made several acquisitions
in the past to bolster digital capabilities, including the Triton
Digital acquisition in 2021, but additional activity is likely to
be limited in 2024.
The ABL credit facility is subject to a fixed charge coverage ratio
of at least 1x if borrowing availability is less than the greater
of $40 million and 10% of the aggregate commitments for two
consecutive days. The term loans and secured notes are covenant
lite. Moody's projects iHeart will remain well within compliance
with the ABL covenant.
The Caa1 ratings on the senior secured term loans and senior
secured notes are the same as the Caa1 CFR reflecting that secured
debt now represents the preponderance of the capital structure. The
company retired a cumulative $518.6 million of senior unsecured
notes from Q2 2022 to Q3 2023. The Caa3 rating on the senior
unsecured notes is two notches below the CFR due to the significant
amount of secured debt ahead of it in the debt structure. There is
also a $450 million ABL revolving credit facility (unrated) that
ranks senior to the secured debt for collateral supporting the
borrowing base.
iHeart's ESG Credit Impact Score of CIS-4 indicates the rating is
lower than it would have been if ESG risk exposures did not exist.
While environmental risks are limited, social and governance risks
are the main drivers. Social risks arise from social and
demographical trends as competition for listeners from digital
music services has increased and advertising dollars have shifted
to digital and social media advertising. Governance risks are
related to elevated leverage levels which are partly mitigated by a
track record of directing free cash flow to debt repayment.
The negative outlook reflects the company's limited financial
flexibility given large debt maturities in 2026 and 2027 and the
potential for a distressed exchange.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The rating could be upgraded if iHeart achieves a long-term
solution to its debt refinancing needs that results in a
sustainable capital structure.
The rating could be downgraded if Moody's assessment of the
probability of default were to increase or recovery at default were
to decline.
iHeartCommunications, Inc. (iHeart) with its headquarters in San
Antonio, Texas, is the leading terrestrial radio operator and
podcasting service provider in the US. In addition, iHeart operates
its iHeartRadio digital platform, data analytics services, live
events, syndicated networks, and the Katz Media Group. iHeart
emerged from Chapter 11 bankruptcy protection and separated from
Clear Channel Outdoor Holdings, Inc. in Q2 2019. Revenue was
approximately $3.8 billion for the last twelve months ending
September 2023.
The principal methodology used in these ratings was Media published
in June 2021.
INGEVITY CORP: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable
--------------------------------------------------------------
Fitch Ratings has affirmed Ingevity Corporation's Long-Term Issuer
Default Rating (IDR) at 'BB'. Fitch has also affirmed the company's
senior unsecured long-term issue ratings at 'BB'/'RR4'. The Rating
Outlook remains Stable.
Fitch has also downgraded the senior secured long-term issue
ratings to 'BB+'/'RR2' from 'BBB-'/'RR1', reflecting structural
subordination of the senior secured revolver resulting from the new
A/R securitization program entered on Oct. 2, 2023.
The ratings reflect the company's relatively modest size, strong
margins owing to technological and market leadership in activated
carbon for auto emissions control, some exposure to cyclical
end-markets and its generally modest leverage.
The Stable Outlook reflects Fitch's expectations for EBITDA
Leverage to improve to between 2.5x and 3.0x through the forecast
horizon, as Fitch expects the company to focusing on deleveraging
over the near-term.
KEY RATING DRIVERS
Performance Chemicals Restructuring: Fitch believes the announced
restructuring of Ingevity's Performance Chemicals (PC) segment
improves the company's business profile over the long-term, as it
reduces the company's reliance on high-cost crude tall oil (CTO)
feedstocks, improves product mix towards higher-margin pavement
technologies and activated carbon products, and eliminates exposure
to the more cyclical adhesives and printing inks markets.
The restructuring does result in meaningful near-term headwinds for
the segment, including $300 million in reduced revenue resulting
from the closure of the DeRidder, Louisiana site, cash
restructuring charges of approximately $100 million, and initial
expected EBITDA losses of around $30 million-$80 million resulting
from temporary sales of excess CTO inventories. However, Fitch
expects continued stability from the higher-growth, higher-margin
Performance Materials (PM) and pavement technologies products to
substantially cushion these impacts, resulting in sufficient FCF
generation and liquidity levels to provide financial flexibility
through the forecast period.
Longer-term, Ingevity also faces execution risk surrounding
customer adoption of its alternative fatty acid (AFA)-based
products, and associated reformulations to ensure adequate product
performance. This risk is mitigated by the company's existing
market presence in AFAs, having made its first sales of AFA and
derivatives in 2021, coupled with the global shift toward
sustainability and the renewable sources of Ingevity's products
versus those based from petroleum, which could help deliver the
sustainability initiatives of customers.
Expected Deleveraging: With an elevated revolver balance of $825
million as of 3Q23, Fitch expects Ingevity's primary near-term
capital allocation priority to be deleveraging back towards its
targeted 2.0x-2.5x net leverage range. Fitch forecasts gross debt
reduction totaling over $100 million through 2025, leading to
EBITDA Leverage of below 3.0x. This is supported by expectations
for stable positive FCF generation through the period, aided by an
expected working capital release in 2024 stemming from excess CTO
resales, and manageable capex requirements.
Upon returning to within its targeted leverage ranges, Ingevity is
expected by Fitch to pivot capital allocation priorities back to a
balance between growth investments, both organic and inorganic, and
measured share repurchases.
Solid FCF Amid Cost Headwinds: Notwithstanding persistent headwinds
seen in the PC segment, Ingevity is still forecasted by Fitch to
generate solid FCF of close to $100 million in the near-term. This
is largely driven by strength in the company's PM segment, which
generated reported segment EBITDA margins of 51% in 3Q23, and the
high-growth pavement technologies product line. Fitch believes the
company's recent performance highlights Ingevity's solid product
diversification, and competitive strengths of its strong market
positions -- particularly in activated carbon materials.
Fitch expects benefits from higher emissions standards and higher
infrastructure spending to result in strong annual FCF generation
of around $130 million on average over the forecast horizon,
despite Fitch's forecasts for continued weakness in the PC
segment.
Emissions Standards Benefit Materials: Gasoline vapor emissions
regulation drives volume in the PM segment. Ingevity's high market
share and technological leadership should enable the segment to
sustain EBITDA margins over 40%.
Recent U.S. and Canadian regulations phased in control systems that
better utilize higher margin activated carbon. Other regions are
implementing increasingly stringent emission regulations, including
Euro 6D and China 6, which are now fully implemented, with Europe's
Euro 7 and China's China 7 regulations expected to be implemented
by mid-decade. Fitch believes the increase in global emission
regulations more than offsets reduced auto sales and the long-term
threat of continued electric vehicle use. The recent investment in
Nexeon also diversifies the end-market exposure for Ingevity's
activated carbon products toward EVs.
DERIVATION SUMMARY
Ingevity is smaller than specialty chemical peers and H.B. Fuller
Company (BB/Stable), Koppers Holdings Inc (BB-/Stable) and Axalta
Coatings Systems Ltd. (not rated). Ingevity generally maintains a
conservative capital structure with EBITDA Leverage generally
around 2.5x-3.5x compared with around 3.5x-4.5x for H.B. Fuller,
Koppers, and Axalta. Fitch expects Ingevity's EBITDA Leverage to
trend below 3.0x, consistent with management's pre-acquisition
leverage target.
Ingevity's EBITDA margins are forecast to be close to 30%
throughout the forecast, which compares with margins for Fuller,
Koppers, and Axalta in the low-mid teens range. This is primarily
due to Ingevity's market position in its PM segment, which
consistently sees margins above 40%.
However, Fitch believes the company's PM segment has a higher
degree of exposure to the moderately cyclical autos end market when
compared with peers. The company is strategically shifting towards
higher value product offerings within its PC segment to reduce
earnings volatility, as exemplified by recent acquisitions and
product developments.
KEY ASSUMPTIONS
- Mid double-digit organic revenue declines in 2024 driven by PC
restructuring, partially offset by stability in PM and pavement
technologies, followed by moderate recoveries in thereafter;
- EBITDA margins recover to around 27% by 2025, due to exits from
lower-margin PC markets, and mix shift in volumes towards PM and
pavement technologies, and some realized cost savings;
- FCF is primarily allocated to debt repayment in 2024-2025,
resulting in EBITDA Leverage returning to below 3.0x by 2025;
- Capex assumed to be roughly similar to 2023 levels in 2024 to
preserve FCF, before ramping up towards the $130 million range
thereafter;
- Excess cash flow applied to share repurchases.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Although an upgrade is unlikely, one may be considered upon
increases in size, scale, and/or diversification that further
enhance the business profile;
- Adherence to a financial policy demonstrating a clear commitment
to deleveraging to EBITDA Leverage sustained below 2.5x.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Deviation from financial policy resulting in EBITDA Leverage
sustained above 3.5x;
- Capital allocation prioritization toward additional acquisitions
or stock repurchases in favor of debt repayments;
- Substantial sustained EBITDA margin deterioration signaling
unsuccessful repositioning in Performance Chemicals, or increased
integration risk associated with future investments.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: As of Sept. 30, 2023, the company had
approximately $85 million of cash and equivalents with $175 million
in availability under its new $1 billion revolving credit facility
due 2027. Fitch projects annual FCF generation to average around
$130 million throughout the forecast, which should provide the
company with adequate liquidity over the ratings horizon.
Ingevity's liquidity position was further bolstered with the
October 2023 issuance of a new $100 million A/R Securitization
facility.
Ingevity is materially exposed to the perceived elevated interest
rate environment over the medium-term, given that about 60% of
total debt as of Sept. 30, 2023 is floating rate.
ISSUER PROFILE
Ingevity Corporation is a leading global manufacturer of specialty
chemicals and high-performance activated carbon materials. It
produces chemicals through refining crude tall oil and AFAs, and
carbon materials from burning sawdust necessary to control gasoline
emissions in automobiles.
ESG CONSIDERATIONS
Ingevity Corporation has a ESG Relevance Score of '4' for GHG
Emissions & Air Quality due to the impact of the company's
activated carbon materials towards global efforts to reduce harmful
gasoline vapor emissions, which has a positive impact on the credit
profile, and is relevant to the ratings 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
----------- ------ -------- -----
Ingevity Corporation LT IDR BB Affirmed BB
senior unsecured LT BB Affirmed RR4 BB
senior secured LT BB+ Downgrade RR2 BBB-
INNOVATION PHARMACEUTICALS: Alfasigma Terminates License Agreement
------------------------------------------------------------------
Innovation Pharmaceuticals Inc. disclosed in a Form 8-K filed with
the Securities and Exchange Commission that Alfasigma S.p.A.
terminated without cause the Exclusive License Agreement between
the parties dated July 18, 2019, which granted Alfasigma the
worldwide right to develop, manufacture and commercialize
locally-administered Brilacidin for the treatment of ulcerative
proctitis/ulcerative proctosigmoiditis (UP/UPS).
Alfasigma terminated the License Agreement following its decision
to discontinue further work under the License Agreement. On Dec.
4, 2023, the parties entered into a mutual release relating to the
License Agreement and the Company waived the 60-day notice period
for terminations without cause by Alfasigma.
About Innovation Pharmaceuticals
Innovation Pharmaceuticals Inc. (IPIX) -- http://www.IPharmInc.com
-- is in the business of developing or licensing innovative small
molecule therapies to treat diseases with significant medical need,
particularly in the areas of inflammatory diseases, cancer,
dermatology and anti-infectives.
Innovation reported a net loss of $3.17 million for the year ended
June 30, 2023, compared to a net loss of $7.04 million for the year
ended June 30, 2022. As of Sept. 30, 2023, the Company had $6.67
million in total assets, $5.51 million in total liabilities, and
$1.16 million in total stockholders' equity.
Farmington, Utah-based Pinnacle Accountancy Group of Utah, the
Company's auditor since 2018, issued a "going concern"
qualification in its report dated Sept. 28, 2023, citing that the
Company has negative working capital, has suffered losses and
negative cash flow from operations, which raise substantial doubt
about its ability to continue as a going concern.
INVERSIONES LATIN AMERICA: Unsecureds be Paid in Full or Reinstated
-------------------------------------------------------------------
Inversiones Latin America Power Ltda. ("ILAP") and Debtor
Affiliates filed with the U.S. Bankruptcy Court for the Southern
District of New York a Disclosure Statement for Joint Prepackaged
Plan of Reorganization.
The Company is a clean energy company that owns and operates wind
generation plants with an aggregate installed capacity of 239.2
megawatts (MW) and is engaged in the generation of electricity
business in northern Chile.
The Debtors are pleased to report that after extensive, good faith
and arms'-length negotiations with certain of the holders of the
Existing Notes and the Holder of the LC Facility Claims, the Plan
embodies a comprehensive settlement among the Debtors and a
majority of their key creditor constituencies on a consensual
transaction that will reduce the Debtors' debt service obligations
and position the Debtors for continued operations.
To evidence their support of the Debtors' restructuring plan,
holders of the Existing Notes representing approximately 83.8% of
the aggregate outstanding principal amount of the Existing Notes
have executed the Restructuring Support Agreement, dated as of
October 30, 2023 (as amended and supplemented and in effect from
time to time, "RSA"). Further, the Holder of 100% of the LC
Facility Claims executed a joinder to the RSA on November 29, 2023.
The RSA provides for the implementation of the restructuring
through an expedited chapter 11 process and commits the Consenting
Creditors and the Debtors to support the Plan subject to the terms
and conditions of the RSA.
The RSA contemplates that, if the Debtors need to incur post
petition financing, the Consenting Noteholders will, subject to the
terms and conditions set forth in the RSA, engage with the Debtors
on providing such financing.
After giving effect to the following transactions contemplated by
the RSA and the Plan, the Debtors will emerge from chapter 11
appropriately capitalized to support their emergence and going
forward business needs.
* On the Plan Effective Date, the Reorganized ILAP shall issue
to Holders of Senior Debt Claims senior secured notes in the
principal amount of $260,000,000 (as further defined in the Plan,
the "Take-back SSNs"). Furthermore, in settlement of disputes and
claims, the Holder of the LC Facility Claims have agreed to forfeit
their rights to receive Convertible Notes in exchange for the
issuance of the Settlement Take-back SSNs in the principal amount
of $4,305,966. The obligations under the Take-back SSNs shall be
guaranteed by the Reorganized Guarantor Debtors and the New Issuer,
which will be an entity that, on the Plan Effective Date, will hold
all of the Interests in the Reorganized ILAP. The Take back SSNs
shall be secured by substantially all of the assets of the
Reorganized Debtors and the New Issuer.
* On the Plan Effective Date, the New Issuer shall issue to
Holders of Senior Debt Claims convertible notes in the principal
amount of $173,345,973 (as further defined in the Plan, the
"Convertible Notes"). The Convertibles Notes shall be secured by a
charge over the equity shares in the New Issuer (the "New Issuer
Equity"). Furthermore, as noted, the Holder of the LC Facility
Claims have agreed to forfeit their Pro Rata Share of the
Convertible Notes (totaling approximately $8.23 million in
principal amount of the Convertible Notes) in exchange for the
issuance of the Settlement Take-back SSNs.
* On the Plan Effective Date, the Reorganized ILAP shall issue
senior secured notes, with super-priority relative to the Take-back
SSNs and Convertible Notes, in the principal amount of $14,000,000
(as further defined in the Plan, the "Super Priority Notes"). The
obligations under the Super Priority Notes shall be guaranteed by
the Reorganized Guarantor Debtors and the New Issuer, which will be
an entity that, on the Plan Effective Date, will hold all of the
Interests in the Reorganized ILAP (the "Reorganized ILAP Equity").
The Super Priority Notes shall be secured by substantially all of
the assets of the Reorganized Debtors and the New Issuer. The
proceeds from the sale of the Super Priority Notes will be used
largely to fund costs associated with the Restructuring and to
provide working capital to the Reorganized Debtors.
* On the Plan Effective Date, the New Issuer shall issue all
of the New Issuer Equity to Latin America Power S.A., a corporation
(sociedad anonima) formed under the laws of Chile ("LAP Chile"),
which is the Holder of substantially all of the Existing ILAP
Equity Interest.
* On or prior to the Plan Effective Date, a holding company
structured as a Cayman Islands exempted company shall be formed
("New Issuer" and together with the Reorganized Debtors, the
"Reorganized Business"). Upon implementation of the Restructuring
Transactions, from and after the Plan Effective Date, the New
Issuer shall hold all of the Reorganized ILAP Equity.
* On or prior to the Plan Effective Date, ILAP shall
reorganize as a Chilean stock corporation (sociedad por acciones).
* On or prior to the Plan Effective Date, LAP Chile shall
contribute the Purchased PEC 1 Receivables to the Reorganized
Business.
* On the Plan Effective Date, the New Issuer, the Reorganized
Debtors, the ILAP Partners and the Convertible Notes Indenture
Trustee will enter into a Sales Facilitation Agreement, pursuant to
which the parties thereto will agree to make their best efforts to
sell 100% of the Reorganized ILAP Equity by December 31, 2025 in a
manner designed to maximize the sales proceeds to all
stakeholders.
On the Plan Effective Date:
* Except as otherwise expressly provided in the Plan, each
Holder of an Allowed Administrative Claim shall receive payment in
full in cash.
* Each Holder of an Allowed Priority Tax Claim shall receive
treatment in a manner consistent with section 1129(a)(9)(C) of the
Bankruptcy Code.
* Each Holder of an Allowed Other Secured Claim shall receive,
at the Debtors' or Reorganized Debtors' option (as applicable): (a)
payment in full in cash; (b) the collateral securing its Allowed
Other Secured Claim; (c) Reinstatement of its Allowed Other Secured
Claim; or (d) such other treatment rendering its Allowed Other
Secured Claim Unimpaired in accordance with section 1124 of the
Bankruptcy Code.
* Each Holder of an Allowed Other Priority Claim shall receive
treatment in a manner consistent with section 1129(a)(9) of the
Bankruptcy Code.
* The Senior Debt Claims shall be Allowed in an amount of
$433,345,973. On the Plan Effective Date (or as soon as practicable
thereafter), each Holder of an Allowed Existing Notes Claim and
Allowed LC Facility Claim shall receive their Pro Rata Share of the
Take-back SSNs and the Convertible Notes. Furthermore, in
settlement of disputes and claims, the Holder of the LC Facility
Claims have agreed to forfeit their rights to receive Convertible
Notes in exchange for the issuance of the Settlement Take-back
SSNs.
* Each Holder of an Allowed General Unsecured Claim shall
either be Reinstated or otherwise paid in full in Cash in the
ordinary course of business.
* Each Holder of an Existing Guarantor Equity Interest shall
have such Interest Reinstated.
* LAP Renewables B.V., a Dutch corporation, the minority
Holder of the Existing ILAP Equity Interest, shall transfer such
Interest to LAP Chile; LAP Chile, in turn, will contribute to the
New Issuer all Existing ILAP Equity Interest (inclusive of the
Interest that LAP BV will transfer to LAP Chile), and LAP Chile
shall receive 100% of the New Issuer Equity.
Class 4 consists of General Unsecured Claims. Each Holder of an
Allowed General Unsecured Claim shall, at the election of the
applicable Debtor or Reorganized Debtor, (A) have the legal,
equitable and contractual rights of such Holder Reinstated or (B)
receive Cash in an amount equal to such Allowed General Unsecured
Claims in the ordinary course of business. Cash payments to
creditors outside of the United States of America may be made in
such funds and by such means as are necessary or customary in a
particular foreign jurisdiction. The allowed unsecured claims total
$14.6 million. This Class will receive a distribution of 100% of
their allowed claims. This Class is unimpaired.
All Cash consideration necessary for the Reorganized Debtors to
make payments or distributions pursuant to this Plan shall be
obtained from the Cash proceeds received from the Super Priority
Notes, Cash on hand, and Cash derived from post-petition business
operations. Further, the Debtors and the Reorganized Debtors will
be entitled to transfer funds between and among themselves as they
determine to be necessary or appropriate to enable the Reorganized
Debtors to satisfy their obligations under the Plan.
A full-text copy of the Disclosure Statement dated November 30,
2023 is available at https://urlcurt.com/u?l=yMhgVj from Epiq
Corporate Restructuring LLC, claims agent.
Proposed Counsel for the Debtors:
Oscar N. Pinkas, Esq.
Brian E. Greer, Esq.
Leo Muchnik, Esq.
Sara A. Hoffman, Esq.
Jessica M. Wolfert, Esq.
GREENBERG TRAURIG, LLP
One Vanderbilt Avenue
New York, New York 10017
Tel: (212) 801-9200
Fax: (212) 801-6400
E-mail: PinkasO@gtlaw.com
GreerB@gtlaw.com
MuchnikL@gtlaw.com
HoffmanS@gtlaw.com
Jessica.Wolfert@gtlaw.com
About Inversiones Latin America
Inversiones Latin America Power Ltda. is a clean energy company
that owns and operates wind generation plants with an aggregate
installed capacity of 239.2 megawatts (MW) and is engaged in the
generation of electricity business in northern Chile.
Inversiones owns and operates two wind farm projects: (1) a 193.2
MW facility located in Freirina, Vallenar in the region of Atacama
(the "San Juan Project"), currently the second largest wind farm
project by capacity in Chile, and (2) a 46.0 MW facility located in
Canela, in the region of Coquimbo (the "Totoral Project"). The San
Juan Project has been fully operational since March 2017 and the
Totoral Project has been fully operational since January 2010. Both
wind projects are located in areas characterized for their strong
and highly predictable wind resource.
Inversiones Latin America Power Ltda. and affiliates San Juan S.A.
and Norvind S.A. sought Chapter 11 protection (Bankr. S.D.N.Y. Lead
Case No. 23-11891) on Nov. 30, 2023.
Inversiones estimated assets and debt of $100 million to $500
million as of the bankruptcy filing.
The Hon. Judge John P. Mastando III is the case judge.
The Debtors tapped GREENBERG TRAURIG, LLP as counsel, and LAZARD
FRERES & CO. LLC as investment banker. BARROS, SILVA, VARELA &
VIGIL ABOGADOS LIMITADA is the Chilean legal advisor. EPIQ
CORPORATE RESTRUCTURING, LLC, is the claims agent.
IQ DENTAL: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: IQ Dental Supply, LLC
353 Route 46W, Building C, Unit 120
Fairfield, NJ 07004
Business Description: IQ Dental is a full service dental supply
company selling dental supplies, equipment,
and providing service since 2009.
Chapter 11 Petition Date: December 8, 2023
Court: United States Bankruptcy Court
District of New Jersey
Case No.: 23-21402
Debtor's Counsel: Richard D. Trenk, Esq.
TRENK ISABEL SIDDIQI & SHAHDANIAN P.C.
290 W. Mt. Pleasant Avenue
Suite 2370
Livingston, NJ 07039
Tel: (973) 533-1000
Fax: (973) 533-1111
Email: rtrenk@trenkisabel.law
Total Assets: $10,092,591
Total Liabilities: $8,098,257
The petition was signed by Sergey Kunin as managing member.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/5J7OIFI/IQ_Dental_Supply_LLC__njbke-23-21402__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
1. 3M Oral Care Trade Debt $332,159
2510 Conway Avenue
St. Paul, MN
55144-1000
Attn: Legal/Bankruptcy
Tel: 888-364-3577
2. Aidite (Qinhuangdoa) Trade Debt $324,039
Technology Co.
Advanced Dental Materials
600 Technology Park
Suite 108
Lake Mary, FL 32746
Tel: 407-567-7827
3. Air Techniques Products Trade Debt $121,533
1295 Walt Whitman Road
Melville, NY 11747
Esteban Reinhardt
Phone: 516-433-7676
Email: orders@airtechniques.com
4. Align Technology/ Trade Debt $58,890
iTero
410 North
Scottsdale Road,
Suite 1300
Tempe, AZ 85281
Attn: Legal/Bankruptcy
Phone: 800-577-8767
Email: iterosupport@aligntech.com
5. American Eagle Trade Debt $50,753
Instruments, Inc
6575 Butler Creek Rd.
Missoula, MT 59808
Attn: Legal/Bankruptcy
Phone: (800) 551-5172
Email: customerservice@
younginnovations.com
6. American Express Credit Card $128,000
World Financial Center Purchases
200 Vessey Street
New York, NY 10285
Attn: Legal Department/Bankruptcy
7. American Express Credit Card $513,938
World Financial Center Purchases
200 Vessey Street
New York, NY 10285
Attn: Legal Department/
Bankruptcy
8. Capital One Credit Card $70,220
1680 Capital One Drive Purchases
McLean, VA
22102-3491
Attn: Legal Department
9. Crown Delta Corporation Trade Debt $257,266
1520 Front Street
Yorktown Heights,
NY 10598
Tel: 914-245-8912
914-245-8910
10. Dentsply Caulk Trade Debt $124,935
Dentsply International Inc.
570 West College Ave
York, PA 17401
11. Dentsply Professional Trade Debt $111,357
Dentsply International Inc.
570 West College Ave
York, PA 17401
Tel: 717-848-3739
717-845-7511
12. EcoGuard, Inc. Trade Debt $52,400
700 S Battleground Ave
#103
Grover, NC 28073
Tel: 704-322-3710
13. Forest Dental Trade Debt $108,093
301 Lindenwood Drive
Suite 100
Malvern, PA 1935
Phone: 610-725-8004
Email: forestsales@dentalez.com
14. GC America Inc. Trade Debt $164,678
3737 W. 127th St
Alsip, IL 60803
Tel: 800-323-7063
15. Midmark Trade Debt $80,679
60 Vista Drive
Versailles, OH 45380
Tel: 937-526-3662
16. NDC Inc. Trade Debt $230,718
402 BNA Drive,
Suite 500
Nashville, TN 37217
Attn: Marcus Williams
Phone: 629-237-8815
Email: mwilliams2@ndci-inc.com
17. Safe-Dent Trade Debt $49,437
Enterprises LLC
4 Orchard Hill Drive
Monsey, NY 10952
Hedy Worch
Tel: (845) 362-0141
18. Septodont Trade Debt $54,673
205 Granite Run
Drive, Suite 150
Lancaster, PA 17601
Tel: 800-872-8305
19. TD Bank Credit Card $48,085
1701 Marlton Pike E Purchases
Cherry Hill, NJ
08003
20. Vatech America Inc. Trade Debt $145,897
2200 Fletcher Avenue
Suite 705A
Fort Lee, NJ 07024
Tel: 201-210-5028
IRONCLAD PRESSURE: Case Summary & 20 Largest Unsecured Creditors
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Debtor: Ironclad Pressure Control, LLC
16690 W. Basin St.
Odessa, TX 79763
Business Description: The Debtor provides support activities for
mining industry.
Chapter 11 Petition Date: December 8, 2023
Court: United States Bankruptcy Court
Western District of Texas
Case No.: 23-70156
Judge: Hon. Shad Robinson
Debtor's Counsel: Joseph F. Postnikoff, Esq.
ROCHELLE MCCULLOUGH, LLP
300 Throckmorton Street, Suite 520
Fort Worth, TX 76102-2929
Tel: (817) 347-5260
Email: jpostnikoff@romclaw.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Bailee Fernandez as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/LAQQN5Y/Ironclad_Pressure_Control_LLC__txwbke-23-70156__0001.0.pdf?mcid=tGE4TAMA
ISLAND ROOFING: Ruediger Mueller of TCMI Named Subchapter V Trustee
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The U.S. Trustee for Region 21 appointed Ruediger Mueller of TCMI,
Inc. as Subchapter V trustee for Island Roofing and Restoration,
LLC.
Mr. Mueller will be paid an hourly fee of $350 for his services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Mr. Mueller declared that he is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Ruediger Mueller
TCMI, Inc.
1112 Watson Court
Reunion, FL 34747
Email: truste@tcmius.com
About Island Roofing and Restoration
Island Roofing and Restoration, LLC is a roofing contractor in Fort
Myers, Fla.
Island Roofing and Restoration filed a petition under Chapter 11,
Subchapter V of the Bankruptcy Code (Bankr. M.D. Fla. Case No.
23-01419) on Nov. 22, 2023, with $10 million to $50 million in
assets and $1 million to $10 million in liabilities. Jason Martin,
manager, signed the petition.
Judge Caryl E. Delano oversees the case.
The Debtor is represented by Alberto F. Gomez, Jr., Esq., at
Johnson Pope Bokor Ruppel & Burns, LLP.
JIN YUAN GROUP: Voluntary Chapter 11 Case Summary
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Debtor: Jin Yuan Group LLC
8710 Queens Blvd
Elmhurst NY 11373
Business Description: The Debtor is engaged in activities related
to real estate.
Chapter 11 Petition Date: December 8, 2023
Court: United States Bankruptcy Court
Eastern District of New York
Case No.: 23-44540
Debtor's Counsel: William Zou, Esq.
BILL ZOU & ASSOCIATES PLLC
136-20 38 Avenue, Suite 10D
Flushing, NY 11354
Tel: 718-661-9562
Email: xfzou@aol.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Bo Jin Zhu as manager.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/EFFUSJI/Jin_Yuan_Group_LLC__nyebke-23-44540__0001.0.pdf?mcid=tGE4TAMA
JOANN INC: Posts $21.6 Million Net Loss in Third Quarter
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JOANN Inc. filed with the Securities and Exchange Commission its
Quarterly Report on Form 10-Q disclosing a net loss of $21.6
million on $539.8 million of net sales for the 13 weeks ended Oct.
28, 2023, compared to a net loss of $17.5 million on $562.8 million
of net sales for the 13 weeks ended Oct. 29, 2022.
For the 39 weeks ended Oct. 28, 2023, the Company reported a net
loss of $149.1 million on $1.47 billion of net sales, compared to a
net loss of $109.5 million on $1.52 billion of net sales for the 39
weeks ended Oct. 29, 2022.
As of Oct. 28, 2023, the Company had $2.25 billion in total assets,
$553.7 million in total current liabilities, $1.15 billion in net
long-term debt, $692 million in long-term operating lease
liabilities, $20.8 million in long-term deferred income taxes, $26
million in other long-term liabilities, and a total shareholders'
deficit of $183 million.
JOANN said, "Based on our current plans and market conditions, we
believe that our cash and cash equivalents on hand, cash flows
generated from our operations and borrowing capacity under our
credit facilities will be sufficient to satisfy our anticipated
working capital, capital expenditure and debt service requirement
needs for the next twelve months. However, we may be required to
obtain additional financing in the future to address our liquidity
needs, and subject to market conditions, we may from time to time
seek to amend, refinance, restructure or repurchase our outstanding
debt and/or raise additional equity financing to support our
business and may require additional funds to respond to business
challenges. If we raise additional funds through future issuances
of equity, convertible debt or other equity-linked securities such
as warrants, our existing shareholders could suffer significant
dilution, and any new equity or equity-linked securities we issue
could have rights, preferences and privileges superior to those of
holders of our common stock. In addition, any debt financing we
secure in the future could require an increase in our aggregate
interest expense and include restrictive financial or operational
covenants relating to our capital raising activities and other
financial and operational matters, which may make it more difficult
for us to obtain additional capital and to pursue business
opportunities. We may not be able to obtain additional debt or
equity financing on terms favorable to us or at all. If we are
unable to obtain adequate financing or financing on terms
satisfactory to us when we require it, our ability to continue to
support our business and to respond to business challenges could be
significantly impaired, and our business may be harmed.
Furthermore, our failure to obtain any necessary financing could
have a material and adverse effect on our results of operations,
cash flows, financial condition and liquidity.
"We are not currently in compliance with Nasdaq's continued listing
requirements. If we are unable to comply with Nasdaq's continued
listing requirements, our common stock could be delisted, which
could adversely affect the price of our common stock, reduce our
ability to raise additional capital and make it more difficult for
holders of our common stock to sell their shares."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1834585/000095017023067992/joan-20231028.htm
About JOANN
JOANN operates in the fabric and sewing industry with one of the
largest assortments of arts and crafts products. JOANN has
transformed itself into a fully-integrated, digitally-connected
omni-channel retailer.
JOANN reported a net loss of $200.6 million for the year ended Jan.
28, 2023. As of July 29, 2023, the Company had $2.26 billion in
total assets, $563.3 million in total current liabilities, $1.09
billion in long-term debt, $714.8 million in long-term operating
lease liabilities, $20.4 million in long-term deferred income
taxes, $29.2 million in other long-term liabilities, and a total
shareholders' deficit of $162.2 million.
* * *
As reported by the TCR on July 14, 2023, S&P Global Ratings lowered
its ratings on U.S.-based creative products retailer Joann Inc. to
'CCC' from 'CCC+'. The outlook is negative, reflecting the risk
S&P could lower its rating on Joann if liquidity deteriorates or
the company pursues a debt transaction that S&P views as tantamount
to default.
JUPITER FINANCE 2008-003: Fitch Lowers Rating on CLN Notes to BB+sf
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Fitch Ratings has downgraded the ratings of the notes issued by
Jupiter Finance Limited Series No: 2008-003 (Jupiter Finance) to
'BB+sf' from 'BBB-sf'. The Rating Outlook is Stable.
Entity/Debt Rating Prior
----------- ------ -----
Jupiter Finance
Limited Series
No: 2008-003
CLN- Codelco
XS0350268867 LT BB+sf Downgrade BBB-sf
TRANSACTION SUMMARY
The downgrade of the notes follows Fitch's downgrade of Corporacion
Nacional del Cobre de Chile (CODELCO) (one of the risk-presenting
entities) to 'BBB+sf' from 'A-sf' on November 22nd, 2023. The
revised rating on the notes issued by Jupiter Finance to
'BB+sf'/Outlook Stable reflects the application of the Two-Risk
Credit-Linked Notes (CLN) Matrix per Fitch's Single- and Multi-Name
CLN Rating Criteria.
KEY RATING DRIVERS
The rating of Jupiter Finance Limited Series No: 2008-003 CLN is
linked to two risk-presenting entities and notches the reference
entity's rating down by one notch based on the following factors:
- The rating of the transaction's qualified investment (QI), a
subordinated note issued by Citigroup Inc.rated 'BBB+'. This also
considers Citigroup Inc's role as credit default swap (CDS)
counterparty to the transaction (IDR 'A'/Stable/'F1'). The lowest
applicable rating of the Citigroup leg is used as prescribed by
Fitch's CLN criteria.
- Corporacion Nacional del Cobre de Chile (CODELCO) (IDR
'BBB+'/Stable) as the reference entity in the credit default swap;
- The terms of the transaction's CDS allows for the restructuring
of CODELCO as a credit event. Fitch's CLN criteria require a
one-notch downward adjustment on the rating of the entity subject
to restructuring under a swap to reflect the additional risk
imposed to the investors.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
Rating Scenarios Regarding CODELCO (assuming no change to the
current rating assigned to Citigroup Inc. Subordinated Notes
(CUSIP: US172967DR95))
- A downgrade of one notch would result in a rating downgrade of
the notes to 'BBsf';
- A downgrade of two notches would result in a rating downgrade of
the notes to 'BB-sf'.
Rating Scenarios Regarding Citigroup Inc. Subordinated Notes
(CUSIP: US172967DR95) (assuming no change to the current rating
assigned to CODELCO)
- A downgrade of one notch would result in a no rating action on
the notes;
- A downgrade of two notches would result in a rating downgrade of
the notes to 'BBsf'.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
Rating Scenarios Regarding CODELCO (assuming no change to the
current rating assigned to Citigroup Inc. Subordinated Notes
(CUSIP: US172967DR95))
- An upgrade of one notch would result in a rating upgrade to the
notes to 'BBB-sf';
- An upgrade of two notches would result in a rating upgrade to the
notes to 'BBBsf'.
Rating Scenarios Regarding Citigroup Inc. Subordinated Notes
(CUSIP: US172967DR95) (assuming no change to the current rating
assigned to CODELCO)
- An upgrade of one notch would result in a rating upgrade to the
notes to 'BBB-sf';
- An upgrade of two notches would result in a rating upgrade to the
notes to 'BBB-sf'.
PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS
A change of the ratings assigned to any of the risk presenting
entities could result in a change of the rating assigned to the
notes based on Fitch's CLN Criteria Two-Risk CLN Matrix.
KASPIEN HOLDINGS: To Lay Off Most Employees
-------------------------------------------
Kaspien Holdings Inc. disclosed in a Form 8-K filed with the
Securities and Exchange Commission that after an assessment of its
current cash and liquidity position, the Company decided to
initiate a reduction in force of substantially all of its employees
other than a core group of employees.
The Company estimates that it will incur approximately $1.8 million
for retention, severance and other employee termination-related
costs in the fourth quarter of 2023. The Company expects to
substantially complete the workforce reduction prior to the end of
January 2024. The estimate of costs that the Company expects to
incur and the timing thereof are subject to a number of
assumptions, and actual results may differ.
About Kaspien Holdings
Headquartered in Spokane, WA, Kaspien Holdings Inc. (f/k/a Trans
World Entertainment Corporation) (NASDAQ: KSPN) -- www.kaspien.com
-- is a global e-commerce accelerator that deploys AI-driven
software and end-to-end services to optimize and grow brands on
Amazon, Walmart, Target, eBay, and other online marketplaces.
Rebranded as Kaspien in 2020, the Company has spent more than a
decade developing a marketplace growth platform of proprietary
technologies that maximize supply chain resilience, optimize
marketing, strengthen brand control, and provide predictive
analytics. Serving a variety of brands, distributors, agencies and
FBA aggregators, Kaspien accelerates growth by tailoring an
extensive suite of seller services to its partners' dynamic
e-commerce needs.
Spokane, Washington-based Fruci & Associates II, PLLC, the
Company's auditor since 2020, issued a "going concern"
qualification in its report dated April 28, 2023, citing that the
Company has experienced negative cash flows from operations and
expects continued losses into 2023. These factors, among others,
raise substantial doubt about the Company's ability to continue as
a going concern.
KAUFFMAN INTERMEDIATE: 95% Markdown for $1.2MM Midcap Loan
----------------------------------------------------------
MidCap Financial Investment Corporation has marked its $1,243,000
loan extended to Kauffman Intermediate, LLC to market at $56,000 or
5% of the outstanding amount, as of September 30, 2023, according
to Midcap Financial's Form 10-Q Report for the Quarterly period
ended September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver Loan to Kauffman Intermediate, LLC. The loan accrues
interest at a rate of 1% (SOFR+585) per annum. The loan matures on
May 8, 2025.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
KAUFFMAN INTERMEDIATE: Midcap Marks $78,000 Loan at 28% Off
-----------------------------------------------------------
MidCap Financial Investment Corporation has marked its $78,000 loan
extended to Kauffman Intermediate, LLC to market at $56,000 or 72%
of the outstanding amount, as of September 30, 2023, according to
Midcap Financial's Form 10-Q Report for the Quarterly period ended,
September 30, 2023, filed with the Securities and Exchange
Commission on November 7, 2023.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver Loan to Kauffman Intermediate, LLC. The loan accrues
interest at a rate of (SOFR+585, 1.00% Floor) per annum. The loan
matures on MAY 08, 2025.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
LBU FRANCHISES: Has Interim OK on Cash Access, DIP Loan from Fox
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas,
Houston Division, authorized LBU Franchises Corporation d/b/a Light
Bulbs Unlimited to use cash collateral and obtain postpetition
financing, on an interim basis.
The Debtor entered bankruptcy with significant obligations due on
December 1, 2023, including rent, insurance premiums, and employee
obligations. To fund operations and the Chapter 11 case, the Debtor
sought debtor-in-possession financing from various financial
institutions and lenders. Ultimately, it sought post-petition
financing pursuant to a senior secured super-priority
debtor-in-possession term loan in the principal amount of $50,000
from Fox Capital Group, LLC, one of the prepetition creditors.
The Debtor is permitted to borrow $25,000 on an interim basis, and
if ordered borrow an additional, $10,000.
The DIP Loan is subject to the following conditions:
a. Interest on the DIP Loan will accrue at a rate of 15% per
annum;
b. The DIP Loan will mature at the earlier of: 1) December 1,
2024; or 2) an order of the Court denying final approval of the DIP
Loan (in which event, all borrowings under the DIP Loan shall be
deemed immediately repayable);
c. Unless superseded by a final order or the early maturity of
the DIP Loan due to the Court's entry of an order denying final
approval of the DIP Loan, the Debtor will pay the interest due on
the Interim Loan Amount on the 1st of each month, beginning January
1, 2024, and continuing through June 1, 2024. The Debtor will pay
principal and interest in equal monthly installments on the 1st of
each month thereafter, beginning July 1, 2024, and ending December
1, 2024;
d. A default will occur if, and only if, the Debtor fails to
timely pay the amounts due under the DIP Loan.
The DIP Lender will receive first priority senior priming liens on
all the Debtor's "Accounts," "Deposit Accounts," and "Inventory"
upon entry of the Interim Order. The DIP Lender will receive first
priority senior and, if necessary, priming liens on all the
proceeds of Debtor's and the Debtor's estate's causes of action
against any party upon entry of the Final Order.
Pursuant to 11 U.S.C. section 507(a)(2) and 503(b)(1)(A), Fox will
have a priority administrative claim for all amounts presently due
under the DIP Loan.
The DIP Lender will also receive junior liens on the Debtor's lease
for the Property.
LBU has two assets of substantial value:
1) its inventory, which LBU values at approximately $60,000 on
its balance sheet; and
2) a lease of real property commonly known as 1203 Westheimer
Road, Houston, Texas 77006, which LBU values at $118,800 on its
balance sheet.
LBU's property is currently subject to liens held by Harris County,
Texas, the Internal Revenue Services, the United States Small
Business Administration, and, potentially, the MCAs.
The liens held by Harris County and the IRS appears to be perfected
in all the Debtor's property. The liens held by the SBA are
perfected only in the Debtor's personal property. The liens
potentially held by the MCAs would only be perfected in the
Debtor's accounts receivable.
As adequate protection, Harris County and IRS will retain their
first-position liens on the Debtor's lease of the Property.
Additionally, they will:
(i) retain their liens, and receive adequate protection liens,
on all Debtor's personal property other than the Priority DIP
Collateral; and
(ii) will receive replacement second-position adequate
protection liens on the Priority DIP Collateral.
The SBA will receive adequate protection payments of $2,332 per
month, as well as replacement liens in the Non-DIP Collateral and
third-position adequate protection liens on the Priority DIP
Collateral.
The MCAs will receive adequate protection in the form of
replacement liens in the Non-DIP Collateral and fourth-position
adequate protection liens on the Priority DIP Collateral.
A final hearing on the matter is set for December 11 at 9:30 a.m.
A copy of the order is available at https://urlcurt.com/u?l=bl7oXo
from PacerMonitor.com.
About LBU Franchises Corporation
LBU Franchises Corporation sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 23-34586) on
November 22, 2023. In the petition signed by David Bekker, its
president, the Debtor disclosed up to $500,000 in assets and up to
$1 million in liabilities.
Judge Jeffrey P. Norman oversees the case.
Broocks McClure Wilson, Esq., at Kean Miller LLP, represents the
Debtor as legal counsel.
LEGACY CARES: Gets Court Nod to Sell Assets to Burke for $25.7MM
----------------------------------------------------------------
A U.S. bankruptcy judge overseeing the Chapter 11 case of Legacy
Cares, Inc. approved the sale of Legacy Park, a 320-acre sports and
entertainment complex in Mesa, Ariz.
Judge Daniel Collins of the U.S. Bankruptcy Court for the District
of Arizona approved the sale agreement entered into by Legacy
Cares, Miami-based Burke Operating Partners, LLC and Elite Sports
Group, LLC, which operates Legacy Park.
"The court finds that [Legacy Cares] has articulated good and
sufficient business reasons justifying the sale transaction," Judge
Collins said in his order, adding that Burke "is a good faith
buyer."
Under the deal, Burke agreed to purchase Legacy Park for $25.7
million in cash, of which $19.7 will be provided by the buyer while
$6.04 million will be provided by Pacific Proving, LLC.
Pacific Proving is the landlord under the ground lease with Legacy
Cares relating to the sports and entertainment complex. The lease
will be assumed by Legacy Cares and then assigned to the buyer as
part of the sale.
Bondholders will receive $2.4 million in cash from the sale
proceeds while Shamrock Foods Company will receive $325,023 in cash
in full payment of its secured claim. Most of the proceeds will go
to building contractors for unpaid work, according to court
filings.
About Legacy Cares
Legacy Cares, Inc. is a 501c3 non-profit organization dedicated to
providing athletes and non-athletes of all ages, economic
backgrounds and levels of athletic proficiency the opportunity to
participate in sports and e-sports while fostering the enjoyment
and camaraderie of teamwork and perseverance, key components in
athletic competition and lifetime success. The organization is
based in Mesa, Ariz.
Legacy Cares sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Ariz. Case No. 23-02832) on May 1, 2023,
with $242,329,104 in assets and $366,719,676 in liabilities.
Douglas Moss, president of Legacy Cares, signed the petition.
Judge Daniel P. Collins oversees the case.
The Debtor tapped Henk Taylor, Esq., at Warner Angle Hallam Jackson
Formanek, PLC as bankruptcy counsel; Papetti Samuels Weiss
McKirgan, LLP and Slania Law, PLLC as special counsels; and Miller
Buckfire & Co., LLC and its affiliate, Stifel, Nicolaus & Co.,
Inc., as investment banker. Epiq Corporate Restructuring, LLC is
the noticing, claims and balloting agent.
The U.S. Trustee for Region 14 appointed an official committee to
represent unsecured creditors in the Debtor's Chapter 11 case.
Pachulski Stang Ziehl & Jones, LLP and AlixPartners, LLP serve as
the committee's legal counsel and financial advisor, respectively.
LENDINGTREE INC: S&P Cuts ICR to 'SD on Distressed Debt Repurchase
------------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on U.S.-based
online lending marketplace and marketing services provider
LendingTree Inc. to 'SD' (selective default) from 'CCC+'.
S&P said, "We view the debt repurchase as distressed and tantamount
to a default. The downgrade follows LendingTree's announcement that
it has completed a below-par cash repurchase of $100 million in
aggregate principal amount of its $384 million (outstanding) senior
unsecured convertible notes due in 2025 through separate and
individually negotiated transactions with certain note holders. The
company repurchased the debt at an average price of approximately
81.4 cents on the dollar. We view the transaction as distressed
because lenders received substantially less than originally
promised, and we also view the company's capital structure as
unsustainable. This is the second distressed debt repurchase in the
past 12 months; the company previously repurchased $190 million in
aggregate principal of notes for approximately 82 cents on the
dollar in March 2023. Absent this transaction, we would have
expected LendingTree to end 2024 with leverage of around 8x and
free operating cash flow (FOCF) to debt of about 8%, levels which
we view it would have difficulty refinancing its debt at."
LendingTree's operating and financial performance has been under
pressure the past two years from rising interest rates, resulting
in fewer new mortgages and less refinancing activity. There has
also been headwinds in the insurance industry from rising costs and
reduced profitability due to inflation, and higher loss ratios.
This has led to reduced spending from the company's network
partners. The company has been able to somewhat offset lost revenue
from expense cuts, but S&P Global Ratings-adjusted EBITDA remains
far below levels from two years ago when the company generated $124
million of EBITDA in 2021.
S&P said, "We plan to reassess our issuer credit rating on the
company. Over the coming days, we will reassess and most likely
raise our issuer credit rating on LendingTree back into the 'CCC'
category, reflecting the longer-term issues surrounding the
sustainability of its capital structure and the nearer-term risk of
further distressed exchanges. We expect leverage of about 7x and
FOCF to debt around 9% in 2024 following its recent debt
repurchase. However, we note there is limited visibility into 2024
performance. Although leverage is improved, we believe LendingTree
could still have difficulty refinancing its senior unsecured
convertible notes if it cannot decrease leverage more toward 6x in
advance of the debt maturity or have to do so at a significantly
higher interest rate that could pressure its FOCF to debt coverage.
The company will be reliant upon favorable economic conditions to
deleverage and meet its financial obligations over the longer term.
However, we expect liquidity to remain adequate over the next 12
months as the company still has about $100 million of cash on the
balance sheet after the debt repurchase and we expect it to
generate around $50 million of FOCF in 2024 to service its debt and
fund other liquidity needs."
LIVINGSTON TOWNSHIP: Selling Flora Property to E&N for $1.125MM
---------------------------------------------------------------
Livingston Township Fund One, LLC received approval from the U.S.
Bankruptcy Court for the Southern District of Mississippi to sell
real property to E&N, LLC.
E&N, doing business as Plato Feliz Mexican Bar & Grill, offered to
buy the property for $1.125 million and pay an additional $50,000,
which must be paid in full by Feb. 29 next year pursuant to a loan
agreement.
The property to be sold is located at 115 Livingston Church Road,
Flora, Miss. It is a part of the Livingston Township Planned United
development and is being carved out of two larger parcels, one of
which is owned by Livingston.
Bank of Montgomery, which has a deed of trust on the parcel owned
by Livingston, will be paid the sum of $965,975.75 from the sale.
In addition, Livingston's interest in the loan agreement will be
assigned to Bank of Montgomery.
Livingston will use $159,024.25 of the sale proceeds to pay the
sale costs.
About Livingston Township Fund One
Livingston Township Fund One, LLC filed a petition under Chapter
11, Subchapter V of the Bankruptcy Code (Bankr. S.D. Miss. Case No.
23-02573) on Nov. 6, 2023, with $1 million to $10 million in both
assets and liabilities. Craig Geno, Esq., at the Law Offices of
Craig M. Geno, PLLC serves as Subchapter V trustee.
Judge Jamie A. Wilson oversees the case.
The Debtor tapped The Rollins Law Firm, PLLC, Steven H. Smith, PLLC
and Eileen N. Shaffer, Esq., a practicing attorney in Jackson,
Miss., as legal counsels. Lisa Ellison of South Pasadena, Calif. is
the Debtor's accountant.
LOUISVILLE LUSH: Unsecureds Will Get 93% in Subchapter V Plan
-------------------------------------------------------------
Louisville Lush Aesthetics, LLC, filed with the U.S. Bankruptcy
Court for the Western District of Kentucky a Subchapter V Plan of
Reorganization dated November 30, 2023.
The Debtor is a single-member limited liability company based in
Louisville, Kentucky. The Company has existed since February 17,
2021, and its principal business activity is the operation of a
boutique medspa in Louisville, Kentucky.
The Debtor's principal and sole member, Jana Brewer, who is a
Certified Registered Nurse Anesthetist, operates the business under
the trade name "XO Aesthetic Refinery."
The Debtor's financial projections show that the Debtor will have
projected disposable income of approximately $5,000.00 per month.
This Plan of Reorganization provides for 60 monthly payments in the
amount of $5,000.00 per month commencing on February 1, 2024, with
the final Plan payment to be paid on or before January 1, 2029. The
Debtor shall make the Plan payments from its business operations
following payment of the Debtor's normal and customary expenses as
they come due.
This Plan provides for payment of administrative claims of
approximately $10,000.00, priority unsecured claims totaling
$8,200.05, 1 class of secured claims that will be paid according to
the parties' various contracts, and 1 class of non-priority
unsecured claims totaling $300,755.37, as follows:
* The Debtor's first two Plan payments totaling $10,000.00
shall be paid to satisfy the Debtor's administrative claims,
consisting of $5,000.00 to the Subchapter V Trustee and roughly
$5,000.00 owed to Debtor's counsel. Administrative claims shall be
fully paid following the second Plan payment.
* The Debtor's third Plan payment totaling $5,000.00 shall be
paid toward the unsecured priority claim of the Internal Revenue
Service. Three Thousand Two Hundred Five Dollars and Five Cents of
the Debtor's fourth Plan payment shall be paid to pay the IRS
unsecured priority claim in full. The Debtor shall hold the
remaining $1,799.95 of its fourth Plan payment in reserve.
* The Debtor's final 56 Plan payments, each in the amount of
$5,000.00, and totaling $280,000.00, shall be paid pro rata toward
its general unsecured claims, which total $298,255.37. Following
the conclusion of the Plan payments, the Debtor's unsecured
creditors are anticipated to have received 93% of the value of
their claims.
Under the terms of this plan, secured claims shall be paid in the
ordinary course of business according to the parties' contract
terms. Administrative claims and the single unsecured priority
claim shall be paid in full with the first 4 of the Debtor's plan
payments. Beginning with the Debtor's 5th plan payment, general
non-priority unsecured creditors shall receive regular monthly
installment payments from the Debtor's remaining disposable income
on a pro rata basis, which the proponent of this Plan has valued at
approximately 0.93 cents on the dollar (available funds following
payment of administrative claims of approximately $10,0001 and
priority claims of $8,200.05 (paid with the first 4 Plan payments)
leaves $280,000 to be distributed in monthly payments of $5,000.00
over the course of the Plan to pay general non-priority allowed
unsecured claims totaling $300,755.37) ($280,000 in total plan
payments / $300,755.37 = 0.9309).
The Debtor shall set aside projected disposable income of $5,000.00
per month to make payments under the Plan in the manner illustrated
in Article I of this Plan.
A full-text copy of the Subchapter V Plan dated November 30, 2023
is available at https://urlcurt.com/u?l=TDVpKd from
PacerMonitor.com at no charge.
Counsel for the Debtor:
Michael W. McClain, Esq.
Goldberg Simpson, LLC
9301 Dayflower Street
Prospect, KY 40059
Telephone: (502) 589-4440
Email: mmcclain@goldbergsimpson.com
About Louisville Lush Aesthetics
Louisville Lush Aesthetics, LLC, operates a boutique medspa in
Louisville, Kentucky.
The Debtor filed a Chapter 11 petition (Bankr. W.D. Ky. Case No.
23-32060) on Sept. 1, 2023, with up to $1 million in both assets
and liabilities.
Judge Charles R. Merrill oversees the case.
Michael W. McClain, Esq., at Goldberg Simpson, LLC, is the Debtor's
legal counsel.
LTL MANAGEMENT: J&J Cites 'Progress' in Resolving Talc Cases
------------------------------------------------------------
Jef Feeley of Bloomberg News reports that Johnson & Johnson said
it's moving forward to resolve lawsuits that claim its talc-based
Baby Powder causes cancer to avoid facing some jury trials next
year and further its strategy of finding a global settlement for
thousands of cases.
"We have made recent progress over the last few weeks in resolving"
groups of cases handled by law firms representing consumers who
allege they developed mesothelioma from baby powder tainted by
asbestos, Eric Haas, J&J's in-house lawyer overseeing the talc
litigation, told investors Tuesday during a meeting at the New York
Stock Exchange.
Bloomberg News reported Monday that a trio of law firms have
reached agreements for mesothelioma settlements covering about 100
cases, according to people familiar with the deals. The financial
size of the accords is being kept private, according to the people,
who declined to be identified because they weren't authorized to
speak publicly.
At the meeting, Haas pointed to investors' "interest in resolving
the talc litigation" and said the settlements are part of the
company's strategy for corralling the decade-long talc litigation.
Haas didn't identify the firms with whom J&J has settled. The
session's main focus was on the company's long-term growth outlook
and product pipeline.
"Our intention with talc is to bring resolution to these cases so
we can spend our days" advancing treatment for our patients, J&J
Chief Executive Officer Joaquin Duato told investors at the
session.
Cancer Risk
The company faces more than 50,000 suits accusing it of concealing
the cancer risk of baby powder to protect its iconic product. Most
of those claims are from women with ovarian cancer. The majority
of the cases are consolidated before a federal judge in New Jersey.
Courts have twice rejected J&J's attempts to use the bankruptcy
system to force a $9 billion talc settlement by setting up a trust
to pay victims.
J&J contends that its talc-based products don't cause cancer and it
has marketed Baby Powder appropriately for more than 100 years.
But in 2020, the New Brunswick, New Jersey-based company pulled its
talc-based powders off the market in the US and Canada, citing
slipping sales. The world's largest maker of health-care products
replaced talcum with a cornstarch-based version. J&J vowed to
remove all its baby powders containing talcum powder worldwide by
the end of this year.
The settlements recently reached with plaintiffs' law firms
included a case that was already on trial in state court in
Oakland, California, in November 2023 and will head off trials that
were supposed to start in January and March in state court in New
Jersey, the people said. J&J still faces a mesothelioma case in
state court in Minnesota later this December 2023, the people
said.
Meanwhile, J&J asked the New Jersey federal judge to remove lawyer
Andy Birchfield as head of the plaintiffs' steering committee and
bar him from representing talc claimants, alleging that he's forged
an alliance with a former company attorney and had access to
confidential information.
Birchfield responded in an email by accusing the company of
"another misguided attempt to silence thousands of ovarian-cancer
victims and their families."
The consolidated case is In Re Johnson & Johnson Talcum Powder
Products Marketing, Sales Practices and Products Liability
Litigation, 16-md-2738, US District Court, District of New Jersey
(Trenton).
About LTL Management
LTL Management, LLC, is a subsidiary of Johnson & Johnson (J&J),
which was formed to manage and defend thousands of talc-related
claims and oversee the operations of Royalty A&M. Royalty A&M owns
a portfolio of royalty revenue streams, including royalty revenue
streams based on third-party sales of LACTAID, MYLANTA/MYLICON and
ROGAINE products.
LTL Management filed a petition for Chapter 11 protection (Bankr.
W.D.N.C. Case No. 21-30589) on Oct. 14, 2021. The case was
transferred to New Jersey (Bankr. D.N.J. Case No. 21-30589) on Nov.
16, 2021. The Hon. Michael B. Kaplan is the case judge. At the
time of the filing, the Debtor was estimated to have $1 billion to
$10 billion in both assets and liabilities.
The Debtor tapped Jones Day and Rayburn Cooper & Durham, P.A., as
bankruptcy counsel; King & Spalding, LLP and Shook, Hardy & Bacon
LLP as special counsel; McCarter & English, LLP as litigation
consultant; Bates White, LLC as financial consultant; and
AlixPartners, LLP as restructuring advisor. Epiq Corporate
Restructuring, LLC, is the claims agent.
An official committee of talc claimants was formed in the Debtor's
Chapter 11 case on Nov. 9, 2021. On Dec. 24, 2021, the U.S.
Trustee for Regions 3 and 9 reconstituted the talc claimants'
committee and appointed two separate committees: (i) the official
committee of talc claimants I, which represents ovarian cancer
claimants, and (ii) the official committee of talc claimants II,
which represents mesothelioma claimants.
The official committee of talc claimants I tapped Genova Burns LLC,
Brown Rudnick LLP, Otterbourg PC and Parkins Lee & Rubio LLP as its
legal counsel. Meanwhile, the official committee of talc claimants
II is represented by the law firms of Cooley LLP, Bailey Glasser
LLP, Waldrep Wall Babcock & Bailey PLLC, Massey & Gail LLP, and
Sherman Silverstein Kohl Rose & Podolsky P.A.
Re-Filing of Chapter 11 Petition
On Jan. 30, 2023, a panel of the Third Circuit issued an opinion
directing the Court to dismiss the 2021 Chapter 11 case on the
basis that it was not filed in good faith. Although the Third
Circuit panel recognized that the Debtor "inherited massive
liabilities" and faced "thousands" of future claims, it concluded
that the Debtor was not in financial distress before the filing.
On March 22, 2023, the Third Circuit entered an order denying the
Debtor's petition for rehearing. The Third Circuit entered an order
denying LTL's stay motion on March 31, 2023, and, on the same day,
issued its mandate directing the Bankruptcy Court to dismiss the
2021 Chapter 11 Case.
The Bankruptcy Court entered an order dismissing the 2021 Case on
April 4, 2023.
Johnson & Johnson on April 4, 2023, announced that its subsidiary
LTL Management LLC (LTL) has re-filed for voluntary Chapter 11
bankruptcy protection (Bankr. D.N.J. Case No. 23-12825) to obtain
approval of a reorganization plan that will equitably and
efficiently resolve all claims arising from cosmetic talc
litigation against the Company and its affiliates in North
America.
In August 2023, U.S. Bankruptcy Judge Michael Kaplan in Trenton,
New Jersey, ruled that the second bankruptcy case should be
dismissed, ending J&J's second attempt to use bankruptcy to resolve
thousands of lawsuits alleging that its talc products sometimes
contained asbestos and caused mesothelioma and ovarian cancer.
MALLINCKRODT PLC: Inks Deal to Resolve SEC Probe
------------------------------------------------
Mallinckrodt plc disclosed in a Form 8-K Report that the Company
reached an agreement with the Securities and Exchange Commission to
resolve the SEC staff's previously disclosed investigation into the
Company's disclosures relating to:
(a) a now resolved dispute with the Centers for Medicare and
Medicaid Services over the base date average manufacturer price for
Acthar Gel under the Medicaid Drug Rebate Program, which was also
the subject of litigation that the Company filed against CMS in May
2019;
(b) the civil investigative demand received by the Company
from the U.S. Attorney's Office for the District of Massachusetts
in January 2019 related to the Company's dispute with CMS.
Specifically, Mallinckrodt consented to the entry of an Order
Instituting Cease-And-Desist Proceedings Pursuant to Section 8A of
the Securities Act and Section 21C of the Exchange Act, Making
Findings, and Imposing a Cease-And-Desist Order.
The Order includes findings by the SEC that are neither admitted
nor denied by Mallinckrodt and directs Mallinckrodt to cease and
desist from committing or causing any violations and any future
violations of Sections 17(a)(2) and 17(a)(3) of the Securities Act
of 1933, as amended, Sections 13(a), 13(b)(2)(A), and 13(b)(2)(B)
of the Exchange Act of 1934, as amended, and Exchange Act Rules
12b-20, 13a-1, 13a-13, and 13a-15(a).
In addition, the Order requires Mallinckrodt to retain a compliance
consultant to review the Company's disclosure controls and
procedures relating to collection and assessment of information
concerning potential risks, contingencies, trends, and
uncertainties, and the implementation and sufficiency of the
Company's internal accounting controls related to GAAP ASC 450.
Under the terms of the Order, Mallinckrodt will implement
recommendations of the Consultant.
The Order does not require Mallinckrodt to pay fines, disgorgement,
or penalties. The Company understands that the SEC does not intend
to take action against any of Mallinckrodt's current or former
directors, officers, or employees.
About Mallinckrodt plc
Mallinckrodt (OTCMKTS: MNKTQ) — http://www.mallinckrodt.com/—
is a global business consisting of multiple wholly-owned
subsidiaries that develop, manufacture, market and distribute
specialty pharmaceutical products and therapies. The company's
Specialty Brands reportable segment's areas of focus include
autoimmune and rare diseases in specialty areas like neurology,
rheumatology, nephrology, pulmonology and ophthalmology;
immunotherapy and neonatal respiratory critical care therapies;
analgesics; and gastrointestinal products. Its Specialty Generics
reportable segment includes specialty generic drugs and active
pharmaceutical ingredients.
On Oct. 12, 2020, Mallinckrodt plc and certain of its affiliates
sought Chapter 11 protection in Delaware (Bankr. D. Del. Lead Case
No. 20-12522) to seek approval of a restructuring that would reduce
total debt by $1.3 billion and resolve opioid-related claims
against them. Mallinckrodt in mid-June 2022 successfully completed
its reorganization process, emerged from Chapter 11 and completed
the Irish Examinership proceedings.
Mallinckrodt Plc said in a regulatory filing in early June 2023
that it was considering a second bankruptcy filing and other
options after its lenders raised concerns over an upcoming $200
million payment related to opioid-related litigation.
Mallinckrodt plc and certain of its affiliates again sought Chapter
11 protection (Bankr. D. Del. Lead Case No. 23-11258) on Aug. 28,
2023. Mallinckrodt disclosed $5,106,900,000 in assets and
$3,512,000,000 in liabilities as of June 30, 2023.
Judge John T. Dorsey oversees the new cases.
In the prior Chapter 11 cases, the Debtors tapped Latham & Watkins,
LLP and Richards, Layton & Finger, P.A. as their bankruptcy
counsel; Arthur Cox and Wachtell, Lipton, Rosen & Katz as corporate
and finance counsel; Ropes & Gray, LLP as litigation counsel;
Torys, LLP as CCAA counsel; Guggenheim Securities, LLC as
investment banker; and AlixPartners, LLP, as restructuring
advisor.
In the new Chapter 11 cases, the Debtors tapped Latham & Watkins,
LLP and Richards, Layton & Finger, P.A., as their bankruptcy
counsel; Arthur Cox and Wachtell, Lipton, Rosen & Katz as corporate
and finance counsel; Guggenheim Securities, LLC as investment
banker; and AlixPartners, LLP, as restructuring advisor. Kroll is
the claims agent.
MALLINCKRODT PLC: Silver Point, 2 Others Report 6.1% Equity Stake
-----------------------------------------------------------------
In a Schedule 13D filed with the Securities and Exchange
Commission, Silver Point Capital, L.P., Edward A. Mule and Robert
O'Shea reported beneficial ownership of 1,215,673 shares of common
stock of Mallinckrodt plc, which represents 6.1% based on a total
of 19,696,335 shares of common stock issued and outstanding as of
November 14, 2023, as reported in the Company's Current Report on
Form 8-K filed on November 15, 2023. A full-text copy of the
regulatory filing is available for free at:
https://www.sec.gov/Archives/edgar/data/1332784/000119312523282761/d721765dsc13d.htm
About Mallinckrodt plc
Mallinckrodt (OTCMKTS: MNKTQ) — http://www.mallinckrodt.com/—
is a global business consisting of multiple wholly-owned
subsidiaries that develop, manufacture, market and distribute
specialty pharmaceutical products and therapies. The company's
Specialty Brands reportable segment's areas of focus include
autoimmune and rare diseases in specialty areas like neurology,
rheumatology, nephrology, pulmonology and ophthalmology;
immunotherapy and neonatal respiratory critical care therapies;
analgesics; and gastrointestinal products. Its Specialty Generics
reportable segment includes specialty generic drugs and active
pharmaceutical ingredients.
On Oct. 12, 2020, Mallinckrodt plc and certain of its affiliates
sought Chapter 11 protection in Delaware (Bankr. D. Del. Lead Case
No. 20-12522) to seek approval of a restructuring that would reduce
total debt by $1.3 billion and resolve opioid-related claims
against them. Mallinckrodt in mid-June 2022 successfully completed
its reorganization process, emerged from Chapter 11 and completed
the Irish Examinership proceedings.
Mallinckrodt Plc said in a regulatory filing in early June 2023
that it was considering a second bankruptcy filing and other
options after its lenders raised concerns over an upcoming $200
million payment related to opioid-related litigation.
Mallinckrodt plc and certain of its affiliates again sought Chapter
11 protection (Bankr. D. Del. Lead Case No. 23-11258) on Aug. 28,
2023. Mallinckrodt disclosed $5,106,900,000 in assets and
$3,512,000,000 in liabilities as of June 30, 2023.
Judge John T. Dorsey oversees the new cases.
In the prior Chapter 11 cases, the Debtors tapped Latham & Watkins,
LLP and Richards, Layton & Finger, P.A. as their bankruptcy
counsel; Arthur Cox and Wachtell, Lipton, Rosen & Katz as corporate
and finance counsel; Ropes & Gray, LLP as litigation counsel;
Torys, LLP as CCAA counsel; Guggenheim Securities, LLC as
investment banker; and AlixPartners, LLP, as restructuring
advisor.
In the new Chapter 11 cases, the Debtors tapped Latham & Watkins,
LLP and Richards, Layton & Finger, P.A., as their bankruptcy
counsel; Arthur Cox and Wachtell, Lipton, Rosen & Katz as corporate
and finance counsel; Guggenheim Securities, LLC as investment
banker; and AlixPartners, LLP, as restructuring advisor. Kroll is
the claims agent.
MALLINCKRODT PLC: Squarepoint Ops Reports 6.6% of Ordinary Shares
-----------------------------------------------------------------
In a Schedule 13D filed with the Securities and Exchange
Commission, these entities reported beneficial ownership of
ordinary shares of Mallinckrodt, plc as of November 14, 2023:
Shares Percent
Beneficially of
Reporting Person Owned Class
---------------- ------------ ---------
Squarepoint Master Fund Limited 127,535 0.6%
Arini Credit Master Fund Limited 1,177,868 6.0%
Squarepoint Ops LLC 1,305,403 6.6%
The Reporting Persons acquired the Ordinary Shares pursuant to the
prepackaged Chapter 11 plan of Mallinckrodt and certain of its
subsidiaries.
Squarepoint Ops, in its capacity as the investment advisor to both
Arini Credit and Squarepoint, has the ability to indirectly control
the decisions of Arini Credit and Squarepoint regarding the vote
and disposition of securities held by Arini Credit and Squarepoint
and as such may be deemed to have an indirect beneficial ownership
of the Ordinary Shares held of record by Arini Credit and
Squarepoint.
A full-text copy of the regulatory filing is available for free
at:
https://www.sec.gov/Archives/edgar/data/1567892/000095014223002836/eh230423564_13d-mnktq.htm
About Mallinckrodt plc
Mallinckrodt (OTCMKTS: MNKTQ) — http://www.mallinckrodt.com/—
is a global business consisting of multiple wholly-owned
subsidiaries that develop, manufacture, market and distribute
specialty pharmaceutical products and therapies. The company's
Specialty Brands reportable segment's areas of focus include
autoimmune and rare diseases in specialty areas like neurology,
rheumatology, nephrology, pulmonology and ophthalmology;
immunotherapy and neonatal respiratory critical care therapies;
analgesics; and gastrointestinal products. Its Specialty Generics
reportable segment includes specialty generic drugs and active
pharmaceutical ingredients.
On Oct. 12, 2020, Mallinckrodt plc and certain of its affiliates
sought Chapter 11 protection in Delaware (Bankr. D. Del. Lead Case
No. 20-12522) to seek approval of a restructuring that would reduce
total debt by $1.3 billion and resolve opioid-related claims
against them. Mallinckrodt in mid-June 2022 successfully completed
its reorganization process, emerged from Chapter 11 and completed
the Irish Examinership proceedings.
Mallinckrodt Plc said in a regulatory filing in early June 2023
that it was considering a second bankruptcy filing and other
options after its lenders raised concerns over an upcoming $200
million payment related to opioid-related litigation.
Mallinckrodt plc and certain of its affiliates again sought Chapter
11 protection (Bankr. D. Del. Lead Case No. 23-11258) on Aug. 28,
2023. Mallinckrodt disclosed $5,106,900,000 in assets and
$3,512,000,000 in liabilities as of June 30, 2023.
Judge John T. Dorsey oversees the new cases.
In the prior Chapter 11 cases, the Debtors tapped Latham & Watkins,
LLP and Richards, Layton & Finger, P.A. as their bankruptcy
counsel; Arthur Cox and Wachtell, Lipton, Rosen & Katz as corporate
and finance counsel; Ropes & Gray, LLP as litigation counsel;
Torys, LLP as CCAA counsel; Guggenheim Securities, LLC as
investment banker; and AlixPartners, LLP, as restructuring
advisor.
In the new Chapter 11 cases, the Debtors tapped Latham & Watkins,
LLP and Richards, Layton & Finger, P.A., as their bankruptcy
counsel; Arthur Cox and Wachtell, Lipton, Rosen & Katz as corporate
and finance counsel; Guggenheim Securities, LLC as investment
banker; and AlixPartners, LLP, as restructuring advisor. Kroll is
the claims agent.
MEDICAL GUARDIAN: Midcap Financial Marks $3.8MM Loan at 82% Off
---------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $3,810,000
loan to Medical Guardian, LLC to market at $686,000 or 18% of the
outstanding amount, as of September 30, 2023, according to Midcap
Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver Loan to Medical Guardian, LLC. The loan accrues
interest at a rate of 1% (SOFR+635) per annum. The loan matures on
October 26, 2026.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Medical Guardian is an American medical alert systems provider
headquartered in Philadelphia, Pennsylvania. The company appeared
in Inc. Magazine's list of 5000 fastest-growing companies four
years in a row from 2013 to 2016.
MEGNA REAL ESTATE: Gets OK to Sell Property to W&Z for $2MM
-----------------------------------------------------------
Megna Real Estate Investments, Inc. received approval from the U.S.
Bankruptcy Court for the Central District of California to sell a
single-family residence to W&Z Realty Group, LLC.
W&Z offered $2 million for the property located at 705 Yarmouth
Road, Palos Verdes Estates, Calif.
Megna will use the sale proceeds to pay the costs of sale and the
claim of Center Street Lending VIII, SPE, which the lender says,
totals $1,786,792.60.
Pursuant to the bankruptcy court's order, Megna will pay the
undisputed portion of the claim, which is $1.45 million through
escrow.
Meanwhile, the net proceeds will be held pending resolution of the
disputed portion of Center Street's claim and pending further order
of the court. The disputed amount is $336,792.60.
Megna is required to file and serve its objection to Center
Street's claim not later than 30 days after the close of escrow.
About Megna Real Estate
Megna Real Estate Investments, Inc. owns a single-family residence
located at 705 Yarmouth Road, Palos Verdes, Estates, Calif., valued
at $2.5 million.
Megna Real Estate Investments filed a Chapter 11 petition (Bankr.
C.D. Calif. Case No. 23-10809) on June 12, 2023, with $2,509,232 in
assets and $6,625,582 in liabilities. John-Patrick Fritz has been
appointed as Subchapter V trustee.
Judge Martin R. Barash oversees the case.
Donahoe Young & Williams, LLP is the Debtor's legal counsel.
MERCURITY FINTECH: Adopts Compensation Recovery Policy
------------------------------------------------------
Mercurity Fintech Holding Inc.'s Board of Directors has adopted a
Policy for Recovery of Erroneously Awarded Compensation in
accordance with the requirements of The Nasdaq Stock Market.
The Policy applies to current and former officers of the Company
and applies to incentive-based compensation received on or after
October 2, 2023, the effective date.
A full-text copy of the Policy is available at:
https://www.sec.gov/Archives/edgar/data/1527762/000149315223043297/ex99-1.htm
About Mercurity
Formerly known as JMU Limited, Mercurity Fintech Holding Inc. is a
digital fintech group powered by blockchain technology. The
Company's primary business scope includes digital asset trading,
asset digitization, cross-border remittance and other services,
providing compliant, professional, and highly efficient digital
financial services to its customers. The Company recently began to
narrow in on Bitcoin mining, digital currency investment and
trading, and other related fields. This shift has enabled the
company to deepen its involvement in all aspects of the blockchain
industry, from production to circulation.
Mercurity reported a net loss of US$5.63 million in 2022, compared
to a net loss of US$21.66 million in 2021. As of Dec. 31, 2022, the
Company had US$18.89 million in total assets, US$2.06 million in
total liabilities, and US$16.83 million in total shareholders'
equity.
Singapore-based Onestop Assurance PAC, the Company's auditor since
2023, issued a "going concern" qualification in its report dated
April 25, 2023, citing that the Company has incurred recurring
operating losses and negative cash flows from operating activities
and has an accumulated deficit, which raise substantial doubt about
its ability to continue as a going concern.
MERCURITY FINTECH: Raises $6M From Private Placement Financing
--------------------------------------------------------------
Mercurity Fintech Holding Inc. announced that it priced a private
investment in public equity ("PIPE") offering, through which it
sold an aggregate of 14,251,781 units of its securities, each
consisting of one ordinary share and three warrants, to one
non-U.S. institutional investor at an offering price of $0.421 per
unit, for the gross proceeds of $6 million, prior to the deduction
of fees and offering expenses payable by the Company. The warrants
are exercisable to purchase up to a total of 42,755,344 ordinary
shares, for a period of three years commencing from Nov. 30, 2023,
at an exercise price of US$1.00 per ordinary share.
The Company intends to utilize the net proceeds derived from the
PIPE for general working capital purposes, enhancing its human
capital and business development. The PIPE financing proceeds were
received on Dec. 4, 2023.
The securities were sold in a private placement and have not been
registered under the Securities Act of 1933, as amended, and may
not be offered or sold in the United States absent registration
with the Securities and Exchange Commission or an applicable
exemption from such registration requirements.
Shi Qiu, CEO of MFH, commented on this significant development,
stating, "We are grateful to our investors for their continued
support and investments that will allow us to grow our business.
Our commitment to delivering value to our public shareholders is
the driving force behind our decision-making. By accepting these
commitments for a strategic infusion of growth capital, we are
confident that our company will continue to expand upon a solid
foundation for success."
About Mercurity
Formerly known as JMU Limited, Mercurity Fintech Holding Inc. is a
digital fintech group powered by blockchain technology. The
Company's primary business scope includes digital asset trading,
asset digitization, cross-border remittance and other services,
providing compliant, professional, and highly efficient digital
financial services to its customers. The Company recently began to
narrow in on Bitcoin mining, digital currency investment and
trading, and other related fields. This shift has enabled the
company to deepen its involvement in all aspects of the blockchain
industry, from production to circulation.
Mercurity reported a net loss of US$5.63 million in 2022, compared
to a net loss of US$21.66 million in 2021. As of Dec. 31, 2022,
the Company had US$18.89 million in total assets, US$2.06 million
in total liabilities, and US$16.83 million in total shareholders'
equity.
Singapore-based Onestop Assurance PAC, the Company's auditor since
2023, issued a "going concern" qualification in its report dated
April 25, 2023, citing that the Company has incurred recurring
operating losses and negative cash flows from operating activities
and has an accumulated deficit, which raise substantial doubt about
its ability to continue as a going concern.
MH SUB I: S&P Affirms 'B' ICR on Cost Savings Initiatives
---------------------------------------------------------
S&P Global Ratings affirmed its 'B' issuer credit rating on
U.S.-based MH Sub I LLC (doing business as WebMD and Internet
Brands). In addition, S&P affirmed the 'B' issue-level rating and
'3' recovery rating on the company's first-lien term loan and the
'CCC+' issue-level rating on its second-lien term loan and '6'
recovery rating.
S&P said, "The negative outlook reflects our expectation that while
the company's free operating cash flow (FOCF) to debt for 2023 will
be about 2% for 2023, it will improve toward 5% in 2024 due to a
cyclical rebound in advertising, benefits from cost reduction
measures in 2023, and the use of its large cash position to fund
accretive tuck-in acquisitions.
"We expect MH Sub I's cost saving actions to improve its EBITDA
margin to the mid- to high-30% area in 2024. MH Sub I has been
proactive in implementing cost savings initiatives to combat
revenue challenges over the last few quarters. These will save it
about $35 million, which will benefit its EBITDA in 2024. We expect
these cost actions along with improving growth as advertising
revenue rebounds in the second half of 2024 to improve its EBITDA
margin 200-300 basis points.
"Additionally, we believe the company will continue optimizing its
cost base through various initiatives, including headcount
reduction and infrastructure optimization in 2024, which will
provide additional cost management opportunities. Due to the
company's acquisitive history and success in favorable integration
of acquired businesses, we expect some benefits from cost synergies
of acquisitions, further supporting a steady EBITDA margin of
36%-37% in 2024. In total, our EBITDA expectations result in S&P
Global Ratings-adjusted leverage declining to the low- to mid-6x
area in 2024 from the mid-7x area in 2023.
"Advertising market weakness remains a challenge as 70% of MH Sub
I's revenue comes from advertising. We expect continued
macroeconomic challenges and for 2024 GDP growth to decline to
about 1.5% in 2024 from our current expectation of 2.3% GDP growth
in 2023. We believe these dynamics will pressure the auto sector
and other non-health categories in the first half of the year, with
modest recovery in the second half of the year. However, MH Sub I
derives about 75% of its revenues from its health segment,
including WebMD, which we view as a relatively resilient end
market. We expect these end markets to bounce back quicker than the
overall advertising market.
"Due to our expectations for an eventual broader advertising
recovery in 2024 and the underlying favorable factors for the
health vertical and MH Sub I's subscription-based revenue, we
expect the company's revenue to grow in the low-single-digit
percent area in 2024. Additionally, we expect the company to
augment its growth through acquisitions given its large cash
balance and history of growth through acquisitions."
MH Sub I's large cash balance provides it ample liquidity to repay
upcoming maturities, service fixed costs, and fund tuck-in
acquisitions. As of Sept. 30, 2023, the company has about $777
million of cash on the balance sheet and full availability under
its $300 million revolver due 2026. S&P believes this provides MH
Sub I with flexibility to address the approximately $500 million of
first-lien debt maturing in 2024, either by refinancing it or
paying it off. It also provides it an ample cushion to make tuck-in
acquisitions that can supplement organic revenue and EBITDA
growth.
The company has a good track record of making accretive
acquisitions and seamlessly integrating them into its various
segments. S&P expects this to be key to its growth strategy, which,
in combination with increasing organic growth in 2024, will improve
its credit metrics.
S&P said, "We believe it will service its interest expense of about
$470 million over the next 12 months and the current portion of its
first-lien term loan due in 2024 by using its available liquidity
sources or refinancing. However, we expect its FOCF generation to
remain pressured over the next 12 months due to interest costs and
uncertainty in the advertising market. As such, we expect the
company's S&P Global Ratings-adjusted FOCF to debt will improve but
remain below 5% through 2024."
MH Sub I's track record of solid operating performance and ability
to integrate acquisitions make us confident it can improve FOCF to
debt toward 5% despite economic uncertainty and high interest cost
burden. MH Sub I has a long history of growth and operating
efficiency due to its ability to organically grow the business,
maintain a strong margin profile, and make accretive acquisitions
that it can integrate into its platform. This track record gives
S&P confidence that despite pressures from a cyclically challenged
advertising market and very high interest costs of approximately
$470 million, it will generate healthy FOCF in 2024 of over $200
million due to its growth initiatives and cost reduction efforts.
However, if MH Sub I cannot return to its historic trajectory of
good growth due to a prolonged weak advertising market, weaker
competitive position, or an inability to integrate acquisitions
effectively, reducing its ability to generate strong cash flow on a
sustained basis, we would reassess our rating and likely lower it
to 'B-'.
S&P said, "The negative outlook reflects our expectation that while
MH Sub I's FOCF to debt for 2023 will be about 2%, it will improve
toward 5% in 2024. We believe this will occur due to a cyclical
rebound in advertising, benefits from the company's cost reduction
measures in 2023, and the use of its large cash position to fund
accretive tuck-in acquisitions."
S&P could lower its issuer credit rating on MH Sub I if its FOCF to
debt remains well below 5% due to:
-- Weaker-than-expected advertising demand that results in
negative revenue growth; or
-- Poor cost management such that its EBITDA margins do not
materially improve over the next 12 months.
S&P could revise its outlook to stable if:
-- The company can generate FOCF to debt approaching 5% or more.
-- The company's operating trends improve such that organic
revenue growth returns to the low- to mid-single-digit percent area
in 2024 and its EBITDA margin expands to the mid- to high-30% area.
This would likely happen due to an improving advertising market and
continued benefits from cost discipline measures.
MICHIGAN MEDICAL: Deborah Fish Named Subchapter V Trustee
---------------------------------------------------------
The U.S. Trustee for Regions 3 and 9 appointed Deborah Fish, Esq.,
managing partner at Allard & Fish, P.C., as Subchapter V trustee
for Michigan Medical Group, P.C.
Ms. Fish will be paid an hourly fee of $400 for her services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Ms. Fish declared that she is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Deborah L. Fish, Esq.
Allard & Fish, P.C.
1001 Woodward Ave., Ste. 850
Detroit, MI 48226
Phone: (313) 961-6141
Email: dfish@allardfishpc.com
About Michigan Medical Group
Organized in 2001, Michigan Medical Group, P.C. is a medical
practice located in Taylor, Mich., that specializes in internal
medicine. Its sole shareholder is Dr. Najam K. Syed.
Michigan Medical Group filed a petition under Chapter 11,
Subchapter V of the Bankruptcy Code (Bankr. E.D. Mich. Case No.
23-50240) on Nov. 22, 2023, with up to $50,000 in assets and $1
million to $10 million in liabilities. Najam Syed, president,
signed the petition.
Dr. Najam Syed also commenced a personal Chapter 11 bankruptcy case
(Case No.23-50241) on Nov. 22, 2023. Mr. Syed's case is jointly
administered with Michigan Medical's.
Judge Mark A. Randon oversees the cases.
The Debtors are represented by Elliot G. Crowder, Esq., a
practicing attorney in Canton, Mich.
MICROTEK: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------
Debtor: Microtek
10865 Rancho Bernardo Road, Suite 101
San Diego, CA 92127
Business Description: Microtek provides a full range of design,
engineering, and manufacturing solutions.
Chapter 11 Petition Date: December 8, 2023
Court: United States Bankruptcy Court
Southern District of California
Case No.: 23-03868
Judge: Hon. Christopher B. Latham
Debtor's Counsel: Craig E. Dwyer, Esq.
CRAIG E. DWYER, ESQ.
8745 Aero Drive, Suite 301
San Diego, CA 92123-1763
Tel: 858-268-9909
Email: craigedwyer@aol.com
Total Assets: $661,315
Total Liabilities: $6,245,168
The petition was signed by Tri Le as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/G3S4B5A/Microtek__casbke-23-03868__0001.0.pdf?mcid=tGE4TAMA
MILLSTONE MEDICAL: Goldman MML Marks $259,000 Loan at 86% Off
-------------------------------------------------------------
Goldman Sachs Middle Market Lending LLC II has marked its $259,000
loan extended to Millstone Medical Outsourcing LLC to market at
$35,000 or 14% of the outstanding amount, as of September 30, 2023,
according to Goldman Sachs Middle Market Lending II'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 Middle Market Lending II is a participant in a First
Lien Senior Secured Debt Loan Millstone Medical Outsourcing LLC.
The loan accrues interest at a rate of 13.50% (P +5.00%) per annum.
The loan matures on December 15, 2027.
Goldman Sachs Middle Market Lending LLC II was formed on February
21, 2020. Effective November 23, 2021, MMLC LLC II converted from a
Delaware limited liability company to a Delaware corporation named
Goldman Sachs Middle Market Lending Corp. II, which term refers to
either Goldman Sachs Middle Market Lending Corp. II or Goldman
Sachs Middle Market Lending Corp. II together with its consolidated
subsidiary, as the context may require), which, by operation of
law, is deemed for purposes of Delaware law the same entity as MMLC
LLC II. The Company commenced operations on October 29, 2021. On
November 23, 2021, the Company's initial investors funded the
initial portion of their capital commitment to purchase shares of
common stock, at which time the Initial Member's initial capital
contribution to MMLC LLC II was cancelled. The Company has elected
to be regulated as a business development company under the
Investment Company Act.
Millstone Medical Outsourcing LLC was founded in 2004. It offers
post manufacturing and aftermarket services to more than 50
customers worldwide, including some of the top 10 orthopedic
companies in the world.
MILLTOO LLC: M. Colette Gibbons Named Subchapter V Trustee
----------------------------------------------------------
The U.S. Trustee for Region 9 appointed M. Colette Gibbons, Esq., a
practicing attorney in Westlake, Ohio, as Subchapter V trustee for
Milltoo, LLC.
Ms. Gibbons will be paid an hourly fee of $375 for her services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Ms. Gibbons declared that she is a disinterested person according
to Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
M. Colette Gibbons, Esq.
Attorney at Law
28841 Weybridge Drive
Westlake, OH 44145
Phone: (216) 798-6940
Email: colette@mcgibbonslaw.com
About Milltoo LLC
Milltoo, LLC filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. N.D. Ohio Case No. 23-51617) on Nov. 20,
2023, with up to $1 million in both assets and liabilities. Sean
Miller, managing member, signed the petition.
Judge Alan M. Koschik oversees the case.
Michael A. Steel, Esq., at Steel & Company, Ltd. represents the
Debtor as legal counsel.
MINIM INC: Receives Noncompliance Notice From Nasdaq
----------------------------------------------------
Minim, Inc. disclosed in a Form 8-K filed with the Securities and
Exchange Commission that it received a letter from The Nasdaq Stock
Market LLC notifying the Company, that because the Market Value of
Publicly Held Shares (the number of shares outstanding multiplied
by the current market price of the firm's shares) for the Company's
common stock listed on Nasdaq was below $1,000,000 for 30
consecutive business days, the Company no longer meets the minimum
value requirement for continued listing on Nasdaq under Nasdaq
Listing Rule 5550(a)(5), which requires a minimum Market Value of
$1,000,000. The notification from Nasdaq has no immediate effect
on the listing of the Company's common stock.
Pursuant to Nasdaq Listing Rule 5810(c)(3)(D), the Company has been
granted a grace period of 180 calendar days, or until May 28, 2024,
to regain compliance with the minimum Market Value requirement for
continued listing. To regain compliance, the Market Value of
Publicly Held Shares must meet or exceed $1,000,000 for at least
ten consecutive business days during this 180-day grace period.
To qualify for the additional 180 calendar day compliance period,
the Company would be required to meet the continued listing
requirement for the minimum bid price of publicly held shares and
all other initial listing standards for The Nasdaq Capital Market,
except for the minimum Market Value, and provide written notice to
Nasdaq of its intent to cure the deficiency during this second
compliance period, by effecting a reverse stock split, if
necessary. However, if it appears to the Nasdaq staff that the
Company will not be able to cure the deficiency, or if the Company
is otherwise not eligible, Nasdaq will provide notice to the
Company that its common stock will be subject to delisting.
The Company intends to monitor the Market Value of its common stock
and consider its available options in the event that the Market
Value of Publicly Held Shares of its common stock remains below
$1,000,000. There can be no assurance that the Company will be
able to regain compliance with the market value requirement or
maintain compliance with the other listing requirements.
About Minim Inc.
Minim was founded in 1977 as a networking company and now delivers
intelligent software to protect and improve the WiFi connections.
Headquartered in Manchester, New Hampshire, Minim holds the
exclusive global license to design, manufacture, and sell consumer
networking products under the Motorola brand. The Company designs
and manufactures products including cable modems, cable
modem/routers, mobile broadband modems, wireless routers,
Multimedia over Coax adapters and mesh home networking devices.
Minim reported a net loss of $15.55 million in 2022 following a net
loss of $2.20 million in 2021.
Boston, Massachusetts-based RSM US LLP, the Company's auditor since
2021, issued a "going concern" qualification in its report dated
March 31, 2023, citing that Company has suffered recurring losses
and negative cash flows from operations and will need additional
funding within the next twelve months. This raises substantial
doubt about the Company's ability to continue as a going concern.
MP PPH LLC: Seeks to Hire Pillsbury Winthrop as Counsel
-------------------------------------------------------
The official committee of unsecured creditors of MP PPH LLC seeks
approval from the U.S. Bankruptcy Court for the District of
Columbia to employ Pillsbury Winthrop Shaw Pittman LLP as counsel.
The firm's services include:
(a) assisting, advising and representing the Committee in its
consultations with the Debtor relative to the administration of
this Case, which may include adversary proceedings and litigation
pending in other courts;
(b) assisting, advising and representing the Committee in
analyzing the Debtor's assets and liabilities, investigating the
extent and validity of liens, and participating in and reviewing
any proposed asset sales or dispositions;
(c) assisting the Committee in potential real estate
transactions, including in any sales, leases, or negotiations
relating to the Property, to ensure compliance with relevant laws
and protect the interests of the Committee in such transactions;
(d) attending meetings and negotiating with the representatives
of the Debtor, the Debtor's insiders and secured creditors;
(e) assisting and advising the Committee in its examination and
analysis of the conduct of the Debtor's affairs;
(f) assisting the Committee in reviewing, analyzing, and
negotiating any chapter 11 plan and disclosure statement that may
be filed;
(g) assisting the Committee in reviewing, analyzing, and
negotiating any financing or funding agreements;
(h) taking all necessary actions to protect and preserve the
interests of the Committee, including, without limitation, by
prosecuting actions on its behalf, engaging in negotiations
concerning all litigation in which the Debtor or the estate is
involved, and reviewing and analyzing all claims filed against the
estate;
(i) preparing on behalf of the Committee all necessary motions,
applications, answers, responses, objections, orders, reports, and
other papers in support of positions taken or relief sought by the
Committee;
(j) appearing, as appropriate, before this Court and any other
courts in which matters may be heard and protecting the interests
of the Committee in court; and
(k) performing all other necessary, warranted, or requested
legal services for the Committee in this Case, related adversary
proceedings, and in any other potential cases in other courts that
may impact the rights, obligations, and interests of the Committee
and its constituents.
The firm will be paid at these rates:
Patrick J. Potter, Partner $1,197 per hour
Claire K. Wu, Counsel $999 per hour
Caroline Tart, Associate $790 per hour
Xinyi (Nino) Li, Associate $700 per hour
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Patrick J. Potter, Esq., a partner at Pillsbury Winthrop Shaw
Pittman LLP, disclosed in a court filing that the firm is a
"disinterested person" as the term is defined in Section 101(14) of
the Bankruptcy Code.
The firm can be reached at:
Patrick J. Potter, Esq.
Claire K. Wu, Esq.
Xinyi (Nino) Li, Esq.
Caroline Tart, Esq.
Pillsbury Winthrop Shaw Pittman LLP
1200 Seventeenth Street, NW
Washington, DC 20036-3006
Tel: (202) 663-8000
Email: patrick.potter@pillsburylaw.com
claire.wu@pillsburylaw.com
nino.li@pillsburylaw.com
caroline.tart@pillsburylaw.com
About MP PPH LLC
MP PPH, LLC filed Chapter 11 petition (Bankr. D. D.C. Case No.
23-00246) on Aug. 31, 2023, with $100 million to $500 million in
assets and $50 million to $100 million in liabilities. Michael A.
Abreu, vice president of operations, signed the petition.
Judge Elizabeth L. Gunn oversees the case.
The Debtor tapped Marc E. Albert, Esq., at Stinson LLP as
bankruptcy counsel; Lewis Brisbois Bisgaard & Smith, LLP and Nixon
Peabody, LLP as special counsels; and Noble Realty Advisors, LLC as
property manager.
MY CITY BUILDERS: Raises Going Concern Doubt
--------------------------------------------
My City Builders, Inc. disclosed in a Form 10-Q Report filed with
the U.S. Securities and Exchange Commission for the quarterly
period ended October 31, 2023, that there is substantial doubt
about the Company's ability to continue as a going concern.
During the three months ended October 31, 2023, the Company
incurred a net loss of $78,577 compared to a net loss of $22,197
for the same period in 2022, and net cash used in operating
activities of $38,048. As of October 31, 2023, it had an
accumulated deficit of $2,124,315. In order to continue as a going
concern, the Company will need, among other things, additional
capital resources. Management plans to raise necessary funding
through equity and debt financing arrangements, which may be
insufficient to fund its capital expenditures, working capital and
other cash requirements. The ability of the Company to continue
operations in its new business model is dependent upon, among other
things, obtaining financing to continue operations and continue
developing the business plan. The Company cannot give any assurance
as to the ability to develop or operate profitably. These factors,
among others, 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 at
https://tinyurl.com/ys5x74dx
About My City Builders, Inc.
Miami, FL-based My City Builders, Inc. operates as a real estate
development company. The Company buys, sells, and leases low-income
housing properties, as well as provides new construction and
renovation services.
As of October 31, 2023, the Company has $2,401,553 in total assets
and $4,194,202 in total liabilities.
NAVIGA INC: Midcap Financial Marks $500,000 Loan at 32% Off
-----------------------------------------------------------
MidCap Financial Investment Corporation has marked its $500,000
loan extended to Naviga Inc. (fka Newscycle Solutions, Inc.) to
market at $340,000 or 68% of the outstanding amount, as of
September 30, 2023, according to Midcap Financial's Form 10-Q
Report for the Quarterly period ended September 30, 2023, filed
with the Securities and Exchange Commission.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver Loan to Naviga Inc. (fka Newscycle Solutions, Inc).
The loan accrues interest at a rate of 1% (SOFR+710) per annum. The
loan matures on December 29, 2023.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Naviga Inc develops and delivers software technology solutions. The
Company offers business operations strengthening and expanding
services using networking, digital publishing, and cloud computing.
Naviga serves customers in the United States.
NEAR INTELLIGENCE: Case Summary & 30 Largest Unsecured Creditors
----------------------------------------------------------------
Lead Debtor: Near Intelligence, Inc.
100 W Walnut St.
Suite A-4
Pasadena, CA 91124
Business Description: Near Intelligence, Inc. and its subsidiaries
operate a global, full-stack data
intelligence software platform that curates
one of the world's largest sources of
intelligence on people, places, and
products.
Chapter 11 Petition Date: December 8, 2023
Court: United States Bankruptcy Court
District of Delaware
Four affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------- --------
Near Intelligence, Inc. (Lead Case) 23-11962
Near Intelligence LLC 23-11965
Near Intelligence Pte. Lte. 23-11966
Near North America, Inc. 23-11967
Judge: Hon. Thomas M. Horan
Debtors'
Delaware
Counsel: Edmon L. Morton, Esq.
Matthew B. Lunn, Esq.
Shane M. Reil, Esq.
Carol E. Cox, Esq.
YOUNG CONAWAY STARGATT & TAYLOR, LLP
Rodney Square
1000 North King Street
Wilmington, Delaware 19801
Tel: (302) 571-6600
Fax: (302) 571-1253
Email: emorton@ycst.com
mlunn@ycst.com
sreil@ycst.com
ccox@ycst.com
Debtors'
General
Bankruptcy
Counsel: Rachel C. Strickland, Esq.
Andrew S. Mordkoff, Esq.
Joseph R. Brandt, Esq.
WILLKIE FARR & GALLAGHER LLP
787 Seventh Avenue
New York, New York 10019
Tel: (212) 728-8000
Fax: (212) 728-8111
Email: rstrickland@willkie.com
amordkoff@willkie.com
jbrandt@willkie.com
Debtors'
Restructuring
Advisor: ERNST & YOUNG LLP
560 Mission Street,
Suite 1600
San Francisco, CA 94105
Debtors'
Investment
Banker: GLC ADVISORS & CO., LLC
600 Lexington Ave.
9th floor
New York, NY 10022
Debtors'
Claims,
Notice,
Solicitation &
Balloting
Agent: KROLL LLC
Estimated Assets: $50 million to $100 million
Estimated Liabilities: $100 million to $500 million
The petitions were signed by John Faieta as chief financial
officer.
A full-text copy of the Lead Debtor's petition is available for
free at PacerMonitor.com at:
https://www.pacermonitor.com/view/GCUP3WA/Near_Intelligence_Inc__debke-23-11962__0001.0.pdf?mcid=tGE4TAMA
Consolidated List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
1. YA II PN, Ltd Unsecured $6,687,994
c/o Yorkville Advisors Convertible
Global, LLC Debentures
1012, Springfield Avenue,
Mountainside, New Jersey, USA, 07092
Attn: Mark Angelo
Phone: +1 201-985-8300
Email: legal@yorkvilleadvisors.com
2. Kirkland & Ellis LLP Professional $4,987,245
601 Lexington Avenue Services
New York, NY 10022
Attn: Tamar Donikyan
Phone: +1 212-909-3421
Email: tamar.donikyan@kirkland.com
3. KludeIn Prime, LLC Unsecured $6,479,558
1096, Keeler Avenue, Berkeley, Convertible
California, USA, 94708 Debentures,
Attn: President /General Counsel Unsecured
Email: info@inkludelabs.com Promissory
Notes
4. Amazon Web Services, Inc. Trade Debt $2,590,656
40 Terry Avenue North
Seattle, WA 98124
Attn: Jon Jones
Phone: +1 656-722-0300
Email: jonjones@amazon.com
5. Polar Multi Strategy Unsecured $2,331,794
Master Fund Convertible
Polar Asset Management Debentures
Partners Inc.
16 York Street, Suite 2900,
Toronto, ON
M5J 0E6, Canada
Attn: Jillian Bruce
Phone: +1 416-369-8656
Email: jbruce@polaramp.com
6. Cantor Fitzgerald & Co. Professional $2,000,000
110 East 59th Street Services
New York, NY 10022
Attn: Sage Kelly
Phone: +1 212-938-5000
Email: sage.kelly@cantor.com
7. Greater Pacific Capital Unsecured $2,000,117
Management Ltd, GPC NIV LTD. Convertible
PO Box 309, Ugland House, Grand Debentures
Cayman, KY1-1104, George town,
Cayman Islands
Attn: Vumindaba Dube
Phone: +1 345-749-2433
Email: vdube@waystone.com
8. EGS Inc. Professional $1,288,482
333 W. Hampden Ave. Suite 530 Fees
Englewood, CO 80110
Attn: President/General Counsel
Phone: +1 303-477-6800
9. Haynes and Boone, LLP Professional $1,209,728
2801 N. Harwood Street, Ste. 2300, Services
Dallas, TX 75201
Attn: Rosebud Nau
Phone: +1 214-651-5367
Email: rosebud.nau@haynesboone.com
10. Akama Holdings Fz-LLC Unsecured $1,000,052
P.O. 14303, 11424, Convertible
Riyadh, Saudi Arabia Debentures
Attn: Alexandre Hawari
Email: alexandre@akamaholding.com
11. Sequoia Capital Unsecured $750,044
India III Ltd Convertible
5th Floor, Ebene Esplanade, 24 Cyber Debentures
City, Ebene, Quatre Bornes, Mauritius
Attn: Suzanne Gujadhur
Krishnacoomari Bundhoo
Email: sequoiagroup@internationalproximity.com
12. Titan Columbus Ventures Unsecured $750,035
2559 Harvard Lane, Seaford, New York, Convertible
USA, 11783 Debentures
Attn: John Cronin
Email: johnmcronin23@gmail.com
13. Telstra Ventures Fund II, L.P Unsecured $650,038
North Suite 2, Town Mills, Convertible
Rue Du Pre, St Debentures
Peter Port, Guernsey, GY1 1L
Attn: Tom Chamberlain
Email: geoff@telstraventures.com and/or
telstra@langhamhall.com
14. Contact Discovery Services Trade Debt $338,409
1100 13th Street. NW Suite 925,
Washington, DC 20005
Attn: Joshua F. Blanthorn
Phone: +1 631-605-6169
Email: jblanthorn@contactdiscoveryservices.com
15. North Land Capital Markets Professional $325,000
150 South 5th Street, Ste. 3300 Services
Minneapolis, MN 55402
Attn: Jeff Peterson
Phone: +1 612-991-5993
Email: jpeterson@northlandcapitalmarkets.com
16. Smaato, Inc. Trade Debt $318,189
240 Stockton Street, 9th Floor
San Francisco, CA 9410
Attn: President/General Counsel
Phone: +1 650-286-1198
Email: accounting@smaato.com
17. Palisades Media Group, Inc. Trade Debt $312,010
1601 Cloverfield Blvd., Ste. 6000n
Santa Monica, CA 90404
Attn: Roger Schaffner, CEO
Phone: +1 310-564-5400
Email: contact@palisadesmedia.com
18. ICR LLC Trade Debt $289,000
761 Main Avenue
Norwalk, CT 06851
Attn: John Sorensen
Phone: +1 203-682-8200
Email: legal@icrinc.com
19. The Benchmark Company, LLC Trade Debt $275,000
150 East 58th Street
New York, NY 10155
Attn: Joseph J. Kronk
Phone: +1 212-312-6767
Email: jkronk@benchmarkcompany.com
20. Verve Group Europe GmbH Trade Debt $265,499
Karl-Liebknecht-Str 32
Berlin, Germany 10178
Attn: Daniela Silvasantos
Phone: +49 52933245
Email: daniela.silvasantos@verve.com
21. The Ebinger Family Trust Unsecured $250,015
481 W Maple Way, Woodside, CA, Convertible
United States Debentures
Attn: Jonathan Ebinger
Email: ebinger.jr@gmail.com
22. Magnite, Inc. Trade Debt $212,504
6080 Center Drive,
Suite 400/4th Floor
Los Angeles, CA 90045
Attn: Tony Nguyen
Phone: +1 310-207-0272
Email: tnguyen@magnite.com
23. Venable LLP Professional $192,265
151 W. 42nd Street, Services
49th Floor,
New York, NY 10036
Attn: William N. Haddad
Phone: +1 917-287-1580
Email: wnhaddad@venable.com
24. Interxion Ireland DAC Limited Trade $186,234
Unit 24, Hume Avenue Park West
Business Park Dublin, 12 Ireland
Attn: Niamh O'Hara
Phone: +353 1434-4900
Email: arinvoicesirl@interxion.com
25. HERE Europe B.V. Trade Debt $175,064
Kennedyplein 222-226, 5611 ZT
Eindhoven, Netherlands
Attn: R.A.J. Houben
Phone: +31 40-744-1242
26. Taylor Wessing LLP Professional $162,932
5 New Street Square Services
London, Great Britain 94005
Attn: Ross McNaughton
Phone: +44 20-7300-7000
Email: R.McNaughton@taylorwessing.com
27. Gopal Srinivasan Unsecured $150,007
14 Boat Club Road, Raja Convertible
Annamalaipuram, Chennai, Tamil Nadu, Debentures
India, 600028
Attn: Gopal Srinivasan
Email: investments@gopal.com
28. UHY LLP Professional $148,644
1185 Avenue of Americas, Services
38th Floor
Cleveland, OH 44192
Attn: Mehmet Sengulen
Phone: +1 518-449-3166
Email: msengulen@uhy-us.com
29. Talent Hunt USA Trade Debt $143,788
304 S. Jones Boulevard Suite 8851
Las Vegas, NV 89107
Attn: Paul Huffman
Phone: +1 905-518-4048
Email: paul@talenthunt.ca
30. EdgarAgents, LLC Trade Debt $126,329
207 West 25th Street, 9th Floor,
New York, NY 10001
Attn: John Bonerbo
Phone: +1 917-453-2921
Email: john.bonerbo@edgaragents.com
NEAR INTELLIGENCE: Files for Chapter 11 to Sell Business
--------------------------------------------------------
Near Intelligence, Inc. (NASDAQ:NIR), a privacy-led data
intelligence company, and certain of its subsidiaries have
voluntarily initiated a Chapter 11 proceeding in the United States
Bankruptcy Court for the District of Delaware and will seek to sell
their assets through a court supervised sales process.
The Company has also entered into a DIP financing agreement with
its existing secured lenders, affiliates of Blue Torch Finance LLC,
to provide up to $16 million of operating capital.
In addition, the Company intends to file a motion on or shortly
after the petition date seeking, among other things, approval of
sale procedures with respect to the sale of substantially all of
its assets that provides for the Company's existing secured lenders
to serve as a "stalking horse" bidder.
The Debtors have filed various "first day" motions with the
Bankruptcy Court requesting customary relief that will enable them
to transition into Chapter 11 while continuing to operate their
business in the ordinary course without material disruption,
including seeking authority to obtain debtor-in-possession ("DIP")
financing and pay employee wages and benefits without
interruption.
The Debtors' existing secured lenders are supportive of the Chapter
11 proceeding and court supervised sale process. The secured
lenders have committed to provide the Debtors with DIP financing
and have submitted a binding “stalking horse” bid to acquire
their assets.
DIP Financing
In order to provide necessary funding during the Chapter 11
proceeding, Near has obtained a multi-draw DIP financing facility
in an aggregate principal amount of up to $16 million from its
existing secured lenders. Upon approval by the Bankruptcy Court,
the DIP financing is expected to provide Near with the necessary
liquidity to operate in the normal course and meet obligations to
its employees, vendors and customers incurred during the Chapter 11
proceeding while executing on the sales process.
Sales Process
Prior to the Chapter 11 filing, and subject to Bankruptcy Court
approval, the Company entered into a "stalking horse" asset
purchase agreement with Blue Torch, to acquire substantially all of
the assets of the Company in the form of a credit-bid of not less
than $50 million, comprised of (i) all amounts Near owes to its
lenders under the $ 16 million DIP facility and (ii) not less than
$34 million of amounts Near owes to its lenders under the
prepetition senior secured credit facility. The transaction is
part of a sale process under Section 363 of the Bankruptcy Code
that will be subject to compliance with agreed upon and Bankruptcy
Court-approved bidding procedures allowing for the submission of
higher or otherwise better offers, and other agreed-upon
conditions. In addition, the closing of the transaction will be
subject to the satisfaction or waiver of customary closing
conditions. In accordance with the sale process under Section 363
of the Bankruptcy Code, notice of the "stalking horse" bid will be
given to third parties and competing bids will be solicited. The
Company will manage the bidding process and evaluate any bids
received, in consultation with its advisors and as overseen by the
Bankruptcy Court.
About Near Intelligence
Near Intelligence Inc. -- https://www.near.com -- publicly traded
software firm that provides data insights to major companies
including Wendy's Co. and Ford Motor Co.
Near is a global, privacy-led data intelligence platform curates
one of the world's largest sources of intelligence on people and
places. Near's patented technology analyzes data to deliver
insights on approximately 1.6 billion unique user IDs across 70
million points of interest in more than 44 countries.
With a presence in Pasadena, San Francisco, Paris, Bangalore,
Singapore, Sydney, and Tokyo, Near serves enterprises in a diverse
spectrum of industries including retail, real estate, restaurant,
travel/tourism, telecom, media, and more.
Near Intelligence Inc. and its affiliates sought relief under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case
No. 23-11962) on Dec. 8, 2023. In the petition filed by CFO John
Faieta, the Debtor estimated assets between $50 milliion and $100
million and liabilities between $100 million and $500 million.
Near is represented by Willkie Farr & Gallagher LLP and Young
Conway Stargatt & Taylor, LLP, as counsel, Ernst & Young LLP as
restructuring advisor and GLC Advisors & Co., LLC as restructuring
investment banker. Kroll is the claims agent.
NEXUS BUYER: Moody's Rates New $500MM 1st Lien Incremental Loan B2
------------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to Nexus Buyer LLC's
(IntraFi) proposed $500 million senior secured first lien
incremental term loan due 2028, which the company plans to use to
make a nearly $450 million distribution to shareholders, repay the
$33 million outstanding balance on the revolver, and pay
transaction fees and original issue discount. Moody's also affirmed
the existing ratings, including the B3 Corporate Family Rating, the
B3-PD Probability of Default Rating, the B2 $100 million senior
secured first lien revolver, the B2 $1,100 million senior secured
first lien term loan, and the Caa2 $540 million senior secured
second lien term loan. The outlook is maintained at stable.
The stable outlook reflects Moody's expectation that revenue will
grow in the double digit range in 2024 and that EBITDA margin will
continue to expand.
RATINGS RATIONALE
The B3 CFR reflects elevated leverage in a high-interest rate
environment, the potential for regulatory changes and/or
technological advancements that could introduce greater competition
in the industry, and uncertainty about the pace of deposit growth
in the network, especially into 2025. At the same time, the company
benefits from very strong net revenue growth in 2023, network
deposit balances that tend to be sticky and continue to grow over
time, and increased margins as a result of operational leverage.
Pro forma for the $500 million incremental debt for a shareholder
distribution, the company's total debt would approximate $2.1
billion and debt-to-EBITDA (Moody's-adjusted) would be about 5.7x
at year-end 2023. This heavy debt load exposes the company's cash
flows to changes in interest rates.
Given the company's strong growth and market share (particularly in
reciprocal deposits), Moody's also considers the risk that it may
face greater regulation, which could lead to slower growth rates
and/or greater competition in deposit-allocation services. New
entrants, with novel technology offerings, could potentially also
introduce competitive pressures. This would also generally better
align with banks' desire for choice in terms of service providers.
The company's credit profile also considers the uncertainty around
the pace of deposit growth in the network, especially given the
unprecedented growth rates in the Reciprocal and One-Way products
in 2023. It's unclear whether the historical deposit growth rates
of nearly 15% CAGR can continue, especially into 2025, now that the
company has a larger deposit base, and also as fears around the
regional banking crisis that began in March 2023 subside.
The recent strong revenue growth resulted from a sharp increase in
demand and interest in the company's deposit-allocation products,
which enable banks' end costumers to insure large deposits (as
large as $250+ million), through IntraFi's large network of more
than 3,000 financial institutions. The regional banking crisis led
both end customers and bank themselves to adopt and promote
IntraFi's products as a way to provide safety and retain deposits.
Albeit less significantly, the company has also benefitted from
better spreads in the One-Way product, which enables banks to sell
and/or purchase deposits. A decline in deposit balances in the
Brokerage Sweep product, which broker-dealers use to sweep cash
onto different financial institutions and to make sure those
amounts are FDIC-insured, has offset some of the growth; still, the
expectation is that net revenue will expand approximately 60% in
2023.
Also, the very robust growth in deposits in the Reciprocal and
One-Way products is expected to be sticky, since banking customers
that enter these arrangements typically don't go back to having
their deposits uninsured. The reasons are the peace of mind that
FDIC-insurance provides, as well as the fact that the depositors
don't have to pay for the fees themselves, and the banks are
usually inclined to cover those fees, since it results in greater
retention of large deposits. Also, Federal Reserve data shows that
aggregate banking deposits generally increase, regardless of the
interest rate environment. The one notable exception is 2022, given
the correction in the exceptional increase in bank balances from
federal stimulus connected to the Covid-19 pandemic, and which
eventually started to come down due mainly to inflation and healthy
consumer spending.
The company also benefits from an increase in margins, due mainly
to operational leverage, as its large scale and technological
platform do not require material increases in costs to accommodate
incremental revenue. Hence, Moody's expects EBITDA margins of about
70% (which include stock-based compensation costs) in the near
term, but which are expected to increase as more normalized equity
compensation expense kicks in.
The company also benefits from good liquidity characterized by a
pro forma cash balance of about $60 million, an undrawn $100
million revolving credit facility (pro forma for the transaction),
expectation of about $80 million of free cash flow in 2024, and
ample cushion under the first lien net leverage springing covenant.
Also, the revolver expires in November 2024, but Moody's expects
the company to extend it as part of the dividend transaction.
Mitigating some of the positive liquidity aspects are the
expectations of higher tax distributions vs. recent prior years as
well as a higher interest rate environment which could pressure
liquidity, especially in 2025, when the company's interest rate
hedges expire.
Governance considerations include aggressive financial policies
that prioritize shareholder interests, including by increasing
leverage from time to time to pay sizable dividends to the
company's owners.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if debt-to-EBITDA is sustained below
5.5x, Free-Cash-Flow-to-Debt is consistently above 3%, together
with ongoing organic revenue growth.
The ratings could be downgraded if Debt-to-EBITDA is sustained
above 6.5x, and/or if there's inability to generate sufficient free
cash flow to cover term loan amortization on an ongoing basis.
Founded in 2002, IntraFi is a financial technology solution
provider acting as an intermediary network between financial
institutions collecting and using deposits. With a network of more
than 3,000 financial institutions and net revenues of approximately
$500 million, the company is the leading provider of deposit
allocation services in the United States. The company was acquired
by Blackstone Group and management in 2019 for total purchase asset
value of about $2.5 billion, and Warburg Pincus was added as a
shareholder in 2022.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
NOGIN INC: Case Summary & 30 Largest Unsecured Creditors
--------------------------------------------------------
Three affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
Nogin, Inc. (Lead Case) 23-11945
105 E. 34th Street
Suite 137
New York, NY 10016
Nogin Commerce, Inc. 23-11946
Native Brands Group LLC 23-11947
Business Description: Nogin provides enterprise-class ecommerce
technology and services for consumer
products through its Intelligent Commerce
technology, a cloud-based ecommerce
environment purpose-built for brands selling
direct-to-consumer (D2C) and business-to-
business (B2B).
Chapter 11 Petition Date: December 5, 2023
Court: United States Bankruptcy Court
District of Delaware
Debtors' Counsel: Daniel J. DeFransceschi, Esq.
RICHARDS, LAYTON & FINGER, P.A.
920 North King Street
Wilmington DE 19801
Tel: (302) 651-7700
Email: defranceschi@rlf.com
Debtors'
CRO Provider: TRIPLE P RTS, LLC
Debtors'
Investment
Banker: LIVINGSTONE PARTNERS LLC
Debtors'
Claims &
Noticing
Agent: DONLIN, RECANO & COMPANY, INC.
Total Assets as of Sept. 30, 2023: $47,263,000
Total Debts as of Sept. 30, 2023: $142,815,000
The petitions were signed by Vladimir Kasparov as chief
restructuring officer.
Full-text copies of the petitions are available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/7NKPV2Q/Nogin_Inc__debke-23-11945__0001.0.pdf?mcid=tGE4TAMA
https://www.pacermonitor.com/view/IYWRIAQ/Nogin_Commerce_Inc__debke-23-11946__0001.0.pdf?mcid=tGE4TAMA
https://www.pacermonitor.com/view/2VQ4UFI/Native_Brands_Group_LLC__debke-23-11947__0001.0.pdf?mcid=tGE4TAMA
Consolidated List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
1. Jefferies Professional $7,716,917
520 Madison Avenue Services
New York NY 10022
Evan Osheroff
Email: eosheroff@jeffries.com
2. Stifel Professional $4,230,518
One Financial Plaza Services
501 North Broadway
St. Louis MO 63102
Peg Jackson
Email: pjackson@stifel.com
3. Latham & Watkins Professional $2,378,991
P.O. Box 2130 Services
Carol Stream IL 60132-2130
Ryan Maierson
Email: Ryan.Maierson@lw.com
4. Commission Junction LLC Professional $1,218,052
4140 Solutions Center Services
#774140
Chicago IL 60677-4001
Kathryn Rymer
Email: kathryn.rymer@cj.com
5. Scotch & Soda Brand Trade Debts $1,074,736
Holdings LLC
240 Madison Ave, 15th Floor
New York NY 10016
Joseph Sutton
Email: jsutton@bluestarall.com
6. Robert K. Vogel Company Trade Debts $1,038,064
300 Paseo Tesoro
Walnut CA 91789
Robert K. Vogel
Email: bob@vogelproperties.com
7. Factory X Professional $929,125
1000 Wilshire Blvd Services
Ste 1500
Los Angeles CA 90017-2457
C/O Russel Allyn
Email: rallyn@buchalter.com
8. Karen Kane Trade Debts $911,522
2275 East 37th Street
Los Angeles CA 90058
C/O Jeffrey Kapor
Email: jkapor@buchalter.com
9. Hurley Brand Holdings, LLC Trade Debts $822,870
240 Madison Ave, 15th Floor
New York NY 10016
Joseph Sutton
Email: jsutton@bluestarall.com
10. Bebe Trade Debts $762,449
240 Madison Ave, 15th Floor
New York NY 10016
Joseph Sutton
Email: jsutton@bluestarall.com
11. Rumpl, Inc. Trade Debts $595,263
2544 NW Upshur Street
Portland OR 97210
Ellyn Craven
Email: ellyn@rumpl.com
12. Brookstone Trade Debts $552,236
1 Innovation Way
Merrimack NH 03054
Joseph Sutton
Email: jsutton@bluestarall.com
13. Locus Robotics Trade Debts $539,034
301 Ballardvale St. Suite 1
Wilmington MA 01887
Andrew Wang
Email: accountsreceivable@locusrobotics.com
14. Donnelley Financial Solutions Trade Debts $429,813
(DFIN)
P.O. Box 842282
Boston MA 02284-2282
Glenny Cabrera
Email: nybay@dfinsolutions.com
15. Google LLC Trade Debts $401,589
PO Box 883654
Los Angeles CA 90088-3654
B Rachel
Email: collections@google.com
16. Justice Brand Holdings, LLC Trade Debts $401,523
240 Madison Avenue
15th Floor
New York NY 10016
Joseph Sutton
Email: jsutton@bluestarall.com
17. Giordano's Trade Debts $400,000
704 North Rush Street
Chicago IL 60611
Jayme D'Heilly
Email: jayme.d'heilly@lathropgpm.com
18. Cordial Experience, Inc. Professional $396,251
402 W Broadway Services
San Diego CA 92101
Bailey Busch
Email: bbusch@cordial.com
19. Apexus Roswell L.P. Trade Debts $351,918
(Previously HM Roswell)
2250 Roswell Drive
Pittsburgh PA 15205
Gabriel Dan
Email: gabriel@aminimholdings.com
20. Michelada LLC Professional $349,320
9450 SW Gemini Dr, #18347 Services
Beaverton OR 97008-7105
Angel Sanchez
Email: info@michelada.io
21. Sports Products of America, LLC Professional $349,003
Adjmi SPA Services
463 7th Ave
New York NY 10018
Allan Tawil
Email: atawil@adjmi.com
22. Attentive Mobile Inc. Professional $324,566
221 River Street Services
9th Floor
Hoboken NJ 07030
Reagan Sullivan
Email: ar@attentivemobile.com
23. Horizons HRS Service Staffing Trade Debts $311,643
II LLC
PO Box 207527
Dallas TX 75320-7527
Tim Regan
Email: tregan@horizonshrservices.com
24. Kenneth Cole Trade Debts $306,058
603 West 50th Street
New York NY 10019
David Edelman
Email: dedelman@kennethcole.com
25. Lee & Associates - Ontario Professional $260,881
3535 Inland Empire Blvd Services
Ontario CA 91764
Attn: Accounts Receivable
Email: stacey@lee-assoc.com
26. Bottom Line Concepts LLC Professional $255,057
3323 NE 163rd Street, Suite Services
302
North Miami Beach FL 33160
Attn: Accounting
Email: accounting@bottomlinesavings.com
27. Junk Food Clothing Trade Debts $250,182
5770 W. Jefferson Blvd
Los Angeles CA 90016
Joni Lee Gaudes
Email: jlgaudes@hybridapparel.com
28. Flight Phase I Owner, LLC Trade Debts $236,836
19600 Fairchild, Suite 100
Irvine CA 92612
Megan Crabtree
Email: mcrabtree@lpc.com
29. BB Brand Holdings LLC Trade Debts $235,000
240 Madison Ave
15th Floor
New York NY 10016
Joseph Sutton
Email: jsutton@bluestarall.com
30. Titan Rack & Shelving LLC Trade Debts $234,984
4 Zeller Dr
Somerset NJ 08873
Scott Miller
Email: scott@titanrackllc.com
NOGIN INC: Dec. 13 Deadline Set for Panel Questionnaires
--------------------------------------------------------
The United States Trustee is soliciting members for committee of
unsecured creditors in the bankruptcy case of Nogin Inc., et al.
If a party wishes to be considered for membership on any official
committee that is appointed, it must complete a questionnaire
available at https://tinyurl.com/2bau6uxn and return by email it to
Jane M. Leamy - Jane.M.Leamy@usdoj.gov - at the Office of the
United States Trustee so that it is received no later than 4:00
p.m., on Wednesday, Dec. 13, 2023.
If the U.S. Trustee receives sufficient creditor interest in the
solicitation, it may schedule a meeting or telephone conference for
the purpose of forming a committee.
About Nogin Inc.
Nogin Inc. provides enterprise-class ecommerce technology and
services for consumer products through its Intelligent Commerce
technology, a cloud-based ecommerce environment purpose-built for
brands selling direct-to-consumer (D2C) and business-to-business
(B2B).
Nogin Inc. and two of its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No.
23-11945) on Dec. 5, 2023.
In the petitions signed by Vladimir Kasparov as chief restructuring
officer, the Debtors posted total assets of $47,263,000 and total
debts of $142,815,000 as of September 30, 2023.
Richards, Layton & Finger, Esq. has been tapped as counsel to the
Debtors; Triple P RTS, LLC as CRO Provider; Livingstone Partners
LLC as investment banker; and Donlin, Recano & Company Inc. as
claims and noticing agent.
NOVVI LLC: Unsecured Creditors Unimpaired in Debt-for-Equity Plan
-----------------------------------------------------------------
Novvi, LLC, filed with the U.S. Bankruptcy Court for the Southern
District of Texas a Joint Chapter 11 Plan of Reorganization and
Disclosure Statement dated December 3, 2023.
The Debtor, a Delaware Limited Liability Company, was formed in
2011 as a joint venture between Amyris, Inc. and Cosan US, Inc. to
develop, produce, market and sell lubricant base oils from
renewable feedstocks.
The majority of the Debtor's manufacturing operations are located
in a 25 kiloton a year plant (the "Plant") located in La Porte,
Texas where the Debtor employs 37 people. Presently, the Debtor's
membership interests are held by four entities: Amyris, H&R,
Chevron, American Refining Group, Inc. ("ARG").
The primary issues leading to the Debtor's filing of the Chapter 11
Case stemmed from (i) the Debtor's inability to utilize the Plant
to its full capacity (
OMADA HEALTH: 96% Markdown for $100,000 Midcap Financial Loan
-------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $100,000
loan extended to Omada Health, Inc to market at $4,000 or 4% of the
outstanding amount, as of September 30, 2023, according to Midcap
Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver to Omada Health, Inc. The loan accrues interest at a
rate of 2.50% (SOFR + 410%) per annum. The loan matures on June 1,
2028.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Omada Health, Inc. provides virtual health care services. The
Company offers a digital care solution with personalized programs
designed to adapt to every member. Omada Health serves patients in
the United States.
OMADA HEALTH: Midcap Financial Marks $2.9MM Loan at 51% Off
-----------------------------------------------------------
MidCap Financial Investment Corporation has marked its $2,900,000
loan extended to Omada Health, Inc to market at $1,422,000 or 49%
of the outstanding amount, as of September 30, 2023, according to
Midcap Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to Omada Health, Inc. The loan accrues interest at a rate of 2.50%
(SOFR + 710%) per annum. The loan matures on June 1, 2028.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Omada Health, Inc. provides virtual health care services. The
Company offers a digital care solution with personalized programs
designed to adapt to every member. Omada Health serves patients in
the United States.
ORIGINCLEAR INC: Incurs $8.3MM Net Loss in Q3 2023
--------------------------------------------------
OriginClear, Inc. filed with the Securities and Exchange Commission
its Quarterly Report on Form 10-Q disclosing a net loss of
$8,294,666 for the three months ended September 30, 2023 compared
to a net loss of $29,052,223 for the same period in 2022.
For the nine months of September 30, 2023, OriginClear reported a
net loss of $18,180,762 compared to a net loss of $33,894,246 for
the same period in 2022.
According to the Company, it has not generated significant revenue
and has negative cash flows from operations, which raise
substantial doubt about the Company's ability to continue as a
going concern.
As of September 30, 2023, the Company has $4,266,517 in total
assets and $35,782,228 in total liabilities.
The Company said, "We have estimated our current average burn, and
believe that we have assets to ensure that we can function without
liquidation for a limited time, due to our cash on hand, growing
revenue, and our ability to raise money from our investor base.
Based on the aforementioned, we believe we have the ability to
continue our operations for the immediate future and will be able
to realize assets and discharge liabilities in the normal course of
operations. However, there cannot be any assurance that any of the
aforementioned assumptions will come to fruition and as such we may
only be able to function for a short time."
A full-text copy of the Form 10-Q Report is available at
https://tinyurl.com/bd7wbwph
About OriginClear
Headquartered in Clearwater, Florida, Originclear, Inc. --
https://www.originclear.tech -- designs, engineers, manufactures,
and distributes water treatment solutions for commercial,
industrial, and municipal end markets.
OriginClear reported a net loss of $10.79 million for the year
ended Dec. 31, 2022, compared to a net loss of $2.12 million for
the year ended Dec. 31, 2021. As of March 31, 2023, the Company had
$5.48 million in total assets, $22.45 million in total liabilities,
$9.98 million in commitments and contingencies, and a total
stockholders' deficit of $26.96 million.
Houston, TX-based M&K CPAS, PLLC, the Company's auditor since 2019,
issued a "going concern" qualification in its report dated April
17, 2023, citing that the Company suffered a net loss from
operations and used cash in operations, which raises substantial
doubt about its ability to continue as a going concern.
OUTERSTUFF LLC: Moody's Ups CFR to Caa1 & Alters Outlook to Stable
------------------------------------------------------------------
Moody's Investors Service upgraded Outerstuff LLC's corporate
family rating to Caa1 from Caa2. The probability of default rating
was affirmed at Caa2-PD, reflecting the anticipated payment default
on the stub non-extended portion of the term loan at its upcoming
December 29, 2023 maturity, at which time Moody's will temporarily
assign a limited default "/LD" designation. Concurrently, Moody's
assigned a Caa2 rating to the amended senior secured term loan due
2027 and upgraded the senior secured non-extended term loan to Caa2
from Caa3. The outlook was changed to stable from negative.
The rating actions reflect Outerstuff's amendment and extension of
its senior secured term loan to December 31, 2027 from December 29,
2023. As part of the transaction, the company's majority owner Sol
Werdiger contributed $30 million of equity, which was used to pay
down $20 million of the term loan pro-rata, reducing the total term
loan outstanding amount to $122 million from $142.5 million, and
pay for fees and expenses. A $14 million stub portion of the term
loan was not extended, and the amendment includes a forbearance on
exercising rights and remedies with regard to the upcoming December
29, 2023 payment default. Although the stub term loan will not be
repaid on December 29, 2023, it is pari passu with the rest of the
senior secured facility. The company also extended its $100 million
asset-based revolver to November 15, 2027. The $5 million
shareholder loan was extended to March 31, 2028.
The upgrades reflect the company's maturity extension and debt
reduction. Pro-forma for the transaction, Moody's-adjusted
debt/EBITDA was 6.5x (equivalent to about 4.6x
debt/company-adjusted EBITDA) and (EBITDA-Capex)/interest expense
was at an estimated 1.4x. Moody's expects leverage to decline to
low-5x debt/EBITDA in 2024, driven by revolver repayment with free
cash flow. Moody's projects adequate overall liquidity over the
next 12-18 months, supported by increasing revolver availability
driven by unwinding of working capital primarily in Q4 2023.
Moody's expects adequate covenant cushion and modestly positive
free cash flow after term loan amortization payments in 2024.
RATINGS RATIONALE
Outerstuff's Caa1 CFR is constrained by the company's small scale
and high leverage. While revenue and earnings grew significantly in
2022 and have been relatively stable year-to-date 2023, and the
amendment has reduced outstanding debt, leverage remains high at
6.5x as of September 30, 2023 pro-forma for the transaction. In
addition, Moody's anticipates that following earnings improvement
in Q4 2023, earnings will be modestly lower in 2024, reflecting
weaker consumer discretionary demand and corporate cost increases,
mitigated by relatively resilient spending on youth apparel and
growth in key contracts. The credit profile also reflects the
company's narrow product concentration and reliance on licensing
arrangements from several sports leagues for a significant majority
of revenue. The rating also includes governance considerations,
including several distressed exchanges and a history of earnings
underperformance relative to budget since 2015.
The rating is supported by Outerstuff's adequate liquidity
following the maturity extension. In addition, the rating is
benefits from the company's entrenched market position with
exclusive license contracts and long-standing relationships with
the NFL, NBA, NHL, MLB, NCAA, MLS and USA Olympics, which allow it
to sell virtually all children's apparel with the teams' logos. The
children's licensed sports apparel market is relatively stable
because of its low fashion risk, natural replenishment cycle and
consumers' steady interest in team sports.
The stable outlook reflects Moody's expectation for adequate
liquidity, stable operating performance and deleveraging over the
next 12-18 months.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade would require continued solid operating performance,
lower leverage and improved liquidity including reduced revolver
reliance. Quantitatively, the ratings could be upgraded with
Moody's-adjusted debt/EBITDA sustained below 5.0x and
(EBITDA-Capex)/interest expense above 1.5x.
The ratings could be downgraded if liquidity deteriorates for any
reason, including constrained revolver availability or covenant
tightness, or if revenue or EBITDA deteriorate. The ratings could
also be downgraded if the company loses any significant licenses.
Outerstuff is a designer, manufacturer and marketer of licensed
children's and adults' sports apparel. The company generates most
its revenue from products sold under exclusive licenses with the
NFL, NBA, NHL, MLB, MLS, USA Olympics and Umbro, as well as
licenses with over 300 NCAA colleges and universities, and sells to
team shops, specialty sports chain stores, department stores and
mass merchants. The company is majority owned by company
management, including founder and CEO, Sol Werdiger.
The principal methodology used in these ratings was Retail and
Apparel published in November 2023.
OXFORD FINANCE: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable
---------------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Ratings
(IDRs) of Oxford Finance LLC (Oxford) and its wholly owned,
debt-issuing subsidiary Oxford Finance Co-Issuer II Inc. at 'BB'.
The Rating Outlook is Stable. Fitch has also affirmed Oxford's
senior unsecured debt rating at 'BB-'.
KEY RATING DRIVERS
The ratings affirmation reflects Oxford's solid franchise in the
health care/life sciences sectors; a well laddered and diversified
funding profile; its focus on senior lending, which has
historically led to strong asset quality performance; relatively
consistent operating performance through market cycles; an
expanding managed funds business, which will contribute to growing
fee income over time; and an experienced management team.
Rating constraints include higher leverage as compared to business
development company (BDC) peers; a largely secured funding profile,
which reduces funding flexibility; and the potential liquidity and
leverage impact from elevated charge-offs and meaningful draws on
portfolio company revolver commitments, which tend to increase
during market downturns. Constraints also include a less
diversified sector focus compared to most BDC peers and Fitch's
expectations for weaker asset quality metrics in 2024 for the
corporate loan sector more broadly amid elevated interest rates and
slower growth at portfolio companies given the more challenging
macroeconomic backdrop.
Oxford is a specialty finance lender with a $4.4 billion loan
portfolio as of Sept. 30, 2023, across life sciences and healthcare
sectors. The company is focused on the senior part of the capital
structure, with a portfolio consisting largely of first lien loans,
which Fitch views favorably. At Sept. 30, 2023, Oxford had exposure
to 141 borrowers across 42 health care and life sciences
subsectors. Oxford's top 10 borrowers represented 18.8% of the
total portfolio at 3Q23, which is modestly below the peer average
and reduces the firm's exposure to loss from any individual lending
position.
Oxford's credit performance has been solid historically, with just
$147.5 million of cumulative net charge-offs, representing 1.3% of
$11.4 billion in originations since 2002. For the nine months-ended
Sept. 30, 2023, the net charge-off to gross loan ratio was 1.0%,
while non-accruals were 1.8% at quarter-end. Non-accruals ticked up
more recently due to a number of idiosyncratic issues in the loan
portfolio. Fitch expects non-accruals will increase in 2024 as a
more challenging macroeconomic backdrop weighs on portfolio
companies. The company's historically solid asset quality has
benefitted from attractive health care industry dynamics, such as
significant financial investment, government spending and favorable
demographics.
Oxford's core earnings have been solid. Pre-tax ROAA was 4.6% for
the nine months ended Sept. 30, 2023, higher than the four-year
average of 4.0% from 2019 to 2022. Profitability has benefitted
from rising base rates given 96% of the loan portfolio pays a
floating rate. Partially offsetting this has been $37.8 million of
loan loss provisions through the first nine months of 2023, up from
$15.9 million for the same period last year, and largely driven by
a single borrower which was charged off in 3Q23.
Relative to BDCs, Fitch expects Oxford to have a more stable
earnings profile as it is not required to mark its portfolio to
fair value on a quarterly basis and it has less exposure to equity
investments, which can contribute to more volatile gains and
losses. Fitch believes core earnings are approaching peak levels as
funding costs will rise with refinancing needs, spreads compress
with increased competition and non-accrual levels potentially rise
as portfolio companies experience higher debt service burdens and
slower growth. Still, these headwinds could be mitigated by
Oxford's focus on lending to defensive and less cyclical
industries.
Oxford has a targeted leverage ratio, as measured by consolidated
gross debt divided by tangible equity, of 3.0x-3.5x. Tangible
equity is calculated as total equity less goodwill and intangible
assets. Leverage was 3.1x at Sept. 30, 2023, which is within the
targeted range and up from 2.9x at YE22, due to an increase in
borrowings to fund portfolio growth. Inclusive of the $50 million
upsize to an existing asset backed notes issuance post quarter end,
leverage was 3.2x on a pro forma basis at 3Q23. Oxford's leverage
is higher than rated BDC peers but relatively consistent with other
commercial lenders. It is within Fitch's 'bbb' category benchmark
range of 0.75x-4.0x for finance and leasing companies with a sector
risk operating environment (SROE) score in the 'bbb' category.
Oxford's funding profile is largely secured, but it is relatively
diversified with well laddered maturities. At Sept. 30, 2023, the
company had six different revolving lending facilities from over a
dozen banks in addition to six securitizations, an asset-backed
notes agreement and $400 million of unsecured notes.
Unsecured debt represented 12% of total debt at 3Q23, which is
below the rated BDC average and within Fitch's 'b and below'
funding, liquidity and coverage benchmark range of less than 20%
for finance and leasing companies with an SROE score in the 'bbb'
category. Fitch does not expect a material change in the company's
funding mix over the Outlook horizon, which will continue to
constrain the ratings.
Fitch views Oxford's liquidity profile as sound. Given its revolver
commitments, Fitch expects Oxford to maintain adequate liquidity to
meet potential peak revolver draws during periods of market stress,
as was seen in 1H20, when revolver utilization peaked around 58%.
At Sept. 30, 2023, Oxford had $510.2 million of liquidity through
unrestricted cash on balance sheet, availability under debt
financing agreements, cash available for reinvestment and equity
commitments, which is sufficient to fund $366 million of portfolio
company revolver commitments.
While Oxford has generally paid out the majority of its earnings to
shareholders over time, the company has the flexibility to reduce
distributions at any time, which Fitch views favorably.
Shareholders have also been supportive of portfolio growth,
injecting $124.5 million of capital into Oxford in 2022 and an
additional $49.5 million in the first nine months of 2023. Fitch
believes the shareholder's $300 million equity commitment reflects
a strong willingness to support Oxford.
The Stable Outlook reflects Fitch's expectation that, over the
Outlook horizon, Oxford will retain underwriting discipline given
the competitive market conditions, demonstrate sound credit
performance, manage leverage within the targeted range and maintain
sufficient liquidity to fund potential draws on unfunded
commitments.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
A sustained increase in leverage above the targeted range, material
deterioration in asset quality, an inability to maintain sufficient
liquidity to fund operating expenses and revolver draws, a change
in the perceived risk profile of the portfolio, and/or damage to
the firm's franchise which negatively impacts its access to deal
flow and industry relationships would be negative for the ratings.
Additionally, any change in the funding mix, such as the removal of
unsecured funding, could lead to a negative rating action.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
Increased portfolio diversification by sector and issuer, a
sustained reduction in leverage below 3.0x, improved funding
flexibility, as evidenced by unsecured debt approaching 30% of
total debt, and strong and differentiated credit performance of
recent vintages would be positive for the ratings.
Any ratings upgrade would be contingent on the maintenance of
consistent operating performance and a sufficient liquidity
profile.
DEBT AND OTHER INSTRUMENT RATINGS: KEY RATING DRIVERS
The senior unsecured debt rating is one notch below the Long-Term
IDR given the high balance sheet encumbrance and the largely
secured funding profile, which indicates weaker recovery prospects
under a stress scenario.
DEBT AND OTHER INSTRUMENT RATINGS: RATING SENSITIVITIES
The unsecured debt rating is expected to move in tandem with the
Long-Term IDR. However, a material increase in the proportion of
unsecured funding or the creation of a sufficient unencumbered
asset pool, which alters Fitch's view of the recovery prospects for
the debt class, could result in the unsecured debt rating being
equalized with the IDR.
SUBSIDIARY AND AFFILIATE RATINGS: RATING SENSITIVITIES
The Long-Term IDR and the unsecured debt rating of Oxford Finance
Co-Issuer II Inc. are linked to the parent and would be expected to
move in tandem.
ADJUSTMENTS
The Standalone Credit Profile has been assigned below the implied
Standalone Credit Profile due to the following adjustment reason:
Weakest Link - Funding, Liquidity & Coverage (negative).
The Earnings & Profitability score has been assigned below the
implied score due to the following adjustment reasons: Historical
and future metrics (negative).
The Capitalisation & Leverage score has been assigned below the
implied score due to the following adjustment reasons: Risk profile
and business model (negative).
The Funding, Liquidity & Coverage score has been assigned below the
implied score due to the following adjustment reason: Liquidity
coverage (negative).
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity. Fitch's ESG Relevance Scores are not inputs
in the rating process; they are an observation of the materiality
and relevance of ESG factors in the rating decision.
Entity/Debt Rating Prior
----------- ------ -----
Oxford Finance LLC LT IDR BB Affirmed BB
senior unsecured LT BB- Affirmed BB-
Oxford Finance
Co-Issuer II Inc. LT IDR BB Affirmed BB
senior unsecured LT BB- Affirmed BB-
P&L DEVELOPMENT: Moody's Cuts CFR to Caa2 & Alters Outlook to Neg.
------------------------------------------------------------------
Moody's Investors Service downgraded P&L Development, LLC's ("PLD")
Corporate Family Rating to Caa2 from Caa1 and its Probability of
Default rating to Caa2-PD from Caa1-PD. At the same time, Moody's
downgraded the rating on PLD's senior secured notes to Caa3 from
Caa2. The rating outlook is negative and was previously stable.
The downgrades of the CFR and PDR reflect that PLD's weak credit
metrics including negative free cash flow and high financial
leverage above 10.0x debt-to-EBITDA as of September 30, 2023 will
make it challenging to refinance the 2025 senior notes maturities
at a manageable cash interest cost without impairing part of the
debt structure. Although earnings in 2023 are improving from 2022
due to an easing of raw material and labor cost increases, the
improvement was materially behind Moody's previous expectations.
This is a result of other challenges such as a reduction in product
demand expectations from certain customers, as well as delays and
operational issues on new product launches. Moody's expects PLD's
debt-to-EBITDA to remain above 7.0x through 2025 even with further
improvement in revenue and earnings from recent business wins,
additional pricing actions, and the company's recent focus on
improving profitability and cash flow generation. Uncertainty
remains including timing of the gummies business launch and finding
customers to fill the remaining capacity in mouthwash, Pedialyte
and gummies businesses. PLD also faces execution risks to launch
products with adequate returns and control costs to improve
profitability. Moody's thus views default risk as growing including
the potential for a distressed exchange transaction such as a
discounted debt repurchase by the company or by its majority equity
holders the Singer family or Stephens Inc., a long-term minority
equity holder of PLD. The Caa3 rating on the senior secured notes
also reflects a one notch override to the Loss Given Default (LGD)
Caa2 model-indicated rating, reflecting Moody's view of recovery
given the higher interest rate environment and the company's
limited free cash flow.
The negative outlook reflects Moody's view that PLD's capital
structure is unsustainable absent a material improvement in
earnings owing to high leverage and negative free cash flow. The
negative outlook also reflects that the likelihood of a
restructuring is high, and that recovery values could weaken if
earnings do not improve meaningfully.
RATINGS RATIONALE
PLD's Caa2 CFR reflects the company's modest scale with annual
revenue of about $600 million, weak credit metrics including
negative free cash flow and financial leverage above 10.0x
debt-to-EBITDA for the 12 months ending September 30, 2023. PLD has
limited geographic diversity, with the majority of its revenues
derived from US markets, where the competitive landscape for store
brand over-the-counter products ("OTC") is intense. The company
continues to win new business and add to its portfolio through
acquisitions. However, PLD's revenue and profit realization in the
last few years from new business wins have lagged expectations,
leading to leverage being sustained at a very high level and
persistent negative free cash flow. In addition to higher raw
materials and labor cost, earnings and operating cashflow in 2023
were further impacted by delays and operational issues on new
product launches, as well as reduced demand from certain customers.
Partially offsetting these risks are PLD's attractive growth
prospects including nicotine replacement therapy products, new
business wins, as well as product expansion and volume growth with
existing customers. PLD also implemented several pricing increases
and increasingly focused on cost control, operational efficiency
and working capital management to improve profitability and free
cash flow. Moreover, Moody's believes that most of PLD's product
categories are important staples for consumers and retail partners,
and consumers will also opt for lower-priced store brands in an
economic downturn. Another positive factor is PLD's favorable
relationship with key retailers such as Walmart Inc. and Walgreens
Boots Alliance, Inc., as well as with larger consumer packaged
goods clients including The Procter & Gamble Company, Bayer AG, and
Haleon plc.
Moody's estimates that PLD's financial leverage will remain high
but decline to a high-single-digit range over the next 12-18 months
through EBITDA growth. Earnings growth will benefit from recently
implemented price increases, new product launches, ramp-up of
recently launched products, and cost savings through its logistics
optimization program.
PLD has adequate liquidity in the year ahead largely supported by
its $125 million ABL facility that expires in June 2025. The
company had $46 million availability on the revolver and very
limited cash on hand of September 30, 2023. PLD's ABL is subject to
a springing minimum fixed charge coverage ratio (FCCR) covenant of
1.0x that is tested when availability is less than 15% (or $18.75
million). Moody's does not believe the company will meet the FCCR
covenant if it is triggered, which limits effective availability to
just below the covenant trigger level. Moody's expects PLD will
improve free cash flow to $5-$10 million in 2024, primarily due to
lower capital spending and better working capital management.
Financial policies are aggressive including high leverage and debt
used for acquisitions. However, Moody's believes the company has a
long-term investment focus under majority family ownership.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if leverage materially declines
driven by improvement in operating results and less reliance on
external sources of liquidity. The company would also need to
improve liquidity including interest coverage and cash generation
while also addressing the 2025 maturities at a manageable cash
interest cost to be upgraded.
The ratings could be downgraded if there is a deterioration in
liquidity, highlighted by increasing revolver reliance, the
probability of a debt restructuring or event of default increases
for any reason, or recovery prospects decline.
The principal methodology used in these ratings was Consumer
Packaged Goods published in June 2022.
Headquartered in Westbury, NY, PLD manufactures, packages and
distributes over-the-counter private label products across multiple
categories. The company provides contract manufacturing and
contract packaging services to major OTC and nutritional companies
in the United States. PLD is majority owned by the Singer family
with Stephens Inc., a long-term equity holder of PLD, as a minority
shareholder. The company generates annual revenues of $603 million
for the last 12 months ending September 30, 2023.
PALATIN TECHNOLOGIES: Registers 2.5M Shares for Possible Resale
---------------------------------------------------------------
Palatin Technologies, Inc. filed a Form S-1 registration statement
with the Securities and Exchange Commission relating to the offer
and sale by the selling stockholders or their permitted
transferees, of up to an aggregate of 2,476,416 shares of common
stock, par value $0.01 per share, of the Company, consisting of (i)
2,358,491 shares of common stock issuable upon exercise of common
stock purchase warrants that the Company issued in a private
placement in connection with a concurrent registered offering
completed on Oct. 24, 2023, and (ii) 117,925 shares of common stock
issuable upon exercise of placement agent warrants that the Company
issued to certain designees of H.C. Wainwright & Co., LLC as part
of Wainwright's compensation for serving as the Company's exclusive
placement agent in connection with the October Financing.
The Selling Stockholders may sell the shares of the Company's
common stock covered by this prospectus from time to time through
any of the means described in the section of this prospectus
entitled "Plan of Distribution," at varying prices determined by
the prevailing market price for the shares or in negotiated
transactions. The Company will not receive any proceeds from the
sale of shares of common stock offered for resale by the Selling
Stockholders.
The Company's common stock is traded on the NYSE American under the
symbol "PTN." On Dec. 1, 2023, the last reported sale price of the
Company's common stock on the NYSE American was $2.22 per share.
A full-text copy of the Registration Statement is available for
free at:
https://www.sec.gov/Archives/edgar/data/911216/000165495423015130/ptn_s1.htm
About Palatin
Headquartered in New Jersey, Palatin -- www.Palatin.com -- is a
biopharmaceutical company developing first-in-class medicines based
on molecules that modulate the activity of the melanocortin
receptor systems, with targeted, receptor-specific product
candidates for the treatment of diseases with significant unmet
medical need and commercial potential. Palatin's strategy is to
develop products and then form marketing collaborations with
industry leaders to maximize their commercial potential.
Palatin reported a net loss of $27.54 million for the year ended
June 30, 2023, compared to a net loss of $36.20 million on $1.47
million of total revenues for the year ended June 30, 2022.
Philadelphia, Pennsylvania-based KPMG LLP, the Company's auditor
since 2002, issued a "going concern" qualification in its report
dated Sept. 28, 2023, citing that the Company has incurred
operating losses and negative cash flows from operations since
inception and will need additional funding to complete planned
product development efforts that raise substantial doubt about its
ability to continue as a going concern.
PARAGON 28: Midcap Financial Marks $10MM Loan at 25% Off
--------------------------------------------------------
MidCap Financial Investment Corporation has marked its $10,000,000
loan to Paragon 28, Inc to market at $7,450,000 or 75% of the
outstanding amount, as of September 30, 2023, according to Midcap
Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to Paragon 28, Inc. The loan accrues interest at a rate of 1%
(SOFR+611) per annum. The loan matures on May 1, 2026.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Paragon 28, Inc. operates as a medical device company. The Company
offers medical products for products for foot and ankle ailments,
such as fore-foot plating, hind-foot plating, medical screws,
custom bone wedges, and other surgical instruments.
PARTS ID: Taps Canaccord and DLA Piper to Explore Options
---------------------------------------------------------
PARTS iD, Inc. disclosed in a Form 10-Q Report filed with the U.S.
Securities and Exchange Commission for the quarterly period ended
September 30, 2023, that there is substantial doubt about the
Company's ability to continue as a going concern.
According to the Company, it has a working capital deficiency of
approximately $47 million.
"We continue to face macro-economic headwinds and the resulting
declining revenue and profitability, which increased the working
capital deficit, and resulted in the use of approximately $8.4
million in cash from operating activities, of which $2.4 million
was attributable to changes in working capital during the nine
months ended September 30, 2023. With this, substantial doubt
exists about the Company's ability to continue as a going concern
within 12 months.
To address liquidity concerns, the Company is pursuing additional
financing and continues to restructure and optimize its operations
including moderating capital investments, improving gross margin,
reducing expenses, and renegotiating vendor payment terms. In
addition, to address its liquidity needs, the Company recently
obtained an aggregate of approximately $14 million from the sale
and issuance of convertible notes and warrants. In addition, the
Company obtained additional financing in October and November
2023.
Additionally, management is implementing cost saving initiatives to
reduce operating costs and plans to continue to implement further
cost saving initiatives where appropriate. The Company's plans are
dependent on conditions and factors, many of which are outside of
the Company's control. There can be no assurance that the Company
will be successful in implementing its plans or that it will be
able to generate positive cash flow from operations in any future
period, nor can there be any assurance that it will be able to
raise additional capital. The result of such inability, whether
individually or in the aggregate, will adversely impact the
Company's financial condition and could cause the Company to
curtail or cease operations or to pursue other strategic
alternatives, including commencing a case under the U.S. Bankruptcy
Code.
PARTS iD has also retained Canaccord Genuity Group, Inc. as its
financial advisor and DLA Piper LLP as its legal counsel to assist
in evaluating potential strategic alternatives. There can be no
assurance that the evaluation of strategic alternatives will result
in any potential transaction, or any assurance as to its outcome or
timing.
For the three months ended September 30, 2023, the Company reported
a net loss of $5,671,589 compared to a net loss of $6,271,028 for
the same period in 2022.
A full-text copy of the Form 10-Q is available at
https://tinyurl.com/4tpfkjvk
About PARTS iD, Inc.
Cranbury, New Jersey-based PARTS iD, Inc., a Delaware corporation
is a technology-driven, digital commerce company focused on
creating custom infrastructure and unique user experience within
niche markets. PARTS iD has a product portfolio comprised of
approximately 18 million SKUs, when fully available, an end-to-end
digital commerce platform for both digital commerce and
fulfillment, and a virtual shipping network comprising over 2,500
locations, approximately 4,500 active brands, and machine learning
algorithms for complex fitment industries such as vehicle parts and
accessories.
As of September 30, 2023, PARTS iD has $18,697,244 in total assets
and $55,026,246 in total liabilities.
PARTS iD has retained Canaccord Genuity Group, Inc. as its
financial advisor and DLA Piper LLP as its legal counsel to assist
in evaluating potential strategic alternatives.
PEACE EQUIPMENT: Amends Several Secured Claims Pay Details
----------------------------------------------------------
Peace Equipment, LLC, submitted a Second Amended Revised Plan of
Reorganization for Small Business dated November 30, 2023.
This Plan of Reorganization proposes to pay Debtor's creditors from
the cash flow generated in the ordinary course of the Debtor's
business after confirmation.
Class 3 consists of the allowed secured claims of BMO Harris Bank,
N.A. Peace will pay the amounts as set forth herein for Class 3 in
full satisfaction of the claim of BMO. The amounts to be paid to
BMO will be a total of $110,942.24 for the 2020 Kenworth T680 and 2
2020 trailers VIN xxx8823 and xxx4414. Peace will pay BMO the
amount of $1,875 per month for six months following the Effective
Date of Confirmation in accordance with the "Payments" section
herein. Thereafter, Peace will pay BMO the amount of $2,325.43 per
month for 54 months. Such amounts shall be in full satisfaction of
the Class 3 Claim. Within 30 days of plan completion and payments
under the plan, the Class 3 creditor must execute and deliver to
the Debtor releases of all liens, security interests and
encumbrances on any property of the Debtor and any collateral for
any loans to the Debtor. Any further amounts claimed by BMO shall
be paid as an unsecured claim in Class 14.
Class 5 consists of the allowed secured claim of Commercial Credit
Group, Inc. ("CCG"). On or before December 29, 2023. Peace shall
surrender to CCG the CCG Collateral consisting of a 2019 Kenworth
T680 Tractor, VIN ending in xxx0866, a 2019 Kenworth T680 Tractor,
VIN ending in xxx0867 and all insurance proceeds, and a 2020
Kenworth T680, VIN ending in xxx5898 (collectively, "Surrendered
CCG Collateral"). Until such date that CCG takes actual possession
of the Surrendered CCG Collateral, Peace shall maintain insurance
coverage on the Surrendered CCG Collateral and maintain the
Surrendered CCG Collateral in industry standard condition with
normal wear and tear. The automatic stay and/or plan injunction
shall terminate as to the Surrendered CCG Collateral upon
confirmation of this amended plan without further relief necessary
from or recourse to the Bankruptcy Court.
Further, Peace shall pay the amount of $447,527.57 for Class 5 in
full satisfaction of the CCG Allowed Secured Claim. Peace will pay
CCG the amount of $5,090 per month for six months following the
Effective Date of Confirmation in accordance with the "Payments"
section herein. Thereafter, Peace will pay CCG the amount of $9,750
per month for 54 months. Such amounts shall be in full satisfaction
of the CCG Allowed Secured Claim. Unless otherwise notified in
writing by CCG, all plan payments to CCG shall be directed to
Commercial Credit Group Inc., c/o Herb Orengo, 2135 City Gate Lane,
Suite 440, Naperville, IL 60563. CCG has and shall continue to have
valid and perfected security interests in the CCG Collateral.
Within 30 days of plan completion and payments under the plan, the
Class 5 creditor must execute and deliver to the Debtor releases of
all liens, security interests and encumbrances on any property of
the Debtor and any collateral for any loans to the Debtor.
Class 9 consists of the allowed secured claim of Paccar Financial
Corp. Peace will pay the amounts as set forth herein for Class 9 in
full satisfaction of the secured claim of Paccar. Peace will pay
Paccar the amount of $2,245 per month for six months following the
Effective Date of Confirmation in accordance with the "Payments"
section herein. The amount of $775 per month shall be for the 2020
Kenworth T680 and $1,470 per month shall be for the 2023 Kenworth
T680. Thereafter, Peace will pay Paccar the amount of $1,289.42 per
month for the 2020 Kenworth T680 and $3,180.40 per month for the
2023 Kenworth T680 for 54 months. Such amounts shall be in full
satisfaction of the secured Class 9 Claim. Within 30 days of plan
completion and payments under the plan, the Class 9 creditor must
execute and deliver to the Debtor releases of all liens, security
interests and encumbrances on any property of the Debtor and any
collateral for any loans to the Debtor.
Class 13 consists of the allowed secured claim of Sumitomo Mitsu
Finance & Leasing Co., Ltd. Peace will pay the amounts as set forth
herein for Class 13 in full satisfaction of the secured claim of
Sumitomo. Peace will pay Sumitomo the amount of $1,470 per month
for six months following the Effective Date of Confirmation in
accordance with the "Payments" section herein. Thereafter, Peace
will pay Sumitomo the amount of $2,775.93 per month for 54 months.
Such amounts shall be in full satisfaction of the Class 13 Claim.
Within 30 days of plan completion and payments under the plan, the
Class 13 creditor must execute and deliver to the Debtor releases
of all liens, security interests and encumbrances on any property
of the Debtor and any collateral for any loans to the Debtor.
Like in the prior iteration of the Plan, Peace will pay the
projected disposable income for 60 months following the Effective
Date to creditors in this Class 14 Unsecured Creditors with allowed
claims.
A full-text copy of the Second Amended Revised Plan dated Nov. 30,
2023 is available at https://urlcurt.com/u?l=QVoRSf from
PacerMonitor.com at no charge.
Attorney for Debtor:
Reese Baker, Esq.
Baker & Associates
950 Echo Lane, Ste. 300
Houston, Texas 77024
(713) 979-2279
(713) 869-9100 Fax
About Peace Equipment
Peace Equipment, LLC, is a commercial trucking company that
provides commercial truck services across the United States.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Tex. Case No. 23-70098) on May 24,
2023. In the petition signed by Alejandro G. Mascorro, president,
the Debtor disclosed up to $10 million in both assets and
liabilities.
Judge Eduardo V. Rodriguez oversees the case.
Reese W. Baker, Esq., at Baker and Associates, is the Debtor's
legal counsel.
PENNYMAC FINANCIAL: Fitch Gives BB-(EXP) Rating on $650MM Notes
---------------------------------------------------------------
Fitch Ratings expects to rate PennyMac Financial Services Inc.'s
(PFSI) upcoming long-term $650 million senior unsecured notes
issuance 'BB-(EXP)'. Proceeds from the issuance are expected to be
used to repay a portion of the company's secured term notes due
2025 and for other general corporate purposes.
KEY RATING DRIVERS
The unsecured debt is expected to rank pari passu with PFSI's
existing senior unsecured debt, and therefore, the expected rating
is equalized with its outstanding senior unsecured debt and
Long-Term Issuer Default Rating (IDR). The equalization reflects
average recovery prospects under a stress scenario given the
availability of unencumbered assets.
Fitch does not expect the debt issuance to have a meaningful impact
on the company's leverage profile as proceeds are expected to
refinance upcoming secured debt maturities. PFSI's leverage,
calculated as debt to tangible equity, was 2.6x at 3Q23, compared
with 2.0x at YE 2022.
PFSI's ratings are supported by its solid franchise and historical
track record in the U.S. nonbank residential mortgage space,
experienced senior management team with extensive industry
background, and a sufficiently robust and integrated technology
platform. Fitch views PFSI's multichannel approach favorably and
believes its servicing retained business model with high recapture
rates may serve as a natural hedge, although not a full offset to
the cyclicality of the mortgage origination business.
The ratings are constrained by PFSI's elevated exposure to Ginnie
Mae (GNMA) loans with higher advancing needs and potentially higher
regulatory scrutiny, reliance on short-term, uncommitted funding,
and a complex group structure given elevated related party
transactions with PennyMac Mortgage Trust (PMT), which invests in
mortgage-related assets, and other affiliates.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Sustained profitability challenges that erode tangible equity and
the company's market position;
- Gross leverage sustained above 5.0x and corporate leverage
sustained above 1.5x;
- Decrease in aggregate liquidity resources that constrain the
company's funding flexibility; and or increased utilization of
secured funding that reduces the unsecured funding mix below 10%;
- Regulatory scrutiny resulting in PFSI incurring substantial fines
that negatively impact its franchise or operating performance,
could also drive negative rating momentum.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Improvement in the funding profile, including an extension of
funding duration, an increase in the committed funding percentage
and the maintenance of unsecured debt above 25% of total debt;
- Leverage maintained at or below 3.0x and corporate leverage
maintained at or below 1.0x;
- Growth of the business that enhances the franchise and platform
scale;
- Improved earnings consistency; and
- Stronger liquidity profile, as evidenced by a meaningful increase
in the percentage of available liquidity resources (cash and
available borrowing capacity) to total debt.
DEBT AND OTHER INSTRUMENT RATINGS: KEY RATING DRIVERS
The senior unsecured debt is equalized with PFSI's Long-Term IDR,
reflecting the funding mix and average recovery prospects in a
stressed scenario.
DEBT AND OTHER INSTRUMENT RATINGS: RATING SENSITIVITIES
The unsecured debt rating is primarily sensitive to changes in
PFSI's Long-Term IDR, and these ratings would be expected to move
in tandem. However, a meaningful increase in the proportion of
secured debt could result in the unsecured debt being notched down
from the IDR.
ADJUSTMENTS
The Business Profile score has been assigned below the implied
score due to the following adjustment reason: Organizational
structure (negative).The Earnings and Profitability score has been
assigned below the implied score due to the following adjustment
reasons: Earnings stability (negative) and historical and future
metrics (negative).The Capitalization and Leverage score has been
assigned below the implied score due to the following adjustment
reason: Profitability, payouts and growth (negative).
ESG CONSIDERATIONS
PFSI has an ESG Relevance Score of '4' for Customer Welfare - Fair
Messaging, Privacy and Data Security due to its exposure to
compliance risks that include fair lending practices, debt
collection practices and consumer data protection. These have a
negative impact on the credit profile and are relevant to the
rating in conjunction with other factors.
PFSI has an ESG Relevance Score of '4' for Governance Structure due
to board effectiveness in relation to protection of creditor and
shareholder rights and related party transactions among PMT, its
externally managed REIT, and other affiliates. An ESG Relevance
Score of '4' means Governance Structure is relevant to PFSI's
rating but is not a key rating driver. However, it impacts the
rating in combination 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, due to either 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
----------- ------
PennyMac Financial
Services, Inc.
senior unsecured LT BB-(EXP) Expected Rating
PHS BUYER: Midcap Financial Marks $2MM Loan at 47% Off
------------------------------------------------------
MidCap Financial Investment Corporation has marked its $2,000,000
loan to PHS Buyer, Inc to market at $1,059,000 or 53% of the
outstanding amount, as of September 30, 2023, according to Midcap
Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver Loan to PHS Buyer, Inc. The loan accrues interest at
a rate of 1% (SOFR+610 Cash plus 1.5% Payment In Kind) per annum.
The loan matures on January 31, 2027.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
PHS is a hygiene services provider in the U.K., Ireland and Spain,
offering washroom, healthcare and floor care solutions.
PLATINUM BEAUTY: Unsecureds Will Get 100% of Claims over 5 Years
----------------------------------------------------------------
Platinum Beauty Bar and Spa, LLC, filed with the U.S. Bankruptcy
Court for the Middle District of Georgia a Plan of Reorganization
dated November 30, 2023.
The Debtor operates a full-service spa retreat (the "Business").
On August 31, 2021, the Debtor took out an SBA backed loan with
Citizens Bank in order to purchase and renovate the property
located at 1990 Parker Road, SE, Conyers, Georgia (the "Property")
to house the Business. The Debtor was finally able to open the
Business in December 2022. The Debtor was constrained by a very
small advertising budget due to the costly renovations, and revenue
was slow the first few months the Business was open.
In the summer of 2023 revenue substantially increased, however by
this point the Debtor was delinquent in its debt service payments
to Citizens. To make matters more difficult for the Debtor, the
note with Citizens contained an adjustable-rate note, and the
monthly debt service payment doubled from the inception of the
loan. Citizens instituted foreclosure proceedings and the Debtor
filed the instant bankruptcy case in order to save the Property and
reorganize its debts.
The Debtor is proposing to pay creditors in full, therefore holders
of claims would not receive any greater return in a liquidation of
Debtor's assets. After payment to secured creditors, the Debtor has
unencumbered assets totaling approximately $661,920.12. The filed
and scheduled unsecured claims in the case total $76,800.61.
This Plan deals with all property of Debtor and provides for
treatment of all Claims against Debtor and its property.
Class 3 consists of General Unsecured Claims ("GUCs"). The Debtor
will pay GUCs in full. If the Plan is confirmed under Section
1191(a) of the Bankruptcy Code, Debtor shall pay GUCs
$3,840.03/quarter over five years. The first quarterly payment will
be made on the first day of the calendar month following the
Effective Date and continue every three months for a total of 20
quarterly payments. The allowed unsecured claims total $76,800.61.
This Class will receive a distribution of 100% of their allowed
claims.
If the Plan is confirmed under Section 1191(b) of the Bankruptcy
Code, Class 3 shall be treated the same as if the Plan was
confirmed under Section 1191(a) of the Bankruptcy Code.
Notwithstanding anything else in this document to the contrary, any
claim listed shall be reduced by any payment received by the
creditor holding such claim from any third party or other obligor
and Debtor's obligations hereunder shall be reduced accordingly.
The Claims of the Class 3 Creditors are Impaired by the Plan, and
the holders of Class 3 Claims are entitled to vote to accept or
reject the Plan.
Class 4 consists of the Equity Holder of the Debtor. The Equity
Holder will retain her Interest in the reorganized Debtor as such
Interest existed as of the Petition Date. 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
Debtor's continued business operations.
A full-text copy of the Plan of Reorganization dated November 30,
2023 is available at https://urlcurt.com/u?l=Temn3A from
PacerMonitor.com at no charge.
Attorneys for Debtor:
William A. Rountree, Esq.
Elizabeth A. Childers, 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 Platinum Beauty Bar and Spa
Platinum Beauty Bar and Spa, LLC, is a full-service spa in Conyers,
Georgia. The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Ga. Case No. 23-51222) on September 1,
2023. In the petition signed by Rebecca Davis, sole member, the
Debtor disclosed up to $10 million in both assets and liabilities.
Judge Austin E. Carter oversees the case.
William Rountree, Esq., at Rountree, Leitman, Klein & Geer, LLC,
represents the Debtor as legal counsel.
Citizens Bank, as lender, is represented by John A. Thomson, Jr.,
Esq. at Adams and Reese LLP.
POTRERO MEDICAL: Jami Nimeroff Named Subchapter V Trustee
---------------------------------------------------------
The U.S. Trustee for Regions 3 and 9 appointed Jami Nimeroff, Esq.,
at Brown McGarry Nimeroff, LLC as Subchapter V trustee for Potrero
Medical Inc.
Mr. Nimeroff will be paid an hourly fee of $400 for his services as
Subchapter V trustee while paralegals will be compensated at $185
per hour.
Mr. Nimeroff declared that he is a disinterested person according
to Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Jami Nimeroff, Esq.
Brown McGarry Nimeroff, LLC
919 N. Market Street, Suite 420
Wilmington, DE 19801
Telephone: (302) 428-8142
Fax: (302) 351-2744
Email: jnimeroff@bmnlawyers.com
About Potrero Medical
Potrero Medical Inc. -- https://potreromed.com/ -- is a predictive
health company developing the Next Gen of smart sensors and AI. Its
mission is to protect the kidney.
Potrero Medical filed Chapter 11 petition (Bankr. D. Del. Case No.
23-11900) on Nov. 21, 2023, with $1 million to $10 million in both
assets and liabilities. Joseph A. Urban, chief executive officer,
signed the petition.
Judge Laurie Selber Silverstein oversees the case.
The Debtor is represented by David M. Klauder, Esq., at Bielli &
Klauder, LLC as legal counsel.
PREMIER KINGS: Seeks to Hire Hyperams LLC as Consultant
-------------------------------------------------------
Premier Kings, Inc., seeks approval from the U.S. Bankruptcy Court
for the Northern District of Alabama to employ Hyperams, LLC as
consultant.
The firm's services include:
a. preparing a valuation report for the furniture, fixtures
and equipment within the four walls of certain of the Debtors'
Burger King restaurant locations; and
b. testifying as an expert to provide valuation testimony for
hearings in the Bankruptcy Court involving the valuations of the
FF&E.
The firm will be paid at the rates of $400.
The firm charge a flat fee of $14,000 for the appraisal of 28
Burger King locations designated by the Debtors.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Michael Jones, a managing director at Hyperams, LLC, disclosed in a
court filing that the firm is a "disinterested person" as the term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Michael Jones
Hyperams, LLC
980 Carnegie Street
Rolling Meadows, IL 60008
Tel: (262) 853-6270
Email: mjones@hyperams.com
About Premier Kings, Inc.
Premier Kings, Inc. and affiliates are the owners and operators of
174 operating Burger King franchise locations.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ala. Lead Case No. 23-02871) on Oct.
25, 2023. At the time of the filing, Premier Kings reported $10
million to $50 million in assets and $50 million to $100 million in
liabilities.
Judge Tamara O. Mitchell oversees the cases.
The Debtors tapped Cole Schotz, PC as the lead counsel; Holland &
Knight, LLP as local bankruptcy counsel; Raymond James &
Associates, Inc. as investment banker; and Kurtzman Carson
Consultants, LLC as noticing and claims agent.
PRINCESS PORT: Gina Klump Named Subchapter V Trustee
----------------------------------------------------
The U.S. Trustee for Region 17 appointed Gina Klump, Esq., at the
Law Office of Gina R. Klump, as Subchapter V trustee for Princess
Port Bed & Breakfast, Inc.
Ms. Klump will be paid an hourly fee of $485 for her services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Ms. Klump declared that she is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Gina Klump, Esq.
Law Office of Gina R. Klump
11 5th Street, Suite 102
Petaluma, CA 94952
Phone: (707) 778-0111
Email: gklump@klumplaw.net
About Princess Port Bed and Breakfast
Princess Port Bed and Breakfast, Inc. is the owner of real property
located at 445 Mirada Road, Half Moon Bay, Calif., valued at $2.58
million based on Zillow valuation.
The Debtor filed Chapter 11 petition (Bankr. N.D. Calif. Case No.
23-30761) on Nov. 8, 2023, with $2,585,562 in assets and $1,429,200
in liabilities. Maria Boruta, principal, signed the petition.
Judge Dennis Montali oversees the case.
E. Vincent Wood, Esq., at The Law Offices of E. Vincent Wood
represents the Debtor as bankruptcy counsel.
PURDUE PHARMA: S.C. Decision Could Affect Other Bankruptcy Cases
----------------------------------------------------------------
James Nani and Alex Wolf of Bloomberg Law report that a pending US
Supreme Court decision on Purdue Pharma LP's litigation shield for
its Sackler family owners threatens a widely used tool across the
bankruptcy spectrum.
The result, no matter where the justices land, is likely to inform
a large swath of Chapter 11 cases. Many of them rely on releases
to protect parties with close ties to a bankrupt entity from future
litigation related to the company's conduct.
The appeal was brought by the Justice Department's bankruptcy
watchdog, the US Trustee, which called the dispute one of the "most
controversial issues in Chapter 11 bankruptcy."
At stake is whether the Supreme Court, which heard oral arguments
on the matter Monday, reverses a Second Circuit opinion upholding
releases for Purdue's Sackler family owners, who have offered
roughly $6 billion to a trust for opioid victims in exchange for
protection against civil liability from suits related to opioid
marketing. The Sacklers, who aren't themselves in bankruptcy,
would benefit from the so-called non-debtor, or third-party,
releases.
A finding by the high court scaling back non-consensual third-party
releases could affect any case in which a reorganization plan
hasn't yet been confirmed or is pending on appeal, said Ralph
Brubaker, a bankruptcy professor at the University of Illinois
College of Law.
The decision could also impact the trajectory of Catholic diocese
cases, so-called Texas Two-Step cases still pending in the North
Carolina bankruptcy courts, and even small business
reorganizations, Brubaker said.
"In broad strokes, it's any case that involves mass torts," said
bankruptcy attorney George Singer of Holland & Hart LLP. "Whatever
it rules will be consequential."
However, Chapter 11 cases with final orders on plans that include
releases are likely safe. It would be too late to challenge the
scope of a release, regardless of its lawfulness, if it's embedded
in "a final and non-appealable judgment," Curtis E. Gannon, deputy
solicitor general representing the US Trustee, told the Supreme
Court in oral arguments Monday, December 4, 2023.
Below is an overview of notable cases that have relied on
non-debtor releases that could be affected by the Supreme Court's
Purdue decision.
Boy Scouts
The Boy Scouts of America emerged from bankruptcy in April, but an
amicus brief filed in the Purdue case by the youth organization's
attorneys suggests there's some concern the high court's decision
could interfere with its reorganization plan.
The core transactions in the reorganization are already complete
and "could not possibly be unwound at this stage," the Boy Scouts
said.
Attorneys representing the organization told the justices it's
"critically important" to clarify that however it rules, the
Supreme Court's opinion isn't intended to disturb effective
bankruptcy plans outside of Purdue.
The Boy Scouts bankruptcy plan includes third-party releases for
its local councils, chartering organizations, and others that
contributed to a $2.46 billion trust for abuse victims. More than
85% of survivor claimants voted in favor of the settlement plan,
which was ultimately approved over the objection of others whose
personal injury claims were extinguished.
Nonetheless, an appeal in the Boy Scouts case is still pending in
the Third Circuit. A group of Boy Scouts sex abuse claimants in
August asked the appeals court to pause the bankruptcy settlement
plan following the Supreme Court's decision to hear the Purdue
challenge, but the request was rejected.
Catholic Dioceses
The US Conference of Catholic Bishops told the justices that as
diocesan bankruptcies have unfolded across the country,
non-consensual third-party releases "have proven critical to
successful reorganizations."
Bankruptcy proceedings for Catholic dioceses facing a flood of
child sex abuse claims are proceeding in several states, including
six in New York—where third-party non-consensual releases are
allowed by the Second Circuit—and two in California, where such
releases aren't allowed by the Ninth Circuit.
The liability releases Catholic groups have won in bankruptcy
"provide the only viable means for the Catholic infrastructure in
many communities to survive what has become decades of
mission-crippling litigation," the conference said.
The bankruptcy of a single diocese is often used to shield related
parishes, schools, and other jurisdictional church entities from
litigation.
"If third-party releases were not allowed, everyone involved in
diocesan bankruptcies would be worse off," the conference said.
"Claimant recoveries would suffer, and third-party parishes,
schools, and charities would be driven into separate individual
bankruptcies."
To avoid an outcome that grants unbridled authority to bankruptcy
judges or, conversely, completely upends non-consensual releases,
the justices could fashion a narrow ruling that permits them in
only rare circumstances, said Singer.
"It's got to be a tailored facts and circumstances approach," he
said. "I can't imagine it going any other way."
Rite Aid
Rite Aid Corp. has also proposed a Chapter 11 plan that includes
non-consensual third-party releases, calling them an "integral
part" of its overall restructuring efforts and "an essential
element of the negotiations among" itself and senior noteholders.
The bankrupt pharmacy chain is facing claims it wrongly sold
addictive pain killers, and has been given until March 1 to
complete its turnaround under a timeline approved by a federal
judge.
Endo International Plc, another bankrupt corporation facing a host
of opioid-related claims, could also be affected. An agreement the
company put forth would create a trust to pay out claims and
provide releases to non-bankrupt affiliates and their officers and
directors as part of proposed $6 billion sale of the company to
senior lenders.
Unsecured creditors who participate in the trust must agree to
release their claims as part of the deal. But the US Trustee's
office has pushed back, saying that such non-consensual releases of
non-debtors isn't appropriate in any Chapter 11 case.
Highland Capital
The high court's decision could also implicate a more narrow but
commonly used type of release generally reserved to parties
involved directly in a bankruptcy case.
The Supreme Court in January 2023 was asked to consider whether the
US Court of Appeals for the Fifth Circuit interpreted bankruptcy
law correctly in striking down a type of liability release, called
an exculpation, that's more narrow than those used in Purdue's
case. That limited release has become a point of contention in the
2021 bankruptcy plan for Highland Capital Management LP, a
Dallas-based investment firm.
The appeal stems from Highland's tussle with co-founder and former
CEO James Dondero, who has claimed to be a creditor and sought to
have a say in the firm's Chapter 11 case even after he left the
company.
On Monday, December 4, 2023, Justice Sonia Sotomayor asked the
government how the court could write its opinion in Purdue so as
not to affect the Highland case or any others related to
exculpation.
An exculpation is a common type of release in bankruptcy plans
meant to reduce liability for those who are involved in the
bankruptcy case, such as creditor group members, estate
fiduciaries, and their employees and consultants. They generally
aim to stop renewed litigation over issues resolved in bankruptcy
court.
The Solicitor General in October told the justices that while
exculpations in the Highland case differ from Purdue's releases,
they should wait until Purdue is decided to "shed light" on the
Highland case because both are third-party releases the bankruptcy
code doesn't authorize without claimants' full consent.
Highland's bankruptcy plan provided exculpations to board members
and members of an unsecured creditors committee. Some outsiders --
including advisers, certain non-bankrupt affiliates, and a trust
for creditors' benefit—also received exculpations.
Asbestos
Cancer victims caught up in asbestos-related bankruptcies asked the
high court to steer clear of the one statute which does explicitly
permit non-consensual third-party releases: those used in
asbestos-related bankruptcies.
Section 524(g) of the bankruptcy code enables the creation of a
trust and injunction channeling all current and future asbestos
claims against the debtor into the trust for compensation.
The asbestos claimants told the justices in an amicus brief that
the high court should "be wary of broad pronouncements on the law's
legality or scope."
They also said 524(g) violates the Seventh Amendment's guarantees
of a right to a jury trial, and due process rights. Those
constitutional issues, while not in question in Purdue’s case,
could cut not only against third-party, non-consensual releases but
against 524(g) itself.
Meanwhile, attorneys representing three businesses in bankruptcy
related to asbestos liabilities, Aldrich Pump LLC, Murray Boiler
LLC, and Bestwall LLC, told the justices that they should ignore
the claimants' concerns about 524(g)'s constitutionality and that
such asbestos trusts are constitutional.
Attorney Deborah Kovsky-Apap of Troutman Pepper Hamilton Sanders
LLP said that 524(g) is a useful model of how mass tort claims can
be viewed and dealt with in bankruptcy.
It should make no difference about what specifically harmed mass
tort claimants, she said. "There's no other practical way to deal
with this," she said.
About Purdue Pharma LP
Purdue Pharma L.P. and its subsidiaries --
http://www.purduepharma.com/-- develop and provide prescription
medicines and consumer products that meet the evolving needs of
healthcare professionals, patients, consumers and caregivers.
Purdue's subsidiaries include Adlon Therapeutics L.P., focused on
treatment for Attention-Deficit/Hyperactivity Disorder (ADHD) and
related disorders; Avrio Health L.P., a consumer health products
company that champions an improved quality of life for people in
the United States through the reimagining of innovative product
solutions; Imbrium Therapeutics L.P., established to further
advance the emerging portfolio and develop the pipeline in the
areas of CNS, non-opioid pain medicines, and select oncology
through internal research, strategic collaborations and
partnerships; and Greenfield Bioventures L.P., an investment
vehicle focused on value-inflection in early stages of clinical
development.
Opioid makers in the U.S. are facing pressure from a crackdown on
the addictive drug in the wake of the opioid crisis and as state
attorneys general file lawsuits against manufacturers. More than
2,000 states, counties, municipalities and Native American
governments have sued Purdue Pharma and other pharmaceutical
companies for their role in the opioid crisis in the U.S., which
has contributed to the more than 700,000 drug overdose deaths in
the U.S. since 1999.
OxyContin, Purdue Pharma's most prominent pain medication, has been
the target of over 2,600 civil actions pending in various state and
federal courts and other fora across the United States and its
territories.
On Sept. 15 and 16, 2019, Purdue Pharma L.P. and 23 affiliated
debtors each filed a voluntary petition for relief under Chapter 11
of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No.
19-23649), after reaching terms of a preliminary agreement for
settling the massive opioid litigation. The Debtors' consolidated
balance sheet as of Aug. 31, 2019, showed $1.972 billion in assets
and $562 million in liabilities.
U.S. Bankruptcy Judge Robert Drain oversees the cases.
The Debtors tapped Davis Polk & Wardwell, LLP and Dechert, LLP, as
legal counsels; PJT Partners as investment banker; AlixPartners as
financial advisor; and Grant Thornton, LLP as tax structuring
consultant. Prime Clerk, LLC, is the claims agent.
Akin Gump Strauss Hauer & Feld LLP and Bayard, P.A., represent the
official committee of unsecured creditors appointed in the Debtors'
bankruptcy cases.
David M. Klauder, Esq., is the fee examiner appointed in the
Debtors' cases. The fee examiner is represented by Bielli &
Klauder, LLC.
* * *
U.S. Bankruptcy Judge Robert Drain in early September 2021 approved
a plan to turn Purdue into a new company (Knoa Pharma LLC) no
longer owned by members of the Sackler family, with its profits
going to fight the opioid epidemic. The Sackler family agreed to
pay $4.3 billion over nine years to the states and private
plaintiffs and in exchange for a lifetime legal immunity. The deal
resolves some 3,000 lawsuits filed by state and local governments,
Native American tribes, unions, hospitals and others who claimed
the company's marketing of prescription opioids helped spark and
continue an overdose epidemic.
Separate appeals to approval of the Plan have already been filed by
the U.S. Bankruptcy Trustee, California, Connecticut, the District
of Columbia, Maryland, Rhode Island and Washington state, plus some
Canadian local governments and other Canadian entities.
In early March 2022, Purdue Pharma reached a nationwide settlement
over its role in the opioid crisis, with the Sackler family members
boosting their cash contribution to as much as $6 billion. The
settlement was hammered out with attorneys general from the eight
states -- California, Connecticut, Delaware, Maryland, Oregon,
Rhode Island, Vermont and Washington -- and D.C. who had opposed
the previous settlement.
R1 RCM: Fitch Alters Outlook on 'BB' LongTerm IDR to Stable
-----------------------------------------------------------
Fitch Ratings has assigned a 'BBB-'/'RR1' rating to R1 RCM Inc.'s
(R1 or The Company) proposed incremental senior secured term loan B
due 2029.
R1 RCM will use proceeds from the loan offering along with partial
draw on the revolver to fund the acquisition of Acclara. Under the
terms of the acquisition agreement, R1 will acquire Acclara for
$675 million in cash and warrants to purchase 12.2 million shares
of R1 stock at a strike price of $10.52, including a three-year
lock-up.
Fitch ratings has also affirmed R1 RCM's Long-Term Issuer Default
Rating (IDR) at 'BB'. The Rating Outlook has been revised to Stable
from Positive.
KEY RATING DRIVERS
Financial Policy: Following the Acclara transaction, Fitch
forecasts proforma gross leverage increases to 3.9x in FY23, which
is above Fitch's negative sensitivity leverage threshold of 3.5x.
However, leverage is expected to decline to 2.5x by FY25 through a
combination of EBITDA growth, 5% scheduled amortization rate on the
term loan A, partial realization of cost synergies from the Acclara
acquisition and voluntary debt paydowns.
R1 does not maintain a formal financial policy commitment. Fitch
does not expect the company to adopt a formal financial policy
given desired flexibility to maximize long-term shareholder value
through organic growth, acquisitions or share buybacks, indicative
of the 'BB' rating category. However, Fitch still expects
management to take a conservative posture with regards to financial
leverage and balance this with their pursuit of growth
opportunities but it does exercise caution given gross leverage in
the near term is expected to be higher than Fitch's prior
expectations. This is the main driver of the Outlook revision.
Secular Tailwinds: Fitch expects R1 to benefit from underlying
secular trends in U.S. health care spending. The Centers for
Medicare and Medicaid Services (CMS) forecasts national health
expenditure growth of 5.1% per annum through 2030 due to
longstanding trends in medical procedure/drug cost and utilization
growth. Also, efforts to digitize health records, increasing
regulatory burdens, overall medical billing complexity and other
cost pressures have created a need for an end-to-end Revenue Cycle
Management (RCM) solution.
R1's outsourced RCM offerings deliver this end-to-end solution by
leveraging their own experienced billing/coding staff and utilizing
a software platform that integrates the various RCM software tools,
providing increased efficiency through improved accuracy and use of
automation. As a result, external spend by providers on RCM
solutions is forecast to grow 11.6% per annum through 2030,
according to Research and Markets, creating a strong tailwind for
adoption of R1's solutions.
Growth Prospects: Fitch expects R1 to maintain a reliable organic
growth profile. R1's contingent fee pricing model results in a
strong correlation with the underlying secular growth in U.S.
healthcare spending. In addition, Fitch notes major customer wins
in 2022, which are still in the onboarding phase and the new
end-to-end deal with Providence Health Care as a result of the
Acclara merger will provide a multi-year runway for sustained
growth given the company's improved capacity to implement $9
billion of new NPR per annum.
Growth prospects are further supported by strong retention rates
resulting from an average remaining contract life for end-to-end
customers of 7+ years and high switching costs that include staff
training, implementation costs, business interruption risks and
reduced productivity when swapping vendors. Fitch believes that the
secular tailwinds and high switching costs produce a dependable
growth trajectory that benefits the credit profile.
Low Cyclicality: Closely related to the underlying health care
expenditure secular growth driver, Fitch expects R1 to exhibit low
cyclicality for the foreseeable future. Fitch believes the
company's pricing model ensures strong correlation to overall U.S.
health care spending, which is highly non-discretionary and has
experienced uninterrupted growth since at least 2000 according to
CMS. As a result, Fitch believes R1 will demonstrate a stable
credit profile with little sensitivity to macroeconomic cycles.
Acclara Transaction: The Acclara merger complements R1's existing
modular solutions and solutions offered by Cloudmed. R1 expects to
realize about $50 million in cost synergies from the transaction
over the next five years. Further, as part of the transaction, R1
has secured a major 10-year commercial contract with Providence
Heath to provide end to end RCM services. This is expected to
strongly benefit R1's overall revenue and profitability as
Providence gets onboarded.
Governance Structure: Ascension Health Alliance (AA+/Negative), the
nation's largest Catholic and non-profit health system, along with
TowerBrook Capital Partners, jointly owns approximately 30% of the
company. Further, New Mountain Capital holds approximately 30% of
outstanding shares on a diluted basis.
Ascension and TowerBrook Capital Partners, an investment management
firm, made a joint investment in R1 in 2016. R1 will serve as the
exclusive provider of RCM services for hospitals affiliated with
Ascension. Fitch believes the ownership concentration introduces
potential concerns regarding board independence and effectiveness,
but notes no prior record of governance failings.
Customer Concentration: R1 derives a significant portion of its
revenue from two customers. Ascension and Intermountain Healthcare
represented 39% and 11% of YTD September 2023 revenue,
respectively. This has declined from 49% and 12% as of FY 2022.
Ascension serves as a strong reference customer for R1's salesforce
ability to win new logos. Ascension and Towerbrook, along with
affiliates of New Mountain Capital, are major owners of R1 and are
expected to have aligned interests. However, the magnitude of the
concentration introduces risk of severe credit profile degradation
should the nature of the relationship change in the future. Fitch,
however, notes that the Ascension contract was renewed in May 2021
for a 10-year term. Fitch typically views material customer
concentration as representative of the 'BB' rating category.
DERIVATION SUMMARY
Fitch expects R1 will benefit from a reliable growth path with a
pricing model that creates close correlation to the underlying
secular growth in U.S. health care expenditures and a robust
pipeline of contract wins expected to be implemented over the
forecast horizon. Fitch expects R1 to exhibit minimal cyclicality
and durable resistance to economic cycles. This is due to the
non-discretionary nature of health care spend persisting, strong
client retention rates and average remaining contract lives for
end-to-end customers of 7+ years. Other considerations are high
switching costs and pent-up demand for end-to-end RCM solutions as
significant room is available to penetrate the market.
Fitch compares R1 with health care IT peers such as RCM providers
athenahealth Group, Inc. (B/Negative), Finthrive Software
Intermediate Holdings, Inc. dba nThrive (B-/Negative), and Waystar
Technologies, Inc. (B/Positive). Fitch's forecast for R1's FY23
proforma leverage of 3.9x is well below the 5.0x-11.5x range for
Fitch-rated health care IT issuers.
Profitability metrics are mixed in comparison with peers with Fitch
forecasting EBITDA margins of 25%-28%, which is below the 33%
average for Fitch-rated health care IT peers due to R1's higher
labor component in offerings.
However, Fitch expects consistent FCF margins as a percent of
revenues to improve to the low teens over the rating horizon, above
the levels of peers, due to a lower interest burden. Peers are
predominantly private-equity owned and are more aggressively
capitalized than the publicly-traded R1. Fitch believes strong FCF
will be sustainable due to the low cyclicality of the business,
strong customer retention, reliable growth and low capital
intensity.
Fitch views the 'BB' rating as supported by secular tailwinds
benefitting the company, a reliable growth trajectory, low
cyclicality and strong industrial logic for the acquisition of
Cloudmed and Acclara. Key ratings constraints include a lack of
financial policy needed to ensure flexibility in delivery
shareholder value growth, the governance structure with joint
ownership position by Ascension/TowerBrook and the customer
concentration.
KEY ASSUMPTIONS
- Organic revenue growth assumed in low teens over the forecast
horizon as the company continues to benefit from onboarding new NPR
from recent contract wins, including the recent win of the
Providence Health Care contract from the Acclara acquisition
coupled with high-teens growth expected from Cloudmed;
- EBITDA margins assumed at 24.8% for 2024 due to addition of lower
margin Acclara business and the company initially incurring higher
costs related to the onboarding of recent contract wins including
Providence, with margins expected to increase to high 20s over the
rating horizon due to gradual achievement of identified synergies,
contract wins get fully onboarded and turn profitable, savings from
automation and operating leverage;
- Capex/sales at 4% over the forecast horizon consistent with
management's estimates;
- Fitch assumes close to $140 million in voluntary debt paydowns
apart from scheduled amortization payments over the forecast
horizon;
- Fitch assumes aggregate acquisitions of about $400 million funded
with a combination of incremental debt and cash on balance sheet;
- Fitch assumes aggregate $200 million in share buybacks over the
forecast period.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Fitch's expectation of EBITDA leverage sustaining below 2.5x;
- Increased customer diversification;
- Improved governance structure, such that Ascension and TowerBrook
no longer exercise effective control.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- EBITDA leverage sustained above 3.5x;
- (CFO-capex)/debt with equity credit sustained below 15%;
- Sustained loss of market share or underperformance relative to
guidance and forecasts.
LIQUIDITY AND DEBT STRUCTURE
Fitch expects R1 to maintain abundant liquidity throughout the
forecast horizon given strong FCF margins, a highly variable cost
structure, and moderate liquidity requirements. Following the
Acclara transaction, on a proforma basis liquidity is expected to
be comprised of a $600 million RCF with approximately $345 million
undrawn and $165 million in readily available cash balance.
Liquidity is further supported by Fitch's forecast of the company
generating FCF margins as high as the low teens over the forecast
horizon.
ISSUER PROFILE
R1 RCM manages health care revenue cycle operations for health
systems, hospitals and physician groups.
ESG CONSIDERATIONS
R1 has an ESG Relevance Score of '4' for Governance Structure due
to concentrated joint ownership by Ascension and TowerBrook, who
beneficially own about 30% of the common equity. Ascension will
remain a material customer representing less than 40% of pro forma
revenue, which has a negative impact on the credit profile, and is
relevant to the rating in conjunction with other factors.
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
R1 RCM Inc. LT IDR BB Affirmed BB
senior secured LT BBB- New Rating RR1
senior secured LT BBB- Affirmed RR1 BBB-
R1 RCM: Moody's Lowers CFR to 'Ba3', Outlook Negative
-----------------------------------------------------
Moody's Investors Service downgraded the corporate family rating of
R1 RCM, Inc. to Ba3 from Ba2 and its probability of default to
Ba3-PD from Ba2-PD. At the same time, Moody's assigned a Ba3 rating
to the company's newly proposed $500 million term loan B due 2029
and downgraded the company's existing senior secured credit
facilities consisting of a $600 million revolver due 2026, a $665
million term loan A due 2026, a $513 million term loan A due 2027
and a $495 million term loan B due 2029 to Ba3 from Ba2, and
maintained the negative outlook. The speculative grade liquidity
("SGL") rating remains SGL-2. R1 is a provider technology-enhanced
revenue cycle management ("RCM") and physician advisory services to
healthcare providers including acute-care hospitals and hospital-
and office-based physicians and emergency medical facilities.
Proceeds from the debt issuance along with $205 million of revolver
draw and equity in the form of warrants will be used to acquire
Acclara Solutions Group, Inc. ("Acclara"), a RCM provider to
hospital systems and healthcare providers, and pay related fees and
expenses. Through the acquisition, R1 has also secured a 10-year
contact to the be the exclusive RCM end-to-end service provider
across all of Providence Health and Services, Inc. ("PSH"). PSH is
a multi-state, not-for-profit healthcare system operating 51
hospitals based primarily in the US West Coast and the current
principal shareholder of Acclara. The acquisition of Acclara will
provide enhanced scale and customer diversification and has long
term upside for margins and cash flow, but it also comes with a
near-to-intermediate term weakening of the company credit profile
and uses a healthy portion of the company's revolving credit
facility to fund the acquisition.
The ratings downgrade reflects the very high pro forma leverage and
diminished liquidity expected by Moody's from the pending
acquisition, as well as the lengthy three-year onboarding process
that the Providence contract entails before it will contribute
meaningfully to earnings. The negative outlook is indicative of
Moody's view that credit metrics are weak for the Ba3 CFR and
reflects risk that any delays in revenue and earnings growth or
additional debt funded acquisitions would leave debt to EBITDA
sustained above 5x through 2024. Moody's estimates debt to EBITDA
at close to be 6.0x excluding stock based compensation and one-time
costs, principally integration and strategic initiatives costs.
Governance risk, specifically financial risk management, was a key
consideration in the rating actions. Moody's changed the company's
ESG credit impact score to CIS-4 from CIS-3 and revised the
governance IPS to G-4 from G-3, given the company's acquisition
growth strategy.
RATINGS RATIONALE
R1's Ba3 CFR reflects the company's established position in the
healthcare revenue cycle management space, including its large
operating scale with a Moody's-expected $2.5 billion of revenue in
2023 including $300 million of revenue from Acclara. The company
has experienced high revenue growth rates historically with strong
customer renewal rates governed by multi-year service agreements.
Moody's expects revenue growth will modestly slow in 2024, though
remain in the mid to high single digits supported by onboarding of
net patient revenues ("NPR", or cash collected from healthcare
payors) and should increase to the mid-teens in 2025 as the
Providence contract ramps up. More broadly, Moody's believes demand
for RCM services is favorable long term and supported by healthcare
industry trends that include increased healthcare spending and
strain on healthcare providers to drive improved collections as
they face high labor cost inflation, increased patient volumes at
lower margins, and regulatory-driven complexity in the billing
process. Moody's expects EBITDA margins will improve to around 19%
in 2024, and that the company should generate around $110 million
in free cash flow that will go largely towards debt repayment.
The credit profile is constrained by a debt-funded acquisition
growth strategy that has led to high debt to EBITDA leverage. The
acquisition of Acclara within less than two years after the
Cloudmed acquisition is viewed by Moody's as indicative of an
aggressive financial policy and introduces additional integration
risk. Visibility into the long-term profitability of the company
remains uncertain given one-time integration costs, expected cost
synergies, and other strategic initiatives associated with
acquisitions.
All financial metrics cited reflect Moody's standard adjustments.
The negative outlook reflects Moody's expectation that debt to
EBITDA will remain above 5x over the next 12 to 18 months and the
risk that higher costs, lower volumes, or a more aggressive
financial policy could result in sustained higher leverage and a
weaker liquidity profile. The outlook could be changed to stable if
Moody's expects debt to EBITDA will be sustained below 5x with free
cash flow to debt above 5%.
The SGL-2 liquidity rating reflects Moody's view of R1's liquidity
profile as good, supported by Moody's expectations for around $110
million of free cash flow in 2024. Total liquidity was $704 million
as of September 30, 2023 and would have been $499 million pro forma
for the transaction with $165 million of cash and $334 million of
availability on its $600 million revolver due 2026. Moody's also
expects free cash flow will be sufficient to cover the company's
annual mandatory debt amortization of $67 million in 2024 with any
remainder going towards repayment of revolver borrowings. Financial
covenants apply to the revolver and term loan A and include a
maximum total net leverage ratio of 5x, with a step-down to 4.5x,
and a static minimum interest coverage ratio of 3x. An acquisition
or a share repurchase can permit a step-up in the leverage ratio by
a half turn for the following six fiscal quarters. The leverage
covenant is not contingent upon any minimum level of revolver
borrowings. Moody's expects the company to be well in compliance
with its covenants over the next 12 to 18 months.
The Ba3 rating assigned to the $500 million term loan B reflects
R1's senior secured debt capital structure, overall probability of
default, reflected in the Ba3-PD, and the loss given default
assessments for individual instruments. The new and existing
revolver and term loans are expected to be pari passu with regard
to the application of collateral proceeds in the event of a
default. Both the revolver and the term loans have a first-priority
security interest in substantially all tangible and intangible
assets of the borrower and its domestic subsidiaries. Given the
single class of debt, the instrument ratings are the same as the
company's Ba3 CFR.
Terms of the new $500 million term loan are expected to contain
aggressive covenant flexibility for transactions not disclosed at
this time that could adversely affect creditors, including the
omission of certain material lender protections.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
While unlikely during the next 12 to 18 months given the negative
outlook, ratings could be upgraded if R1 continues to grow revenue
at double-digit rates, improves its liquidity profile, debt to
EBITDA and retained cash flow to net debt are sustained below 4x
and above 20%, respectively.
A ratings downgrade could result if organic revenue grows at no
better than mid-single-digit percentages, if Moody's expects debt
to EBITDA leverage will remain above 5x past 2024, retained cash
flow to net debt falls below 15%, or if liquidity deteriorates
including increased revolver reliance.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
With Moody's-expected 2023 revenue around $2.5 billion, Utah-based
R1 RCM (NASDAQ: RCM) provides technology-enhanced revenue cycle
management and physician advisory services to healthcare providers
including acute-care hospitals and hospital- and office-based
physicians and emergency medical facilities. Affiliates of private
equity firm New Mountain Capital, and TowerBrook Capital Partners,
and Ascension Health Alliance hold about 60% of the company's
common equity excluding warrants.
RA CUSTOM DESIGN: Unsecureds to be Paid in Full over 5 Years
------------------------------------------------------------
RA Custom Design, Inc., filed with the U.S. Bankruptcy Court for
the Northern District of Georgia a Plan of Reorganization dated
November 30, 2023.
Debtor is a Georgia corporation and as its business, Debtor is a
custom residential home builder located at 2451 Cumberland Parkway,
#3946, Atlanta, Georgia 30339 (the "Business").
Debtor's sole shareholder and CEO is Mr. Raymond Curry. Mr. Curry
is engaged on a full-time basis in Debtor's business. Mr. Curry is
responsible for the day-to-day operations of the business.
Debtor had issues with cost overruns on materials and supply chains
to deliver materials to finalize certain builds. This caused Debtor
to fall behind on certain mortgage payments and was threatened with
foreclosure on certain property located at 1410 Lavista Road.
Debtor filed bankruptcy on September 1, 2023 to reorganize its
financial affairs without the threat of collection.
This Plan deals with all property of Debtor and provides for
treatment of all Claims against Debtor and its property.
Class 10 shall consist of general unsecured claims. Debtor will pay
the Holders of Class 10 General Unsecured Claims in full over five
years. Debtor shall pay such Unsecured Total Distribution in
semi-annually payments of $115,345.86 commencing on the 15th day of
the sixth month following the Effective Date and continuing
semi-annually thereafter for a total of 10 payments. The Total
Unsecured Distributions shall be $1,153,458.66. The Claims of the
Class 10 Creditors are Impaired by the Plan.
Class 11 consists of the Equity Claims. Raymond Curry shall retain
his interests in the shares in Debtor.
The source of funds for the payments pursuant to the Plan is
Debtor's sale of the houses as well as the continued operations of
Debtor and future projects.
A full-text copy of the Plan of Reorganization dated November 30,
2023 is available at https://urlcurt.com/u?l=sag4m6 from
PacerMonitor.com at no charge.
Attorney for Debtor:
Cameron M. McCord, Esq.
JONES & WALDEN LLC
699 Piedmont Ave. NE
Atlanta, GA 30308
Tel: (404) 564-9300
Email: cmccord@joneswalden.com
About RA Custom Design
RA Custom Design, Inc. is a custom residential home builder located
at 2451 Cumberland Parkway, #3946, Atlanta, Georgia 30339.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. N.D. Ga. Case No. 23-58494) on Sept. 1,
2023, with as much as $50,000 in assets and $1 million to $10
million in liabilities. Raymond Curry, authorized representative,
signed the petition.
Judge Sage M. Sigler oversees the case.
Cameron M. McCord, Esq., at Jones & Walden, LLC, is the Debtor's
legal counsel.
RHI ACQUISITION: Midcap Financial Marks $9.2MM Loan at 32% Off
--------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $9,210,000
loan extended to RHI Acquisition LLC to market at $6,246,000 or 68%
of the outstanding amount, as of September 30, 2023, according to
Midcap Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to RHI Acquisition LLC. The loan accrues interest at a rate of 1%
(SOFR+660) per annum. The loan matures on November 23, 2027.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
RITE AID CORP: Closes Stores in Pittsburgh in Bankruptcy
--------------------------------------------------------
Rite Aid is closing dozens more stores, including two in the City
of Pittsburgh.
The company's store locations along Smithfield Street in Downtown
Pittsburgh and along Second Avenue in the city's Hazelwood
neighborhood are among the dozens that will be closing.
Rite Aid filed for Chapter 11 bankruptcy protection last month.
Several local Rite Aid stores, including the one in Moon Township,
Crafton, and the one at the corner of Route 51 and Route 88 have
already closed
With more than 2,100 retail stores across 17 states and thousands
of employees, Rite Aid's filing for Chapter 11 is a last-ditch
attempt to reorganize to keep many of its stores open.
Rite Aid, the third biggest stand-alone pharmacy, blames falling
sales and legal troubles stemming from opioid prescriptions for its
demise. But closing stores like Rite Aid can hurt access to
medicines and health care, creating what's called pharmacy deserts
or neighborhoods without easy access to a drugstore.
Chapter 11 is a way for companies to buy time, reorganize, secure
financing, pay off creditors at a discount, rewrite labor
agreements and often downsize to remain open.
With customers able to purchase drugs and medications online, by
mail, and at doctors' offices and even at grocery stores —
everyone is selling these days.
Wendell Young, president of the United Food and Commercial Workers
that represents many Rite Aid employees says that he hopes that the
company can survive in some format through Chapter 11
reorganization, but worries that Rite Aid could go belly up and
liquidate.
Rite Aid has promised to transfer prescriptions to nearby
pharmacies that can best help its customers.
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 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.
RMCNV HOLDINGS: Hires Lefkovitz & Lefkovitz PLLC as Counsel
-----------------------------------------------------------
RMCNV Holdings, LLC seeks approval from the U.S. Bankruptcy Court
for the Middle District of Tennessee to employ Lefkovitz &
Lefkovitz, PLLC as counsel.
The Debtor requires legal counsel to:
a. advising the Debtor as to the rights, duties, and powers as
Debtor-in Possession;
b. preparing and filing statements and schedules, plans, and
other documents and pleadings necessary to be filed by the Debtor
in this proceeding;
c. representing the Debtor at all hearings, meetings of
creditors, conferences, trials, and any other proceedings in this
case; and
d. performing such other legal services as may be necessary in
connection with this case.
The firm will be paid at these rates:
Steven L. Lefkovitz $600 per hour
Jay R. Lefkovitz $450 per hour
Michelle R. Lefkovitz $450 per hour
Associate Attorneys $350 per hour
Paralegals $125 per hour
The firm received a retainer of $7,500, plus filing fee of $1,738.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Steven Lefkovitz, Esq., an attorney at Lefkovitz & Lefkovitz,
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:
Steven L. Lefkovitz, Esq.
Lefkovitz & Lefkovitz, PLLC
908 Harpeth Valley Place
Nashville, TN 37221
Tel: (615) 256-8300
Fax: (615) 255-4516
Email: slefkovitz@lefkovitz.com
About RMCNV Holdings, LLC
RMCNV Holdings, LLC in Nashville, TN, filed its voluntary petition
for Chapter 11 protection (Bankr. M.D. Tenn. Case No. 23-04217) on
November 15, 2023, listing $10,000 in assets and $1,217,270 in
liabilities. David Wachtel as chief manager, signed the petition.
Judge Randal S. Mashburn oversees the case.
LEFKOVITZ & LEFKOVITZ serve as the Debtor's legal counsel.
ROSCOE MEDICAL: Midcap Financial Marks $1.3MM Loan at 33% Off
-------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $1,393,000
loan to Roscoe Medical, Inc to market at $931,000 or 67% of the
outstanding amount, as of September 30, 2023, according to Midcap
Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver Loan to Roscoe Medical, Inc. The loan accrues
interest at a rate of 1% (SOFR+636) per annum. The loan matures on
September 30, 2024.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Roscoe Medical, Inc. manufactures and distributes healthcare
products for homecare markets. The Company offers aerosol therapy,
asthma management, bath safety, canes and crutches, concentrator
parts, homecare beds and accessories, infection protection
products, walkers, and wheelchairs.
ROSIE LABS: Hires Phocus Law as Special Corporate Counsel
---------------------------------------------------------
Rosie Labs LLC, seeks approval from the U.S. Bankruptcy Court for
the Southern District of New York to employ Phocus Law as special
corporate counsel.
The firm's services include:
a. ongoing general counsel services including drafting,
negotiating, and helping to execute contracts with its vendors,
partners, and clients;
b. advising it with respect to hiring decisions and any
contracts related thereto;
c. structuring partnerships, joint-ventures, and key client
engagements;
d. advising with respect to any equity and/or debt financing
opportunities.
The firm will be paid at the rate of $375 per hour.
The firm will be paid a retainer in the amount of $7,912.50
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Michele Leonelli, Esq., a partner at Phocus Law, disclosed in a
court filing that the firm is a "disinterested person" as the term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Michele Leonelli, Esq.
PHOCUS LAW
7600 N. Pheonix Street, Suite 100
Pheonix, AZ 85020
Tel: (602) 457-2191
Email: Michele@phocuscompanies.com
About Rosie Labs LLC
Rosie Labs LLC is an international collective of start up mavens,
rebels with a cause, and risk takers hailing from the corporate
world. Its goal is to efficiently deliver big ideas and
unprecedented results in an agile environment.
Rosie Labs LLC in New York, NY, filed its voluntary petition for
Chapter 11 protection (Bankr. S.D.N.Y. Case No. 23-10780) on May
15, 2023, listing $0 to $50,000 in assets and $1 million to $10
million in liabilities. David Song as CEO, signed the petition.
Judge Martin Glenn oversees the case.
Kirby Aisner & Curley, LLP serves as the Debtor's legal counsel.
RV RETAILER: S&P Alters Outlook to Negative, Affirms 'B+' ICR
-------------------------------------------------------------
S&P Global Ratings revised its rating outlook on RV Retailer
Intermediate Holdings LLC to negative from stable. S&P also
affirmed all ratings, including its 'B+' issuer credit rating.
S&P said, "The negative outlook reflects our forecast for S&P
Global Ratings-adjusted debt to EBITDA to remain above our 5x
downgrade threshold for the next several quarters following steep
declines in retail sales and margin compression in 2023. We could
lower the ratings if we lose confidence in the company's ability to
generate S&P Global Ratings-adjusted EBITDA such that leverage is
reduced back within our threshold by year-end 2024.
"Our forecast for revenue and S&P Global Ratings-adjusted EBITDA
improvement in 2024 is reliant on a recovery in retail RV demand in
the second half of 2024 and the nonrecurrence of certain operating
events. The RV industry is vulnerable to economic cyclicality and
fluctuations in interest rates. Although we are not forecasting a
recession over the next 12 months, S&P Global economists forecast
that U.S. GDP growth will slow in 2024 to around 1.5% and about
1.4% in 2025, down from about 2.4% expected in 2023. Notably, we
expect this deceleration will be due to weaker real consumer
spending growth and a modest increase in unemployment over the next
two years.
"We expect consumer spending will align with real wage growth in
2024 (which has been muted for the past year) as consumers have
used up a significant portion of excess savings that had built up
during the pandemic. Meanwhile, we anticipate higher costs of
capital and slower growth will result in slower hiring and an
uptick in unemployment. While these expected developments could
result in incremental disinflation in 2024, our economists still
expect another 25 basis point (bps) interest rate hike in December
2023 and that rates will not come down until the second half 2024.
"The resulting macroeconomic backdrop poses downside risks to our
base-case forecast for RV Retailer because RVs are a highly
discretionary purchase that are typically financed over 10-20
years. Buyers may continue to stay on the sidelines through 2024 if
interest rates on loans remain high. The interest rate equation for
those trading in used RVs is also impacted by the fact that the
vehicle the consumer currently owns was likely financed at a much
more attractive interest rate.
"We revised the outlook to negative due to a spike in leverage
above our 5x downgrade threshold over the next several quarters.
Our leverage forecast is based on our expectation of stabilizing
retail demand for RVs in the second half of 2024 and an increase in
gross margin and reduced selling, general, and administrative
(SG&A) expense--as a percent of revenue--in 2024. We expect
same-store unit sales on both new and used RVs to be flat to down
low-single digit percent in 2024. We also expect mid-single digit
declines in average selling prices next year. While we do not
anticipate the level of discounting required to clear out aged
inventory throughout 2023 will repeat itself in 2024 given the
company is entering the new year with a more favorable mix of
product, we expect the industry at-large to emphasize lower price
point models in order attract new buyers. The company also
increased aged inventory reserves and took losses related to the
summer 2023 flood that occurred in Vermont, which we do not expect
to recur in 2024, and as a result we believe gross margins could
improve by approximately 100 bps-200 bps.
"Additionally, we believe that rapid increases in consumer
financing rates, high inflation, as well as a pull forward of
demand during the pandemic led to an exaggerated decline in retail
demand in 2023. There are macroeconomic downside risks to our base
case, but we expect retail demand will normalize, albeit at lower
levels in 2024, as inflation eases and consumers adjust to the new
interest rate environment. Retail sales of new RVs fell
precipitously through the third quarter of 2023. RV Retailer's unit
sales of new and used RV's were down approximately 23% and 16%,
respectively. At the same time, gross profit per unit deteriorated
meaningfully for new and used sales as the company took measures to
clear out its aged inventory of 2022 models and reduce its model
year 2023 mix of product.
"Lastly, we expect the company will benefit from reduced SG&A
expense in 2024 as the nears completion of its rebranding
efforts."
RV Retailer's acquisitive appetite is a risk factor. The company
has an expansion and investment plan that includes store
acquisitions, real estate purchases, and expansion of the servicing
and repairs footprint. Since its formation in 2018, RV Retailer has
meaningfully expanded its footprint of dealerships to be the
second-largest retailer of RVs in North America in under three
years. RV Retailer added 17 stores in 2022 and as of September
2023, the company operated 104 retail locations across 33 states,
making it the second-largest RV dealer in the U.S. S&P said, "While
the company has not made meaningful acquisitions in 2023 and has
closed some underperforming dealerships, we believe that growth
through acquisition remains a key piece of the company's strategy
going forward and RV Retailer might even take advantage of the
difficult retail environment to negotiate acquisitions, possibly
increasing leverage compared to our base case. RV Retailer's
sizable investment plan is a source of risk, particularly if the
acquisitions are made during a period of poor RV demand."
The economic cycle and potential declines in consumer credit
availability could further slow demand for new and used RVs. RV
Retailer operates in a competitive and highly fragmented industry.
The company's geographic footprint is somewhat concentrated and
manufacturing supplier relationships highly concentrated, which is
typical for RV dealerships. In addition, with an EBITDA margin
historically in the high-single- to low-double-digit percentage
range, the company ranks lower than most other rated leisure
companies. Dealers typically vie for inventory when buying behavior
is strong. In turn, RV original equipment manufacturers (OEMs)
compete to manufacture and deliver inventory to satisfy dealers. In
2019, wholesale shipments outpaced retail demand and contributed to
an industrywide correction and surplus inventory at dealerships,
which led to discounting and temporarily pressured dealer margins.
Such dynamics could introduce variability in revenue, EBITDA
margin, and working capital if the industry does not match supply
with demand. Business risks are partly offset by less volatile
demand for vehicle parts and services, high margins from finance
and insurance, and the company's increasing scale. RV Retailer will
increasingly benefit from scale efficiencies as it expands, if
scale enhances its ability to manage inventory, extract cost
savings, and raise capital to attract acquisitions.
S&P said, "The negative outlook reflects our forecast for S&P
Global Ratings-adjusted debt to EBITDA to remain above our 5x
downgrade threshold for the next several quarters following steep
declines in retail sales and margin compression in 2023. We could
lower the ratings if do not believe the company's can generate S&P
Global Ratings-adjusted EBITDA such that leverage is reduced back
within our threshold by year-end 2024.
"We could lower our rating on RV Retailer if we anticipate that S&P
Global Ratings-adjusted leverage will increase above its current
level or if we forecast leverage to remain above 5x beyond fiscal
year 2024. Such a scenario would likely be the result of a
combination of further declines in retail unit sales and a lack of
improvement in gross and EBITDA margins.
"Although unlikely over the next 12 months, we could raise the
rating on RV Retailer if we believe it can sustain S&P Global
Ratings-adjusted debt to EBITDA below 4x with a sufficient cushion
to absorb volatility and acquisition activity over an economic
cycle. Such a scenario would depend on whether we believe RV demand
is sufficiently sustainable to enable RV Retailer to manage costs
and maintain leverage below 4x. The RV business is highly cyclical;
therefore, we would likely require at least a 1x sustained cushion
compared to our upgrade threshold during times of economic and
consumer spending growth.
"ESG factors have a neutral influence on our credit rating analysis
of RV Retailer. The company is the second largest retailer of
recreational vehicles and can shift its mix of sales to address
potential incremental future regulation or changes in consumer
preferences related to greenhouse gas emissions. RV Retailer also
plans to increase investments in its servicing and repairs
capabilities, which are intended to complement electrification over
time. While the company's products and offerings benefited from
increased interest in outdoor recreation activities, such as RVing
and camping, during the pandemic, some of the excess demand has
moderated in 2023 (as expected), causing a decline in retail unit
sales."
SECURUS TECHNOLOGIES: Midcap Marks $7.1MM Loan at 15% Off
---------------------------------------------------------
MidCap Financial Investment Corporation has marked its $7,128,000
loan extended to Securus Technologies Holdings, Inc. to market at
$6,094,000 or 85% of the outstanding amount, as of September 30,
2023, according to Midcap Financial's Form 10-Q Report for the
Quarterly period ended September 30, 2023, filed with the
Securities and Exchange Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to Securus Technologies Holdings, Inc. The loan accrues interest at
a rate of 1% (L+825) per annum. The loan matures on November 1,
2025.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Based in Dallas, Texas, Securus Technologies Holdings, Inc. is one
of the largest providers of telecommunication services to
correctional facilities, with a presence in 50 states, Washington
DC, and Canada. Securus is owned and controlled by the private
equity firm Platinum Equity, LLC.
SELECTIS HEALTH: Enters Deals to Sell 4 Georgia Nursing Facilities
------------------------------------------------------------------
Selectis Health, Inc. announced that several wholly owned
affiliates have entered into agreements to sell the Company's four
owned and operated skilled nursing facilities in Georgia. The
agreements provide for the sale of the Company's Warrenton
Healthcare & Rehabilitation, Eastman Healthcare & Rehabilitation,
Glen Eagle Nursing and Rehabilitation, and Providence of Sparta
Healthcare & Rehabilitation facilities, for an aggregate
consideration of $31 million.
Transaction Summary
On Nov. 30, 2023, the Affiliates concurrently entered into Purchase
and Sale ("PSA") and Operations Transfer ("OTA") agreements with
Glen Eagle Propco LLC, Eastman Propco LLC, Providence Propco LLC,
and Warrenton Propco LLC. Under the agreements' terms, the
Purchaser will acquire the four Georgia facilities' real estate,
buildings, and improvements, along with certain personal property
used in their respective operations.
At the Purchaser's election, the Affiliates' rights and interests
associated with their Medicare and Medicaid provider numbers --
along with their Medicare and Medicaid provider reimbursement
Agreements—shall also be assigned to the Purchaser at the close
of the transaction, subject to legal permissibility and related
conditions noted in the OTA.
Georgia Facilities Included in the Transaction
Facility Beds
Warrenton Healthcare & Rehabilitation 110
Glen Eagle Nursing & Rehabilitation 101
Eastman Healthcare & Rehabilitation 100
Providence of Sparta Healthcare & Rehabilitation 71
Following completion of the transaction, the Company's remaining
owned facility in Georgia will be the Archway Transitional Care
skilled nursing facility (formerly known as Goodwill Nursing Home).
The Company's total remaining footprint is summarized below:
Facility Beds
Grand Prairie Nursing Home 141
Archway Transitional Care 172
Meadowview Healthcare & Rehabilitation 99
Higher Call Healthcare & Rehabilitation 86
Maple Street Healthcare & Rehabilitation 29
Park Place Healthcare & Rehabilitation 106
Southern Hills Assisted Living Facility 24
Southern Hills Healthcare & Rehabilitation 106
Southern Hills Retirement Facility 90
Closing Terms and Proceeds
To close the transaction, the Purchaser must obtain the facilities'
required operating licenses from the Georgia Department of
Community Health, along with other necessary federal and state
regulatory certifications, operational licenses, and permits. The
Affiliates and Purchaser must also satisfy all due diligence
provisions and requirements set forth in the PSA. Subject to these
and other closing requirements, the transaction is expected to
close at least 45 days after (i) the completion of the due
diligence period and (ii) obtaining the necessary regulatory
approvals, on the first business day of the first calendar month
after the last of these processes is complete.
Pursuant to the agreements, the facilities will be sold for an
aggregate consideration of $31 million. On the Effective Date, the
Purchaser placed an initial deposit of $250,000 in escrow, which
shall be fully refundable until the expiration of the due diligence
period. Once the due diligence period expires, the Purchaser shall
deposit an additional $250,000 into escrow. Both deposits, and the
remaining balance of the purchase price, will be paid to the
Affiliates at closing.
Adam Desmond, interim CEO of Selectis Health, commented: "The
attractive valuation of our Georgia facilities is a testament to
the success of our facility-level financing and operational
improvement initiatives. We expect the significant additional
capital from this sale to enhance the flexibility of our balance
sheet as we optimize our remaining footprint and progress towards
portfolio-wide profitability. While our work is not yet finished,
we will continue to work towards closing this transaction and seek
additional opportunities to create and maximize shareholder
value."
About Selectis Health
Headquartered in Greenwood Village, Colo., Selectis Health, Inc.
and/or operates healthcare facilities in Arkansas, Georgia, Ohio,
and Oklahoma, providing a wide array of living services, speech,
occupational, physical therapies, social services, and other
rehabilitation and healthcare services. Selectis focuses on
building strategic relationships with local communities in which
its partnership can improve the quality of care for facility
residents. With its focused growth strategy, Selectis intends to
deepen its American Southcentral and Southeastern market presence
to better serve the aging population along a full continuum of
care.
Selectis Health reported a net loss of $2.39 million in 2022
following a net loss of $2.24 million in 2021.
Selectis said in its Quarterly Report on Form 10-Q for the quarter
ended Sept. 30, 2023, that, "For the nine months ended September
30, 2023, the Company had operating cash flows of $2,390,891 and
negative net working capital of $8.8 million. As a result of our
losses and our projected cash needs, substantial doubt exists about
the Company's ability to continue as a going concern."
SI HOLDINGS: Midcap Financial Marks $3.4MM Loan at 34% Off
----------------------------------------------------------
MidCap Financial Investment Corporation has marked its
$3,413,000loan extended to SI Holdings, Inc. to market at
$2,259,000 or 66% of the outstanding amount, as of September 30,
2023, according to Midcap Financial's Form 10-Q Report for the
Quarterly period ended, September 30, 2023, filed with the
Securities and Exchange Commission.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver Loan to SI Holdings, Inc. The loan accrues interest
at a rate of 1% (SOFR+610) per annum. The loan matures on July 25,
2024.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
SI Holdings, Inc. designs and develops application software.
SIMEIO GROUP: Midcap Financial Marks $1.7MM Loan at 35% Off
-----------------------------------------------------------
MidCap Financial Investment Corporation has marked its $1,731,000
loan extended to Simeio Group Holdings, Inc to market at $1,124,000
or 65% of the outstanding amount, as of September 30, 2023,
according to Midcap Financial's Form 10-Q Report for the Quarterly
period ended September 30, 2023, filed with the Securities and
Exchange Commission.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver Loan to Simeio Group Holdings, Inc. The loan accrues
interest at a rate of 1% (SOFR + 560%) per annum.
The Midcap Financial Investment Corporation is a Maryland
corporation incorporated on February 2, 2004. It is a closed-end,
externally managed, non-diversified management investment company
that has elected to be treated as a business development company
under the Investment Company Act of 1940. Apollo Investment
Management, L.P. is the investment adviser and an affiliate of
Apollo Global Management, Inc. and its consolidated subsidiaries
(AGM). Apollo Investment Administration, LLC, an affiliate of AGM,
provides, among other things, administrative services and
facilities for Midcap.
Simeio offers professional services, Identity and Access Management
(IAM) managed services and Identity as a Service.
SIMPLEDIRECTCLUB: In Talks With Creditors, Founders to Save Co.
---------------------------------------------------------------
SmileDirectClub Inc. is in talks with its founders and creditors
about a plan to save the company from liquidation.
SmileDirectClub filed for bankruptcy in late September 2023 with
plans to hunt for a buyer. While no third-party suitor emerged by
an agreed deadline, new court papers show, founders Jordan Katzman
and Alex Fenkell have since offered to take over the business and
invest fresh cash.
Following the Petition Date, the Debtors, with the assistance of
Centerview Partners LLC, began a 60-day marketing process for a
going-concern transaction to be implemented under a plan of
reorganization. But no one offered a going concern bid of more
than the $25 million required to top the DIP Lenders' credit bid.
To recall, on Nov. 7, 2023, the Court entered an order, approving
the Debtors' DIP Facility on a final basis. The DIP facility
provided the Debtors with up to $20 million in new-money financing
to be used to run an expedited marketing process during the first
60 days of the chapter 11 cases. Under the DIP Facility, an
additional $30 million of new-money financing would be available as
a delayed draw if, on Nov. 28, 2023, (i) a cash flow test was
satisfied, requiring no greater than a $7,000,000 reduction in net
cash flow as compared to the Initial Budget and (ii) a successful
bid was received.
On Dec. 4, 2023, the Debtors filed the Delayed Draw Notice and
Notice of
T-2 Hearing. The Delayed Draw Notice states that "the Debtors had
not received an actionable proposal for a going concern
transaction" by the Bid Deadline. The Delayed Draw Notice also
states that, following the Bid Deadline, the Insider DIP Lenders
submitted a proposal for a going concern transaction, pursuant to
which the Insider DIP Lenders will fund the Delayed Draw T-2 Loans
and up to $25 million on the effective date of a plan that provides
for the issuance of 100% of the New Common Stock to the Insider DIP
Lenders in full and final satisfaction of any claims on account of
the DIP Facility (the "DIP Lender Proposal").
The Delayed Draw Notice provides "notice of satisfaction or waiver
of the Delayed Draw Condition, subject to the Debtors (a) reaching
an agreement with the Committee and HPS regarding the terms of an
acceptable Plan, and (b) obtaining an acceptable amendment to the
Forbearance Agreement from HPS."
Align Technology Inc., however, claims that conversion of the
Chapter 11 cases to chapter 7 or dismissal may be warranted under
the circumstances.
"Until parties are afforded a full and fair opportunity to evaluate
estate claims and causes of action, liens should not be granted on
those claims and causes of action or their proceeds. This is
particularly true here, where the Insider DIP Lenders are on both
sides of these claims. Further, granting such liens would also
give the Debtors undue leverage in their ongoing negotiations with
the Creditors’ Committee over potential recoveries for unsecured
creditors, especially given that the Committee’s support for a
plan is a requirement for funding."
"As expected, the Insider DIP Lenders have emerged as the only
party willing to purchase (through a credit bid of the DIP
Facility) the Debtors’ business. The Court should not permit the
Insider DIP Lenders—the prospective defendants in those
actions— to fund the Delayed Draw T-2 Loans in an attempt to
ultimately foreclose on the business itself and on what is likely
the only source of recovery for unsecured creditors," Align added.
About SmileDirectClub, Inc.
SmileDirectClub, Inc. (Nasdaq: SDC) --
http://www.SmileDirectClub.com/-- is an oral care company and
creator of the first medtech platform for teeth straightening.
Through its cutting-edge telehealth technology and vertically
integrated model, SmileDirectClub is revolutionizing the oral care
industry. Its mission is to democratize access to a smile each and
every person loves by making it affordable and convenient for
everyone. SmileDirectClub is headquartered in Nashville,
Tennessee.
SmileDirectClub and its affiliates sought protection under Chapter
11 of the U.S. Bankruptcy Code (Bankr. S.D. Texas Lead Case No.
23-90786) on Sept. 29, 2023. In the petition signed by its chief
financial officer, Troy Crawford, SmileDirectClub disclosed
$498,712,000 in assets and $1,051,823,000 in liabilities.
Judge Christopher M. Lopez oversees the cases.
The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis
International, LLP as general bankruptcy counsel; Jackson Walker,
LLP as local bankruptcy counsel; Centerview Partners, LLC as
financial advisor and investment banker; FTI Consulting, Inc., as
restructuring advisor; and Kroll Restructuring Administration,
LLC,
as notice and claims agent.
SMILEDIRECTCLUB: Align Says Additional Facts Should be Disclosed
----------------------------------------------------------------
Align Technology, Inc., objects to the Smiledirectclub, Inc., et
al.'s motion for entry of an order conditionally approving the
adequacy of the disclosure statement.
According to Align Technology, the premise of the Debtors' proposed
"toggle" plan is that the Debtors do not yet know what path these
cases will take and whether the Plan will be one of reorganization
or liquidation. Regardless of how these cases develop, it is
crucial that stakeholders be fully informed and given the
opportunity to vote to accept or reject the Plan. The Disclosure
Statement Motion should not be approved because the Disclosure
Statement and the proposed Solicitation and Voting Procedures fail
to accomplish either requirement.
A disclosure statement, Align points out, need not include every
fact about the Debtors in order for stakeholders to vote on an
informed basis. There are, however, certain facts related to the
Debtors' business practices that are either omitted or misstated in
the Disclosure Statement, and which go to the heart of the
feasibility of any reorganized business, the value of estate claims
and causes of action (which in some cases are proposed to be
released), and the determination of whether creditors would fare
better under a chapter 7 liquidation. These practices undermine the
value and viability of the Debtors' business, which jeopardizes the
future of any potential reorganization, and give rise to valuable
estate claims and causes of action. Given their materiality,
additional facts regarding these practices should be disclosed.
Align asserts that the Disclosure Statement similarly fails to
provide any disclosure regarding (i) estate claims and causes of
action stemming from (among other things) these business practices
and prepetition distributions to insiders, (ii) the status of the
ongoing investigations of these claims by the Official Committee of
Unsecured Creditors and the Special Committee of the Board of
Directors of SDC, Inc., or (iii) an assessment of the value of
these claims. The Disclosure Statement should not be approved (on a
conditional basis or otherwise) unless these and other key facts
are accurately disclosed to the Debtors' stakeholders as set forth
in Align's proposed changes to the Disclosure Statement.
Align also points out that in addition to insufficient disclosure,
the Disclosure Statement Motion seeks approval of Solicitation and
Voting Procedures that could improperly disenfranchise
stakeholders. Among other things, any creditor whose claim is
objected to by the Debtors for voting purposes (the proposed
deadline for which is two days prior to the Voting Deadline) would
have to either get an agreement by the Debtors or file a 3018
motion (or some other motion seeking the allowance of its claim for
voting purposes) and obtain a ruling from the Court at least two
business days prior to the Voting Deadline—a date that falls
before the last date that an objection can be filed by the Debtors.
This gives the Debtors inappropriate power to disenfranchise
creditors simply by objecting to their claims (whether such
objection is legitimate or not). The Solicitation and Voting
Procedures should not be approved unless (i) holders of claims
subject to an objection are given sufficient time to resolve such
objection and have their votes counted and (ii) other solicitation
infirmities, as set forth herein, are remedied.
Finally, the Plan, according to Align, suffers from several
infirmities that render it unconfirmable, some of which should be
modified prior to solicitation to save the estates from potentially
having to resolicit. First, in the case of a restructuring, the
Plan unfairly discriminates against Align and other general
unsecured creditors in violation of section 1123(a)(4) of the
Bankruptcy Code because HPS's similarly situated guarantee claims
will be reinstated while general unsecured creditors will receive a
minimal (if any) recovery. Second, in a wind down scenario, the
Plan improperly classifies the HPS guarantee claims separately from
other unsecured claims in order to gerrymander an impaired
accepting class in violation of section 1122 of the Bankruptcy
Code. Third, in a restructuring, the Plan is not feasible because
the Debtors' business is not viable. Finally, the Plan's
exculpation and release provisions are overbroad. If not remedied,
Align reserves all rights to object to these and other infirmities
in the Debtors' proposed Plan.
Counsel to Align Technology, Inc.:
WHITE & CASE LLP
Charles R. Koster, Esq.
609 Main St., Suite 2900
Houston, TX 77002
Tel: (713) 496-9700
E-mail: charles.koster@whitecase.com
– and –
Jason N. Zakia, Esq.
Gregory F. Pesce, Esq.
Erin Rosenberg, Esq.
Laura E. Baccash, Esq.
111 South Wacker Drive, Suite 5100
Chicago, IL 60606
Tel: (312) 881-5400
E-mail: jzakia@whitecase.com
gregory.pesce@whitecase.com
erin.rosenberg@whitecase.com
laura.baccash@whitecase.com
– and –
Andrew Zatz, Esq.
Barrett Lingle, Esq.
1221 Avenue of the Americas
New York, NY 10020
Tel: (212) 819-8200
E-mail: azatz@whitecase.com
barrett.lingle@whitecase.com
About SmileDirectClub Inc.
SmileDirectClub, Inc. (Nasdaq: SDC) --
http://www.SmileDirectClub.com/-- is an oral care company and
creator of the first medtech platform for teeth straightening.
Through its cutting-edge telehealth technology and vertically
integrated model, SmileDirectClub is revolutionizing the oral care
industry. Its mission is to democratize access to a smile each and
every person loves by making it affordable and convenient for
everyone. SmileDirectClub is headquartered in Nashville,
Tennessee.
SmileDirectClub and its affiliates sought protection under Chapter
11 of the U.S. Bankruptcy Code (Bankr. S.D. Texas Lead Case No.
23-90786) on Sept. 29, 2023. In the petition signed by its chief
financial officer, Troy Crawford, SmileDirectClub disclosed
$498,712,000 in assets and $1,051,823,000 in liabilities.
Judge Christopher M. Lopez oversees the cases.
The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis
International, LLP as general bankruptcy counsel; Jackson Walker,
LLP as local bankruptcy counsel; Centerview Partners, LLC as
financial advisor and investment banker; FTI Consulting, Inc., as
restructuring advisor; and Kroll Restructuring Administration, LLC,
as notice and claims agent.
SOLARPLICITY UK: Midcap Financial Marks $5.5MM Loan at 65% Off
--------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $5,562,000
loan extended to Solarplicity UK Holdings Limited to market at
$1,950,000or 35% of the outstanding amount, as of September 30,
2023, according to Midcap Financial's Form 10-Q Report for the
Quarterly period ended September 30, 2023, filed with the
Securities and Exchange Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to Solarplicity UK Holdings Limited. The loan accrues interest at a
rate of 4% per annum. The loan matured last March 8, 2023.
Midcap said the loan is on non-accrual status.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Solarplicity was a renewable energy company based in Hertfordshire,
England. In August 2019 the company became the 13th energy supplier
to collapse since 2018, affecting around 7,500 domestic and 500
business customers.
SOUTHERN NEW YORK: Unsecureds to Get 30 Cents on Dollar in Plan
---------------------------------------------------------------
Southern New York Neurosurgical Group, P.C., filed with the U.S.
Bankruptcy Court for the Northern District of New York a Small
Business Plan of Reorganization dated November 30, 2023.
The Debtor has been in the business of an active medical practice
until 2017, when it ceased operations as a medical practice and
operated solely as a 35 percent owner of another entity.
The Debtor receives quarterly income from that ownership interest.
Debtor's official address is 46 Harrison Street, Johnson City, NY
13790. Debtor has had no employees since 2017.
In 2016-2017 the Debtor sold its medical practice to United Health
Services (UHS). Debtor retained a 35% ownership in PET/CT Imaging
Services, LLC, which owns a piece of equipment that is leased to
UHS and which results in a quarterly payment to the Debtor. This
quarterly payment is the only income the Debtor receives. As of the
filing of the bankruptcy case, the Debtor expects about 6 more
quarterly payments before the lease ends.
At the time of the sale of the practice, Debtor was owned by three
doctors, Dr. Galyon, Dr. Bajwa and Dr. Sethi. Since that time, only
Dr. Sethi remains, and now owns 100% of the stock in the Debtor
corporation. Disagreements occurred between the three doctors,
which resulted in litigation in state court. (Saeed A. Bajwa, M.D.
v. Southern New York Neurosurgical Group, P.C., et al.
EFCA2020001974). Pretrial activity proved to be expensive, and the
Debtor only had the limited quarterly income from PET/CT Imaging
Services, LLC. Debtor made the decision to move the entire matter
to the Bankruptcy Court so that Debtor's future income could be
distributed through this Subchapter V case to creditors.
This Plan of Reorganization proposes to pay creditors of the Debtor
from future income.
Non-priority unsecured creditors holding allowed claims will
receive distributions, which the proponent of this Plan has valued
at approximately 30 cents on the dollar. This Plan also provides
for the payment of administrative and priority claims.
Class 3 consists of Non-priority unsecured creditors. Unsecured
creditors will be paid a pro-rata share of Debtor's future income
for three years after the effective date of this Plan. It is
anticipated that this will yield approximately 30 cents on the
dollar of all allowed claims.
Equity Interest holders shall receive 100% of the shareholder
interests in the reorganized Debtor.
The Plan will be implemented by the Debtor remitting payment to
creditors from the Debtor's cash flow derived from income from its
35% ownership of another entity.
Upon Confirmation of the Plan, all property of the Debtor, tangible
and intangible, including, without limitation, licenses, furniture,
fixtures, and equipment, will revert free and clear of all Claims
and Equitable Interests except as provided in the Plan, to the
Debtor. The Debtor expects to have sufficient cash on hand to make
the payments required on the Effective Date.
A full-text copy of the Plan of Reorganization dated November 30,
2023 is available at https://urlcurt.com/u?l=JUP2sk from
PacerMonitor.com at no charge.
Attorneys for Debtor:
Peter A. Orville, Esq.
Zachary D. McDonald, Esq.
ORVILLE & MCDONALD LAW, PC
30 Riverside Dr.
Binghamton, NY 13905
Tel: (607) 770-1007
Email: peteropc@gmail.com
About Southern New York Neurosurgical
Southern New York Neurosurgical Group, P.C., has been in the
business of an active medical practice until 2017, when it ceased
operations as a medical practice and operated solely as a 35
percent owner of another entity.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. N.D.N.Y. Case No. 23-60654) on Sept. 1,
2023, with $100,001 to $500,000 in both assets and liabilities.
Peter Alan Orville of Orville & McDonald Law, PC, is the Debtor's
legal counsel.
STAR US: Moody's Lowers Secured Bank Loans to 'B3', Outlook Stable
------------------------------------------------------------------
Moody's Investors Service affirmed Star US Bidco, LLC's (dba
Sundyne) B3 Corporate Family Rating and B3-PD Probability of
Default Rating. Simultaneously, Moody's downgraded the senior
secured bank credit facilities to B3 from B2. The outlook is
stable.
The affirmation of the CFR and PDR reflect Sundyne's solid
operating performance driven by good demand for products and
aftermarket services across end markets, good liquidity and growing
committed backlog. Moody's expects the positive operating momentum
to continue into 2024 and will support deleveraging. The downgrade
of the senior secured bank credit facilities reflects the proposed
refinancing of the second lien term loan in its entirety with
incremental first lien debt. About $50 million of first lien debt
combined with cash on hand will fund a $70 million dividend to
shareholders. The proposed $150 million fungible first lien term
loan add-on will increase pro forma debt/EBITDA to 6.2 times from
5.5 times as of September 30, 2023. Pro forma EBITA/Interest
expense will also be modest at about 1.5 times. Sundyne will
maintain good liquidity with positive free cash flow generation
despite higher interest expense and an undrawn revolver that will
be extended by two years expiring in 2027.
RATINGS RATIONALE
The B3 CFR reflects Sundyne's modest scale, exposure to volatile
end markets and modest interest coverage. More than half of revenue
is generated by oil and gas companies. Favorably, most of Sundyne's
oil and gas customers are in the more stable mid-stream and
down-stream portion of the energy sector. Also, the price of oil is
expected to sustain continued investment in and maintenance of
production capacity for the next several quarters. Volatility from
the energy sector is further mitigated by the growth in chemical
and industrial end markets. Pro forma EBITA/Interest expense will
be modest at 1.5 times due to the elevated interest rate
environment and higher debt burden, however, will benefit from the
refinancing of more expensive second lien debt.
Sundyne benefits from a large installed base of its pumps and gas
compressors. About a half of total revenue is generated by higher
margin aftermarket services and offsets much of the volatility in
equipment sales. Committed backlog is solid and provides good
revenue visibility. The company also benefits from the
mission-critical nature of its products, robust EBITDA margins, and
well-established relationships with a blue-chip customer base
supported by strong brands in niche markets. The rating is also
supported by the solid outlook in several of its end markets.
Sundyne will continue to maintain good liquidity. Moody's expects
that the company will be able to fund debt service and capital
expenditures over the next 12 to 18 months with free cash flow from
operations. Sundyne also benefits from an undrawn $100 million
revolver and separate letter of credit facility, with ample
headroom under its springing financial maintenance covenant.
The stable outlook reflects Moody's expectation that the company's
growing backlog will translate into continued solid operating
performance and support deleveraging over the next 12 to 18 months.
Moody's also expects that Sundyne will continue to maintain good
liquidity supported by positive free cash flow.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Sundyne's ratings may be downgraded if there is an erosion in
liquidity, debt/EBITDA exceeds 7.0 times or EBITA/interest declines
towards 1.0 times. The loss of a major customer, with volumes not
replaced, could also drive negative ratings action.
Ratings may be upgraded if the company demonstrates steady revenue
and earnings growth such that debt/EBITDA is sustained below 6.0
times or if EBITA/interest approaches 2.0 times. Continued positive
free cash flow and a less aggressive financial policy would also
support a ratings upgrade.
Headquartered in Arvada, Colorado, Sundyne is a manufacturer of
pumps and compressors sold to the mid and downstream oil & gas and
LNG end markets in addition to chemicals, industrials and
renewables sectors. The company is owned by private equity sponsor
Warburg Pincus International LLC.
The principal methodology used in these ratings was Manufacturing
published in September 2021.
SUNLIGHT FINANCIAL: Judge Walrath to Approve Acquisition
--------------------------------------------------------
Jonathan Randles of Bloomberg Law reports that a Delaware
bankruptcy judge indicated she will approve solar-panel loan
arranger Sunlight Financial Holdings Inc.'s acquisition by an
investment consortium led by affiliates of Greenbacker Capital
Management, Sunstone Credit and IGS Ventures.
Judge Mary Walrath said Tuesday, December 5, 2023, that she's
inclined to greenlight the acquisition, which is included in
Sunlight's broader restructuring plan, pending lawyers finalizing
an ancillary proposal to keep intact a shareholder lawsuit seeking
money from the company's insurers.
Sunlight went bankrupt in October 2023 after going public in 2021
through a merger with a special-purpose acquisition company backed
by Apollo Global Management Inc.
About Sunlight Financial Holdings
Sunlight Financial Holdings Inc. operates a
business-to-business-to-consumer, technology-enabled point-of-sale
financing platform. The Company provides solar and home
improvement contractors across the United States with the ability
to offer homeowners loans funded by the Company's capital
providers. The Company uses proprietary technology and deep credit
expertise to simplify the financing process for contractors and
installers, capital providers, and homeowners, successfully helping
over 125,000 homeowners install residential solar systems, reduce
their
carbon footprint, and save money.
Sunlight Financial Holdings Inc. and its affiliates sought relief
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead
Case No. 23-11794) on Oct. 30, 2023. In the petition filed by
Matthew R. Potere, as chief executive officer, the Debtor reported
total assets as of Aug. 31, 2023 amounting to $403,848,901 and
total debt of $173,943,096.
The Debtors tapped WEIL, GOTSHAL & MANGES LLP as bankruptcy
counsel; RICHARDS, LAYTON & FINGER, P.A., as local counsel; ALVAREZ
& MARSAL NORTH AMERICA, LLC, as financial advisor; and GUGGENHEIM
PARTNERS, LLC, as investment banker. OMNI AGENT SOLUTIONS, INC.,
is the claims agent.
SUPERIOR INDUSTRIES: S&P Alters Outlook to Neg., Affirms 'B-' ICR
-----------------------------------------------------------------
S&P Global Ratings revised its outlook to negative from stable and
affirmed its 'B-' issuer credit rating on Superior Industries
International Inc.
The negative outlook reflects S&P's expectation that Superior could
face challenges addressing its debt maturities, affecting the
entire capital structure over the next couple quarters.
S&P said, "We revised our outlook on Superior to negative because
it faces heightened refinancing risk, affecting its entire capital
structure over the next 18-24 months. The company will have to
address its EUR250 million senior unsecured notes due June 2025
followed by its redeemable preferred equity due September 2025.
Additionally, the company's senior secured debt, including its cash
flow revolver and first-lien term loan, feature a springing
maturity condition that would terminate these commitments 90 days
prior to the maturity of its senior unsecured notes (June 15, 2025)
or redeemable preferred equity (Sept. 14, 2025). Once current,
these debt maturities will act as a material use in our liquidity
assessment and would strain its limited sources, primarily
consisting of cash on balance sheet and positive funds from
operations (FFO).
"Additionally, topline growth and margins have been weaker than
expected in 2023, though we forecast improvement in 2024 and 2025.
We expect EBITDA margins will gradually recover and that the
company will generate modest FOCF over the next three years. Sales
have been pressured in the first three quarters of 2023 as lower
aluminum prices and weaker unit volumes at key customers led to
revenue being down 13% compared to the same prior-year period.
While revenues have been lower this year, Superior has maintained
EBITDA margins greater than 10% (albeit lower than our previous
forecast of 12.2%), primarily because of its commercial cost
recovery efforts with original equipment manufacturer (OEM)
customers and mix shift to higher value-added content. Margins in
our latest base case are lower than previously forecast because of
incremental restructuring costs related to Superior's
reorganization of its German manufacturing facility and impact of
the United Auto Worker (UAW) strike in North America. Still, we
forecast margin improvement to at least 12% in 2024 and 2025 due to
gradually increasing production volumes and benefits of recent
restructuring actions.
"We expect credit metrics will be somewhat weaker in 2023 with
leverage above 6x, but we believe leverage will revert back down to
between 5x-6x in 2024 and 2025 as margins recover. In 2023, we
expect free operating cash flow (FOCF) will be only modestly
positive as the company invests in working capital. Cash flows will
likely improve in 2024 and 2025 with better margins and assuming
the company can manage production at its plants.
The negative outlook reflects our expectation that Superior could
face challenges addressing its debt maturities, affecting the
entire capital structure over the next couple quarters.
"We could lower our ratings if the company is unable to address its
upcoming debt maturities in a timely manner, causing its liquidity
to become weak."
S&P could revise its outlook on Superior to stable if:
-- The company addresses the upcoming debt maturities across its
capital structure in a manner that results in creditors receiving
nothing less than the value promised when the debt was issued; and
-- Its sales volumes and EBITDA margins normalize and support at
least breakeven FOCF.
ESG factors have an overall neutral influence on S&P's credit
rating analysis of Superior. The increased electrification of
vehicle powertrains will not have a significant effect on demand
for wheels.
SURF OPCO: Midcap Financial Marks $20MM Loan at 32% Off
-------------------------------------------------------
MidCap Financial Investment Corporation has marked its $20,000,000
loan extended to Surf Opco, LLC to market at $13,629,000 or 68% of
the outstanding amount, as of September 30, 2023, according to
Midcap Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver Loan to Surf Opco, LLC. The loan accrues interest at
a rate of 1% (SOFR+411) per annum. The loan matures on March 17,
2026.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for the
Company.
Surf Opco LLC, does business as Wave Electronics. It is a
distributor of consumer electronics and home automation integration
products.
SYSTEM1 INC: Sells Total Security Limited for $340M
---------------------------------------------------
System1, Inc. announced the sale of Total Security Limited to a
group led by Just Develop It Limited.
The Transaction allows System1 to focus on its core advertising
business and positions the Company for accelerated growth powered
by its industry-leading Responsive Acquisition Marketing Platform
(RAMP). The Transaction also enhances the Company's financial
profile and leverage position, while providing greater financial
flexibility to fuel its future growth.
"The sale of Total Security represents System1's commitment to
providing our world-class RAMP technology to powerful brands and
delivering high-quality consumers to our advertising partners,"
said Michael Blend, System1's co-founder, chairman & chief
executive officer. "The transaction allows us to focus on
investing in RAMP, growing our advertising business, and
capitalizing on the recent upturn in the online advertising market
to drive shareholder value. We thank the employees of Total
Security for their hard work and dedication, and wish them well
under their new ownership group."
Tridivesh Kidambi, System1's chief financial officer, commented,
"As we have stated before, we are committed to positioning System1
to take advantage of current trends in digital advertising through
our RAMP platform, and believe the financial flexibility created by
this transaction will allow us to further those efforts. The new
capital will enable us to both continue investing in our core
advertising business, while also improving our leverage and
liquidity position."
Transaction Highlights
The Transaction consideration valued at approximately $340 million
includes (a) a $240 million cash payment to System1, subject to
certain closing adjustments, (b) the assumption and waiver of $60
million of potential earnout payments due to Total Security in
connection with the business combination transaction in January
2022, and (c) the transfer to System1 of approximately 29.1 million
shares of System1's Class A common stock held by Just Develop It
Limited and related persons with an aggregate value of
approximately $40 million as of the closing price on Nov. 29, 2023,
representing approximately 25% of the Company's shares outstanding.
The Company will use $51.0 million of the proceeds to repay
certain of its outstanding indebtedness.
The transaction was unanimously approved by the non-interested
independent members of the System1 Board of Directors, acting upon
the unanimous recommendation of a Special Committee of independent
directors that was established to evaluate the terms of this
Transaction and other strategic alternatives.
Upon completion of the Transaction, Christopher Phillips, the
controlling stockholder and director of Just Develop It Limited,
voluntarily resigned from his position as a member of the System1
Board of Directors.
Advisors
Solomon Partners served as financial advisor to the Special
Committee and Weil, Gotshal & Manges LLP served as legal counsel to
the Special Committee. Latham & Watkins LLP served as legal
counsel to the Company.
Fiscal Year 2023 Guidance
As a result of the Transaction, the Company is withdrawing its
guidance for the second half of fiscal year 2023 which was provided
in August of this year.
Share Buyback Authorization
The Company also reconfirmed it still has approximately $24 million
remaining on its previously announced Stock and Warrant repurchase
program.
About System1
Headquartered in Marina Del Rey, CA, System1, Inc. operates an
omnichannel customer acquisition platform, delivering high-intent
customers to advertisers and marketing antivirus software packages
to end user customers.
Los Angeles, California-based PricewaterhouseCoopers LLP, the
Company's auditor since 2020, issued a "going concern"
qualification in its report dated June 5, 2023, citing that the
Company has violated a covenant which resulted in the outstanding
principal balances under the Company's Term Loan and Revolving
Facility with Bank of America being callable at the request of, or
with the consent of, the required majority lenders and has
insufficient liquidity to settle the outstanding principal balances
of the Term Loan and Revolving Facility that raise substantial
doubt about its ability to continue as a going concern.
TASEKO MINES: Moody's Affirms 'B3' CFR, Outlook Remains Stable
--------------------------------------------------------------
Moody's Investors Service has affirmed Taseko Mines Limited's B3
corporate family rating, B3-PD probability of default rating and
the B3 senior secured note ratings. Taseko's Speculative Grade
Liquidity Rating ("SGL") remains unchanged at SGL-2. The outlook
remains stable.
"The rating affirmations reflects higher copper production at
Taseko's Gibraltar mine in 2023 and the company's progress on
securing funding for its Florence copper project", said Jamie
Koutsoukis Moody's analyst.
RATINGS RATIONALE
Taseko's B3 CFR is constrained by: 1) the company's concentration
of cash flows from primarily one metal (copper) at a single mine
(Gibraltar); 2) by the inherent price volatility of copper which
periodically results in high leverage during trough market prices;
3) execution risk for its Florence project that includes the
technical risks of in-situ mining, which has not been used for a
large scale copper projects to date; and 4) Florence project
capital spending that has partially been funded with debt that will
be supported by Gibralter cash flow until Florence is producing.
The company benefits from: 1) its mine locations in favorable
mining jurisdictions (Canada and the US); and 2) long reserve life
(21 years at Gibraltar, 21 years expected at Florence).
Taseko's liquidity is good over the next year (SGL-2) with about
CAD380 million in sources compared to about CAD280 million of uses.
Sources include CAD82 million in cash at September 30, 2023; about
CAD65 million available on its US$80 million revolving credit
facility (expires July 2026); US$25 million equipment loan
commitment from Bank of America; a US$50 million royalty for 1.95%
of the gross revenue from the sale of all copper from Florence
Copper for the life of mine from Taurus Mining Royalty Fund L.P; a
US$50 million investment from Mitsui for Florence Copper in the
form of a copper stream agreement and a US$50 million senior
secured debt facility through Societe Generale.
Uses include Moody's expectation that the company will have
negative free cash flow of about CAD260 million through to the end
of 2024 (using a $3.55/lb copper price sensitivity, after deducting
capex and stripping costs). Taseko will also pay about CAD20
million for the 12.5% Gibraltar mine interest acquisition. The
company has no debt maturities until February 2026. The company's
credit facility contains financial covenants that include senior
secured debt to EBITDA and minimum interest coverage tests which
Moody's expects the company to remain in compliance with.
The stable outlook reflects Moody's expectation that Taseko will
maintain copper equivalent production at about 115 million lbs/year
at Gibraltar (about 100 million lbs/year for their 87.5% share) and
that it will have sufficient liquidity to fund the development of
Florence over the next two years.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be downgraded if Taseko experiences operating
challenges at Gibraltar, funding constraints for its Florence
project, or if liquidity weakens.
The ratings could be upgraded if the company is able to achieve
increased mine diversity and improve its cost profile through the
development of Florence. An upgrade would also require Taseko to
generate sustained positive free cash flow, while maintaining
adjusted debt/EBITDA below 4.0x.
The principal methodology used in these ratings was Mining
published in October 2021.
Headquartered in Vancouver, Canada, Taseko Mines Limited operates
Gibraltar, an open-pit copper and molybdenum mine located in
British Columbia (BC), Canada, producing about 120-130 million
pounds/year. Gibraltar is an unincorporated joint venture, 87.5%
owned by Taseko and 12.5% owned a Japanese consortium. The company
also plans to develop its Florence copper in situ development
project (Arizona).
TELA BIO: Midcap Financial Marks $16.6MM Loan at 20% Off
--------------------------------------------------------
MidCap Financial Investment Corporation has marked its $16,667,000
loan to TELA Bio, Inc to market at $13,333,000 or 80% of the
outstanding amount, as of September 30, 2023, according to Midcap
Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured Debt-
Loan to TELA Bio, Inc. The loan accrues interest at a rate of 1%
(SOFR+635) per annum. The loan matures on May 1, 2027.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Based in Malvern, Pa., TELA Bio, Inc. is a commercial stage medical
technology company focused on designing, developing, and marketing
a new category of tissue reinforcement materials to address unmet
needs in soft tissue reconstruction.
TELESOFT HOLDINGS: 93% Markdown for $2.2MM Midcap Loan
------------------------------------------------------
MidCap Financial Investment Corporation has marked its $2,273,000
loan extended Telesoft Holdings, LLC to market at $168,000 or 7% of
the outstanding amount, as of September 30, 2023, according to
Midcap Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured
Debt-Revolver Loan to Telesoft Holdings, LLC. The loan accrues
interest at a rate of 1% (SOFR + 585%) per annum. The loan matures
on December 16, 2025.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Telesoft Holdings LLC provides telecommunications billing and
customer care solutions to educational institutions, corporations,
and government agencies. The Company offers integrated hardware and
proprietary software systems and services. Telesoft serves
customers in the United States.
THREE DELUNA: Hires Stichter Riedel Blain & Postler as Counsel
--------------------------------------------------------------
Three Deluna, LLC seeks approval from the U.S. Bankruptcy Court for
the Northern District of Florida to employ Stichter Riedel Blain &
Postler, P.A. as its legal counsel.
The firm's services include:
a. rendering legal advice with respect to the Debtor's powers
and duties;
b. preparing legal papers;
c. appearing before the court and the United States Trustee to
represent and protect the interests of the Debtor;
d. assisting with and participating in negotiations with
creditors and other parties in interest in preparing a Chapter 11
plan and taking necessary legal steps to confirm such a plan;
e. representing the Debtor in all adversary proceedings,
contested matters, and matters involving administration of the
Debtor's Chapter 11 case; and
f. providing other necessary legal services.
The firm will be paid based upon its normal and usual hourly
billing rates and will be reimbursed for out-of-pocket expenses
incurred.
The firm received from the Debtor a retainer of $5,000.
Jodi Daniel Dubose, Esq., a partner at Stichter Riedel Blain &
Postler, disclosed in a court filing that the firm is a
"disinterested person" pursuant to Section 101(14) of the
Bankruptcy Code.
The firm can be reached at:
Jodi Daniel Dubose, Esq.
Stichter Riedel Blain & Postler, P.A.
41 N. Jefferson St., Suite 111
Pensacola, FL 32502
Tampa, FL 33602
Tel: (850) 637-1836
Email: jdubose@srbp.com
About Three Deluna, LLC
Three Deluna, LLC filed a petition under Chapter 11, Subchapter V
of the Bankruptcy Code (Bankr. N.D. Fla. Case No. 23-30793) on Nov.
10, 2023, with $500,001 to $1 million in both assets and
liabilities.
Jodi Daniel Dubose, Esq., at Stichter Riedel Blain & Postler, P.A.
represents the Debtor as legal counsel.
TISSUETECH INC: Midcap Financial Marks $17.5MM Loan at 30% Off
--------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $17,500,000
loan to TissueTech, Inc to market at $12,250,000 or 70% of the
outstanding amount, as of September 30, 2023, according to Midcap
Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to TissueTech, Inc. The loan accrues interest at a rate of 1%
(SOFR+586) per annum. The loan matures on May 1, 2027.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
TissueTech, Inc. is a privately held biotechnology company that
provides regenerative wound healing therapies.
TONAWANDA COKE: United States Trustee Says Disclosures Inadequate
-----------------------------------------------------------------
William K. Harrington, the United States Trustee for Region 2,
filed an objection to the Disclosure Statement for Plan of
Liquidation of Tonawanda Coke Corporation.
Prepetition, the Debtor produced high-performance foundry coke used
in the production of cast iron metal. Upon information and belief,
the Debtor permanently ceased operations prior to its bankruptcy
filing.
Upon information and belief, the Debtor has completed the
liquidation of all of its assets during the pendency of this case.
On Sept. 27, 2023, the Debtor filed the Disclosure Statement
describing the Plan. The Court has scheduled a hearing on the
Disclosure Statement for Dec. 6, 2023.
The United States Trustee points out that the Disclosure Statement
and the Plan do not make it clear that the debtor will not receive
a discharge. The Disclosure Statement does not clearly disclose,
and the Plan does not clearly provide, that confirmation of the
Plan will not discharge the Debtor. Indeed, as i) the Plan is a
plan of liquidation, ii) the Debtor will not engage in business
post-consummation of the Plan (and is not engaging in business now
in fact), and iii) the Debtor as a corporation would not receive a
discharge in chapter 7, pursuant to 11 U.S.C. s 1141(d)(3)
confirmation of the Plan cannot discharge the Debtor. The
Disclosure Statement and the Plan incorrectly suggest at various
points that the Debtor will receive a release through confirmation
of the Plan.
The United States Trustee further points out that the Plan is not
confirmable with the proposed third-party releases. The proposed
non-consensual release of the "Released Entities" is inappropriate.
Initially, however, even if such release were appropriate the
disclosure regarding this is inadequate. It is not explained why
such releases are needed. Would this impact any still-pending
lawsuits? The actual identities of the individuals included in
"Released Entities" are not disclosed.
The United States Trustee asserts that the exculpation must be
narrowed. The Disclosure Statement and the Plan should
specifically identify the individuals to be exculpated and this
should be limited to those who actually performed fiduciary
functions during the case.
According to United States Trustee, further disclosure is needed as
to the plan administrator:
* The Disclosure Statement and the Plan should provide more
disclosure and detail regarding the Plan Administrator and
post-effective date affairs.
* The Disclosure Statement and the Plan should include as
exhibits copies of any and all agreements with and regarding the
Plan Administrator, including the Plan Administrator Agreement.
* The Plan Administrator should be identified; that is, the
actual individual who will carry out the duties of the Plan
Administrator. The compensation of the Plan Administrator must be
disclosed.
* The Debtor's and the Plan Administrator's duties to pay
quarterly fees owing to the United States Trustee until this case
is closed, dismissed or converted should be set forth.
About Tonawanda Coke Corp
Tonawanda Coke Corporation -- http://www.tonawandacoke.com/-- is
an ISO 9001 Registered merchant producer of high-performance
foundry coke to the U.S. and Canadian foundry, and insulation and
sugar beet industries. The company was founded in 1917 and is
headquartered in Tonawanda, N.Y.
Tonawanda Coke Corporation filed a voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. W.D.N.Y. Case No.
18-12156) on Oct. 15, 2018. In the petition signed by Michael K.
Durkin, president, the Debtor estimated $10 million to $50 million
in both assets and liabilities. The case is assigned to Judge
Michael J. Kaplan. Garry M. Graber, Esq., at Hodgson Russ LLP,
represents the Debtor.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors in the Debtor's case on July 15, 2019. The committee is
represented by Baumeister Denz LLP.
TREACE MEDICAL: 90% Markdown for Midcap Financial $3MM Loan
-----------------------------------------------------------
MidCap Financial Investment Corporation has marked its $3,000,000
loan extended to Treace Medical Concepts, Inc to market at $310,000
or 10% of the outstanding amount, as of September 30, 2023,
according to Midcap Financial's Form 10-Q Report for the Quarterly
period ended September 30, 2023, filed with the Securities and
Exchange Commission.
Midcap Financial is a particiant in a First Lien Secured Debt Loan
to Treace Medical Concepts, Inc. The loan accrues interest at a
rate of 1% (SOFR+410) per annum. The loan matures on April 1,
2027.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Treace Medical Concepts, Inc. operates as an orthopaedic medical
device company. The Company develops lapiplasty 3D bunion
correction systems designed to improve the inconsistent clinical
outcomes of traditional approaches to bunion surgery. Treace
Medical Concepts serves customers worldwide.
TREACE MEDICAL: Midcap Financial Marks $35MM Loan at 61% Off
------------------------------------------------------------
MidCap Financial Investment Corporation has marked its $35,000,000
loan extended to Treace Medical Concepts, Inc.to market at
$13,708,000 or 39% of the outstanding amount, as of September 30,
2023, according to Midcap Financial's Form 10-Q Report for the
Quarterly period ended September 30, 2023, filed with the
Securities and Exchange Commission.
Midcap Financial is a particiant in a First Lien Secured Debt Loan
to Treace Medical Concepts, Inc. The loan accrues interest at a
rate of 1% (SOFR+610) per annum. The loan matures on April 1,
2027.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
Treace Medical Concepts, Inc. operates as an orthopaedic medical
device company. The Company develops lapiplasty 3D bunion
correction systems designed to improve the inconsistent clinical
outcomes of traditional approaches to bunion surgery. Treace
Medical Concepts serves customers worldwide.
TS INVESTORS: Midcap Financial Marks $2.3MM Loan at 18% Off
-----------------------------------------------------------
MidCap Financial Investment Corporation has marked its $2,311,000
loan to TS Investors, LLC to market at $1,884,000 or 82% of the
outstanding amount, as of September 30, 2023, according to Midcap
Financial's for the Quarterly period ended, September 30, 2023,
filed with the Securities and Exchange Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to TS Investors, LLC. The loan accrues interest at a rate of 1%
(SOFR+660) per annum. The loan matures on May 4, 2029.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
TYP MANAGEMENT: Unsecureds Will Get 30.10% of Claims over 36 Months
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TYP Management Inc., filed with the U.S. Bankruptcy Court for the
Northern District of Georgia a Chapter 11 Subchapter V Plan of
Reorganization dated November 30, 2023.
The Debtor was incorporated on October 1, 2019 in the State of
Georgia. The Debtor is a trucking company, hauling freight on a
national basis (the "Business").
The Debtor financed the pre-Petition purchase of its equipment with
high interest loans. This caused cash flow problems. The Debtor
entered into a merchant cash advance loan, again at a high
effective interest rate, that compounded the problem. When the
finance companies threatened to repossess the equipment, the Debtor
filed its Subchapter V Chapter 11 bankruptcy petition on September
1, 2023 initiating this bankruptcy case in order to protect its
assets and to reorganize its debts.
Young Park is the majority shareholder and the Secretary. Young
Park earns $11,000.00 per month. No other insiders receive
compensation. The Debtor anticipates that this structure will
remain the same post-confirmation.
This Plan deals with all property of the Debtor and provides for
treatment of all Claims against the Debtor and its property.
Class 4 shall consist of General Unsecured Claims. Class 4 consists
of General Unsecured Claims including any potential deficiency
claims pursuant to Sections 506 and 522(f) of the Bankruptcy Code.
Debtor believes but does not warrant that all known General
Unsecured Claims in the aggregate amount of approximately
$239,204.02.
If the Plan is confirmed under section 1191(a) of the Bankruptcy
Code, Debtor shall pay to the General Unsecured Creditors holding
Allowed Claims, in full satisfaction of their respective Allowed
Unsecured Claims, a pro rata share of $2,000.00 per month,
commencing on the 1st Business Day of the 1st month immediately
following the Effective Date, and continuing on the 1st Business
Day of each month thereafter until the 36th month after the
Effective Date in full satisfaction of the Allowed Class 4 General
Unsecured Claims. Debtor estimates that if the Plan is confirmed
consensually under Section 1191(a), then Class 4 creditors holding
Allowed General Unsecured Claims will receive Distributions
totaling approximately 30.10% of their Allowed General Unsecured
Claims.
If the Plan is confirmed under section 1191(b) of the Bankruptcy
Code, Class 4 shall be treated the same as if the Plan was
confirmed under section 1191(a) of the Bankruptcy Code. The Claims
of the Class 4 Creditors are Impaired by the Plan and the holders
of Class 4 Claims are entitled to vote to accept or reject the
Plan.
Class 5 consists of the Interests of the Equity Holders of the
Debtor. The Equity Holders will retain their respective Interests
in the Reorganized Debtor as such Interest existed as of the
Petition Date. 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
future income of the Debtor from its normal business operations.
A full-text copy of the Subchapter V Plan dated November 30, 2023
is available at https://urlcurt.com/u?l=fNK4on from
PacerMonitor.com at no charge.
Debtor’s Counsel:
Paul Reece Marr, Esq.
PAUL REECE MARR, P.C.
6075 Barfield Road, Suite 213
Sandy Springs, GA 30328
Telephone: (770) 984-2255
Email: paul.marr@marrlegal.com
About TYP Management Inc.
TYP Management Inc. is a trucking company, hauling freight on a
national basis (the "Business").
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. N.D. Ga. Case No. 23-20981) on Sept. 1,
2023, with $100,001 to $500,000 in both assets and liabilities.
Paul Reece Marr, Esq., at Paul Reece Marr, PC, is the Debtor's
legal counsel.
VENUS CONCEPT: Registers 1.09M Common Shares For Possible Resale
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Venus Concept Inc. filed with the Securities and Exchange
Commission a Form S-3/A registration statement relating to the
resale, from time to time, by EW Healthcare Partners, L.P. and
related investment entities of up to 1,090,402 shares of the
Company's common stock, $0.0001 par value per share, issuable upon
conversion of outstanding shares of the Company's senior
convertible preferred stock, $0.0001 par value per share.
"The selling stockholders may sell the shares of our common stock
offered by this prospectus from time to time on terms to be
determined at the time of sale through ordinary brokerage
transactions or through any other means described in this
prospectus. Such shares may be sold at fixed prices, at market
prices prevailing at the time of sale, at prices related to
prevailing market price or at negotiated prices," the Company
said.
The Company's common stock is listed on the Nasdaq Capital Market
under the symbol VERO. On November 21, 2023, the last reported sale
price of the Company's common stock on the Nasdaq Capital Market
was $1.67 per share.
A full-text copy of the prospectus is available for free at:
https://www.sec.gov/Archives/edgar/data/1409269/000114036123054470/ny20015187x1_s3a.htm
About Venus Concept
Toronto, Ontario-based Venus Concept Inc. is an innovative global
medical technology company that develops, commercializes, and
delivers minimally invasive and non-invasive medical aesthetic and
hair restoration technologies and related practice enhancement
services. The Company's aesthetic systems have been designed on a
cost-effective, proprietary and flexible platform that enables the
Company to expand beyond the aesthetic industry's traditional
markets of dermatology and plastic surgery, and into
non-traditional markets, including family and general practitioners
and aesthetic medical spas.
Venus Concept reported a net loss of $43.58 million in 2022
compared to a net loss of $22.14 million in 2021. As of Dec. 31,
2022, the Company had $125.38 million in total assets, $116.64
million in total liabilities, and $8.74 million in stockholders'
equity.
Toronto, Canada-based MNP LLP, the Company's auditor since 2019,
issued a "going concern" qualification in its report dated March
27, 2023, citing that the Company has reported recurring net losses
and negative cash flows from operations that raise substantial
doubt about its ability to continue as a going concern.
VERDE BIO: Sells Properties to Carolina Natural Resource for $150K
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Verde Bio Holdings, Inc. disclosed in a Form 8-K filed with the
Securities and Exchange Commission that it entered into a Purchase
and Sale Agreement with Carolina Natural Resource Group LLC whereby
the Company agreed to sell, assign and convey to Buyer 100% of
Seller's right, title and interest in certain oil and gas mineral
and royalty interests, overriding royalty interests and other
similar interests associated with properties located in DeSoto
Parish, Louisiana, Belmont County Ohio and Laramie County, Wyoming.
The purchase price for the Properties is $150,000. The transaction
under the Purchase Agreement closed on Nov. 27, 2023.
About Verde Bio
Verde Bio Holdings, Inc. (OTC: VBHI) is an energy company based in
Frisco, Texas, engaged in the acquisition and management of Mineral
and Royalty interests in lower risk, onshore oil and gas properties
within the major oil and gas plays in the U.S. The Company's
dual-focused growth strategy relies primarily on leveraging
management's expertise to grow through the strategic acquisition of
revenue producing royalty interest and strategic and opportunistic
non-operated working interests.
Draper, UT-based Sadler, Gibb & Associates, LLC, the Company's
auditor since 2012, issued a "going concern" qualification in its
report dated Aug. 1, 2023, citing that the Company has suffered
recurring losses from operations and has negative cash flows from
operations that raise substantial doubt about its ability to
continue as a going concern.
Verde Bio said in its Quarterly Report on Form 10-Q for the period
ended July 31, 2023, that "The continuation of the Company as a
going concern is dependent upon the continued financial support
from its management, and its ability to identify future investment
opportunities and obtain the necessary debt or equity financing,
and generating profitable operations from the Company's future
operations. The Company will continue to rely on equity sales of
its common shares in order to continue to fund business operations.
These factors raise substantial doubt regarding the Company's
ability to continue as a going concern for a period of one year
from the date these financial statements are issued."
VIALTO PARTNERS: Moody's Affirms 'B3' CFR & Alters Outlook to Neg.
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Moody's Investors Service affirmed CD&R Galaxy UK Intermediate 3
Limited (d/b/a Vialto Partners or Vialto) corporate family rating
at B3 and its probability of default rating at B3-PD. Moody's
affirmed the senior secured first lien bank credit facilities of
the company's Galaxy US Opco Inc. subsidiary, consisting of a $962
million term loan due April 2029 and a $200 million revolver due
April 2027, at B3. The outlook was revised to negative from stable.
The company is a worldwide provider of global mobility solutions
with a primary focus on tax preparation services for employees of
its corporate clients.
The outlook revision to negative from stable takes into account
Vialto Partners' weak financial performance, which has trailed
Moody's expectations since the company's carveout from former
parent PricewaterhouseCoopers (PwC) on April 29, 2022. Additional
concerns stem from Moody's expectation of continued deterioration
in the company's liquidity profile amidst the current protracted
high interest rate environment. Although a $200 million incremental
equity infusion in December 2022 mitigated the financial impact of
the prior underperformance, weakness in operating results relative
to Moody's expectations has since persisted. In particular, a
higher than anticipated cash flow deficit in the quarter ending
September 30, 2023 presents greater uncertainty in the company's
ability to sustain liquidity levels that are consistent with a B3
CFR over the next 12-15 months.
RATINGS RATIONALE
Vialto Partners' B3 CFR is constrained by the company's elevated
debt-to-EBITDA of approximately 10x (Moody's adjusted) for the
12-month period ended September 30, 2023, as well as a complex
corporate structure comprised of an array of internationally-based
operating subsidiaries and a high proportion of revenue and
earnings from both non-guarantor and unrestricted subsidiaries.
Given Vialto's nascent history operating as an independent entity,
there remains material risk related to the company's ability to
efficiently manage its operational workflow without delays or
disruptions to its business. Moody's expects Vialto to continue to
generate free cash flow deficits over the next 12-15 months, albeit
at a less pronounced pace than in FY23, resulting in deteriorating
liquidity. Additional credit risk is presented by Vialto's
concentrated business focus and corporate governance concerns
related to the company's concentrated private equity sponsor
ownership. These risk factors are mitigated by the company's global
operating scale, strong competitive presence, and a highly
recurring revenue base which capitalizes on steady demand for its
tax services. Revenue stability is also supported by Vialto's
longstanding relationships, multi-year contracts, and high client
retention rates with a high-quality set of large enterprise
customers.
Moody's considers Vialto Partners' liquidity profile to be weak
with concerns of further deterioration over the next 12-15 months.
The company's unrestricted cash balance stood at $57.8 million as
of September 30, 2023. Moody's expects Vialto Partners' free cash
flow deficits in FY24 to reduce cash to approximately $20
million-$30 million while the company continues to rely on its
revolver ($104 million drawn as of September 30, 2023) expiring in
April 2027 for additional liquidity. There is approximately $10
million of annual senior secured first lien term loan amortization.
The company's term loans are not subject to financial covenants.
The revolving credit facility has a springing maximum net senior
secured first lien leverage ratio covenant of 8.0x. Moody's expects
Vialto Partners to maintain adequate cushion under its financial
covenant if it is measured over the next 12-15 months.
The negative rating outlook reflects Moody's expectation that
Vialto Partners' revenue and EBITDA will only increase moderately
in FY24. Moody's projects that Debt-to-EBITDA will contract, but
remain elevated at more than 9x by the end of FY24. The outlook may
be revised to stable if Moody's anticipates that Vialto Partners'
operating performance will exceed Moody's expectations, resulting
in an improved liquidity profile and a sustained reduction in
Debt-to-EBITDA.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Given the negative outlook, a rating upgrade over the next 12-18
months is unlikely. Over the longer term the ratings could be
upgraded if the company establishes a track record of revenue
growth and margin expansion, such that Moody's expects debt/ EBITDA
leverage will be maintained around 6.0x and free cash flow to debt
approximates 5% on a sustained basis.
The ratings could be downgraded if the company's operating
performance trends are weaker than expected, Debt-to-EBITDA remains
elevated, or Vialto Partners incurs higher than anticipated free
cash flow deficits that result in expectations of weakening
liquidity.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
Vialto Partners, headquartered in New York City and controlled by
affiliates of private equity sponsor Clayton, Dubilier & Rice
(CD&R), is a worldwide provider of global mobility solutions,
providing integrated compliance, consulting, and technology
services to global enterprises with a primary focus on tax
preparation services for employees of its corporate clients.
Moody's forecasts that the company will generate revenue of nearly
$900 million in FY24.
VIAVI SOLUTIONS: S&P Downgrades ICR to 'BB', Outlook Stable
-----------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Viavi
Solutions Inc. to 'BB' from 'BB+' and its issue-level rating on its
senior unsecured notes to 'BB' from 'BB+'. S&P's '3' recovery
rating on the notes is unchanged.
S&P said, "Our stable outlook on Viavi reflects our view that we
expect an improvement in the company's EBITDA and cash generation
ability to contribute to more stable credit metrics by the end of
2024, even though macroeconomic uncertainty is high, and the
company is exposed to further near-term spending volatility by
service providers and networking equipment manufacturers. We expect
the company to end fiscal 2024 with leverage on the low-4x area
before declining further to about 3.3x the following year.
"Due to the large industry-wide inventory correction among its
network equipment manufacturing and telecommunication customers,
stemming from the tougher macroeconomic environment, we expect
Viavi will sustain S&P Global Ratings-adjusted gross leverage of
more than 4x in fiscal 2024.We anticipate the company's operating
environment will remain difficult until the second half of 2024 as
end-market demand for both field and fiber solutions are negatively
affected by tighter spending and lower capital expenditures at tier
one service providers. After several years of high investments into
5G and capex, U.S. providers have decelerated spending as they
progress past the peak of 5G deployment and cope with high interest
burdens, increasing leverage, and slowing sales. Further pressuring
Viavi's top-line growth is weakness in its optical security and
performance products (OSP) segment, which we expect to be down this
year, driven by lower demand for anticounterfeiting products due to
post-COVID-19 fiscal tightening and lower 3D sensing revenue due to
industry-wide inventory correction. Due to the strong headwinds to
its demand, we believe Viavi's top-line revenue will decline by 8%
year over year in fiscal 2024."
Viavi's S&P Global Ratings-adjusted EBITDA margins materially
deteriorated over the past couple of quarters and will remain
pressured in the near term. Due to lower hardware volume and
decreasing operating leverage stemming from lower utilization
rates, Viavi's S&P Global Ratings-adjusted EBITDA margins
deteriorated to 17.2% in the first quarter of 2024 from 25% during
the same period last year and its EBITDA base deteriorated nearly
50% peak-to-trough. S&P believes the realization of $30 million of
cost cuts that Viavi has executed will help modestly improve its
profitability, but its tepid sales pipeline will weigh on overall
EBITDA margins. That being said, we expect a modest recovery of
demand in the second half of 2024 will support good organic revenue
growth of about 8% in fiscal 2025 along with a normalization in its
EBITDA margins that we expect to return to the low-20% area in the
next 12-18 months.
S&P said, "We expect the forecast recovery to be supported by
rebounding demand for both wireless and fiber laboratory products,
which carry higher margins, as major network equipment
manufacturers and semiconductor customers ramp up 6G investment
while also extending 5G improvements. Service providers and their
key suppliers can suppress investments and capex for short periods,
but not building fiber or keeping wireless investments down for a
prolonged period is a lost opportunity that increases the risk of
falling behind competitors on the technology curve.
"Although we expect interim volatility in top-line trends for some
of Viavi's tier one customers, which are prone to spending cycles,
we believe broadband and mobile services are essential to
businesses and consumers and we expect government-subsidized rural
broadband expansion to spur significant spending by cable and
telcos over the next several years. In addition, the very long
design life cycle of wireless and fiber networks also increases
client stickiness given the need for testing at each step of the
network buildout. We believe this recovery in the spending cycle
will help reduce its S&P Global Ratings-adjusted gross leverage to
the low-3x area by fiscal 2025.
"Our stable rating outlook on Viavi reflects our view that we
expect an improvement in the company's EBITDA and cash generation
ability to contribute to a stabilization of credit metrics in the
second half of 2024, even though macroeconomic uncertainty is high,
and the company is exposed to further near-term spending volatility
by service providers and networking equipment manufacturers. We
expect the company to end fiscal 2024 with leverage in the low-4x
area before declining further to about 3.3x the following year
while generating stable free cash and maintaining strong
liquidity."
S&P could lower its rating if:
-- Delayed customer spending, competitive pressures, or heightened
investments sustained EBITDA and FOCF declines such that leverage
remained above 4x on a sustained basis or FOCF to debt decreased to
below 10%;
-- It adopted a more aggressive financial policy, including
debt-funded acquisitions or increasing shareholder returns without
a credible path to deleveraging, or
-- Cash flow pressures from operational volatility weakened its
liquidity profile such that cash on hand fell below $250 million
and leverage remains elevated.
While unlikely over the coming year, S&P could consider an upgrade
if:
-- S&P believed the company were better positioned to absorb
end-market cyclicality without a significant business impact
leading to a track record of business growth and consistent
operating performance even through macroeconomic downturns; and
-- It maintained a more conservative financial policy, including
leverage below 3x even when accounting for shareholder returns and
strategic acquisitions.
VIEWRAY INC: Midcap Financial Marks $9.5MM Loan at 37% Off
----------------------------------------------------------
MidCap Financial Investment Corporation has marked its $9,350,000
loan extended to ViewRay Inc. to market at $6,005,000 or 63% of the
outstanding amount, as of September 30, 2023, according to Midcap
Financial's Form 10-Q Report for the Quarterly period ended
September 30, 2023, filed with the Securities and Exchange
Commission.
Midcap Financial is a participant in a First Lien Secured Debt Loan
to ViewRay Inc. The loan accrues interest at a rate of 3.50% per
annum. The loan matures on November 1, 2027.
Midcap Financial classified the loan as on non-accrual status.
Midcap Financial Investment Corporation is a Maryland corporation
incorporated on February 2, 2004. It is a closed-end, externally
managed, non-diversified management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. Apollo Investment Management, L.P.
is the investment adviser and an affiliate of Apollo Global
Management, Inc. and its consolidated subsidiaries (AGM). Apollo
Investment Administration, LLC, an affiliate of AGM, provides,
among other things, administrative services and facilities for
Midcap.
ViewRay Technologies Incorporated develops medical devices. The
Company offers advanced radiation therapy solutions for the
treatment of cancer. ViewRay operates in the United States.
VIVAKOR INC: Falls Short of Nasdaq's Minimum Bid Price Requirement
------------------------------------------------------------------
Vivakor, Inc. disclosed in a Form 8-K Report filed with the
Securities and Exchange Commission that the Company received a
deficiency notification letter from the Listing Qualifications
Staff of the Nasdaq Stock Market LLC indicating that the Company
was not in compliance with Nasdaq Listing Rule 5550(a)(2). The
letter stated that the bid price for the Company's common stock had
closed below $1 per share for 33 consecutive business days prior to
November 22, 2023.
In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company
can regain compliance with the minimum bid price requirement at any
time within the 180-calendar day period following receipt of the
Nasdaq notice, or until May 20, 2024. To regain compliance, the bid
price for the Company's common stock must close at $1 per share or
more for a minimum of 10 consecutive business days.
Nasdaq's written notice has no effect on the listing or trading of
the Company's common stock at this time. The Company intends to
actively monitor the closing bid price of its common stock and, as
appropriate, will consider available options to resolve this
listing deficiency.
About Vivakor Inc.
Coralville, Iowa-based Vivakor, Inc. is an operator, acquirer and
developer of technologies and assets in the oil and gas industry,
as well as, related environmental solutions. Currently, the
Company's efforts are primarily focused on operating crude oil
gathering, storage and transportation facilities, as well as
contaminated soil remediation services.
Vivakor reported a net loss attributable to the Company of $19.44
million in 2022, a net loss attributable to the company of $5.48
million in 2021, a net loss attributable to the company of $2.18
million in 2020. As of Sept. 30, 2023, the Company had $76.12
million in total assets, $52.21 million in total liabilities, and
$23.90 million in total stockholders' equity.
As reported by the Troubled Company Reporter on November 28, 2023,
the Company revealed that there is substantial doubt about its
ability to continue as a going concern.
Vivakor stated, "We have historically suffered net losses and
cumulative negative cash flows from operations, and as of September
30, 2023, we had an accumulated deficit of approximately $62.1
million. As of September 30, 2023 and December 31, 2022, we had a
working capital deficit of approximately $19 million and $3.7
million, respectively. Subsequent to September 30, 2023, $10
million of the working capital deficit was paid with an issuance of
common stock for a reduction in noted payable to a related party,
of which our CEO is a beneficiary..As of September 30, 2023, we had
cash of approximately $1.2 million, and we had obligations to pay
approximately $14.4 million (of which approximately $10 million was
satisfied through the issuance of our common stock under the terms
of the debt subsequent to September 30, 2023...) of debt in cash
within one year of the issuance of these financial statements. Our
CEO has also committed to provide credit support through December
2024, as necessary, for an amount up to $8 million to provide the
Company sufficient cash resources, if required, to execute its
plans for the next twelve months. These conditions raise
substantial doubt about the Company's ability to continue as a
going concern. We believe the liquid assets and CEO commitment
give us adequate working capital to finance our day-to-day
operations for at least twelve months through November 2024."
WASTEPLACE LLC: Cash Infusion & Continued Operations to Fund Plan
-----------------------------------------------------------------
Wasteplace, LLC, filed with the U.S. Bankruptcy Court for the
Western District of Texas a Plan of Reorganization under Subchapter
V dated November 30, 2023.
The Debtor was founded in 2016 by Rachel and Gary LaBreck. The
concept behind WastePlace is to provide an online marketplace where
businesses can post their waste and recycling needs and receive
competitive bids from third-party waste haulers.
Pre-petition, RMS called its convertible note in default against
WastePlace and in 2022 filed suit against WastePlace in Travis
County, Texas (Case No. D-1-GN-22-002145) for failing to repay RM'
note. Despite WastePlace's attempts to resolve the litigation
amicably outside of court, ultimately, the RMS note was reduced to
a judgment against WastePlace on July 31, 2023, in a total amount
of $1.12 million (plus interest and certain fees). In light of the
judgment and a tax levy initiated by the Texas Comptroller, the
Debtor sought bankruptcy relief to protect its assets and
restructure its debts through this Plan.
The Debtor's Plan proposes to raise additional capital to fund the
payments that will be due under the Plan, including a distribution
to creditors upon the occurrence of the Effective Date. At this
time, the Debtor continues to receive interest form several
investors and believes that it will be able to raise sufficient
funding to support this Plan, continue to develop its products, and
grow its business in accordance with its strategic plan to maximize
value to its stakeholders.
Under the terms outlined in this Plan, the Debtor's Secured
Creditors, Administrative Claim Holders, and Creditors holding
priority Claims will be paid in full. Additionally, the Debtor
estimates that General Unsecured Creditors will receive a Pro Rata
distribution of a Reorganization Fund of approximately
$150-200,000, which represents more than parties would receive in a
liquidation scenario. Holders of Equity Interests are being asked
to participate in an open-ended equity raise, the aggregate sum of
which will constitute the Reorganization Fund.
Based on the information to date, the Debtor believes that a cash
infusion of approximately $150-200,000 will occur as a result of
the Plan. Accordingly, the Debtor submits that any Creditor who
does not accept this Plan will receive at least as much under the
Plan as they would in a Chapter 7 liquidation.
As the Projections demonstrate, the Debtor's Plan provides that
additional capital will be raised from (a) cash paid by WHA, and
(b) cash paid by Holders of Equity Interests who elect to
participate in the equity raise for Class C Units. These cash
infusions, coupled with the revenue that the Debtor projects it
will continue to make from its operations, will support Plan
payments and ongoing expenses after the Effective Date. In the
Debtor's expected scenario, the distribution afforded to Class 4
Creditors would be their proportionate share of the Reorganization
Fund through the Plan, as opposed to $0 of potential distribution
in liquidation.
Lastly, the Plan provides a Rights Offering to existing Holders of
Equity Interests pursuant to Section 1145 of the Bankruptcy Code.
The Debtor's rights offering is exempt from applicable securities
laws because the securities are issued (i) pursuant to the Plan,
(ii) by the Debtor and/or Reorganized Debtor, and (iii) are in
exchange for claims against or interests in the Debtor.
Accordingly, the Debtor is not offering or selling new securities
that would require registration with the Securities & Exchange
Commission.
Class 4 consists of Allowed Unsecured Claims. Allowed Unsecured
Claims in Class 4 are impaired. Each Claim in Class 4 shall receive
a Pro Rata share of the Reorganization Fund, to be distributed by
the Plan Proponent on the Effective Date. The Debtor shall in no
way be obligated to make any additional payment to any Creditor in
Class 4 after the Effective Date. The treatment afforded to Class 4
Claims pursuant to this section shall fully discharge all Class 4
Claims as of the Effective Date of the Plan, provided that the Plan
is confirmed under Section 1191(a) of the Bankruptcy Code.
Members in Class 5 that hold Allowed Equity Interests in the Debtor
are unimpaired by the Plan. Holders of Allowed Equity Interests
shall retain their interests as provided for by, and subject to
further dilution as allowed by the Plan and the Debtor's
organizational documents.
Through the Plan, Holders of Allowed Equity Interests are requested
and authorized to pay into the Reorganized Debtor additional
investments in exchange for Class C Units in the Reorganized
Debtor. The Plan Proponent suggests that a minimum contribution
should be no less than 10% of such Equity Interest Holder's
original capital contribution. In exchange for such investment,
Holders that participate will receive approximately 17.32 Class C
Units in the Reorganized Debtor for every $1.00 invested.
This Rights Offering shall remain open through the Contribution
Date at which time, such fundraising round shall close. Holders of
Equity Interests that wish to participate in the Rights Offering
shall (1) notify the Debtor in writing (in a form substantially
similar to Addendum 3) as soon as reasonably practicable in light
of the Voting Deadline but in no event after the Contribution Date,
and (2) shall transmit Cash to the Debtor on or before the
Contribution Date in exchange for the corresponding amount of Class
C Units as set forth herein.
Cash necessary to fund payments shall be from the Reorganization
Fun and the Debtor's normal business operations and cash on hand as
of the Effective Date.
A full-text copy of the Plan of Reorganization dated November 30,
2023 is available at https://urlcurt.com/u?l=6dqpyM from
PacerMonitor.com at no charge.
Debtor's Counsel:
Justin M. Mertz, Esq.,
Michael Best & Friedrich LLP
790 N. Water St., Suite 2500
Milwaukee, WI 53202
Telephone: (414) 271-656
Facsimile: (414) 277.0656
Email: jmmertz@michaelbest.com
About Wasteplace LLC
WastePlace, LLC, is a waste and recycling marketplace that connects
customers to thousands of waste management service providers.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Tex. Case No. 23-10768) on Sept. 18,
2023. In the petition signed by Gary LaBreck, chief executive
officer, the Debtor disclosed up to $50,000 in assets and up to $10
million in liabilities.
Justin M. Mertz, Esq., at Michael Best & Friedrich LLP, represents
the Debtor as legal counsel.
WHAT ABOUT US: Craig Geno Named Subchapter V Trustee
----------------------------------------------------
The Acting U.S. Trustee for Region 8 appointed Craig Geno, Esq., at
the Law Offices of Craig M. Geno, PLLC as Subchapter V trustee for
What About Us In Home Health Care, Inc.
Mr. Geno will be paid an hourly fee of $250 for his services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Mr. Geno declared that he is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Craig M. Geno, Esq.
Law Offices of Craig M. Geno, PLLC
587 Highland Colony Parkway
Ridgeland, MS 39157
Phone: (601) 427-0048
Fax: (601) 427-0050
Email: cmgeno@cmgenolaw.com
About What About Us What About Us In Home
What About Us In Home Health Care, Inc. filed a petition under
Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. W.D. Tenn.
23-25733) on Nov. 21, 2023, with up to $50,000 in assets and $1
million to $10 million in liabilities. Nakita Cannady, president
and chief executive officer, signed the petition.
Judge Denise E. Barnett oversees the case.
Toni Campbell Parker, Esq., at the Law Firm of Toni Campbell Parker
represents the Debtor as bankruptcy counsel.
YELLOW CORP: Amends Credit Agreements With Alter Domus Products
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Yellow Corporation disclosed in a Form 8-K Report filed with the
Securities and Exchange Commission that the Company entered into:
(i) Amendment No. 1 to Junior Secured Super-Priority
Debtor-In-Possession Credit Agreement dated as of September 6,
2023, by and among the Company, as borrower, certain subsidiaries
of the Company, as guarantors, the lenders party thereto from time
to time and Alter Domus Products Corp., as administrative agent and
collateral agent; and
(ii) Amendment No. 5 to Amended and Restated Credit Agreement
dated as of September 11, 2019, by and among the Company, as
borrower, certain subsidiaries of the Company, as guarantors, the
lenders party thereto from time to time and Alter Domus Products
Corp., as administrative agent and collateral agent.
Amendment No. 1 amends the Junior Secured Super-Priority
Debtor-in-Possession Credit Agreement to increase the Delayed Draw
Term Commitments from $70 million to $170 million, and to increase
the number of permitted Borrowings of Delayed Draw Term Loans from
three to seven Borrowings. The increased Delayed Draw Term
Commitments will be available to the Company to be borrowed on and
after December 1, 2023, only if cash and cash equivalents of the
Borrower and its Subsidiaries is less than $25,000,000 in the
aggregate immediately prior to such Borrowing. Each Borrowing of
Delayed Draw Term Loans shall be no more than $25 million.
Amendment No. 5 permits the increased Delayed Draw Term Commitments
under the Junior Secured Super-Priority Debtor-in-Possession Credit
Agreement.
About Yellow Corporation
Yellow Corporation -- http://www.myyellow.com/-- operates
logistics and less-than-truckload (LTL) networks in North America,
providing customers with regional, national, and international
shipping services throughout. Yellow's principal office is in
Nashville, Tenn., and is the holding company for a portfolio of LTL
brands including Holland, New Penn, Reddaway, and YRC Freight, as
well as the logistics company Yellow Logistics.
Yellow Corporation and 23 affiliates concurrently filed voluntary
petitions for relief under Chapter 11 of the Bankruptcy Code
(Bankr. D. Del. Lead Case No. 23-11069) on August 6, 2023, before
the Hon. Craig T. Goldblatt. As of March 31, 2023, Yellow
Corporation had $2,152,200,000 in total assets against
$2,588,800,000 in total liabilities. The petitions were signed by
Matthew A. Doheny as chief restructuring officer.
The Debtors tapped Kirkland & Ellis, LLP as restructuring counsel;
Pachulski Stang Ziehl & Jones, LLP as Delaware local counsel;
Kasowitz, Benson and Torres, LLP as special litigation counsel;
Goodmans, LLP as special Canadian counsel; Ducera Partners, LLC as
investment banker; and Alvarez and Marsal as financial advisor.
Epiq Bankruptcy Solutions is the claims and noticing agent.
Milbank LLP serves as counsel to certain investment funds and
accounts managed by affiliates of Apollo Capital Management, L.P.
while White & Case, LLP and Arnold & Porter Kaye Scholer, LLP serve
as counsels to Beal Bank USA and the U.S. Department of the
Treasury, respectively.
On Aug. 16, 2023, the U.S. Trustee for Region 3 appointed an
official committee of unsecured creditors in the Chapter 11 cases.
The committee tapped Akin Gump Strauss Hauer & Feld, LLP and
Benesch, Friedlander, Coplan & Aronoff, LLP as counsels; Miller
Buckfire as investment banker; and Huron Consulting Services, LLC
as financial advisor.
YOLKED LLC: Areya Aurzada of Holder Law Named Subchapter V Trustee
------------------------------------------------------------------
The U.S. Trustee for Region 6 appointed Areya Holder Aurzada, Esq.,
at Holder Law as Subchapter V trustee for Yolked LLC.
Ms. Aurzada will be paid an hourly fee of $495 for her services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Ms. Aurzada declared that she is a disinterested person according
to Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Areya Holder Aurzada, Esq.
Holder Law
901 Main Street, Ste. 5320
Dallas, TX 75202
Office: 972-438-8800
Mobile: 817-907-4140
About Yolked LLC
Yolked, LLC filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. N.D. Texas Case No. 23-43508) on Nov. 15,
2023, with $100,001 to $500,000 in assets and $500,001 to $1
million in liabilities.
Judge Mark X. Mullin oversees the case.
Joyce W. Lindauer, Esq., at Joyce W. Lindauer Attorney, PLLC
represents the Debtor as bankruptcy counsel.
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