/raid1/www/Hosts/bankrupt/TCR_Public/240412.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Friday, April 12, 2024, Vol. 28, No. 102
Headlines
399 ATHERTON: Unsecureds Owed 5K to Get 100% of Their Claims
7502 HARRISBURG: U.S. Trustee Unable to Appoint Committee
99 CENTS ONLY: Moody's Cuts CFR to 'Ca' Amid Bankruptcy Filing
99 CENTS: S&P Lowers ICR to 'D' on Chapter 11 Bankruptcy Filing
AC/DC SOLAR: Files Emergency Bid to Use Cash Collateral
ADVANTAGE SALES: S&P Rates New Repriced $1.146BB Term Loan B 'BB-'
AERKOMM INC: Signs Merger Agreement With IX Acquisition Corp.
AIM LLC: Bid to Use Cash Collateral Denied
ALLERGY & ASTHMA: No Decline in Patient Care, 4th PCO Report Says
ALLERGY ASSOCIATES: Case Summary & 20 Largest Unsecured Creditors
ALLIANCE TRANS: William Avellone Named Subchapter V Trustee
AMERICAN GREETINGS: Moody's Rates New $1.05BB Loans Due 2029 'B2'
APPLIED SYSTEMS: Court OKs Deal on Cash Collateral Access
AQUABOUNTY TECHNOLOGIES: Reports $27.6 Million Net Loss in 2023
ARCIMOTO INC: Swaps 2.8M Warrants for 2.1M Pre-Funded Warrants
ARENA GROUP: Reports $55.6 Million Net Loss in 2023
ARTICO COLD: Court OKs Cash Collateral Access Thru April 19
ATLAS MIDCO: S&P Upgrades ICR to 'CCC+', Outlook Negative
ATP TOWER: Fitch Lowers LongTerm IDR to 'BB-', Outlook Negative
AULT ALLIANCE: Series C Preferred Shares Increased to 75,000
AYRO INC: Incurs $34.2 Million Net Loss in 2023
AZM RESTAURANTS: AZM Liquidate to Pay Claims in Plan
BAYTEX ENERGY: Fitch Hikes LongTerm IDR to 'BB-', Outlook Stable
BERKELEY HEIGHTS: U.S. Trustee Appoints Joseph Tomaino as PCO
BHAVI HOSPITALITY: Brad Odell of Mullin Named Subchapter V Trustee
BISHOP OF OAKLAND: Seeks to Extend Plan Exclusivity to Sept. 6
BOISSON INC: Files Emergency Bid to Use Cash Collateral
BOROHUB GARDENS: Says Unsecureds Unimpaired in Sale Plan
BOVINE PROPERTIES: Case Summary & 17 Unsecured Creditors
BRADLYNN CORP: May Use Cash Collateral
BRIDGE DIAGNOSTICS: Seeks Cash Collateral Access
BRP GROUP: S&P Alters Outlook to Positive, Affirms 'B-' ICR
C. L. DALE: William Callahan Named Subchapter V Trustee
CANO HEALTH: Widens Net Loss to $1.1 Billion in 2023
CAREISMATIC BRANDS: Unsecureds to Get 0% in Recapitalization Plan
CARLOS A. ROJAS: Linda Leali Named Subchapter V Trustee
CASA SYSTEMS: Unsecureds to Get Nothing in WInd-Down Plan
CASA SYSTEMS: Wins Interim Cash Collateral Access
CENTURY GRANITE: Business Income & Sale Proceeds to Fund Plan
CGI 1100 BISCAYNE: Lender Sets May 23 Auction for Property
CHATEAU CREOLE: Files Emergency Bid to Use Cash Collateral
CLINE DESIGN: Seeks to Extend Plan Exclusivity to July 8
CONVERGEONE HOLDINGS: Unsecureds Unimpaired in Debt-for-Equity Plan
CORNERSTONE PSYCHOLOGICAL: Court OKs Cash Access Thru June 12
COSTA SHIPPING: Wins Cash Collateral Access Thru May 17
COWORKRS 3RD STREET: Unsecureds Will Get 70% of Claims in Plan
DIMITRI VLAHAKIS: Pledged Interests Up for Sale on April 30
DISKIN SYSTEMS: Wins Interim Cash Collateral Access
DISTRICT 9: Joins Other Breweries in Bankruptcy
DON'S BAREFOOT: Court OKs Interim Cash Collateral Access
EGAE LLC: Unsecureds Owed $1.97M to Get $30K Annually for 5 Years
EIGER BIOPHARMACEUTICALS: Incurs $75 Million Net Loss in 2023
EIGER BIOPHARMACEUTICALS: Wins Interim Cash Collateral Access
ELITE ENDEAVORS: U.S. Trustee Unable to Appoint Committee
ESJ TOWERS: Unsecureds Owed $27M to Get $750K in Plan
FARM LLC: Wins Cash Collateral Access Thru April 30
FARZAN ALAMIRAD: Wins Cash Collateral Access Thru April 30
FCA CONSTRUCTION: Voluntary Chapter 11 Case Summary
FENDER MUSICAL: S&P Upgrades ICR to 'B' on Improved Performance
FIRST QUALITY: Seeks Cash Collateral Access
FLANNERY LLC: Unsecured Creditors to Split $12K over 5 Years
FLEXACAR LLC: Court OKs Cash Collateral Access on Final Basis
FLEXACAR LLC: Rental Income to Fund Plan Payments
FLEXPOINT SENSOR: Fruci & Associates II Raises Going Concern Doubt
FROGGY FLATS: Montana Says Disclosures Inadequate
FTX GROUP: Bankruptcy Estate to Repay Customers by End of 2024
G & I SOLUTIONS: L. Todd Budgen Named Subchapter V Trustee
GALLERIA 2425: Court OKs Cash Collateral Access on Final Basis
GARNER ROAD: Court OKs Cash Collateral Access on Final Basis
GARUDA HOTELS: Court OKs Cash Collateral Access
GAUCHO GROUP: Delays Filing of 2023 Annual Report
GAUCHO GROUP: Unveils Strategic Measures to Streamline Operations
GENESIS GLOBAL: Sells Its GBTC Shares, Will Buy 32,041 Bitcoin
GLOBAL FERTILITY: Court OKs Appointment of Chapter 11 Trustee
GNSP CORP: Wins Cash Collateral Access Thru April 25
GREENIDGE GENERATION: Lowers Net Loss to $29.5 Million in 2023
GUR-MEAT INC: Unsecured Claims Under $50K to Recover 3.56% in Plan
IBIO INC: Lynx1 Capital, Weston Nichols Report 9.99% Stake
IBIO INC: Secures $15 Million Private Placement
INDIEV INC: Unsecureds Owed $17M to Get 1% of Claims in Plan
INNOVATE CORP: Further Extends Rights Offering Subscription Period
INNOVATE CORP: Lancer Capital, 2 Others Report Stakes
INNOVEREN SCIENTIFIC: Issues Common Shares, Options to Executives
JAIRRABRANDY REALTY: Voluntary Chapter 11 Case Summary
JD MOTORSPORTS: Seeks Cash Collateral Access
JLK CONSTRUCTION: Seeks Cash Collateral Access Thru July 27
KIDDE-FENWAL INC: Insurers Fight Foam Suits Coverage Bid
KOHL'S CORP: Moody's Alters Outlook on 'Ba2' CFR to Stable
L AND L CARE: Court OKs Cash Collateral Access Thru Sept 30
LEXARIA BIOSCIENCE: Incurs $653K Net Loss in Second Quarter
LMSRQ LLC: Property Sale Proceeds to Fund Plan Payments
LTR INTERMEDIATE: S&P Alters Outlook to Stable, Affirms 'B-' ICR
M & J HOME: Unsecureds to Get 100 Cents on the Dollar in Plan
METRO COURIER: Seeks Cash Collateral Access Thru July 31
MICROVISION INC: Extends Term of CEO Employment Agreement
MOBIQUITY TECHNOLOGIES: Incurs $6.5 Million Net Loss in 2023
MV REALTY: Accused of Abusing Chapter 11 Bankruptcy Process
N.E.L. TRUCKING: Case Summary & 19 Unsecured Creditors
NASH ENGINEERING: Ch. 7 Trustee's $59.7M Case Could Go Before Jury
NAVACORD INTERMEDIATE: Fitch Assigns B LongTerm IDR, Outlook Stable
NEW HAVEN TRUCK: Wins Cash Collateral Access Thru April 30
NORDSTROM INC: Moody's Cuts CFR to Ba2 & Alters Outlook to Stable
OCEAN POWER: Inks Strategic Alliance for Maritime Defense Solutions
OLD SCHOOL POWER: Lender Seeks to Prohibit Cash Collateral Access
OMNIQ CORP: All Six Proposals Passed at Annual Meeting
OUTKAST ELECTRICAL: Wins Cash Collateral Access Thru May 1
OVAINNOVATIONS LLC: Seeks Cash Collateral Access
PALM CC: Unsecureds Owed $90K to Get 10% Under Plan
PARADOX ENTERPRISES: Files Emergency Bid to Use Cash Collateral
PARTNERS IN HOPE: Lender Seeks to Prohibit Cash Collateral Access
PEACOCK INTERMEDIATE: S&P Affirms 'B-' ICR, Outlook Negative
PEGASUS HOME: Plan Exclusivity Period Extended to June 20
PERFECTOS CIGAR: Wins Cash Collateral Access Thru April 30
PERSPECTIVES INC: Court OKs Cash Collateral Access Thru April 28
PLANT BAE: Wins Interim Cash Collateral Access
POLARIS PARENT: S&P Alters Outlook to Negative, Affirms 'B-' ICR
PREDICTIVE ONCOLOGY: KPMG In, BDO USA Out as Auditor
QHT-US INC: Seeks Cash Collateral Access Thru June 3
QUALITY CARE: U.S. Trustee Appoints Joseph Tomaino as PCO
R&P LAND: Court OKs Interim Cash Collateral Access
RANIER VIEW: Court OKs Cash Collateral Access on Final Basis
REDHILL BIOPHARMA: Kesselman & Kesselman Raises Going Concern Doubt
RENNOVA HEALTH: Delays 2023 Annual Report to Complete Audit
RESHAPE LIFESCIENCES: Has Until Oct. 7 to Regain Nasdaq Compliance
RESOURCE FOR EDUCATION: Unsecureds to Get Remaining Funds in Plan
RESTIERI HEALTHCARE: Seeks Cash Collateral Access
RESTORATION FOREST: Court Approves Disclosures, Confirms Plan
REVA HOSPITALITY: Brad Odell of Mullin Named Subchapter V Trustee
RISE DEVELOPMENT: Unsecureds Owed $2.5M to Get $14K in Plan
RITE AID: April 22 Combined Hearing on Plan & Disclosures
ROCKET SOFTWARE: Fitch Assigns 'B' LongTerm IDR, Outlook Stable
SANTOS RANCH: Case Summary & One Unsecured Creditor
SC HEALTHCARE: U.S. Trustee Appoints Creditors' Committee
SCHMOLDT CONSTRUCTION: Unsecureds to Split $150K over 5 Years
SELECTIS HEALTH: Delays Filing of 2023 Annual Report
SIDEATS INC: Court OKs Cash Collateral Access Thru April 30
SIYATA MOBILE: Barzily and Co. Raises Going Concern Doubt
SKILLZ INC: Receives NYSE Notice Regarding Late Form 10-K Filing
SNG INVESTMENTS: Melissa Haselden Named Subchapter V Trustee
STERETT COMPANIES: US Trustee Says Disclosures Inadequate
SUMMIT MIDSTREAM: S&P Affirms 'B' ICR, Outlook Positive
SURGE TRANSPORTATION: Unsecureds Get Share of Exit Loan Facility
TAPATIO KISSIMMEE: L. Todd Budgen Named Subchapter V Trustee
TERRAFORM LABS: Firm, Founder Found Liable for Securities Fraud
THRASIO HOLDINGS: ESR Says Plan Patently Unconfirmable
THRASIO LLC: S&P Assigns 'CCC+' Rating on $360MM DIP Facility
TIMOTHY HILL: Unsecureds Will Get 100% of Claims in Plan
TLG CAPITAL: Case Summary & Five Unsecured Creditors
TRANSOCEAN LTD: Secures $195M Ultra-Deepwater Drillship Contract
TREES CORP: Incurs $7.1 Million Net Loss in 2023
TURF APPEAL: U.S. Trustee Unable to Appoint Committee
TWO RIVERS: Unsecured Creditors to Recover 100% Under Plan
UPHEALTH INC: Enforces $110M Arbitration Award
VENUS CONCEPT: Incurs $37.1 Million Net Loss in 2023
VERITAS FARMS: Needs Additional Time to File Annual Report
VICTORIA'S SECRET: Moody's Alters Outlook on 'Ba3' CFR to Negative
VISTRA OPERATIONS: Fitch Gives 'BB' Rating on 2032 Unsecured Notes
VS HOLDING: S&P Rates New $1.96BB First-Lien Term Loan 'B'
WALLAROO'S FURNITURE: Seeks Cash Collateral Access Thru Aug 31
WESTLAKE SURGICAL: No Decline in Patient Care, 4th PCO Report Says
WHITTAKER CLARK: Denies Bid to Appoint Creditors' Committee
WILSON BUILDING: Seeks Cash Collateral Access
WOM SA: CEO Leaves Bankrupt Company, Criticizes Owner
WOMEN'S HEALTH: Seeks to Use Cash Collateral
XTI AEROSPACE: Fails to Comply With Nasdaq's Director Requirements
YIELD10 BIOSCIENCE: Reports $14.5 Million Net Loss in 2023
YWFM LLC: Daniel Etlinger Named Subchapter V Trustee
[] BOOK REVIEW: Taking Charge
*********
399 ATHERTON: Unsecureds Owed 5K to Get 100% of Their Claims
------------------------------------------------------------
399 Atherton, LLC, submitted a Disclosure Statement to Plan of
Reorganization dated March 29, 2024.
All claims / bona fide creditors shall be paid in full (including
general unsecured creditors [aka Class 2 creditors] in one (1) lump
sum payment made at the close of escrow of the sale of the Debtor's
sole asset / real property on or before August 15, 2024.
The subject property is described as 399 Atherton Avenue Atherton,
CA 94027. It's a 2 story, 4310 sq. ft., 4 bedroom, 3 bath, single
family home. The value is $9,500,000 per Debtor's professional
appraisal conducted by Daniel Chen of Daniel Chen Appraisal
Services (DRE #AF011588) on January 24, 2024.
On January 17, 2024, the Debtor filed the instant case to stop the
attempted foreclosure of the real property located at 399 Atherton
Avenue, Atherton, CA 94027 ("Property") by a junior lienholder. The
Property is worth $9.5 million "as-is" (a licensed appraisal was
done on January 18, 2024) and all debt (secured and unsecured)
combined totals approximately $7,000,000. This will be a 100% plan.
Similar to a lot of the recent ‘developer' entity bankruptcy
filings, the Debtor just needs some time to either refinance all of
the debt (so he can continue to remodel the Property) or he'll just
sell the Property to pay all debt(s) off.
Under the Plan, Class of General Unsecured Claims / Class 2 total
$5,000. Creditors will receive 100 percent of their allowed claims
in one (1) payment made at the close of escrow of either a
refinance or sale of the Property which shall occur no later than
August 15, 2024. Class 2 is impaired.
The hearing at which the Court will determine whether to approve
this Disclosure Statement will take place on May 9, 2024 at 10:00
a.m., in Courtroom 11, at the United States Bankruptcy Court, 280
South First Street, San Jose, California before the Honorable Judge
M. Elaine Hammond.
Attorneys for the Debtor:
Arasto Farsad, Esq.
Nancy Weng, Esq.
FARSAD LAW OFFICE, P.C.
1625 The Alameda, Suite 525
San Jose, CA 95126
Tel: (408) 641-9966
Fax: (408) 866-7334
E-mail: farsadlaw1@gmail.com
nancy@farsadlaw.com
A copy of the Disclosure Statement dated March 29, 2024, is
available at https://tinyurl.ph/sRVJu from PacerMonitor.com.
About 399 Atherton, LLC
399 Atherton is a Single Asset Real Estate debtor (as defined in 11
U.S.C. Section 101(51B)).
399 Atherton, LLC filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. ND Cal. Case No.
24-50052) on Jan. 17, 2024. In the petition signed by Michael Luu
as managing member, the Debtor estimated $1 million to $10 million
in both assets and liabilities.
Arasto Farsad, Esq., at Farsad Law Office, P.C., is the Debtor's
counsel.
7502 HARRISBURG: U.S. Trustee Unable to Appoint Committee
---------------------------------------------------------
The U.S. Trustee for Region 6 disclosed in a court filing that no
official committee of unsecured creditors has been appointed in the
Chapter 11 case of 7502 Harrisburg, LLC.
About 7502 Harrisburg
7502 Harrisburg, LLC, a company in Houston, Texas, filed Chapter 11
petition (Bankr. S.D. Texas Case No. 24-31002) on March 5, 2024,
with $500,001 to $1 million in assets and $1 million to $10 million
in liabilities.
Judge Christopher M. Lopez oversees the case.
Reese Baker, Esq., at Baker & Associates is the Debtor's legal
counsel.
99 CENTS ONLY: Moody's Cuts CFR to 'Ca' Amid Bankruptcy Filing
--------------------------------------------------------------
Moody's Ratings downgraded 99 Cents Only Stores LLC's corporate
family rating to Ca from Caa3 and Probability of Default Rating to
D-PD from Caa3-PD. In addition, Moody's Ratings downgraded the
company's senior secured notes ratings to C from Ca. The outlook is
maintained at stable.
The downgrade of the PDR to D-PD reflects governance considerations
following the company's announcement [1] that it filed voluntary
petitions for relief under Chapter 11 of the U.S. Bankruptcy Code.
99 Cents plans for an orderly wind-down of its business operations
and pursuing a liquidation of its real estate and other assets.
The downgrades of the CFR to Ca and senior secured notes to C
reflect Moody's Ratings estimates of ultimate recovery.
RATINGS RATIONALE
On April 7, 2023, 99 Cents, a wholly-owned subsidiary of Number
Holdings, Inc. and the issuer of the $350 million 7.5% senior
secured notes due January 15, 2026, filed for voluntary petition
for relief under Chapter 11 of the U.S. Bankruptcy Code, which is
deemed a default under Moody's Ratings definition. This follows the
announcement [2] on April 4, 2024, that 99 Cents plans an orderly
wind-down of its business operations which will include, among
other things, the liquidation of all merchandise owned by the
company and dispose of certain fixtures, furnishings, and equipment
at the company's stores as well as the sale of the real estate
assets, both owned and leased, in Arizona, California, Nevada, and
Texas. The company is pursuing debtor-in-possession ("DIP")
financing commitments to support the company's operations while it
goes through the bankruptcy process.
Subsequent to the actions, Moody's Ratings will withdraw all of its
ratings for 99 Cents given the company's bankruptcy filing.
99 Cents Only Stores LLC, operates around 371 retail stores in
California, Texas, Arizona and Nevada. Revenue was about $2.0
billion for the last twelve month period ending October 27, 2023.
The principal methodology used in these ratings was Retail and
Apparel published in November 2023.
99 CENTS: S&P Lowers ICR to 'D' on Chapter 11 Bankruptcy Filing
---------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on
California-based dollar-store chain 99 Cents Only Stores LLC to 'D'
from 'CCC'. At the same time, S&P lowered its issue-level rating on
the company's $350 million secured notes to 'D' from 'CCC'.
On April 7, 2024, 99 Cents Only Stores filed for Chapter 11
bankruptcy protection.
S&P downgraded 99 Cents Only Stores after the company filed for
bankruptcy under Chapter 11 of the U.S. Bankruptcy Code. The
company announced it secured $36 million in new capital as part of
a debtor-in-possession financing package to finance its bankruptcy
costs and support an orderly wind-down of its business operations.
99 Cents Only Stores plans to liquidate and dispose the assets of
all its 371 stores, including merchandise, fixtures, furnishings,
and equipment. In addition, the company will continue to liquidate
its real estate assets. At the time of its filing, 99 Cents Only
Stores' outstanding debt included $63.2 million drawn under its
asset-backed loan (ABL) and first-in last-out (FILO) facilities,
$25.7 million of undrawn letters of credit, $18 million of
promissory notes, and $350 million of secured notes.
99 Cents Only Stores has operated with increasing free operating
cash flow (FOCF) deficits following the COVID-19 pandemic and has
heavily relied on sales leaseback transactions as a short-term
source of liquidity. The company started its transformation plan in
the first quarter of 2023. However, its turnaround initiatives have
been unable to produce meaningful performance improvement because
of macroeconomic challenges, weak consumer demand, and inflationary
pressures.
S&P anticipates that it will withdraw its ratings in the next 30
days, as the company ceases its operations and liquidates its
assets.
Based in Commerce, Calif., 99 Cents Only is a dollar-store chain
that offers a mix of regularly available and closeout grocery,
consumable, and seasonal merchandise, primarily priced at 99 cents
or less. As of April 7, 2024, the company operated 371 stores
across California, Texas, Arizona, and Nevada. The company is also
a wholesale distributor.
AC/DC SOLAR: Files Emergency Bid to Use Cash Collateral
-------------------------------------------------------
AC/DC Solar, LLC asks the U.S. Bankruptcy Court for the Middle
District of Florida, Tampa Division, for authority to use cash
collateral in accordance with the budget, with a 10% variance, and
provide adequate protection.
The Debtor requires the use of cash collateral to fund its
operating expenses and costs of administration in this Chapter 11
case for the duration of the Chapter 11 case.
The U.S. Small Business Administration, which holds a scheduled
claim in the amount of $157,966, may claim a blanket lien on the
Debtor's assets by virtue of a UCC-1 Financing Statement recorded
in the Florida Secured Transaction Registry on June 27, 2020.
The Secured Creditor is secured by various personal property and
cash owned by the Debtor and valued at $24,907 on the Petition
Date. The Secured Creditor Assets include $16,607 in cash and
inventory which constitute cash collateral.
As adequate protection for the use of the cash collateral, the
Debtor offers the Secured Creditor the following:
a. A post-petition replacement lien on the Secured Creditor Assets
to the same extent, validity, and priority as existed on the
Petition Date;
b. The right to inspect the Secured Creditor Assets on 48 hour
notice, provided that said inspection does not unreasonably
interfere with the operations of the Debtor; and
c. Copies of monthly financial documents generated in the Debtor's
ordinary course of business and other information as the Secured
Creditor reasonably requests with respect to the Debtor's
operations.
A copy of the motion is available at https://urlcurt.com/u?l=WEUgqf
from PacerMonitor.com.
About AC/DC Solar
AC/DC Solar, LLC is a solar energy contractor in Florida.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Fla. Case No. 24-01582) on March 26,
2024, with $215,430 in assets and $1,301,378 in liabilities. Jay
Liran Metzer, manager, signed the petition.
Judge Catherine Peek Mcewen presides over the case.
Buddy D. Ford, Esq. at BUDDY D. FORD, P.A. represents the Debtor as
legal counsel.
ADVANTAGE SALES: S&P Rates New Repriced $1.146BB Term Loan B 'BB-'
------------------------------------------------------------------
S&P Global Ratings assigned its 'BB-' issue-level rating to
U.S.-based Advantage Sales & Marketing Inc.'s (subsidiary of
Advantage Solutions Inc.) proposed repriced $1.146 billion term
loan B due 2027. Advantage plans to amend its term loan to reduce
pricing. All other terms, including maturity, will remain the
same.
All other ratings, including the 'B+' issuer credit rating on
Advantage Solutions Inc., are unchanged. The rating outlook is
negative.
AERKOMM INC: Signs Merger Agreement With IX Acquisition Corp.
-------------------------------------------------------------
AERKOMM Inc. and IX Acquisition Corp, a SPAC focused on the
technology, media and telecommunications industries, have entered
into a definitive Business Combination Agreement and raised US$35
million in a private placement.
The combined business will be called AKOM Inc. and its ordinary
shares are expected to result in AERKOMM transferring its listing
from Euronext/OTCQX to Nasdaq under the ticker "AKOM", following
the closing of the business combination. It is the intention of
the combined business to also maintain a secondary listing on
Euronext.
Transaction highlights
* Adjusted enterprise value of AERKOMM is US$200 million, as
well as up to US$200 million of earnout shares for the AERKOMM
shareholders, if certain milestones are achieved.
* Transaction supported by a fund-raise of US$35 million common
equity PIPE (Private Investment in Public Equity) subscribed
concurrently with the signing of the BCA. The PIPE investors
consist of new and current shareholders in AERKOMM. There may be
more capital raised prior to the business combination, but there is
no minimum cash condition for the transaction.
* Existing AERKOMM shareholders are anticipated to roll 100% of
their equity and may own approximately two-thirds of the new
combined pro forma AKOM, subject to final amounts of PIPE capital
raised and of cash retained in IXAQ trust.
* The Nasdaq-listing is intended to enable AKOM to execute its
strategy to provide carrier neutral and software-defined
infrastructure to deliver mission-critical, multi-orbit satellite
broadband connectivity.
* Completion of the transaction is expected in Q3 2024, which is
subject to SEC review, to approval by IXAQ and AERKOMM shareholders
and to the satisfaction of certain other customary closing
conditions.
AERKOMM's strong capabilities deliver differentiated solutions:
* High throughput. AERKOMM's semiconductor glass antenna
transmits and receives 50% Mbps more throughput per square-inch
compared to previous state-of-the-art satellite broadband
terminals.
* Interoperability. AERKOMM's universal terminals, including
multi-orbit glass semiconductor antennas and software-defined radio
modems, provide carrier-neutral broadband connectivity. These
terminals are designed to meet the diverse needs of users across
various sectors, delivering high-quality connectivity and
performance.
* Virtualization. AERKOMM's software-defined core network
waveforms integrate satellites and constellations across all major
orbits, as well as advanced 5G and emerging 6C non-terrestrial
networks (NTN). This approach enhances flexibility, scalability
and efficiency, allowing for dynamic adaptation to evolving
communication needs.
Louis Giordimaina, AERKOMM Chief Executive commented:
"We are delighted to be collaborating with the IXAQ team, who bring
considerable sector and financial experience and expertise. We
will benefit from the resources of the IXAQ team, who also have a
proven track record in the international technology, media and
telecoms sectors.
"We are well positioned to address extremely fast-growing markets -
Aerospace & Defense and Civilian Telecommunications. We are
developing a range of pioneering multi-orbit satellite technologies
with the capability to provide end-to-end broadband connectivity in
collaboration with our satellite partners.
"In the defense sector, we have been leveraging our team's
long-time focus on commercial aviation to demonstrate applications
for satellite communications for unmanned aerial vehicles (UAVs).
Our technology is achieving positive results in real-world settings
and we anticipate commencing our first major contract in 2024. We
will also continue to invest in our talent and partnerships as we
position our technology to scale-up."
Karen Bach, IXAQ Chief Executive commented:
"We launched IXAQ with a team of executives from the digital
infrastructure and telecommunications sectors in order to add value
to the management teams of our target company- in AERKOMM we have
found the right opportunity.
"Switching AERKOMM's listing to Nasdaq and combining with our team
of experienced operators will support the business to rapidly
evolve into an institutional-grade company that is well- positioned
to capitalize on the numerous opportunities in its expanding
markets."
About Aerkomm
Headquartered in Nevada, USA, Aerkomm Inc. --
http://www.aerkomm.com-- is an innovative satellite technology
company, providing carrier-neutral and software- defined
infrastructure for multi-orbit, end-to-end satellite broadband
connectivity, serving both public and private sectors, including
Aerospace & Defense and Civilian Telecommunications. AERKOMM has a
range of next-generation satellite technologies that offer
broadband connectivity by collaborating with satellite partners and
mobile network operators to link users and platforms on the edge to
core infrastructure hubs. AERKOMM has established a strong
engagement with leading satellite constellation operators spanning
multiple orbits, including low-earth orbit (LEO), medium-earth
orbit (MEO), geostationary earth orbit (CEO) and highly elliptical
orbit (HEO). Additionally, AERKOMM's technology is currently being
implemented in the Aerospace & Defense market, having been tested
live in selected defense assets.
Aerkomm reported a net loss of $11.88 million in 2022, a net loss
of $9.38 million in 2021, a net loss of $9.11 million in 2020, a
net loss of $7.98 million in 2019, and a net loss of $8.15 million
in 2018. As of June 30, 2023, the Company had $70.15 million in
total assets, $50.22 million in total liabilities, and $19.93
million in total stockholders' equity.
AIM LLC: Bid to Use Cash Collateral Denied
------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida, Tampa
Division, denied as moot the motion to use cash collateral filed by
AIM, LLC.
The court said an order authorizing the use of cash collateral is
no longer necessary as the note held by has been paid in full
through the Debtor's regular contractual monthly payments to
Centennial Bank.
A copy of the order is available at https://urlcurt.com/u?l=F8Lczj
from PacerMonitor.com.
About AIM LLC
AIM, LLC, a company in Largo, Fla., filed a petition under Chapter
11, Subchapter V of the Bankruptcy Code ((Bankr. M.D. Fla. Case No.
24-00584) on February 5, 2024, with $1,471,550 in assets and
$1,427,109 in liabilities. William G. Buckles, Jr., manager, signed
the petition.
Judge Catherine Peek Mcewen oversees the case.
Jake C. Blanchard, Esq., at Blanchard Law, P.A. represents the
Debtor as bankruptcy counsel.
ALLERGY & ASTHMA: No Decline in Patient Care, 4th PCO Report Says
-----------------------------------------------------------------
David Crapo, the court-appointed patient care ombudsman, filed with
the U.S. Bankruptcy Court for the Central District of California
his fourth report for the period Jan. 22 to March 22, 2024,
regarding the healthcare facility operated by Allergy & Asthma
Center of SW Washington, LLC.
During the Fourth Reporting Period the PCO learned that Allergy &
Asthma Center continued to be staffed by one physician, one
dietician and four physician's assistants. Allergy & Asthma Center
did not hire any nurses during the Fourth Reporting Period. Its
physician, dietician and physician's assistants all remain fully
licensed. There are no disciplinary actions pending against any of
them.
Mr. Crapo stated that the center operates with several affiliates
under the name Columbia Allergy. Certain of the center's clinical
employees (particularly Dr. Jain and the dietician, Chau Brodnan,
RD) work for affiliates of the center as well as the center itself.
In the past, the PCO noted his concern that some of the employees
might have been stretched too thin. However, since the prior
reporting periods in this case, Columbia Allergy has eliminated
some facilities, thereby assuaging the PCO's concerns in that
regard.
The PCO's research did not reveal any medical malpractice or
professional litigation initiated against either the center or any
of its clinical employees during the third reporting period.
The PCO's investigation and analysis reveals that the center
apparently continues to provide the same level of patient care and
safety it historically provided since before the bankruptcy filing.
Hence, there appears to be no decline or compromise of the quality
of patient care or safety and the center's facilities.
A copy of the ombudsman report is available for free at
https://urlcurt.com/u?l=s2AodS from PacerMonitor.com.
About Allergy & Asthma Center
Allergy & Asthma Center of S.W. Washington, LLC is a Los
Angeles-based provider of personalized care for allergies and
asthma.
Allergy & Asthma Center sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. C.D. Calif. Case No. 23-11270) on
March 6, 2023. In the petition signed by its chief executive
officer, Sanjeev Jain, MD, the Debtor disclosed up to $500,000 in
assets and up to $10 million in liabilities.
Judge Vincent P. Zurzolo oversees the case.
Sheila Esmaili, Esq., at the Law Offices of Sheila Esmaili is the
Debtor's bankruptcy counsel.
David N. Crapo is the patient care ombudsman appointed in the
Debtor's Chapter 11 case.
ALLERGY ASSOCIATES: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Allergy Associates of the Palm Beaches, PA
840 US Hwy. 1, Ste. 235
North Palm Beach, FL 33408
Business Description: Allergy Associates provides evidence based,
comprehensive care in the diagnosis and
management of the full spectrum of allergic
and immunologic diseases. All of its
doctors are highly trained and specialize in
both the areas of adult/pediatric allergy
and immunology.
Chapter 11 Petition Date: April 11, 2024
Court: United States Bankruptcy Court
Southern District of Florida
Case No.: 24-13485
Debtor's Counsel: Malinda Hayes, Esq.
LAW OFFICES OF MALINDA L HAYES
378 Northlake Blvd Suite 218
North Palm Beach, FL 33408
Tel: (561) 537-3796
Email: malinda@mlhlawoffices.com
Total Assets: $391,140
Total Liabilities: $3,428,073
The petition was signed by Alan Koterba as member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/RO7R3PY/Allergy_Associates_of_the_Palm__flsbke-24-13485__0001.0.pdf?mcid=tGE4TAMA
ALLIANCE TRANS: William Avellone Named Subchapter V Trustee
-----------------------------------------------------------
The U.S. Trustee for Region 11 appointed William Avellone of
Chartered Management as Subchapter V trustee for Alliance Trans,
Inc.
Mr. Avellone will be paid an hourly fee of $375 for his services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Mr. Avellone declared that he is a disinterested person according
to Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
William B. Avellone
Chartered Management
10 South Riverside Plaza, Suite 875
Chicago, IL 60606
Tel: (312) 273-4004
Email: bill.avellone@charteredmgt.com
About Alliance Trans
Alliance Trans, Inc. filed a petition under Chapter 11, Subchapter
V of the Bankruptcy Code (Bankr. N.D. Ill. Case No. 24-04859) on
April 3, 2024, with as much as $50,000 in both assets and
liabilities.
Judge Donald R. Cassling presides over the case.
Steven A. Leahy, Esq., at the Law Office Steven A Leahy, PC
represents the Debtor as bankruptcy counsel.
AMERICAN GREETINGS: Moody's Rates New $1.05BB Loans Due 2029 'B2'
-----------------------------------------------------------------
Moody's Ratings affirmed greeting cards maker American Greetings
Corporation's B2 Corporate Family Rating and B2-PD Probability of
Default Rating. Concurrently, Moody's Ratings assigned B2 ratings
to the company's $800 million new senior secured term loan due 2029
and $250 million new senior secured revolving credit facility that
expires in 2029. The proceeds from the new term loan and $83
million cash on hand will be used to repay all existing debt,
including a $398 million existing first lien term loan that remains
outstanding and $163 million of senior notes, as well as fund a
$300 million dividend and related fees and expenses. The B1 ratings
on the existing senior secured term loan and revolving credit
facility as well as the Caa1 rating on the senior unsecured notes
are unchanged and will be withdrawn at transaction close. The
rating outlook is stable.
If the proposed refinancing does not go through and the company
repays the remaining $162.5 million of 8.75% senior unsecured notes
due April 2025, Moody's Ratings expects to downgrade the existing
senior secured term loan and revolving credit facility ratings to
B2 from B1, in line with the B2 CFR. This would result from the
elimination of the loss absorption cushion provided by the
unsecured notes in the event of a default with the senior secured
credit facilities representing the preponderance of debt in the
capital structure. In February, the company issued a required
60-day notice that it intends to redeem the notes as early as April
2024.
Moody's Ratings' views the debt-funded dividend as credit negative
because the transaction will increase the total debt balance by
roughly $240 million and increase annual interest costs by $28-$30
million. Moreover, the company's liquidity will be reduced by the
use of a meaningful amount of the cash balance to fund the
distribution and an increase in required annual term loan
amortization. Pro forma for the transaction, the company will have
$28 million of cash at closing and the annual term loan
amortization will increase to $20 million from $4.7 million
currently.
Moody's Ratings affirmed the company's B2 CFR because American
Greetings' credit metrics will remain within Moody's Ratings'
expectations for the rating following the transaction and free cash
flow remains meaningful. Debt-to-EBITDA of 4.5x for the 12-month
ending November 24, 2023 and pro forma for the transaction is below
the 5.0x downgrade factor. Free cash flow will be lower but Moody's
Ratings still expects the company will be able to generate $25-35
million of free cash flow in the fiscal year ended February 2025,
with an improvement to above $50 million in the fiscal 2026 because
higher earnings and lower cash costs.
RATINGS RATIONALE
American Greetings' B2 CFR broadly reflects its narrow product
focus, exposure to the risks inherent in a mature and highly
competitive greeting card industry, characterized by declining
volume, low growth, high customer concentration and weak customer
loyalty. The company is expanding its revenue stream to include
gift wrapping, party goods, balloons, as well as digital offerings
such as e-cards. That said, physical greeting cards still represent
about 70% of the company's total revenue. Exposure to declining
greeting card volumes requires good reinvestment and execution of
growth initiatives to avoid earnings erosion, and also creates
event risk because the company could pursue acquisitions or other
leveraging actions to bolster the product base. American Greetings'
ratings reflect its solid position in the US, Canada and UK
greeting card markets, and the relatively stable demand for the
company's products driven by everyday life events and holidays.
Long-standing relationships with many of its retail customers are
supported by the highly profitable nature of greeting cards for
retailers and its long operating history of over 100 years.
The company's revenue was in decline for several years before
fiscal 2022 partially because of net customer losses and sluggish
retail traffic both in the US and UK markets, as well as
coronavirus-related disruptions. American Greetings grew revenue in
fiscal 2022 driven by customer wins in the US and UK, its broader
celebrations product strategy, and the sunset of prior year
customer losses. In fiscal 2023 and 2024, revenue modestly declined
because of more cautious discretionary consumer spending on goods
due to high inflation, declines in greeting card volumes, and the
bankruptcy of one of its retail customers. New customer wins
overseas as well as increased distribution with Walmart in the US
did not fully offset these headwinds. In the next 12-18 months,
Moody's Ratings expects low-single-digit revenue growth and the
company to maintain a mid-teens EBITDA margin, supported by new
customer wins focused on the company's celebrations strategy across
the broader product assortment, ongoing cost reduction efforts, and
price increases.
Marketing terms for the new credit facilities (final terms may
differ materially) include the following:
Incremental pari passu debt capacity up to the greater of $315
million and 100% of consolidated EBITDA, plus unlimited amounts
subject to 2.75x first lien net leverage ratio. There is an inside
maturity sublimit up to the greater of $145 million and 50% of
consolidated EBITDA, and any indebtedness incurred in connection
with a permitted acquisition or other investment. The credit
agreement is expected to include "J. Crew", "Chewy" and "Serta"
provisions, as well as the ability to reallocate certain restricted
payments baskets to incur debt.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable outlook reflects Moody's Ratings' expectation that the
company will maintain relatively stable revenue and EBITDA over the
next 12 to 18 months, and that the company will generate free cash
flow of $25-$35 million in the fiscal year ended February 2025
(absent dividends) and more than $50 million in fiscal 2026.
The ratings could be upgraded if the company demonstrates
consistent organic revenue growth with a stable or expanding EBITDA
margin, sustains retained cash flow-to-net debt above 12.5%,
maintains a more balanced financial policy with debt-to-EBITDA
sustained below 3.5x, and maintains good liquidity.
The ratings could be downgraded if the company's operating
performance weakens such as the loss of a major customer or volume,
an inability to offset the earnings decline from declining greeting
card volumes, or costs increase. Aggressive strategic or financial
policies such as debt-funded acquisitions or shareholder
distributions, debt-to-EBITDA sustained above 5.0x, retained cash
flow-to-net debt sustained below 7.5% or a deterioration in
liquidity for any reason could also lead to a downgrade.
The principal methodology used in these ratings was Consumer
Packaged Goods published in June 2022.
American Greetings is a leading designer, manufacturer and
distributor of both everyday and seasonal greeting cards and other
social expression products, including gift packaging, party goods,
and stationery products. In April 2018, private equity firm
Clayton, Dubilier, and Rice acquired a 60% majority stake in the
company via a $204 million preferred equity investment, with the
Weiss family (descendants of the founders) maintaining a 40% stake
in the business. The company is private and does not publicly
disclose financial information. American Greetings Corporation
generated revenue of approximately $1.2 billion for the 12-month
period ended November 24, 2023.
APPLIED SYSTEMS: Court OKs Deal on Cash Collateral Access
---------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of New York
authorized Applied Systems Marketing, L.L.C. to use cash
collateral, on an interim basis, in accordance with the budget and
its agreement with First Central Savings Bank.
The Debtor requires the use of cash collateral to pay costs and
expenses necessary to preserve and maintain its business.
The Debtor's principal business consists of the ownership and
management of real property located at and known as 41-49 Forest
Avenue, Glen Cove, New York 11542. The Property has constructed on
it two separate buildings, one of which is fully built out and
occupied by a tenant under a long-term non-residential real
property lease which operates a day care center, and the other
building is substantially built out but currently unoccupied
although it too is currently subject to a non-residential real
property lease.
At present, only the Day Care Center pays rent under the Day Care
Lease of approximately $27,000 per month, which rent is part of
First Central's Collateral and constitutes cash collateral of First
Central.
Prior to the commencement of the case, the Debtor incurred
obligations to First Central under a Substitute Note "A" in the
original principal amount of $650,000, an Amended and Restated
Mortgage Note in the original principal amount of $2.350 million,
an Agreement of Consolidation, Extension and Modification of the
Mortgages, an Assignment of Leases and Rents, and an Assignment of
Leases and Rents, all dated as of May 4, 2018, and an Amended and
Restated Mortgage Note, an Amended and Restated in the original
principal amount of $650,000, an Amended and Restated Mortgage
Note, and an Agreement of Consolidation, Extension and Modification
of the Mortgages, all dated August 1, 2020, under which obligations
were outstanding as of January 16, 2024, with account number ending
in 6273 having a current open principal amount of $2.350 million,
and account number ending in 6265 having a current open principal
about of $650,000, for a total principal balance due and owing of
$3 million.
The First Central Loans are secured by first priority liens on all
assets of the Debtor. The First Central Loans matured on March 1,
2024.
The parties agreed that the Debtor may use cash collateral in the
ordinary course of business for payment of expenses incurred, or to
be incurred in the operation of its business, for any filing fees
or United States Trustee fees in connection with the case; and for
payment of any professional fees and expenses.
As adequate protection, First Central is granted a continuing
post-petition security interest in all of the assets of the Debtor
in possession, except that such lien does not extend to any
avoidance action recoveries.
As additional adequate protection for any Post-Petition Loss, the
Debtor will make a payment of $24,644 per month to First Central
for the earlier of the effective date of a Chapter 11 Plan
confirmed by the Court, or the case is closed. The Debtor will
continue to remit the Adequate Protection Payments to First Central
even after the Maturity Date.
The Debtor agrees to maintain all insurance policies including
general commercial liability insurance, fire, hazard, and casualty
in accordance with the First Central Loan Documents.
These events constitute an "Event of Default":
a. If the Debtor fails to make any Adequate Protection Payments
when due, and such nonpayment has not been cured within five
business days after notice from First Central;
b. The Court removes the Debtor from possession, converts the case
to one under Chapter 7 of the Bankruptcy Code, or dismisses the
case, without the consent of First Central.
c. Any person or entity is granted relief from the automatic stay
with respect to any portion of the Collateral.
d. An order of the Bankruptcy Court in this Chapter 11 case is
entered or modified in a manner materially adverse to First
Central; a motion, pleading or proceeding is filed by the Debtor
that could reasonably be expected to result in a material
impairment of the rights, remedies or interests of First Central;
or there is a determination by the Bankruptcy Court with respect to
any motion, pleading or proceeding brought by another party which
results in any material impairment of the rights, remedies or
interests of the First Central.
A copy of the order is available at https://urlcurt.com/u?l=u9MNBR
from PacerMonitor.com.
About Applied Systems Marketing, LLC
The Debtor is engaged in activities related to real estate. The
Debtor owns three properties in Forest Avenue, Glen Cove, NY valued
at $8.35 million.
Applied Systems Marketing L.L.C. in Glen Cove, NY, filed its
voluntary petition for Chapter 11 protection (Bankr. E.D.N.Y. Case
No. 24-70422) on February 1, 2024, listing $8,762,520 in assets and
$7,783,424 in liabilities. James R. Fitzgerald as chief executive
officer, signed the petition.
Judge Louis A Scarcella oversees the case.
CERTILMAN BALIN ADLER & HYMAN, LLP serve as the Debtor's legal
counsel.
AQUABOUNTY TECHNOLOGIES: Reports $27.6 Million Net Loss in 2023
---------------------------------------------------------------
AquaBounty Technologies, Inc. filed with the Securities and
Exchange Commission its Annual Report on Form 10-K reporting a net
loss of $27.6 million on $2.5 million of product revenue for the
year ended December 31, 2023, compared to a net loss of $22.2
million on $3.1 million of product revenue for the year ended
December 31, 2022.
As of December 31, 2023, the Company had $187.6 million in total
assets, $22.5 million in total liabilities, and $165 million in
total stockholders' equity.
Baltimore, Maryland-based Deloitte & Touche LLP, the Company's
auditor since 2022, issued a "going concern" qualification in its
report dated April 1, 2024, citing that the Company has incurred
cumulative operating losses and negative cash flows from operations
that raise substantial doubt about its ability to continue as a
going concern.
Since inception, the Company has incurred cumulative net losses and
negative cash flows from operations and expects that this will
continue for the foreseeable future. As of December 31, 2023, the
Company has $9.2 million in cash and cash equivalents, and
restricted cash.
The Company's ability to continue as a going concern is dependent
upon its ability to raise additional capital, and there can be no
assurance that such capital will be available in sufficient
amounts, on a timely basis, or on terms acceptable to the Company,
or at all.
Management Commentary
"Our financial results for 2023 are indicative of the financial and
operational challenges that we encountered during the year," stated
Sylvia Wulf, Board Chair and Chief Executive Officer of AquaBounty.
"We began the year with a limited ability to harvest at our
Indiana farm, as needed repairs were performed on our processing
building. By the time the facility was fully back in operation in
early May, the market price for Atlantic salmon had begun to fall.
This continued through the second and third quarters and only
partially recovered during the holiday season in the fourth
quarter. The result was a decline in year-over-year revenue, even
though our total production output increased by 14 percent. Our
net loss for 2023 increased over the prior year, primarily due to
sharp increases in spending for state excise taxes, legal fees, and
outside consulting, the latter two driven by our fundraising
efforts. We also were impacted by another significant increase in
the cost estimate for our Ohio farm, which forced us to pause both
our construction activities and our municipal bond financing
transaction in June.
"Faced with these challenges, we began exploring a range of
financing alternatives to strengthen our balance sheet and increase
our cash runway. We announced in February 2024 that we had made
the decision to sell our Indiana farm operation in order to
increase our cash position and to decrease our on-going cash burn.
Additionally, we engaged Berenson & Company as our investment bank
to advise on debt financing secured by our unencumbered assets and
on additional funding alternatives that are necessary to resume and
complete construction of our Ohio farm and pursue our longer-term
growth strategy.
"Operations at our PEI farm continue to expand with the
installation of additional egg incubation capacity, which will
allow us to increase the availability of non-transgenic Atlantic
salmon eggs and fry for sale to salmon farmers. Furthermore, our
R&D team continues to make advances in genetics, breeding, fish
health and nutrition. We have a fully engaged and committed
management team that is focused on dealing with our challenges and
taking the necessary steps to support our future growth.
"I look forward to providing my fellow stockholders with an update
in the near future," concluded Wulf.
A full-text copy of the Company's Form 10-K is available at
https://tinyurl.com/46c6es87
About AquaBounty
Headquartered in Maynard, Massachusetts, AquaBounty Technologies,
Inc. (NASDAQ: AQB) -- www.aquabounty.com -- is a land-based
sustainable aquaculture company that provides fresh Atlantic salmon
to nearby markets by raising its fish in carefully monitored
land-based fish farms through a safe, secure and sustainable
process. The Company's land-based Recirculating Aquaculture System
("RAS") farms, including a grow-out farm located in Indiana, United
States and a broodstock and egg production farm located on Prince
Edward Island, Canada, are close to key consumption markets and are
designed to prevent disease and to include multiple levels of fish
containment to protect wild fish populations. AquaBounty is
raising nutritious salmon that is free of antibiotics and
contaminants and provides a solution resulting in a reduced carbon
footprint and no risk of pollution to marine ecosystems as compared
to traditional sea-cage farming.
ARCIMOTO INC: Swaps 2.8M Warrants for 2.1M Pre-Funded Warrants
--------------------------------------------------------------
Arcimoto, Inc. disclosed in a Form 8-K filed with the Securities
and Exchange Commission that it entered into an additional exchange
agreement with a certain holder of its warrants for the purchase of
shares of common stock on the terms previously disclosed in the
Periodic Report on Form 8-K filed April 3, 2024. A total of
2,777,779 warrants were exchanged for a total of 2,083,334
pre-funded warrants. The transaction closed on April 4, 2024.
About Arcimoto Inc.
Based in Eugene, Oregon, Arcimoto, Inc. -- http://arcimoto.com--
designs and manufactures electric vehicles. The Company's mission
is to catalyze the global shift to a sustainable transportation
system. Over the past 16 years, the Company has developed
technologies, platforms, and vehicles aimed squarely at rightsizing
daily mobility. To date, the Company has introduced six vehicle
products built on the first Arcimoto platform that target specific
niches in the vehicle market: its flagship product, the Fun Utility
Vehicle, for everyday consumer trips; the Deliverator for last-mile
delivery and general fleet utility, the Flatbed, Arcimoto's
solution for a rightsized pickup truck, and the Rapid Responder for
emergency services and security.
Arcimoto reported a net loss of $62.88 million in 2022 following a
net loss of $47.56 million in 2021.
Portland, Oregon-based Deloitte & Touche LLP, the Company's auditor
since 2022, issued a "going concern" qualification in its report
dated April 14, 2023, citing that the Company has incurred
significant losses and does not have sufficient cash on hand to
meet its obligations as they come due, which raises substantial
doubt about its ability to continue as a going concern.
ARENA GROUP: Reports $55.6 Million Net Loss in 2023
---------------------------------------------------
The Arena Group Holdings, Inc. filed with the Securities and
Exchange Commission its Annual Report on Form 10-K reporting a net
loss of $55.6 million on $244.2 million of revenue for the year
ended December 31, 2023, compared to a net loss of $70.9 million on
$220.9 million of revenue for the year ended December 31, 2022.
As of December 31, 2023, the Company had $188.9 million in total
assets, $247.7 million in total liabilities, $168,000 in total
mezzanine equity, and $59 million in total stockholders' deficit.
New York, NY-based Marcum LLP, the Company's auditor since 2019,
issued a "going concern" qualification in its report dated April 1,
2024, citing that the Company has a significant working capital
deficiency, has incurred significant losses and may need to
restructure its debt 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 plans to refinance or modify the maturities of its
current debt and complete the Business Combination to alleviate the
conditions that raise substantial doubt about its ability to
continue as a going concern, however, there can be no assurance
that the Company will be able to refinance or modify its current
debt and complete the business combination contemplated by the
agreement by and among the Company, Simplify Inventions, LLC,
Bridge Media Networks, LLC, New Arena Holdco, Inc. and the other
parties dated November 5, 2023.
A full-text copy of the Company's Form 10-K is available at
https://tinyurl.com/ywy9kpbs
About The Arena Group Holdings
The Arena Group Holdings, Inc. (NYSE American: AREN) together with
its subsidiaries, operates digital media platform the United States
and internationally. The company offers the Platform, a
proprietary online publishing platform comprising publishing tools,
video platforms, social distribution channels, newsletter
technology, machine learning content recommendations,
notifications, and other technology. The company was formerly
known as The Maven, Inc. and changed its name to The Arena Group
Holdings in February 2022. The Arena Group was incorporated in
1990 and is based in New York.
ARTICO COLD: Court OKs Cash Collateral Access Thru April 19
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois,
Eastern Division, authorized Artico Cold Storage Chicago LLC to use
cash collateral, on an interim basis, in accordance with the
budget, through April 19, 2024.
Wintrust Bank, N.A. asserts an interest in the Debtor's cash
collateral.
The Debtor stipulates that the Wintrust Prepetition Debt as of
March 18, 2024, is not less than approximately $1.9 million and
constitutes the legal, valid and binding obligation of the Debtor,
enforceable in accordance with the terms of the Wintrust Loan
Documents.
As adequate protection, the Lender is granted Replacement Liens and
security interests on the Debtor's property and assets, whether now
owned or hereafter acquired by the Debtor. The Adequate Protection
Liens will be in an amount equal to the Diminution Amount and will
be deemed properly perfected upon the entry of the Order without
the necessity of any physical delivery, recordation, or further
act.
To the extent the adequate protection of the interests of the
Lender in the Wintrust Prepetition Collateral granted proves
insufficient, the Lender will be granted a super-priority
administrative claim under 11 U.S.C. sections 503(b), 507(a), and
507(b) for the amount by which the Adequate Protection Lien proves
inadequate. The 507(b) Claim will have priority over all other
costs and expenses of the kind specified in or ordered pursuant to
sections 105, 326, 330, 331, 503(b), 506(c), 507(a), 507(b), or 726
of the Bankruptcy Code except for fees owed to the United States
Trustee pursuant to 28 U.S.C. section 1930 or the fees and expenses
of the Clerk of the Court.
A continued hearing on the matter is set for April 17 at 1:15 p.m.
A copy of the order is available at https://urlcurt.com/u?l=EVHqEm
from PacerMonitor.com.
About Artico Cold Storage Chicago
Artico Cold Storage Chicago, LLC filed a petition under Chapter 11,
Subchapter V of the Bankruptcy Code (Bankr. N.D. Ill. Case No.
24-04371) on March 26, 2024, with $1 million to $10 million in both
assets and liabilities.
Judge Deborah L. Thorne presides over the case.
William J. Factor, Esq., represents the Debtor as legal counsel.
ATLAS MIDCO: S&P Upgrades ICR to 'CCC+', Outlook Negative
---------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on U.S.-based
contact center and workforce management provider Atlas Midco Inc.
to 'CCC+' from 'D' (default).
S&P said, "At the same time, we assigned a 'B' rating to Atlas
Midco subsidiary Alvaria Holdco's first-lien, first-out term loan,
a 'CCC+' rating to the company's first-lien, second-out term loan,
a 'CCC+' rating to the company's first-lien, second-out revolving
credit facility, a 'CCC-' rating to the company's first-lien,
third-out term loan, and a 'CCC-' rating to the company's
first-lien, fourth-out term loan.
"The negative outlook reflects our view that Atlas Midco faces
business execution risk to stabilize the business following its
debt restructuring. While the transaction provides near-term
relief, we believe the risk of a subsequent default or distressed
exchange is still elevated considering the step up in pricing in
outer years and the company's high leverage.
"While near-term liquidity has improved, we still view Atlas
Midco's high leverage as a risk. Following its restructuring, Atlas
Midco will see improved financial flexibility in the form of $78
million of new money, pay-in-kind (PIK) interest for the next two
years, and covenant relief until 2026. Accordingly, on a pro forma
basis the company will have about $50 million of cash on hand and
about $40 million of availability under its $75 million revolver,
which now matures in May 2027. Despite these improvements, debt
balances and leverage remain relatively high. Debt outstanding
following the transaction, net for both the below par exchange and
the $78 million of new money, totaled $870 million at close, a
modest $50 million decrease from the $920 million of debt
outstanding previously. Furthermore, the PIK interest on the
exchange debt, while cash accretive over the next 24 months, is
expected to increase leverage beyond 10x by the end of fiscal 2025.
Once cash interest payment requirements begin again in 2026, we
believe cash flows could be further pressured if the company's
turn-around plan stalls or projected benefits do not materialize
given the higher pricing associated with the exchange debt.
"The negative outlook reflects our view that Atlas Midco faces high
business execution risk to stabilize the business following its
debt restructuring. While the transaction provides near-term
relief, we believe the risk of a subsequent default or distressed
exchange is still elevated considering the step up in pricing and
the company's high leverage."
S&P could lower its ratings if:
-- Atlas Midco experienced worse-than-expected or sustained
revenue declines because of weak customer demand, elevated customer
churn, or further operational mishaps;
-- While unlikely, greater-than-expected cash burn led to a
further weakened liquidity position, resulting in a likely
inability to meet debt servicing obligations and seasonal net
working capital needs within the next 12 months; or
-- S&P believed persistent business challenges and rising
liquidity pressures could lead to a subsequent restructuring or
similar transaction within the next 12 months.
S&P could revise its rating to stable if:
-- S&P believed any distressed-like debt transaction risk were
diminished; or
-- Longer-term business trends stabilized and we viewed EBITDA
expansion and free cash flow growth as sustainable such that
liquidity improved meaningfully.
ATP TOWER: Fitch Lowers LongTerm IDR to 'BB-', Outlook Negative
---------------------------------------------------------------
Fitch Ratings has downgraded ATP Tower Holdings, LLC's (ATP)
Long-Term Foreign Currency Issuer Default Rating and the senior
secured notes of USD375 million due in 2026 to 'BB-' from 'BB'. The
Rating Outlook is Negative.
ATP's downgrade is based on heightened counterparty risk
underscored by the deterioration of credit quality of ATP's client
portfolio and the high leverage, with net leverage not expected to
fall below 7.0x within 12 months from about 8.0x projected at YE
2023.
The Negative Outlook reflects Fitch's expectations on the negative
impact that higher interest expenses associated with the
refinancing of upcoming debt maturities may have on the company's
FCF generation capabilities.
KEY RATING DRIVERS
Upcoming Refinancing: ATP's debt maturity schedule is notably
compressed, with maturities for its revolving credit facility (RCF)
and senior secured bonds due in January and April of 2026,
respectively. This maturity profile, in conjunction with the
prevailing still relatively tight funding conditions and elevated
interest rates, underscores the material refinancing need ATP faces
before the debt become current in early 2025.
Deterioration in Counterparty Credit Quality: ATP's counterparty
risk has increased, with key clients (around 70% of the revenues)
experiencing credit profile weakening due to competition, market
dynamics, and specific events, leading to Fitch downgrades in the
Andean region. Empresa Nacional de Telecomunicaciones S.A (Entel)
and Telefónica Moviles Chile S.A (TMCH) were downgraded to 'BBB-'
in September 2023 and January 2024, respectively; Telefónica del
Perú to 'B+' in February 2024; and WOM S.A to 'D' post Chapter 11
announcement. ColTel was downgraded to 'BB+' from 'BBB-' in April
2024.
Mitigating this risk is the long-term nature of the take or pay
contracts ATP has with clients, which usually extend 10 years at
inception, with an average remaining contract life of about five
years for towers and eight years for fiber. These agreements help
mitigate volume and price risks. The stability and growth potential
of tower and fiber business also benefit by the collocation
strategy, the integration of the investment strategies of network
development of its clients.
High Leverage: ATP is projected to reach 2023 with net leverage at
8.0x, and this ratio is expected to be around 7.0x in 2024 as the
company intensifies its capital expenditure program. Although this
represents a decrease from the estimated 9.0x leverage in 2022, it
remains significantly above the 6.5x range associated with a 'BB'
rating category. The company's fiber deployment strategy and the
construction of new tower sites are anticipated to drive EBITDA
growth through 2024 and into 2025. Nonetheless, Fitch views the
reduction of net leverage to lower than 6.5x by 2024 as a
challenging target for the company.
High Competition: ATP's ratings are constrained by its small size
when compared with most peers in the independent infrastructure
space. Competition in the telecom infrastructure business has
continued to increase with larger rivals growing both organically
and inorganically. Phoenix Tower International entered the Chilean
market after acquiring 3,800 towers in Chile from WOM S.A.
Increasing competition in the country could lead to slower tenant
acquisition in the medium term.
American Tower Corporation along with America Movil's tower
spin-off, Sitios Latinoamerica, are large competitors with wide
tower infrastructure coverage in Latin America. In fiber optic, the
strong local names and the consolidation of new big operator as a
result of the agreements of KKR and Telefónica in Chile and Peru
are expected to increase competition in the short term.
EBITDA Growth Yet Anticipated Negative FCF: EBITDA is projected to
grow from USD 57 million in 2023 to USD 90 million in 2025, driven
by the company's expansion of its fiber and tower infrastructure.
This expected growth is primarily due to inflation escalators,
fiber-to-the-home (FTTH) contracts in Colombia, and expansion in
Chile. Fitch forecasts that the EBITDA margin will improve
gradually, rising from 44% in the LTM of September 2023 to 54% by
2025.
Despite these positive operational trends, Fitch anticipates a
persistent negative FCF over the medium term, in light of the
substantial capital expenditure (capex) plan estimated at
approximately USD 100 million annually for the 2024-2026 period.
Fitch acknowledges that while capital expenditures are
discretionary and can be reduced if necessary, such a reduction
would likely lead to slower company growth.
Long-Term Growth Opportunities: Demand for data capacity continues
to grow rapidly. Wireless companies have been densifying their 4G
LTE networks, which increases the network capacity, and are
implementing technological evolutions to increase speed and
capacity. Mobile and fixed broadband services remain a key factor
in future revenue and cash flow growth for the tower and fiber
industry.
The development of 5G in Chile , Peru and Colombia should support
the demand for towers, considering the higher site density
required. Disposable income, particularly in the latter two
countries, however, limits the return on capital and could
constrain operators' network investments.
DERIVATION SUMMARY
ATP and other digital infrastructure operators have operating
profiles with high visibility and stability of rental income based
on passive infrastructure and long-term contracts. The tower
industry employs a stable business model and experiences much lower
business risk than many business models within the
telecommunications segment.
The North American wireless telecom tower industry is dominated by
American Tower Corporation (BBB+/Negative) and Crown Castle Inc.
(BBB+/Stable). These operators have better business profiles than
ATP due to larger scale, more diversification, and exposure to a
more stable and mature telecommunications industry. Operadora de
Sites Mexicanos, S.A.B de C.V. (Opsimex; BBB/Positive) also has
stronger business and financial profiles than ATP, and benefits
from its dominant market position in Mexico, favorable relationship
with America Movil, and a track record of consistent deleveraging.
The company's EBITDA net leverage metrics are consistently higher
than global peers and are most closely in line with European
operator Cellnex Telecom S.A. (BBB-/Stable). However, Cellnex's
elevated leverage metrics are supported by a much larger business
scale and more mature operating environment. The EBITDA Interest
coverage of ATP is lower than global peers, only comparable with
Sitios Latinoamérica, S.A.B de C.V (BBB-/Stable), company which
benefit for bigger scale, higher geographic diversification and
solid anchor tenant.
Indonesian peer's PT Profesional Telekomunikasi Indonesia
(Protelindo; BBB/Stable) and PT Tower Bersama Infrastructure (TBI;
BBB-/Stable) are medium-sized players with business profiles that
are more in line with ATP. However, these issuers are much stronger
than ATP financially, boasting lower leverage metrics and much
higher profitability margins.
KEY ASSUMPTIONS
- Revenue grows to around USD150 million in 2024 from about USD109
million in 2022;
- EBITDA margins moving from 45% in 2023 to around 54% in 2025 as
improving tenancy drives economies of scale;
- Annual Capex of around USD50 million in 2023 and around USD100
million in 2024 and 2025;
- No dividend distributions.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
- Given the rating action, positive rating actions are unlikely in
the short term;
- Stabilization of Outlook could occur if the company successfully
completes its refinancing process;
- Stronger than expected revenue growth over the medium term,
driving EBITDA margins of over 60%;
- Net leverage sustained below 6.5x;
- Neutral FCF.
Factors that Could, Individually or collectively, lead to Negative
Rating Action/downgrade
- Inability to complete the refinancing in the following 12
months.
- A delay or inability to execute the business plan as envisioned;
- Revenue growth in the medium term slowing to the mid-single
digits, with EBITDA margins lower than Fitch expectations;
- Net leverage above 7.5x and EBITDA Interest coverage lower than
1.5x in the sustained basis;
- The loss of a major tower tenant, or higher counterparty risk of
its main clients, reflected in further downgrades of its main
clients could drive a downgrade of the ratings.
LIQUIDITY AND DEBT STRUCTURE
RCF support Liquidity, Refinancing need: ATP needs to refinance its
senior secured debt and the RCF in early 2026. As of Sept. 30,
2023, ATP had a cash and cash equivalent level of USD6 million and
not have relevant maturities until 2025, consistent in Andean
Towers Partners Colombia S.A.S's Loan of USD60 million. The
financial flexibility is supported by an RCF of USD120 million,
which was recently extended to 2026 and it is currently undrawn.
ISSUER PROFILE
ATP Tower Holdings, LLC is a privately-owned provider of digital
and telecommunication infrastructure in the Andean region, with
operations mainly in Colombia, Peru and Chile. ATP owns, operates,
manages, and leases telecommunications towers, rooftops, small
cells, distributed antenna systems (DAS), optical fiber networks &
nodes, and C-RAN solutions.
SUMMARY OF FINANCIAL ADJUSTMENTS
- Hedge of derivatives on debt;
- Lease Adjustments.
ESG CONSIDERATIONS
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Prior
----------- ------ -----
ATP Tower
Holdings, LLC LT IDR BB- Downgrade BB
senior secured LT BB- Downgrade BB
AULT ALLIANCE: Series C Preferred Shares Increased to 75,000
------------------------------------------------------------
Ault Alliance, Inc. disclosed in a Form 8-K filed with the
Securities and Exchange Commission that the Company filed a
Certificate of Increase for the Series C Convertible Preferred
Stock with the Secretary of State of the State of Delaware. The
Series Certificate Amendment was approved on April 3, 2024, by an
affirmative vote of the holder of the Series C Convertible
Preferred Stock outstanding as of such date and by the unanimous
affirmative vote of the board of directors of the Company on March
21, 2024. The Certificate became effective upon filing with the
Secretary of State of the State of Delaware.
Pursuant to the Certificate, the number of shares of preferred
stock designated as the Series C Convertible Preferred Stock was
increased from 50,000 to 75,000.
As previously reported on Current Report Form 8-K filed with the
SEC on Nov. 7, 2023, on Nov. 6, 2023, Ault Alliance, Inc. entered
into a Securities Purchase Agreement with Ault & Company, Inc., a
Delaware corporation, pursuant to which the Company agreed to sell
to the Purchaser up to 50,000 shares of Series C convertible
preferred stock, and warrants to purchase shares of the Company's
common stock, par value $0.001 per share for a total purchase price
of up to $50,000,000.00.
As previously reported on Current Report Form 8-K filed with the
Commission on March 26, 2024, on March 25, 2024 the Company and the
Purchaser entered into an amendment that amends (i) the Agreement,
(ii) the Certificate of Designation of Preferences, Rights and
Limitations of the Series C Convertible Preferred Stock and (iii)
the number of Series C Warrants, to provide for (A) an increase in
the Financing from $50,000,000.00 to $75,000,000.00 and (B) an
extension of the date to closing the final tranche of the
Financing.
About Ault Alliance Inc.
Ault Alliance, Inc. (formerly, BitNile Holdings, Inc.) is a
diversified holding company pursuing growth by acquiring
undervalued businesses and disruptive technologies with a global
impact. Through its wholly- and majority-owned subsidiaries and
strategic investments, the Company owns and operates a data center
at which the Company mines Bitcoin and provides mission-critical
products that support a diverse range of industries, including
crane services, oil exploration, defense/aerospace, industrial,
automotive, medical/biopharma, consumer electronics, hotel
operations and textiles. In addition, the Company extends credit to
select entrepreneurial businesses through a licensed lending
subsidiary.
Ault Alliance reported a net loss of $189.83 million for the year
ended Dec. 31, 2022, compared to a net loss of $23.04 million for
the year ended Dec. 31, 2021. As of Sept. 30, 2023, the Company
had $378.46 million in total assets, $257.22 million in total
liabilities, $2.18 million in redeemable noncontrolling interests
in equity of subsidiaries, and total stockholders' equity of
$119.06 million.
Ault Alliance said in its Quarterly Report for the period ended
Sept. 30, 2023, that as of that date, the Company had cash and cash
equivalents of $8.7 million, negative working capital of $45.1
million and a history of net operating losses. The Company has
financed its operations principally through issuances of
convertible debt, promissory notes and equity securities. The
Company said these factors create substantial doubt about the
Company's ability to continue as a going concern for at least one
year after the date that these condensed consolidated financial
statements are issued.
AYRO INC: Incurs $34.2 Million Net Loss in 2023
-----------------------------------------------
Ayro, Inc. filed with the Securities and Exchange Commission its
Annual Report on Form 10-K reporting a net loss of $34.16 million
on $498,917 of revenue for the year ended Dec. 31, 2023, compared
to a net loss of $22.94 million on $2.99 million of revenue for the
year ended Dec. 31, 2022.
As of Dec. 31, 2023, the Company had $52.86 million in total
assets, $27.53 million in total liabilities, $11.19 million in
mezzanine equity, and $14.14 million in total stockholders'
equity.
As of Dec. 31, 2023, the Company had $33,440,867 in cash and
working capital of $44,670,150, including $10,000,000 in restricted
cash. As of Dec. 31, 2022, the Company had $39,096,562 in cash,
$9,848,804 in marketable securities and working capital of
$49,666,744. The decrease in cash and increase in working capital
was primarily a result of the Company's operating loss partially
offset by the issuance of Series H-7 Preferred Stock, the proceeds
of which were primarily invested in marketable securities. The
Company's sources of cash since inception have been predominantly
from the sale of equity and debt.
The Company's business is capital-intensive, and future capital
requirements will depend on many factors, including its growth
rate, the timing and extent of spending to support development
efforts, the results of its strategic review, the expansion of its
sales and marketing teams, the timing of new product introductions
and the continuing market acceptance of its products and services.
The Company is working to control expenses and deploy its capital
in the most efficient manner.
"We are evaluating other options for the strategic deployment of
capital beyond our ongoing strategic initiatives, including
potentially entering other segments of the electric vehicle market.
We anticipate being opportunistic with our capital, and we intend
to explore potential partnerships and acquisitions that could be
synergistic with our competitive stance in the market," Ayro said.
"We are subject to a number of risks similar to those of earlier
stage commercial companies, including dependence on key individuals
and products, the difficulties inherent in the development of a
commercial market, the potential need to obtain additional capital,
and competition from larger companies, other technology companies
and other technologies. Based on the foregoing, management
believes that the existing cash and cash equivalents at December
31, 2023, will be sufficient to fund operations for at least the
next twelve months following the date of this report," the Company
said.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1086745/000149315224012412/form10-k.htm
About AYRO
Texas-based AYRO, Inc., formerly known as DropCar, Inc. --
http://www.ayro.com-- designs and manufactures compact,
sustainable electric vehicles for closed campus mobility, low speed
urban and community transport, local on-demand and last mile
delivery and government use. The Company's four-wheeled
purpose-built electric vehicles are geared toward commercial
customers, including universities, business and medical campuses,
last mile delivery services and food service providers. The
Company has commenced sales and delivery of its current model, the
AYRO Vanish in support of the aforementioned markets.
Ayro, Inc. reported a net loss of $22.94 million in 2022, a net
loss of $33.08 million in 2021, a net loss of $10.76 million in
2020, a net loss of $8.66 million in 2019, and a net loss of $18.75
million in 2018.
AZM RESTAURANTS: AZM Liquidate to Pay Claims in Plan
----------------------------------------------------
AZM Restaurants, L.C., together with the Official Committee of
Unsecured Creditors, filed a Joint Plan of Liquidation, which Plan
provides for the resolution of outstanding Claims against, and
equity Interests in.
AZM Debtor and the Committee, as proponents of the Plan, request
confirmation of the Plan pursuant to Section 1129 of the Bankruptcy
Code.
The Plan provides that the remaining unencumbered Cash of the
Estate and all other assets of the Estate on the Effective Date
will be distributed pursuant to and in accordance with the terms of
this Plan. The Plan will be implemented by the CRO, as the Plan
Administrator, who shall be appointed by the Court on the
Confirmation Date pursuant to the Plan and shall act on behalf of
AZM Debtor to effectuate the terms and provisions of this Plan.
In summary, the assets to be used for distributions under the Plan
include: (a) the AZM Set Aside, which will be distributed to the
Holders of Allowed General Unsecured Claims; and (b) the Retained
Causes of Action, the proceeds of which will be distributed to
Holders of Allowed Claims, including Allowed Administrative Claims.
The Plan Administrator shall be AZM's sole officer and director
after the Effective Date, with delegated authority to distribute,
and charged with the distribution of, the Assets to Holders of
Allowed Claims.
Under the Plan, Class 3 Allowed General Unsecured Claims total in
excess of $53,000,000. Each Holder of an Allowed General Unsecured
Claim will receive its pro rata share of (i) the AZM Set Aside; and
(ii) the Retained Causes of Action after payment of Allowed
Administrative Claims. Pursuant to the Global Settlement Order,
Varilease (i) does not hold a security interest in the AM Set
Aside; (ii) waived any right to assert a security interest in the
AZM Set Aside; and (iii) waived any right to a distribution from
the AZM Estate on account of its alleged Claims. Holders of Allowed
General Unsecured Claims are Impaired under the Plan.
"AZM Set Aside" means $725,000 in Cash and 50% of rebate funds paid
from Coca Cola Corporation to or for the benefit of AZM Debtor or
any of the Meridian Consolidated Debtors on or after March 6, 2024,
each as provided for in the Global Settlement Agreement.
"Global Settlement Order" means the Order entered by the Bankruptcy
Court on March 20, 2024 [Case No. 23-20731, Docket No. 777]
approving the Global Settlement Agreement.
Counsel for AZM Restaurants, L.C.:
Michael R. Johnson, Esq.
David H. Leigh, Esq.
Elaine A. Monson, Esq.
RAY QUINNEY & NEBEKER P.C.
36 South State Street, 14th Floor
Salt Lake City, Utah 84111
Tel: (801) 532-1500
E-mail: mjohnson@rqn.com
dleigh@rqn.com
emonson@rqn.com
- and -
James T. Markus, Esq.
Matthew T. Faga, Esq.
Lacey S. Bryan, Esq.
MARKUS WILLIAMS YOUNG &
HUNSICKER LLC
1775 Sherman Street, Suite 1950
Denver, CO 80203-4505
Tel: (303) 830-0800
Fax: (303) 830-0809
E-mail: jmarkus@markuswilliams.com
mfaga@markuswilliams.com
lbryan@markuswilliams.com
A copy of the Joint Plan of Liquidation dated March 27, 2024, is
available at https://tinyurl.ph/EoXEs from PacerMonitor.com.
About Meridian Restaurants Unlimited
Meridian Restaurants Unlimited, LC, owns and operates restaurants
in Utah.
Meridian Restaurants Unlimited, and its affiliates, including AZM
Restaurants, LC, filed Chapter 11 petitions (Bankr. D. Utah Lead
Case No. 23-20731) on March 2, 2023. At the time of the filing,
Meridian Restaurants Unlimited reported $10 million to $50 million
in both assets and liabilities.
Judge Kevin R. Anderson oversees the cases.
The Debtors tapped Markus Williams Young & Hunsicker, LLC, as
bankruptcy counsel; Ray Quinney & Nebeker P.C. as local and
litigation counsel; Peak Franchise Capital, LLC as financial
advisor; Hilco Corporate Finance, LLC as investment banker; and
Keen-Summit Capital Partners, LLC as real estate advisor. BMC
Group, Inc. is the noticing agent.
The U.S. Trustee for Region 19 appointed an official committee to
represent unsecured creditors in the Debtors' Chapter 11 cases. The
committee is represented by Foley & Lardner, LLP.
BAYTEX ENERGY: Fitch Hikes LongTerm IDR to 'BB-', Outlook Stable
----------------------------------------------------------------
Fitch Ratings has upgraded Baytex Energy Corp.'s (Baytex) Long-Term
Issuer Default Rating (IDR) to 'BB-' from 'B+'. Fitch has also
affirmed Baytex's senior unsecured notes at 'BB-'and has revised
the recovery rating to 'RR4' from 'RR3'. The Rating Outlook is
Stable.
The rating upgrade is underpinned by increasing operational scale
and diversification after the acquisition of Ranger Oil in 2Q23
coupled with recent progress with improving liquidity and
decreasing debt. Fitch expects Baytex to materially reduce leverage
by the end of 2024 in accordance with its financial policy of 50%
pre-dividend FCF applied to debt repayment.
The Stable Outlook reflects Fitch's expectation of the company's
oil and gas production volume growth at low single-digits rates,
positive FCF generation and healthy liquidity.
KEY RATING DRIVERS
Strengthening Liquidity, Debt Reduction: Baytex is on track to
substantially reduce the draw on its revolver, lowering its debt
and increasing the available funds that can support its liquidity
during an oil price downcycle. The company's CAD1.5
billion-equivalent revolver balance fell to CAD865 million at YE
2023 from CAD987 million at the end of 2Q23. In April 2024, Baytex
issued USD575 million notes and used part of it to reduce the
revolver drawdowns. Fitch expects that the company's debt repayment
will be uneven throughout 2024 due to the timing of capex outlays
and shareholder distributions, but projects the revolver balance to
fall below CAD500 million by YE 2024. Baytex's gross debt will
decline to CAD2.2 billion at YE 2024, down from CAD2.5 billion at
YE 2023 and CAD2.6 billion at the end of 2Q23, under Fitch's base
case.
Scale Enhancing Merger: Baytex's acquisition of Ranger Oil
Corporation, which closed in June 2023, considerably increased its
production scale. The company's production reached 160 thousand
barrels of oil equivalent (kboe/d; 83% liquids) in 4Q23, up from 87
kboe/d in 4Q22. This maintains Baytex's favorable standalone
liquids weighting and meaningfully increases its scale to a level
more typical of the 'BB' rating category.
Moreover, Ranger's assets improve Baytex's sensitivity to low oil
prices driven by its Canadian heavy oil assets with higher
production and transportation costs and exposure to volatile
light-heavy oil differentials. Fitch projects Baytex's EBITDA at
CAD2.1 billion in 2024 and CAD1.5 billion at the midcycle price of
USD57 per barrel of West Texas Intermediate (WTI) oil.
Significant Leverage Headroom Expected: Fitch projects that
Baytex's EBITDA leverage will fluctuate between 1.0x and 1.2x in
2024-2028 based on Fitch's WTI oil price assumptions of USD75 per
barrel in 2024 sliding to USD57 by 2028. The company has
considerable headroom under Fitch's 2.5x leverage negative rating
sensitivity. Baytex's EBITDA was 1.4x at YE 2023, although it would
have been lower if a full year of Ranger's results were included in
the consolidated financials. Ranger was acquired for CAD3.2
billion, including the assumption of net debt, with approximately a
third of Ranger's shareholder consideration paid in cash and two
thirds in stock.
Shareholder Distributions Depend on FCF: The pace of Baytex's
deleveraging is linked to its FCF. It aims to allocate 50% of its
pre-dividend FCF to shareholder returns, which include dividends
and share buybacks, while the other half will be used for debt
reduction. Fitch expects Baytex's annual dividends to be roughly
flat at CAD76 million. Under the company's stated financial policy,
shareholder distributions may increase to 75% of FCF if its
adjusted total debt reaches CAD1.5 billion.
Diversified Asset Mix: Baytex has a meaningfully diverse asset base
by geography and hydrocarbon. In 4Q23, 60% of production came from
the Eagle Ford. The remaining 40% was Canadian production most of
which was heavy oil, with heavy oil prices discounted due to
quality and transportation differentials. Potentially lower
Canadian heavy crude differentials following the Trans Mountain
pipeline expansion will be positive for Baytex.
Moderate Growth, Limited Proved Reserves: Baytex intends to
increase production by 1%-4% annually and reach 170 kboe/d in 2028.
Fitch expects that the incremental volumes will mainly come from
its Duvernay formation assets that focus on light oil and have more
favorable economics and development potential than most of its
heavy oil-focused reserves at Fitch's midcycle oil prices. Baytex
estimates that it has at least ten years of development inventory
at each of its production areas at their planned rate of
development. Baytex had around 6 years of net proved reserves life
at YE 2023, a low but manageable level compared to peers.
Hedged Differentials and Commodity Prices: Baytex intends to hedge
approximately 40% of its net oil exposure, helping provide cash
flow visibility. The company also partially hedges Canadian
differentials between Western Canadian Select and Mixed Sweet Blend
to WTI. Baytex has U.S. dollar to Canadian dollar FX exposure due
to its Eagle Ford assets, U.S. dollar-denominated debts and the
majority of oil and gas prices linked to the U.S. dollar.
DERIVATION SUMMARY
Baytex has higher 4Q23 production size than its Canadian peers MEG
Energy Corp. (BB-/Stable; 111 kboe/d; 100% liquids), Vermilion
Energy Inc. (BB-/Stable; 88 kboe/d; 46% liquids) and Strathcona
Resources Ltd. (B+/Stable; 147 kboe/d; 86% liquids). In contrast to
MEG and Strathcona, Baytex produces most of its oil and gas in the
Eagle Ford of the U.S. and is more exposed to light oil, which
typically has less volatile netbacks through the cycle and leads to
less pronounced spikes in leverage.
Baytex's recent 4Q23 operating netback after interest (USD25/boe)
was comparable to Vermilion's (USD26/boe), MEG's (USD26/boe) and
Strathcona's (USD26/boe). Fitch expects Baytex's 1.1x leverage at
midcycle prices to be considerably lower than Strathcona's, broadly
comparable with MEG's and higher than Vermilion's.
Baytex's scale was slightly higher than SM Energy Company's (154
kboe/d; 60% liquids) and had lower share of natural gas in 4Q23. SM
generated greater netback (USD29/boe) due to the more beneficial
production mix, including stronger economics at its Permian Basin
assets. Fitch expects SM to have somewhat higher leverage at
midcycle than Baytex due to the difference in projected gross
debt.
Baytex had lower production than Crescent Energy Company
(B+/Positive; 165 kboe/d; 61% liquids) in 4Q23 but higher exposure
to oil. Baytex's netback was higher than Crescent's (USD19/boe) due
to smaller exposure to mature assets. Both companies are forecasted
to have similar midcycle leverage but Baytex has a more predictable
debt reduction policy.
KEY ASSUMPTIONS
- West Texas Intermediate of U.S. $75 per barrel (bbl) in 2024,
$65/bbl in 2025, $60/bbl in 2026-2027 and $57/bbl at midcycle;
- Henry Hub of U.S. $2.5 per thousand cubic feet (mcf) in 2024,
$3.00/mcf in 2025-2026 and $2.75/mcf in 2027 and midcycle;
- Low single-digit annual production growth through the forecast;
- Dividends close to CAD76 million in 2024-2027;
- Capex averaging CAD1.2 billion annually in 2024-2027;
- Share buybacks based on the current financial policy.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Production volume materially exceeding 200 kboe/d;
- Improvement in average netbacks;
- Midcycle EBITDA leverage maintained below 2.0x.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Weakening liquidity, such as sustained low availability under the
revolver or failure to timely refinance debt;
- Midcycle EBITDA leverage sustained over 2.5x.
LIQUIDITY AND DEBT STRUCTURE
Enhanced Liquidity After Refinancing: Baytex does not have debt
maturities until April 2026 when its USD1.1 billion (CAD1.5
billion) revolving credit facility is due. Fitch expects that
Baytex will timely extend the revolver. The amount drawn under the
facility was CAD865 million at YE 2023, and it may decrease if part
of the recently issued 2032 notes is used for credit facility
repayment. Baytex had CAD56 million of cash available at YE 2023.
Its liquidity was further strengthened by positive FCF projected by
Fitch in 2024-2026.
ISSUER PROFILE
Baytex Energy is a mid-sized Canadian exploration and production
company with a production mix including light oil and condensate,
heavy oil, natural gas liquids and natural gas. Its operations are
in the U.S. within the Eagle Ford formation and in Canada within
the Western Canadian Sedimentary Basin.
ESG CONSIDERATIONS
Baytex's ESG Relevance Score for Energy/Management has been changed
to '3' from '4', reflecting the company's higher scale that may
increase the chance of successfully managing the energy-transition
risks.
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
----------- ------ -------- -----
Baytex Energy Corp. LT IDR BB- Upgrade B+
senior unsecured LT BB- Affirmed RR4 BB-
BERKELEY HEIGHTS: U.S. Trustee Appoints Joseph Tomaino as PCO
-------------------------------------------------------------
Andrew Vara, the U.S. Trustee for Regions 3 and 9, appointed Joseph
Tomaino as patient care ombudsman for Berkeley Heights Dental
Specialists, LLC.
The appointment was made pursuant to the order from the U.S.
Bankruptcy Court for the District of New Jersey on March 23.
Section 333 of the Bankruptcy Code provides that the Patient Care
Ombudsman shall:
* monitor the quality of patient care provided to patients of
the debtor, to the extent necessary under the circumstances,
including interviewing patients and physicians;
* not later than 60 days after the date of this appointment,
and not less frequently than at 60-day intervals thereafter, report
to the court after notice to the parties in interest, at a hearing
or in writing, regarding the quality of patient care provided to
patients of the debtor;
* if such ombudsman determines that the quality of patient
care provided to patients of the debtor is declining significantly
or is otherwise being materially compromised, file with the court a
motion or a written report, with notice to the parties in interest
immediately upon making such determination; and
* maintain any information obtained by such ombudsman under
section 333 of the Bankruptcy Code that relates to patients
(including information relating to patient records) as confidential
information. Such ombudsman may not review confidential patient
records unless the court approves such review in advance and
imposes restrictions on such ombudsman to protect the
confidentiality of such records.
Mr. Tomaino of Grassi Healthcare Advisors, LLC disclosed in a court
filing that he is a "disinterested person" pursuant to Section
101(14) of the Bankruptcy Code.
The ombudsman may be reached at:
Joseph Tomaino
Grassi Healthcare Advisors, LLC
750 Third Avenue, 28th Floor
New York, NY 10017
Tel: (212) 223-5020
Email: jtomaino@grassihealthcareadvisors.com
About Berkeley Heights Dental Specialists
Berkeley Heights Dental Specialists, LLC filed its voluntary
petition for relief under Chapter 11 of the Bankruptcy Code (Bankr.
D.N.J. Case No. 24-11298) on Feb. 11, 2024, with as much as $1
million in both assets and liabilities. Avijit Goel, managing
member of Berkeley owner, Advanced Dental Specialists LLC, signed
the petition.
The Law Offices of Herbert K. Ryder, LLC represents the Debtor as
bankruptcy counsel.
BHAVI HOSPITALITY: Brad Odell of Mullin Named Subchapter V Trustee
------------------------------------------------------------------
The U.S. Trustee for Region 7 appointed Brad Odell, Esq., at Mullin
Hoard & Brown, LLP, as Subchapter V trustee for Bhavi Hospitality,
LLC.
Mr. Odell 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. Odell declared that he is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Brad W. Odell
Mullin Hoard & Brown, LLP
P.O. Box 2585
Lubbock, TX 79408
Direct: 806-712-1238
Office: 806-765-7491
Mobile: 469-449-3690
Email: bodell@mhba.com
About Bhavi Hospitality
Bhavi Hospitality LLC, doing business as Holiday Inn Express
Forney, filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. N.D. Texas Case No. 24-30972) on April 1,
2024, with $1 million to $10 million in both assets and
liabilities. Mehul Gajera, manager, signed the petition.
Judge Scott W. Everett presides over the case.
Joyce W. Lindauer, Esq., at Joyce W. Lindauer Attorney, PLLC
represents the Debtor as bankruptcy counsel.
BISHOP OF OAKLAND: Seeks to Extend Plan Exclusivity to Sept. 6
--------------------------------------------------------------
The Roman Catholic Bishop of Oakland asked the U.S. Bankruptcy
Court for the Northern District of California to extend its
exclusivity periods to file a plan of reorganization and obtain
acceptance thereof to September 6 and November 5, 2024,
respectively.
The Debtor explains that the size and complexity of this case
continues to support an extension of exclusivity. The Debtor's
Schedules list more than 570 creditors. Approximately 560 proofs of
claim were filed, including 386 nonduplicate claims asserting the
Debtor is liable for damages relating to childhood sexual abuse.
Many of those claims are asserted to be of six-figure or
seven-figure amounts, and many are listed as having an unknown
amount.
In addition, the claims related to childhood sexual abuse present
unique complexities of confidentiality, valuation, procedure, and
appropriate and equitable treatment of claims. Extension of the
Exclusivity Periods will allow additional time for the Debtor to
continue to evaluate and value those claims with the assistance of
Foley and A&M, negotiate protocols and values with the Commission
in mediation and craft a plan for satisfying all valid claims.
The Debtor asserts that the nature of the Roman Catholic Bishop of
Oakland, as distinct from a corporate chapter 11 debtor,
contributes to the complexity of the case and resultant need for
additional time to propose a plan. As described in detail in the
First Day Declaration, the Debtor provides central services to the
Churches serving the 82 churches within the Diocese of Oakland, and
also to the Non-Debtor Catholic Entities (as defined in the First
Day Declaration). The Debtor must adhere to Canon Law in addition
to its civil law obligations, a consideration secular, corporate
debtors do not have.
The Debtor further asserts that its mission is unique in its focus:
celebration of the sacraments, provision of pastoral services,
performance of works of mercy, and outreach to and support of the
faithful and the poor within the Diocese of Oakland. These
ministries are the Debtor's foundation. The Debtor requires
additional time to evaluate the impact of potential plan options on
these elements of its mission.
The Debtor claims that it requires additional time to evaluate
options and negotiate a plan through the mediation process. The
first joint mediation session between the Debtor and Committee
occurred in mid-March, and further mediation sessions are scheduled
in April, May, and June, after the current Exclusive Filing Period
is set to expire. Given the complexity and difficulty of the issues
to be addressed in mediation, the Debtor needs the additional time
requested herein to engage in the ongoing mediation with the
Committee without the specter of competing plans.
Additionally, the Insurance Adversary Proceedings are important
potential sources for creditor recoveries, but remain in their
pleading stages despite the Debtor's diligent efforts to press
forward. While the Insurance Adversary Proceedings will inevitably
move forward, the District Court has not yet ruled on the pending
motions to dismiss the third amended complaint. An initial case
management conference is also set for April 18, only two and half
weeks before expiration of the current Exclusive Filing Period.
Extending the Exclusivity Periods will allow that litigation to
extend past the pleading stage and move closer to its ultimate
conclusion before a plan must be filed.
The Roman Catholic Bishop of Oakland is represented by:
Jeffrey R. Blease, Esq.
Thomas F. Carlucci, Esq.
Shane J. Moses, Esq.
Emil P. Khatchatourian, Esq.
Ann Marie Uetz, Esq.
Matthew D. Lee, Esq.
FOLEY & LARDNER LLP
555 California Street, Suite 1700
San Francisco, CA 94104-1520
Email: jblease@foley.com
tcarlucci@foley.com
smoses@foley.com
ekhatchatourian@foley.com
auetz@foley.com
mdlee@foley.com
About The Roman Catholic Bishop of Oakland
The Roman Catholic Bishop of Oakland, a tax-exempt religious
organization, sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Cal. Case No. 23-40523) on May 8,
2023. In the petition signed by Bishop Michael Charles Barber, the
Debtor disclosed $100 million to $500 million in both assets and
liabilities.
Judge William J. Lafferty oversees the case.
The Debtor tapped Foley & Lardner LLP as legal counsel and Alvarez
& Marsal North America, LLC as restructuring advisor. Kurtzman
Carson Consultants LLC is the Debtors' claims and noticing agent
and administrative advisor.
The U.S. Trustee for Region 17 appointed an official committee to
represent unsecured creditors in the Debtor's Chapter 11 case. The
committee tapped Lowenstein Sandler, LLP as bankruptcy counsel;
Burns Bair LLP as special insurance counsel; and Berkeley Research
Group, LLC as financial advisor.
BOISSON INC: Files Emergency Bid to Use Cash Collateral
-------------------------------------------------------
Boisson Inc. asks the U.S. Bankruptcy Court for the Central
District of California, Los Angeles Division, for authority to use
cash collateral, in accordance with the budget, with a 20%
variance, and provide adequate protection.
The Debtor requires the use of cash collateral to pay all of its
projected post-petition expenses.
The Debtor has obtained consent from Connect Ventures I, L.P., as
Collateral Agent to the use of cash collateral pursuant to the
Budget, with Permitted Variances.
Connect Ventures is the only known creditor with a lien on the
Debtor's cash collateral.
In 2023, the Debtor generated a combined revenue of $10 million
from its retail and e-commerce operations, alongside more than $1
million in wholesale revenue and an additional $175,000 from
Boisson-owned brands.
Unfortunately, faced with escalating operational costs,
particularly from retail operations at its current nine traditional
brick and mortar locations, and a competitive landscape that
strained its financial reserves, the Debtor became unable to pay
its debts as they came due.
In order to address its financial issues, the Debtor has begun to
initiate a strategic pivot, whereby it will completely transition
away from physical retail operations to focus instead on e-commerce
and wholesale distribution channels for greater efficiency and
sustainability.
The Debtor obtained a certified search of UCC-1 financing
statements recorded against the Debtor from the Secretary of State
of Delaware, where the Debtor was incorporated.
There are five Financing Statements recorded against the Debtor by
(a) 11770 SVB, LLC, (b) Farnam Street Financial, Inc., (c) HYG
Financial Services, Inc., (d) Connect Ventures, and (v) Ouiby,
Inc.
As of the petition date, the Debtor's primary assets were comprised
of (1) cash in the approximate amount of $80,000, (2) inventory,
which can be sold for no less than $650,000, and (3) approximately
$400,000 in accounts receivable, which are expected to be collected
in the ordinary course of business. In addition, the Debtor owns
intellectual property (including branded beverages), rolling stock,
and goodwill that have substantial value.
The Secured Creditors are or will be adequately protected by (1)
the Adequate Protection Liens, (2) the Adequate Protection
Administrative Claims, and (3) the ongoing operation of the
Debtor's business, which must continue in the ordinary course in
order for the Debtor to emerge as a more streamlined and focused
business following the Chapter 11 reorganization process and the
maintain and maximize the Debtor's enterprise value.
A copy of the motion is available at https://urlcurt.com/u?l=f605kf
from PacerMonitor.com.
About Boisson Inc.
Boisson Inc. offers a vast portfolio, boasting over 125 brands of
non-alcoholic wines, beers, spirits, aperitifs, and mixers,
including brands owned by the Debtor. The Debtor operates 11
storefronts in major cities, including New York, Miami, Los
Angeles, and San Francisco, amplified its digital presence through
a growing e-commerce platform, and also launched a wholesale
distribution channel.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Case No. 24-12614) on April 4,
2024. In the petition signed by Sheetal Aiyer, chief executive
officer, the Debtor disclosed up to $10 million in both assets and
liabilities.
Judge Neil W. Bason oversees the case.
Ron Bender, Esq., at LEVENE, NEALE, BENDER, YOO & GOLUBCHIK L.L.P.,
represents the Debtor as legal counsel.
BOROHUB GARDENS: Says Unsecureds Unimpaired in Sale Plan
--------------------------------------------------------
Borohub Gardens LLC submitted an Amended Plan of Liquidation.
The Debtor's Plan is a liquidating plan with the centerpiece being
a sale of the Debtor's real estate property located at 4820 Bay
Parkway, Brooklyn, New York (the "Property"). To that end, the
Debtor has entered into a contract for a private sale of the
Property. The sales price is $1,500,000. This sum will be
sufficient to pay off the secured liens on the Property, all
unsecured claims and will provide the funding to pay the loan of DM
Investors, which asserted a secured loan against the equity
interests in the Debtor.
Under the Plan, Class 4 consists of all Allowed General Unsecured
Claims. Class 4 Claimants will receive a 100% distribution from
the net proceeds of the sale of the Property to be paid within 30
days after the Effective Date, together with interest at the
federal judgment rate in effect on the Confirmation Date. Class 4
is unimpaired.
The Plan shall be funded by the sale of the Property and the net
proceeds from the sale of the Property and cash on hand. As set
forth in this Disclosure Statement, the Debtor has entered into a
private contract with KALISCH PLUS LLC, or its assigns, to sell the
Property for $1,500,000.00, and subject to all existing tenancies
and occupancies. That contract of sale and the Settlement Agreement
are hereby approved as part of the Plan and incorporated herein.
The sale shall be held within 30 days after the entry of an order
confirming the Plan.
Attorneys for the Debtor:
Avrum J. Rosen, Esq.
Alex E. Tsionis, Esq
LAW OFFICES OF AVRUM J. ROSEN, PLLC
38 New St.
Huntington, NY 11743
Tel: (631) 423-8527
.
A copy of the Amended Plan of Liquidation dated Apr. 3, 2024, is
available at https://tinyurl.ph/KGqYi from PacerMonitor.com.
About Borohub Gardens
Borohub Gardens, LLC, filed a Chapter 11 bankruptcy petition
(Bankr. E.D.N.Y. Case No. 23-44469) on Dec. 4, 2023, with as much
as $1 million in both assets and liabilities.
Judge Jil Mazer-Marino oversees the case.
The Law Offices of Avrum J. Rosen, PLLC, serves as the Debtor's
bankruptcy counsel.
BOVINE PROPERTIES: Case Summary & 17 Unsecured Creditors
--------------------------------------------------------
Debtor: Bovine Properties, LLC
1902 7th Ave
Camanche, IA 52730
Business Description: Bovine Properties is a Single Asset Real
Estate debtor (as defined in 11 U.S.C.
Section 101(51B)). The Debtor owns the real
property located at 1902 7th Ave, Camanche
IA 52730 valued at $5 million.
Chapter 11 Petition Date: April 10, 2024
Court: United States Bankruptcy Court
Northern District of Iowa
Case No.: 24-00316
Debtor's Counsel: Joseph A. Peiffer, Esq.
AG & BUSINESS LEGAL STRATEGIES
PO Box 11425
Cedar Rapids, IA 52410
Tel: 319-363-1641
Fax: 319-200-2059
E-mail: joe@ablsonline.com
Total Assets: $5,000,000
Total Liabilities: $19,588,665
The petition was signed by Andrew Naeve as president.
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/YZR5UJQ/Bovine_Properties_LLC__ianbke-24-00316__0001.0.pdf?mcid=tGE4TAMA
BRADLYNN CORP: May Use Cash Collateral
--------------------------------------
The U.S. Bankruptcy Court for the District of Massachusetts
authorized Bradlynn Corp., Inc. to use cash collateral, on an
interim basis, only to pay the sums due for wages and payroll taxes
not to exceed $6,000 in the aggregate.
As previously reported by the Troubled Company Reporter, the
Debtor's operations were severely affected by COVID, and it is
still in the process of recovering from the COVID closures.
Additionally, creditor Credibly is exercising its UCC and taking
the Debtor's accounts receivable. The Debtor is currently operating
and meeting its current obligations as they come due.
The Debtor's secured creditor is Credibly. The Debtor entered into
a business loan with Credibly in August of 2023. The current
balance of the loan is approximately $110,000. The Debtor's other
secured creditor is Headway. The Debtor entered into a business
loan with Headway in September of 2022 and the current balance of
the loan is approximately $62,923.
Credibly of Arizona LLC and Headway Capital, LLC will be entitled
to the benefit of the adequate protection as set forth in the
Proceeding Memorandum and Order dated January 3, 2024.
The Debtor will by April 9, 2024, at noon, file (i) a
reconciliation of budget to actual expenses with monthly totals and
cash balances for the period ending March 31, 2024; and (ii) a
projection for further use of cash collateral through June 30,
2024.
A copy of the order is available at https://urlcurt.com/u?l=EJegGG
from PacerMonitor.com.
About Bradlynn Corp. Inc.
Bradlynn Corp. Inc. is a Massachusetts corporation that owns and
operates a plumbing business, located in Lakeville, Massachusetts.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Mass. Case No. 23-12142) on December 21,
2023. In the petition signed by Dean Fawcett, III, president, the
Debtor disclosed up to $500,000 in both assets and liabilities.
Judge Janet E. Bostwick oversees the case.
Peter M. Daigle, Esq., at Daigle Law Office, represents the Debtor
as legal counsel.
BRIDGE DIAGNOSTICS: Seeks Cash Collateral Access
------------------------------------------------
Bridge Diagnostics, LLC asks the U.S. Bankruptcy Court for the
Central District of California, Santa Ana Division, for authority
to use cash collateral and provide adequate protection.
The Debtor requires the use of cash collateral to pay its ongoing
operational expenses, including payroll expense, rent, and
utilities.
The Debtor, a clinical diagnostics laboratory, initially focused on
providing infectious disease testing for Women's Health and Urology
markets. However, the COVID-19 pandemic led to a shift from women's
health testing to COVID testing, generating millions of dollars in
revenue. In early 2022, rapid point-of-care COVID testing centers
increased, reducing the Debtor's market share. The Debtor then
shifted to Women's Health and Urology testing, focusing on
PCR-based UTI testing. However, the Medicare Administrative
Contractor (MAC) for the California market discontinued coverage of
PCR-based UTI testing, causing financial strain. The Debtor had
$10-15 million in collectible outstanding accounts receivables from
COVID-related testing, which was backed by the CARES Act.
Post-pandemic, many health insurances stopped paying COVID-related
AR to diagnostic testing centers nationwide. The Debtor faced
financial difficulties and bankruptcy purposes, but has
successfully validated a Pharmacogenomic (PGx) test and obtained
Z-codes for gene testing. The Debtor anticipates profitability in
April 2024 and cash flow positive in June or July.
Initially, the Debtor believes that that a senior secured lien
existed in favor of Mr. Ross Blackburn, in the amount of $2.5
million. However, a review of the UCC search does not indicate that
Blackburn perfected his lien prior to the filing of the Petition
Date.
Additionally, the Debtor's insider, Mr. Jason Hansen, provided
secured financing to the Debtor. Mr. Hansen perfected his security
interest. The Debtor will pay Mr. Hansen's secured lien (since
there is no evidence of perfection of the Blackburn Alleged Lien)
pursuant to the terms of that note, which allows for monthly
interest payments. Further, Mr. Hansen consents to the use of his
cash collateral in this instant matter.
The Debtor acknowledges that the Budget contemplates a $500,000
debtor-in-possession loan for April 2024. The Debtor will not
accept funding for a DIP Loan until this Court has approved a
post-petition financing motion.
As adequate protection, the Debtor intends to pay the Hansen Lien
in accordance with the terms of the underlying note. Moreover, the
Debtor has approximately $10-15 million in collectible accounts
receivable via the CARES Act.
A hearing on the matter is set for April 11, 2024 at 10 a.m.
A copy of the motion is available at https://urlcurt.com/u?l=Z694cy
from PacerMonitor.com.
About Bridge Diagnostic, LLC
Bridge Diagnostic, LLC is a national healthcare services company
providing clinical diagnostic information, clinic workflow
solutions, population health management tools, and precision
medicine data.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Case No. 24-10803) on March 29,
2024. In the petition signed by Jason Hansen, founder and member
manager, the Debtor disclosed up to $50 million in both assets and
liabilities.
Judge Theodor Albert oversees the case.
David A. Wood, Esq., at MARSHACK HAYS WOOD LLP, represents the
Debtor as legal counsel.
BRP GROUP: S&P Alters Outlook to Positive, Affirms 'B-' ICR
-----------------------------------------------------------
S&P Global Ratings revised its outlook to positive from stable and
affirmed its 'B-' issuer and issue-level ratings on BRP Group Inc.
(BRP).
The positive outlook reflects S&P's view that it may raise its
rating on BRP in the next 12 months in connection with improved
financial leverage on a sustained basis.
BRP reported another year of double-digit organic growth of 19% in
2023, with strong performance across all three business segments
driven by favorable new business and retention, as well as overall
success with its strategic focus on leveraging tech-enabled client
engagement tools, specializations, and differentiated embedded
distribution capabilities. The company has shown continued focus on
investing in longer-term topline growth, including the creation of
several new Centers of Excellence (CoE) within its Insurance
Advisory Solutions (IAS) segment, the expansion of its MGA of the
Future product suite, and the launch of a reinsurance brokerage
business called Juniper Re. As BRP expands its distribution
capabilities and develops new products, S&P forecasts organic
growth in the low- to mid-teens over the next 12 months, which it
expects to be further supported by healthy property/casualty (P/C)
pricing trends and strong underlying momentum across the business.
C. L. DALE: William Callahan Named Subchapter V Trustee
-------------------------------------------------------
The Acting U.S. Trustee for Region 4 appointed William Callahan,
Jr., Esq., at Gentry Locke as Subchapter V trustee for C. L. Dale
Construction Services, LLC.
Mr. Callahan will be paid an hourly fee of $475 for his services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Mr. Callahan declared that he is a disinterested person according
to Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
William E. Callahan, Jr., Esq.
Gentry Locke
10 Franklin Road, S.E., Suite 900
Roanoke, VA 24011
Phone: (540) 983-9309
Fax: (540) 983-9400
Email: callahan@gentrylocke.com
About C. L. Dale Construction Services
C. L. Dale Construction Services, LLC is a provider of construction
and engineering services catering to the Southwest Virginia area.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. W.D. Va. Case No. 24-70240) on April 3,
2024, with $482,367 in assets and $3,666,001 in liabilities.
Christopher L. Dale, manager/sole member, signed the petition.
Judge Paul M. Black presides over the case.
Scot Farthing, Esq., at Farthing Legal, PC represents the Debtor as
bankruptcy counsel.
CANO HEALTH: Widens Net Loss to $1.1 Billion in 2023
----------------------------------------------------
Cano Health, Inc. filed with the U.S. Securities and Exchange
Commission its Annual Report on Form 10-K disclosing a net loss of
$1.1 billion for the year ended December 31, 2023, compared to a
net loss of $428.4 million for the year ended December 31, 2022.
As of December 31, 2023, the Company had $1.01 billion in total
assets, $1.55 billion in total liabilities, and $535 million in
total stockholders' deficit.
Miami, Florida-based Ernst & Young, LLP, the Company's auditor
since 2010, issued a "going concern" qualification in its report
dated April 1, 2024, citing that the Company has filed for relief
under Chapter 11 of title 11 of the United States Code in the
United States Bankruptcy Court for the District of Delaware and has
stated that substantial doubt exists about the Company's ability to
continue as a going concern.
A full-text copy of the Company's Form 10-K is available at
https://tinyurl.com/mw8bnzw9
About Cano Health Inc.
Cano Health, Inc., and its affiliates are an independent primary
care physician group.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Lead Case No. 24-10164) on February
4, 2024. In the petitions signed by Mark Kent, authorized
signatory, the Debtors disclosed $1,211,931,000 in assets and
$1,471,032,000 in liabilities.
Judge Karen B. Owens oversees the cases.
The Debtors tapped Richards, Layton & Finger, P.A. and Weil,
Gotshal & Manges, LLP as bankruptcy counsels; Quinn Emanuel
Urquhart & Sullivan, LLP as special counsel; Houlihan Lokey, Inc.
as investment banker; and AlixPartners, LLP as financial advisor.
Kurtzman Carson Consultants, LLC is the claims, notice and
solicitation agent.
Gibson, Dunn & Crutcher, LLP and Pachulski, Stang, Ziehl & Jones,
LLP represent the ad hoc first lien group while ArentFox Schiff,
LLP represents Wilmington Savings Fund Society, FSB, the DIP
agent.
Credit Suisse AG, Cayman Islands Branch, serves as administrative
agent and collateral agent, under the Credit Agreement. Freshfields
Bruckhaus Deringer US, LLP is counsel to the agent.
JPMorgan Chase Bank, N.A., serves as administrative agent and
collateral agent under the Side-Car Credit Agreement. It is
represented by Proskauer Rose, LLP.
CAREISMATIC BRANDS: Unsecureds to Get 0% in Recapitalization Plan
-----------------------------------------------------------------
Careismatic Brands, LLC, and affiliates submitted a Disclosure
Statement relating to the Amended Joint Plan of Reorganization
dated April 4, 2024.
The Plan contemplates that the Debtors will pursue a Sale
Transaction to obtain a Successful Bid from a third-party
Purchaser. If the Debtors do not receive a Successful Bid, or if
the winning bid is a Credit Bid, the Debtors will toggle to the
Recapitalization Transaction, which provides for the equitization
of 100% of the Allowed First Priority Claims, subject to dilution
from the (x) MIP Equity, (y) the DIP Premiums, and (z) if
applicable, the exercise of the Second Lien Warrants, subject to
the DIP Premium Conversion Election Option.
In the event of a Recapitalization Transaction, (i) Holders of DIP
Claims will receive (a) such Holder's pro rata share of the Exit
Term Loan Facility, subject to the DIP Premium Conversion Election
Option, or (b) if there is an Acceptable Alternative Exit Facility,
payment in Cash in full (including all DIP Premiums), (ii) Holders
of First Priority Claims will receive their pro rata distribution
of 100% of the New Common Stock (subject to dilution from (a) MIP
Equity, (b) DIP Premiums, and (c) if applicable, the exercise of
the Second Lien Warrants, subject to the DIP Premium Conversion
Election Option), (iii) Holders of Second Lien Secured Claims will
receive no recovery or distribution on account of their Allowed
Second Lien Secured Claim; provided that, if the Second Lien
Condition is satisfied, each Holder of an Allowed Second Lien
Secured Claim will receive its pro rata share of the Second Lien
Warrants, and (iv) Holders of General Unsecured Claims will receive
no recovery or distribution on account of their Allowed General
Unsecured Claims.
As of the date hereof, the Debtors believe that the Sale Process
being conducted pursuant to the Bidding Procedures provides the
best mechanism to estimate the post-Confirmation going concern
value of the Debtors. Because the Sale Process remains ongoing,
pursuant to which the Debtors are soliciting bids for the New
Common Stock or substantially all assets of the Debtors, the
Debtors have not filed the Valuation Analysis as of the date
hereof.
Class 5 consists of General Unsecured Claims. Except to the extent
that a Holder of an Allowed General Unsecured Claim agrees to less
favorable treatment, on the Effective Date, each Holder of an
Allowed General Unsecured Claim shall receive, in full and final
satisfaction of such Claim:
* in the event of the Recapitalization Transaction, no
recovery or distribution on account of such Allowed General
Unsecured Claims; or
* in the event of the Sale Transaction, its pro rata
distribution of the Excess Distributable Consideration after all
First Priority Claims and Second Lien Secured Claims have been
satisfied in full in Cash.
The allowed unsecured claims total $167,632,306.48. This Class will
receive a distribution of 0% of their allowed claims.
If the Recapitalization Transaction is consummated, the Debtors
shall fund or make distributions under the Plan, as applicable,
with: (i) the proceeds from the Exit Financing Arrangements; (ii)
the New Common Stock; (iii) the Debtors' Cash on hand; and (iv) the
Second Lien Warrants. Each distribution and issuance referred to in
the Plan shall be governed by the terms and conditions set forth in
the Plan applicable to such distribution or issuance and by the
terms and conditions of the instruments or other documents
evidencing or relating to such distribution or issuance, which
terms and conditions shall bind each Entity receiving such
distribution or issuance.
If the Sale Transaction is consummated, the Debtors shall fund
under the Plan with: (i) the proceeds from the Sale Transaction,
(ii) the Debtors' Cash on hand, and (iii) the proceeds of any
Causes of Action retained by the Post-Effective Date Debtors (if
any). Each distribution and issuance referred to in the Plan shall
be governed by the terms and conditions set forth in the Plan
applicable to such distribution or issuance and by the terms and
conditions of the instruments or other documents evidencing or
relating to such distribution or issuance, which terms and
conditions shall bind each Entity receiving such distribution or
issuance.
On April 2, 2024, the Committee filed the Motion of the Official
Committee of Unsecured Creditors for Entry of an Order Granting
Standing and Authorizing the Prosecution of Certain Challenge
Claims on Behalf of the Bankruptcy Estates (the "Standing Motion").
The Standing Motion asserts, among other things, that the Committee
should be ranted standing to pursue, prosecute, and resolve, on
behalf of the Estates: (i) a declaratory judgment that certain
property of the Debtors is not subject to the liens or security
interests granted to the Prepetition Secured Parties (as defined in
the Final DIP Order); (ii) avoidance of certain unperfected liens
and security interests asserted by the Prepetition Secured Parties
against certain property of the Debtors; and (iii) an order
reversing (or otherwise reserving for further investigation)
certain of the other acknowledgements and agreements of the Debtors
set forth in the Final DIP Order.
At the time of the filing of this Disclosure Statement, the
Standing Motion is scheduled to be heard on April 23, 2024, and the
Debtors' full response to the assertions and allegations set forth
in the Standing Motion is forthcoming. For the avoidance of doubt,
the Debtors intend to object to the Standing Motion. If the
Bankruptcy Court were to grant the Standing Motion, it would
unnecessarily extend these Chapter 11 Cases at great expense to the
Debtors and their Estates and risk the highly consensual,
value-maximizing Restructuring Transactions the Debtors have
negotiated.
The Plan is supported by the Debtors and the Holders of Claims,
Interests, and Intercompany Interests that have agreed to the RSA
and the Restructuring Term Sheet, which include (i) the First Lien
Ad Hoc Group, (ii) the Cross-Holder Ad Hoc Group, (iii) the Sponsor
RSA Parties, and (iv) parties that participated in the DIP Facility
Subscription (as defined in the Restructuring Term Sheet) and
executed joinders to the RSA in connection therewith (collectively,
the "RSA Joinder Parties"). Signatories to the RSA, including the
First Lien Ad Hoc Group, the Cross-Holder Ad Hoc Group, and the RSA
Joinder Parties, collectively hold approximately 90% of First Lien
Term Loan Claims, 11% of First Lien RCF Claims, and 70% of Second
Lien Claims.
A full-text copy of the Disclosure Statement dated April 4, 2024 is
available at https://urlcurt.com/u?l=5Q8iA1 from PacerMonitor.com
at no charge.
Co-Counsel to the Debtors:
Joshua A. Sussberg, P.C.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
601 Lexington Avenue
New York, NY 10022
Tel: (212) 446-4800
Fax: (212) 446-4900
E-mail: jsussberg@kirkland.com
- and -
Chad J. Husnick, P.C.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
300 North LaSalle Street
Chicago, IL 60654
Tel: (312) 862-2000
Fax: (312) 862-2200
E-mail: chusnick@kirkland.com
Co-Counsel to the Debtors:
Michael D. Sirota, Esq.
Warren A. Usatine, Esq.
Felice R. Yudkin, Esq.
COLE SCHOTZ P.C.
Court Plaza North, 25 Main Street
Hackensack, NJ 07601
Tel: (201) 489-3000
Fax: (201) 489-1536
E-mail: msirota@coleschotz.com
wusatine@coleschotz.com
fyudkin@coleschotz.com
About Careismatic Brands
The Santa Monica, Calif.-based Careismatic Brands, LLC is a ,
marketer, and distributor of medical apparel, footwear, and
accessories. Founded in 1995 in Chatsworth, Calif., Careismatic
has grown from operating a single flagship brand, Cherokee Medical
Uniforms, to a portfolio of seventeen brands. The company offers
value to its stakeholders through its spectrum of medical apparel
and workwear and omnichannel distribution capabilities across the
globe. It has an extensive portfolio of iconic and emerging brands
across the health and wellness platform, including Cherokee
Uniforms, Dickies Medical, Heartsoul Scrubs, Infinity, Scrubstar,
Healing Hands, Med Couture, Medelita, Classroom Uniforms, AllHeart,
Silverts Adaptive Apparel, and BALA Footwear.
Careismatic Brands filed a Chapter 11 petition (Bankr. D.N.J. Lead
Case No. 24-10561) on Jan. 22, 2024, with $1 billion to $10 billion
in both assets and liabilities. Kent Percy, chief restructuring
officer, signed the petition.
Judge Vincent F. Papalia oversees the case.
Kirkland & Ellis, LLP and Kirkland & Ellis International, LLP
represent the Debtor as general bankruptcy counsel; Cole Schotz,
P.C. as local bankruptcy counsel; AP Services, LLC as financial
advisor; PJT Partners, LP as investment banker; and C Street
Advisory Group as strategic communications advisor. Donlin, Recano
& Company, Inc. is the claims, noticing and solicitation agent and
administrative advisor.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee to represent unsecured creditors in the Debtor's Chapter
11 case. The committee is represented by Bradford J. Sandler, Esq.,
at Pachulski Stang Ziehl & Jones, LLP.
CARLOS A. ROJAS: Linda Leali Named Subchapter V Trustee
-------------------------------------------------------
The U.S. Trustee for Region 21 appointed Linda Leali, Esq., as
Subchapter V trustee for Carlos A. Rojas, D.P.M., P.A.
Ms. Leali will be paid an hourly fee of $450 for her services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Ms. Leali declared that she is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Linda M. Leali
Linda M. Leali, P.A.
2525 Ponce De Leon Blvd., Suite 300
Coral Gables, FL 33134
Phone: (305) 341-0671, ext. 1
Fax: (786) 294-6671
Email: leali@lealilaw.com
About Carlos A. Rojas D.P.M.
Carlos A. Rojas, D.P.M., P.A. sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. S.D. Fla. Case No. 24-13207) on
April 2, 2024, with up to $50,000 in assets and up to $1 million in
liabilities.
Judge Corali Lopez-Castro presides over the case.
Jeffrey N. Schatzman, Esq., represents the Debtor as legal counsel.
CASA SYSTEMS: Unsecureds to Get Nothing in WInd-Down Plan
---------------------------------------------------------
Casa Systems, Inc., et al., submitted a Joint Plan of Liquidation
and a Disclosure Statement.
Casa is incorporated under the laws of the state of Delaware and is
the ultimate parent of several subsidiaries. The Debtors' wholly
owned subsidiaries are located and operate globally, including in
Australia, Canada, China, France, Germany, Hong Kong, Ireland, the
Netherlands, Spain, the United Kingdom, and New Zealand.
While operating as market leaders, the Company faced a myriad of
operational challenges, including shifting market dynamics,
customer loss, the COVID-19 pandemic, and Casa's substantial debt
and inability to meet the liquidity covenant under the
Superpriority Credit Agreement in June 2023, that, taken together,
culminated in their current strained liquidity position and the
need to commence these Chapter 11 Cases.
The Plan is supported by the Debtors and the Ad Hoc Group, which
holds over 98% of the Company's funded debt, including
approximately 98% of the Superpriority Term Loans and 100% of the
Stub Term Loan.
The Debtors intend to sell all or substantially all of their assets
pursuant to Section 363(f) of the Bankruptcy Code prior to and in
connection with confirmation of the Plan. Subsequent to
confirmation, the Debtors intend to enter the next phase of these
Chapter 11 Cases, which involves the (i) wind-down of the Debtors;
and (ii) the liquidation of the Debtors' remaining assets.
On or soon after the Petition Date, the Debtors filed a motion (the
"Cloud/RAN Sale Motion") seeking approval of the private sale of
the Company's Cloud and RAN assets. In addition, the Debtors filed
a combined motion (the "Bidding Procedures Motion") seeking
approval of the bidding procedures (the "Bidding Procedures") and a
purchase agreement for the Cable assets (the "Cable Stalking Horse
APA"). The Bidding Procedures contain provisions relating to,
among other things, (a) participation requirements, (b) access to
due diligence, (c) Bid Requirements (as defined in the Bidding
Procedures Motion), (d) designation of Qualified Bidders (as
defined in the Bidding Procedures Motion), (e) credit bids, (f)
auction procedures (as applicable); and (g) the selection of the
Successful Bid, Back-Up Bid, or Stalking Horse Bid (each as defined
in the Bidding Procedures Motion).
The Debtors have filed the Plan, which contemplates a liquidation
of the Debtors and their estates.
Class 4 consists of the General Unsecured Claims against the
Debtors. Creditors will recover 0% of their claims. All General
Unsecured Claims shall be cancelled, released, discharged, and
extinguished and will be of no further force or effect, and Holders
of such Claims shall not receive any distribution, property, or
other value, under the Plan on account of such Claims. To the
extent there are any Net Distributable Proceeds, each holder of a
General Unsecured Claim shall receive its pro rata share of the Net
Distributable Proceeds. Class 4 is impaired.
Proposed Co-Counsel to the Debtors:
Joseph Barry, Esq.
Joseph M. Mulvihill, Esq.
Timothy R. Powell, Esq.
YOUNG CONAWAY STARGATT & TAYLOR, LLP
1000 North King Street
Rodney Square
Wilmington, DE 19801
Tel: (302) 571-6600
Fax: (302) 571-1253
E-mail: jbarry@ycst.com
jmulvihill@ycst.com
tpowell@ycst.com
SIDLEY AUSTIN LLP
Stephen E. Hessler, Esq. (pro hac vice pending)
Patrick Venter, Esq. (pro hac vice pending)
Margaret R. Alden, Esq. (pro hac vice pending)
787 Seventh Ave.
New York, NY 10019
Tel: (212) 839-5300
Fax: (212) 839-5599
E-mail: shessler@sidley.com
pventer@sidley.com
malden@sidley.com
Ryan L. Fink, Esq.
One South Dearborn
Chicago, IL 60603
Tel: (312) 853-7000
Fax: (312) 853-7036
E-mail: ryan.fink@sidley.com
Julia Philips Roth, Esq.
1999 Avenue of the Stars
Los Angeles, CA 90067
Tel: (310) 595-9500
Fax: (310) 595-9501
E-mail: julia.roth@sidley.com
A copy of the Plan of Liquidation dated April 3, 2024, is available
at https://tinyurl.ph/rizLU from PacerMonitor.com.
About Casa Systems
Casa Systems, Inc. (Nasdaq: CASA) is a next-gen technology leader
that supports mobile, cable, and wireline communications services
providers with market leading solutions. Casa's virtualized and
cloud-native software solutions modernize operators’ network
architectures, expand the range of services they can offer their
consumer and commercial customers, accelerate time to revenue and
reduce the TCO of their network infrastructure and operations.
Casa's suite of open, cloud-native network solutions unlocks new
ways for service providers to quickly build flexible networks and
service offerings that maximize revenue-generating capabilities.
Commercially deployed in more than 70 countries, Casa Systems
serves over 475 Tier 1 and regional service providers worldwide.
On the Web: http://www.casasystems.com/
On April 3, 2024, Casa Systems, Inc., and two of its affiliates
each filed petitions seeking relief under chapter 11 of the United
States Bankruptcy Code (Bankr. D. Del. Lead Csae No. 24-10695).
In the petition filed by CFO Edward Durkin, Casa Systems estimated
assets and liabilities between $100 million and $500 million each.
The Debtors' cases have been assigned to the Honorable Karen B.
Owens.
Casa has engaged Sidley Austin LLP as legal counsel, Ducera
Partners LLC as financial advisor, and Alvarez & Marsal North
America, LLC as restructuring advisor. Epiq is the claims agent.
CASA SYSTEMS: Wins Interim Cash Collateral Access
-------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
Casa Systems, Inc. and affiliates to use cash collateral, on an
interim basis, in accordance with the budget.
As of the Petition Date, the Debtors' capital structure includes
approximately $183.04 million in outstanding prepetition secured
debt obligations in the aggregate.
The Debtors have an ongoing and immediate need to continue using
cash collateral to, among other things: (a) provide working capital
and funding for general corporate purposes; and (b) pay certain
costs of administration of these cases, in each case, subject to
the terms hereof and solely to the extent provided in the Approved
Budget, as subject to Permitted Variances.
The Debtors are party to a Superpriority Credit Agreement, dated as
of June 15, 2023 with Delaware Trust Company, as successor to
JPMorgan Chase Bank, N.A. as administrative agent, and Delaware
Trust Company as collateral agent. Pursuant to the Superpriority
Credit Agreement and the Exchange, the Superpriority Lenders agreed
to the extension of approximately $218.8 million in term loans,
which are scheduled to mature on December 20, 2027.
As of the Petition Date, the Debtors owe approximately $180.98
million under the Superpriority Credit Agreement.
The Debtors are party to a Credit Agreement, dated as of December
16, 2016, by and among Casa, as borrower, the lenders from time to
time party thereto, and Delaware Trust Company, as administrative
agent and collateral agent. Pursuant to the Stub Credit Agreement,
after effectuation of the Exchange, approximately $5 million in
principal remained outstanding and owing to certain non-exchanging
Original Credit Agreement Lenders.
As of the Petition Date, the Debtors owe approximately $2.06
million under the Original Credit Agreement, which is scheduled to
mature on September 30, 2024. Subject to the terms of the
Intercreditor Agreement, the obligations under the Stub Credit
Agreement are secured by substantially all of the assets of Casa.
As adequate protection, the Prepetition Secured Parties are granted
additional and replacement valid, binding, enforceable,
non-avoidable, effective and automatically perfected liens on, and
security interests in any and all tangible and intangible pre- and
postpetition property of the Debtors.
To the extent of any Diminution in Value of their interests in the
Prepetition Collateral, the Superpriority Agents, for the benefit
of the Superpriority Secured Parties, are granted allowed
administrative expense claims against each Debtor with the priority
set forth in 11 U.S.C. section 507(b).
There is a Carve-Out for certain statutory fees and allowed
professional fees of the Debtors and any Creditors’ Committee
appointed pursuant to 11 U.S.C. Section 1103 , including
Professional Fees incurred prior to delivery of a Trigger Notice, a
$750,000 Debtor Post-Trigger Cap for Debtor Professional Fees
incurred after delivery of the Carve Out Notice, and a $250,000
Committee Post-Trigger Fee Cap for Committee Professional Fees
incurred after delivery of a Trigger Notice as more fully detailed
in the Proposed Order.
A final hearing on the matter is set for April 26, 2024 at 9:30
a.m.
A copy of the order is available at https://urlcurt.com/u?l=pXqLfe
from PacerMonitor.com.
About Casa Systems
Casa Systems, Inc. (Nasdaq: CASA) is a next-gen technology leader
that supports mobile, cable, and wireline communications services
providers with market leading solutions. Casa's virtualized and
cloud-native software solutions modernize operators' network
architectures, expand the range of services they can offer their
consumer and commercial customers, accelerate time to revenue and
reduce the TCO of their network infrastructure and operations.
Casa's suite of open, cloud-native network solutions unlocks new
ways for service providers to quickly build flexible networks and
service offerings that maximize revenue-generating capabilities.
Commercially deployed in more than 70 countries, Casa Systems
serves over 475 Tier 1 and regional service providers worldwide. On
the Web: http://www.casasystems.com/
On April 3, 2024, Casa Systems, Inc., and two of its affiliates
each filed petitions seeking relief under chapter 11 of the United
States Bankruptcy Code (Bankr. D. Del. Lead Csae No. 24-10695).
In the petition filed by CFO Edward Durkin, the Debtor estimated
assets and liabilities between $100 million and $500 million each.
The Debtors' cases have been assigned to the Honorable Karen B.
Owens.
Casa has engaged Sidley Austin LLP as legal counsel, Ducera
Partners LLC as financial advisor, and Alvarez & Marsal North
America, LLC as restructuring advisor. Epiq is the claims agent.
CENTURY GRANITE: Business Income & Sale Proceeds to Fund Plan
-------------------------------------------------------------
Century Granite Company, Inc., filed with the U.S. Bankruptcy Court
for the Middle District of Georgia a Subchapter V Plan of
Reorganization dated April 2, 2024.
The Debtor is a manufacturing company that specializes in the
manufacture and sale of marble and granite products that are used
in the monuments industry. The Debtor was formed in 1958 and is
located in Elberton, Georgia.
Various financial distress that is not unusual for manufacturing
companies that are employee-, supply chain-, working capital-, and
logistically-intensive, as well as carryover distress from COVID 19
and related distress faced by the affiliated GV Debtors intensified
in 2023, became intolerable (especially from the strain of
litigation faced by the GV Debtors in Barre, VT from their major
secured creditor), and led the Debtor to file this Subchapter V
Bankruptcy Case to protect the Debtor's business, employees, and
other creditors.
The purpose of this Plan is to allow the Debtor to reorganize its
financial affairs in a way that will permit it to pay Allowed
Claims as proposed in this Plan.
To that end, subject to the Debtor and the GV Debtors receiving an
offer to purchase substantially all of their respective assets in
the next 90 to 120 days, the Debtors determining that such offer is
in the best interests of the Debtor's estate and its creditors, and
the Bankruptcy Court authorizing that purchase, the Debtor proposes
to continue to operate, with the Reorganized Debtor funding its
obligations under the Plan through the Debtor's business income
(including proceeds, if any, from the sale of non essential
assets), through the pursuit of bankruptcy avoidance actions and
the like if the Debtor or the Reorganized Debtor determine that
such actions would be cost-advantageous, and as otherwise shown on
the Budget.
Class 6 consists of Allowed Unsecured Claims (including Deficiency
Claims and Rejection Claims, if any). The Reorganized Debtor shall
pay the Holders of Class 6 Allowed Unsecured Claims their Pro Rata
Share of the Class 6 Total Distribution (as projected on the
Budget) based on each such Holder's Class 6 Allowed Unsecured Claim
compared to the total of all Class 6 Allowed Unsecured Claims. The
Reorganized Debtor shall pay such Class 6 Total Distribution in 4
or less annual installments of varying amounts (as shown on the
Budget) commencing within 60 days after the first anniversary of
the Effective Date, with each subsequent annual installment being
made within 60 days after each subsequent anniversary of the
Effective Date.
The Reorganized Debtor's obligations under Class 6 to make the
Class 6 Total Distribution can be satisfied at any time, with any
payment of the Class 6 Total Distribution, at whatever time that is
on or before the dates required under the Plan, not resulting in a
penalty, including, without limitation, a pre-payment penalty.
Such Class 6 Total Distribution, when paid in full, shall be in
full satisfaction of the Reorganized Debtor's obligations under and
of the Allowed Unsecured Claims allowed in Class 6. Notwithstanding
anything else in the Plan to the contrary, any Allowed Unsecured
Claim in Class 6 shall be reduced by any payment received by the
creditor holding such Claim from any third party or other obligor
and the Reorganized Debtor's obligations hereunder shall be reduced
accordingly.
The Holders of Equity Interests in the Debtor shall retain those
Interests in the Reorganized Debtor and all associated rights,
subject, however, to the provisions of the Plan.
Unless the Debtor consummates a Court-ordered sale of substantially
all of its assets, whether pre-confirmation or under and in
accordance with this Plan, this Plan is a reorganizing Subchapter V
Chapter 11 plan. The funds required for implementation of the Plan
and the distributions hereunder shall be provided from the Debtor's
business income (including proceeds, if any, from the sale of
non-essential assets), from the pursuit of bankruptcy avoidance
actions and the like if the Debtor or Reorganized Debtor determine
that such actions would be cost advantageous, and as otherwise
shown on the Budget.
A full-text copy of the Subchapter V Plan dated April 2, 2024 is
available at https://urlcurt.com/u?l=XEPgtf from PacerMonitor.com
at no charge.
Counsel to the Debtor:
David L. Bury, Jr., Esq.
G. Daniel Taylor, Esq.
STONE & BAXTER, LLP
577 Mulberry Street, Suite 800
Macon, GA 31201
Telephone: (478) 750-9898
Facsimile: (478) 750-9899
Email: dbury@stoneandbaxter.com
dtaylor@stoneandbaxter.com
About Century Granite Company
Century Granite Company, Inc., is a manufacturing company that
specializes in the manufacture and sale of marble and granite
products that are used in the monuments industry.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Ga. Case No. 23-30611) on Dec. 4,
2023. In the petition signed by Anand S. Anandan, president/CEO,
the Debtor disclosed up to $10 million in both assets and
liabilities.
David L. Bury, Jr., Esq., at Stone & Baxter, LLP, is the Debtor's
legal counsel.
CGI 1100 BISCAYNE: Lender Sets May 23 Auction for Property
----------------------------------------------------------
In accordance with applicable provisions of the Uniform Commercial
Code as enacted in New York, by virtue of certain events of default
under the partnership interests pledged and security agreement
dated as of Nov. 24, 2021, ("Pledge Agreement") executed and
delivered by CGI 1100 Biscayne Management GP LLC and CGI 1100
Biscayne Management Holdco LP ("Pledgor") and in accordance with it
right as holder of the security, Madison Realty Capital Debt MA II
Holdings MB LLC ("secured party"), by virtue of possession of those
certain share certificates held in accordance with Article 8 of the
Uniform Commercial Code of the State of New York ("Code"), and by
virtue of those certain UCC-1 filing statement made in favor of
secured party will offer for sale, at public auction: (i) all of
pledgor's right, title, and interest in and to the following: CGI
1100 Biscayne Management LP ("Pledged Entity"), and (ii) certain
related rights and property relating thereto.
Secured party's understanding is that the principal asset of the
pledged entity is the premises located at 1100 Biscayne Blvd.,
Miami, Florida. ("Property").
Mannion Auctions LLC under the direction of Matthew D. Mannion or
William Mannion, will conduct a public sale consisting the
collateral via online bidding on May 23, 2024, at 10:00 a.m. in
satisfaction of an indebtedness in the approximate amount of
$7,631,120.61 including principal interest on principal through May
23, 2024, subject to open charges and all additional costs, fee and
disbursements permitted by law. The secured party reserves the
right to credit bid. The New Sale Date supersedes the UCC sale
previously scheduled for May 16, 2024, at 3:30 p.m.
Online bidding will be made available via Zoom Meeting: Meeting
link: https://bit.ly/1100Biscayne Meeting ID: 844 0421 4057
Passcode: 926256 One Tap Mobile:
+16469313860,,84404214057#,,,,*926256# US;
+16465588656,,84404214057#,,,,*926256# US (New York) Dial by your
location: +1 646 931 3860 US.
Interested parties who intended to bid on the collateral must
contact Brett Rosenberg at Jones Lang LaSalle Americas Inc., 330
Madison Avenue, New York, New York 10017, (212) 812-5926,
Brett.Rosenberg@jll.com, to received the terms and conditions of
sale and bidding instructions by May 21, 2024 by 4:00 p.m. Upon
execution of a standard confidentiality and non-disclosure
agreement, which can be found at the following link
https://www.1100BiscayneBlvdUCCSale.com/
CHATEAU CREOLE: Files Emergency Bid to Use Cash Collateral
----------------------------------------------------------
Chateau Creole Apartments, LLC asks the U.S. Bankruptcy Court for
the Eastern District of Louisiana for authority to use cash
collateral in accordance with the budget, with a 10% variance, and
provide adequate protection.
The Debtor requires the use of cash collateral for the purpose of
meeting necessary expenses incurred in the ordinary course of its
business, including payroll and the costs associated with its
restructuring and these proceedings, while it restructures and
reorganizes its indebtedness and business in a manner that
maximizes value and is fair and equitable to all
parties-in-interest.
The Debtor sought bankruptcy protection because of, among other
things, Federal National Mortgage Association d/b/a Fannie Mae
commenced a foreclosure proceeding and the delays in the Hurricane
Ida litigation in the United States District Court for the Eastern
District of Louisiana.
Given that Fannie Mae effectively assert liens on all of the
Debtor's assets, the Debtor proposes to grant Fannie Mae
replacement liens on post-Petition Date assets, having the same
respective priority as their pre-petition liens, to secure any
post-petition diminution in value thereof, but only to the extent
such interests are entitled to adequate protection against such
diminution under the Bankruptcy Code, and only to the extent and in
the event that it would be ultimately determined that (i) Fannie
Mae possess valid, non-avoidable pre-petition liens and (ii) Fannie
Mae is entitled to adequate protection of any such liens.
The Debtor also proposes paying Fannie Mae $5,000/month as adequate
protection of its interests.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=8GGDo4 from PacerMonitor.com.
The Debtor projects $137,694 in total income and $117,499 in total
expense for April to June 2024.
About Chateau Creole Apartments, LLC
Chateau Creole Apartments, LLC is primarily engaged in renting and
leasing real estate properties.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. La. Case No. 24-10608) on March 29,
2024. In the petition signed by Damon J. Baldone, manager, the
Debtor disclosed up to $10 million in assets and up to $50 million
in liabilities.
Judge Meredith S Grabill oversees the case.
Ryan J. Richmond, Esq., at STERNBERG, NACCARI & WHITE, LLC,
represents the Debtor as legal counsel.
CLINE DESIGN: Seeks to Extend Plan Exclusivity to July 8
--------------------------------------------------------
Cline Design Group, Inc., asked the U.S. Bankruptcy Court for the
District of Colorado to extend its exclusivity periods to file a
plan of reorganization and obtain acceptance thereof to July 8 and
September 4, 2024, respectively.
The Debtor is a construction and design company.
The bankruptcy filing was precipitated by prepetition litigation
commenced by CoorsCrib 2021, LLC and Scott Riopelle (together,
"CoorsCrib") in the District Court for Denver County, Colorado,
related to a construction project at 3327 Tejon Street in Denver,
Colorado. CoorsCrib is Debtor's largest unsecured creditor. Debtor
disputes CoorsCrib's claim.
During the course of the case, Debtor and CoorsCrib have engaged in
extensive settlement negotiations. The parties have nearly
finalized a written settlement agreement which provides, among
other terms, that CoorsCrib will release any and all claims against
Debtor. Once the settlement agreement is finalized, Debtor will
file a motion to approve the settlement agreement pursuant to Fed.
R. Bankr. P. 9019.
As Debtor's largest unsecured creditor, the resolution of
CoorsCrib's claim will materially impact plan formulation.
The Debtor explains that while this is not a complex case, the
CoorsCrib claim is more than fifty percent of the general unsecured
claims pool. Thus, settlement of the CoorsCrib claim will
necessarily impact information contained in the disclosure
statement and plan formulation. Therefore, additional time is
required to finalize and obtain Court approval of the CoorsCrib
settlement.
The Debtor asserts that it is not seeking an extension to pressure
creditors. To the contrary, the extension is being sought to
resolve the contingency that is the CoorsCrib claim.
Cline Design Group, Inc., is represented by:
Aaron J. Conrardy, Esq.
WADSWORTH GARBER WARNER CONRARDY, P.C.
2580 West Main Street, Suite 200
Littleton, CO 80120
Telephone: (303) 296-1999
Facsimile: (303) 296-7600
Email: aconrardy@wgwc-law.com
About Cline Design Group
Cline Design Group, Inc., filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. D. Colo. Case No.
23-15657) on Dec. 8, 2023. The petition was signed by Jeffrey A.
Cline as president. At the time of filing, the Debtor estimated
$100,000 to $500,000 in assets and $1 million to $10 million in
liabilities. Aaron J. Conrardy, Esq. at Wadsworth Garber Warner
Conrardy, P.C., is the Debtor's counsel.
CONVERGEONE HOLDINGS: Unsecureds Unimpaired in Debt-for-Equity Plan
-------------------------------------------------------------------
ConvergeOne Holdings, Inc. ("C1 Holdings") and its debtor
affiliates filed with the U.S. Bankruptcy Court for the Southern
District of Texas a Disclosure Statement for the Joint Prepackaged
Plan of Reorganization dated April 4, 2024.
C1 is a leading global information technology ("IT") services
company. C1 provides connected human experiences by working with
its channel partners, delivering IT services, and developing and
commercializing its own technology products.
The Company designs, implements, and supports thousands of state
of-the-art IT solutions across its core technology markets: pure
and hybrid cloud solutions, business applications, customer
experiences, contact center design and enablement, modern workplace
infrastructure, cyber security, and enterprise networking.
The Debtors commenced Chapter 11 cases on a prepackaged basis with
the support, pursuant to the terms of a Restructuring Support
Agreement (the "RSA"), of creditors holding approximately 81% of
the Debtors' first lien claims and 81% of the Debtors' second lien
term loan debt (the "Consenting Lenders"). The RSA contemplates
the equitization or cancellation of approximately $1.6 billion of
the Debtors' funded debt.
The Debtors have also secured commitments for two debtor-in
possession financing facilities, and the consensual use of cash
collateral, which will permit the Debtors to continue accessing
their prepetition revolving credit facility with maximum
availability of $250 million and draw on a $215 million new money
multi-draw term loan facility during these Chapter 11 Cases. The
Debtors are also negotiating the terms of an exit revolving credit
facility to fund the Debtors' post-chapter 11 operations and
obligations, which exit facility will be provided either by the
Debtors' existing asset-based revolving lender or a third-party
financing provider.
The terms of the transactions developed in connection with the RSA
are contemplated under the Plan. Key terms of the RSA, which are
reflected in the Plan, include the following:
* The Company will (i) conduct a $159.25 million fully
backstopped equity rights offering and (ii) receive a $85.75
million direct investment commitment from the backstop parties for
the new equity interests in reorganized C1 (both subject to
increase with the consent of the Debtors and the Required
Consenting Lenders). As part of these transactions, 95.625% of the
new equity interests will be distributed to holders of first lien
claims and the backstop parties. As part of the equity rights
offering, 65% of the 95.625% of new equity interests will be
offered to all holders of first lien claims on a pro rata basis,
subject to a 10% put option premium owed to the backstop parties
and subject to dilution by the management incentive plan. As part
of the direct investment commitment, the backstop parties have
committed to purchase 35% of the 95.625% of new equity interests,
subject to a 10% put option premium owed to the backstop parties
and subject to dilution by the management incentive plan. The
proceeds of the equity rights offering and direct equity investment
will be used to repay the debtor-in-possession term loan facility
and provide reorganized C1 with working capital.
* Holders of certain first lien claims may elect to receive
(a) takeback term loans issued under an exit term loan facility in
a principal amount equal to such holders' first lien claims
multiplied by 20%, or (b) takeback term loans in a principal amount
equal to such holders' first lien claims multiplied by 15% and
rights to purchase, through the rights offering, new equity
interests in reorganized C1, subject to dilution, including on
account of the management incentive plan and fees owed to the
backstop parties. As set forth in the RSA, these elections will be
adjusted on a pro rata basis, based on oversubscription, so that
participation in each option is capped at 50% of the first lien
claims eligible to participate.
* Holders of second lien claims will receive 4.375% of the new
equity interests in reorganized C1, also subject to dilution by a
management incentive plan.
* General unsecured creditors will receive either
reinstatement of their general unsecured claims pursuant to Section
1124 of the Bankruptcy Code, or payment in full in cash either on
the Effective Date or the date due in the ordinary course of
business in accordance with the terms and conditions of the
particular transaction giving rise to the unsecured claim.
* All prepetition equity interests in the Debtors will be
cancelled and no distributions will be made on account of such
interests.
* Pursuant to a global settlement of all disputes related to
the allowance of claims arising from the Prepetition PVKG Note
Purchase Agreement, PVKG Lender, the other Consenting Lenders, and
the Debtors have agreed that PVKG Lender's claims on account of the
Prepetition PVKG Notes will be allowed in the amount of $213
million.
Class 5 consists of General Unsecured Claims. Except to the extent
that a Holder of an Allowed General Unsecured Claim agrees to less
favorable treatment, in exchange for full and final satisfaction,
settlement, release, and discharge of each Allowed General
Unsecured Claim and in exchange for each Allowed General Unsecured
Claim, on or as soon as reasonably practicable after the Effective
Date, each Holder of an Allowed General Unsecured Claim shall
receive, either (i) Reinstatement of such Allowed General Unsecured
Claim pursuant to section 1124 of the Bankruptcy Code; or (ii)
payment in full in Cash on (A) the Effective or (B) the date due in
the ordinary course of business in accordance with the terms and
conditions of the particular transaction giving rise to such
Allowed General Unsecured Claim. The allowed unsecured claims total
$121 million.
Upon the Effective Date, the provisions of this Plan shall
constitute a good faith compromise and settlement of all Claims and
Interests and controversies (including the PVKG Note Claims
Settlement) resolved pursuant to this Plan, including any challenge
to the amount, validity, perfection, enforceability, priority, or
extent of the First Lien Claims, whether under any provision of
chapter 5 of the Bankruptcy Code, based on any equitable theory, or
otherwise.
The allowance and treatment of the PVKG Note Claims under this
Plan, together with the other terms and conditions set forth in
this Plan and the Confirmation Order (including the releases of and
by the PVKG Lender set forth herein and in the Confirmation Order),
reflects the proposed compromise and settlement of the PVKG Note
Claims pursuant to Bankruptcy Rule 9019 and section 1123 of the
Bankruptcy Code.
On the Effective Date, the Reorganized Debtors shall enter into the
Exit Facilities, the terms of which will be set forth in the Exit
Facilities Documents. Confirmation of this Plan shall be deemed
final approval of the Exit Facilities and the Exit Facilities
Documents, as applicable, and all transactions contemplated
thereby, and all actions to be taken, undertakings to be made, and
obligations to be incurred by the Reorganized Debtors in connection
therewith, including the payment of all fees, indemnities,
expenses, and other payments provided for therein and authorization
of the Reorganized Debtors to enter into and execute the Exit
Facilities Documents and such other documents as may be required to
effectuate the treatment afforded by the Exit Facilities.
A full-text copy of the Disclosure Statement dated April 4, 2024 is
available at https://urlcurt.com/u?l=rQ8rEH from PacerMonitor.com
at no charge.
Proposed Counsel to the Debtors:
Charles R. Koster, Esq.
WHITE & CASE LLP
609 Main Street, Suite 2900
Houston, Texas 77002
Tel: (713) 496-9700
Fax: (713) 496-9701
E-mail: charles.koster@whitecase.com
- and -
Bojan Guzina, Esq.
Andrew F. O'Neill, Esq.
Erin R. Rosenberg, Esq.
Blair M. Warner, Esq.
Adam T. Swingle, Esq.
WHITE & CASE LLP
111 South Wacker Drive, Suite 5100
Chicago, IL 60606
Tel: (312) 881-5400
E-mail: bojan.guzina@whitecase.com
aoneill@whitecase.com
erin.rosenberg@whitecase.com
blair.warner@whitecase.com
adam.swingle@whitecase.com
About ConvergeOne Holdings
ConvergeOne Holdings, Inc., operates as a holding company. The
Company, through its subsidiaries, provides managed cloud, cyber
security, enterprises networking, data center, application and
software development, security infrastructure, and hosted
collaboration solutions.
ConvergeOne Holdings and its subsidiaries sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Lead Case
No. 24-90194) on April 4, 2024, with $1 billion to $10 billion in
assets and liabilities.
Judge Christopher M. Lopez presides over the cases.
White & Case LLP is the Debtors' legal counsel. Evercore Group LLC
is the Debtors' investment banker, and AlixPartners, LLP, is
therestructuring advisor. EPIQ Bankruptcy Solutions is the claims
agent.
Porter Hedges LLP, and Gibson, Dunn & Crutcher LLP advise the first
lien lenders.
CORNERSTONE PSYCHOLOGICAL: Court OKs Cash Access Thru June 12
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Ohio
authorized Cornerstone Psychological & Counseling Services of
Northeast Ohio, LLC to use cash collateral, on an interim basis, in
accordance with the budget, until the earlier of (a) June 12, 2024;
or (b) the occurrence of a Termination Event.
The events that constitute a "Termination Event" include:
(i) the payment or incurrence by the Debtor of any material
expense of a type not set forth in the Budget;
(ii) the payment of any expenses that would cause the aggregate
expenditures under the Budget for any three-month period to exceed
the amount set forth in the Budget for such period by 15%. Any
budgeted expenditures not paid in a particular budget period may be
carried forward into a subsequent budget period. Expenditures,
other than legal or other professional fees, may be paid in an
earlier period in the reasonable discretion of the Debtor, in which
event, the Budget will be deemed amended to move the expenditure
into the month of the actual expenditure for the purpose of
calculating rolling monthly variances set forth above. The Debtor
will provide a written explanation in reasonable detail explaining
the amount of and the reason for the prepayment or delay in
payment. and
(iii) the failure of the Debtor to pay, within 10 days of the
applicable due date, all undisputed administrative expenses in full
in accordance with their terms as provided for in the Budget except
for any expenses under 11 U.S.C. sections 503(b)(9) and/or 546(c).
The Debtor requires the use of cash collateral to pay normal
business purposes.
The Debtor is indebted to Growth Capital Corp. in the principal
amount of $145,938 for a loan taken in 2018 and to the U.S. Small
Business Administration in the amount of $385,500 for a loan taken
in 2020.
Growth Capital's interest in the Debtor's cash collateral arises by
virtue of the following:
i. A Promissory Note dated February 28, 2018, in the original
principal amount of $250,000.
ii. A Commercial Security Agreement dated February 28, 2018.
iii. A UCC Financing Statement filed on February 28, 2018, being
identified as financing statement no. OH00219108122, as timely
continued via SR1035245 on February 9, 2023.
As adequate protection, The Secured Parties are granted Replacement
Liens in property acquired by the Debtor after the Petition Date
that is of the same type as the Collateral against which it
asserted a lien prior to the filing of the Debtor's Petition, to
the extent of the diminution of the respective value of any of the
Secured Parties' interest in cash collateral as of the Petition
Date. The Replacement Liens will have the same validity, priority,
and extent (if any) as the liens on Collateral that existed on the
Petition Date. The Replacement Liens granted are deemed perfected
without the necessity for filing or execution of documents which
might otherwise be required under non-bankruptcy laws for the
perfection of security interests.
A further hearing on the matter is set for June 4 at 11 a.m.
A copy of the order is available at https://urlcurt.com/u?l=1hksP1
from PacerMonitor.com.
About Cornerstone Psychological & Counseling Services
Cornerstone Psychological & Counseling Services sought protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Ohio Case
No. 24-60312) on March 14, 2024. In the petition signed by Kenneth
A. Filbert, president and sole member, the Debtor disclosed up to
$50,000 in assets and up to $10 million in liabilities.
Judge Tiiara N.A. Patton oversees the case.
Peter Tsarnas, Esq., at GERTZ AND ROSEN, LTD., represents the
Debtor as legal counsel.
COSTA SHIPPING: Wins Cash Collateral Access Thru May 17
-------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of California
authorized Costa Shipping & Receiving, Inc. to use cash collateral,
on an interim basis, in accordance with the budget, with a 10%
variance, through May 17, 2024.
The Debtor's current financial difficulties are the result of the
confluence of a number of factors. First, it appears as though Mr.
Nathan A. Costa overpaid for the assets of the prior logistics
company. Second, the pandemic, and its aftermath, required Mr.
Costa to substantially rethink how the company would do business.
This resulted in the purchase of delivery trucks at what now appear
to be inflated prices resulting in higher than should be monthly
payments. At the outset, the company used rented vehicles. The
company was also hit with substantially higher operational costs
principally in the form of fuel and wages. The company also incurs
higher operational costs because its route is primarily in a rural
area. This requires company drivers to drive between 100 and 300
miles a day and not always on paved roads. This results in higher
vehicle maintenance costs. While FedEx is a more than reliable
partner, the income simply is not enough to cover the company’s
current increased operational costs. To cover these increased
costs, and hoping for better days, the company took out lines of
credit, used its credit cards or sold its receivables. Increased
income has not materialized to date, expenses remain high and the
borrowing strategy is no longer an option. The company can,
however, once again, become profitable by utilization of the tools
available to it under the Small Business Reorganization Act.
The Debtor has an immediate and critical need to use cash
collateral to, among other things, fund the ordinary costs of its
operations, make payroll, maintain business relationships with
vendors and suppliers and satisfy other working capital and
operational needs.
Stearns Bank, the U.S. Small Business Administration, CFG
Equipment, Leaf Capital Funding, LLC, CFG Equipment Finance, and
Itria Ventures assert an interest in the Debtor's cash collateral.
To protect against deterioration or diminution in the value of the
Secured Parties interest in the cash collateral, the Secured
Parties will be granted valid, enforceable, fully perfected, and
unavoidable replacement liens in their favor on all of Debtor's
assets or interests in assets acquired on or after the Petition
date that such Secured Parties had in such assets as of the
Petition date, but excluding claims for relief arising under the
Bankruptcy Code. Such Post- Petition Replacement Liens will have
the same priority, validity and extent as its Pre-Petition lien,
but will be subordinate to the (i) fees and expenses of a Chapter 7
trustee; (ii) fees and expenses of the Debtor's professionals in
this Chapter 11, Subchapter V case; and, (iii) fees and expenses of
the Subchapter V Trustee.
If the Post-Petition Replacement Liens together with any other lien
granted by Debtor for the benefit of the Secured Parties are
insufficient to adequately protect the Secured Parties, then the
Secured Parties will also be allowed an administrative priority
claim in accordance with 11 U.S.C. Section 507 for any deficiency
with the exception that any super-priority claim will be
subordinate to the (i) fees and expenses of a Chapter 7 trustee;
(ii) fees and expenses of the Debtor's professionals in the Chapter
11, Subchapter V case; and, (iii) fees and expenses of the
Subchapter V Trustee.
A final hearing on the matter is set for May 13 at 2:30 p.m.
A copy of the order is available at https://urlcurt.com/u?l=ytst4e
from PacerMonitor.com.
About Costa Shipping & Delivery, Inc.
Costa Shipping & Delivery, Inc. operates in the general freight
trucking business.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Cal. Case No. 24-01179) on April 1,
2024. In the petition signed by Nathan Costa, officer, the Debtor
disclosed $1,390,911 in assets and $2,870,686 in liabilities.
Judge Christopher B Latham oversees the case.
Steven E. Cowen, Esq., at S.E. COWEN LAW, represents the Debtor as
legal counsel.
COWORKRS 3RD STREET: Unsecureds Will Get 70% of Claims in Plan
--------------------------------------------------------------
CoWorkrs 3rd Street LLC, d/b/a Bond Gowanus, filed with the U.S.
Bankruptcy Court for the Eastern District of New York a Disclosure
Statement describing Chapter 11 Plan dated April 4, 2024.
The Debtor is a New York limited liability company with its
corporate office located at 68-80 Third Street Brooklyn, New York
11231.
The Debtor's principal asset consists of being the tenant under a
lease between itself and 92 Third Street, LLC ("Landlord")
consisting of a portion of the cellar, a portion of the first floor
and a portion of the second floor in the building located at 68-80
Third Street Brooklyn, N.Y. 11231 ("Premises"). That lease was
entered into on October 6, 2014, for a term of 10 years. The
initial annual rent was $1,904,707.00.
The Debtor is a wholly owned subsidiary of Bond Collective which is
a ten-year old luxury shared workspace brand that provides unique
conference room, office space, hot desking and virtual amenities to
its members on a month-to-month basis. It operates eight locations
in four states. Bond Collective is a d/b/a of Coworkrs, LLC. For
each of its eight locations Coworkrs, LLC has subsidiary LLC's that
were created as leaseholder entities.
Class 5 is the Allowed Unsecured Claim of Chubb. As noted in the
treatment of Class 2, this Claim shall be objected to on several
grounds. To the extent it is Allowed, it is treated differently
because it also has claims against the Debtor's affiliates
including Coworkrs Broadway, which will make distributions under
its plan of reorganization, as well as guaranties from the Debtor's
parent company and several other affiliates. To avoid multiple
recoveries from other parties this Allowed Claim will be paid
$25,000.00. Class 5 is impaired. The allowed unsecured claims total
$973,087.50. This Class will receive a distribution of .02% of
their allowed claims.
Class 6 shall consist of all Allowed Unsecured Claims. Allowed
Unsecured Claims shall be paid a pro rata distribution from the sum
of $50,000.00 put up by New Equity Holders or from available cash
on hand to be paid upon the Effective Date. but not more than their
Allowed Claims, without interest. Class 6 is impaired and is
entitled to vote on the Plan. The allowed unsecured claims total
$50,000.00. This Class will receive a distribution of 70% of their
allowed claims.
The Class 7 Equity members shall not retain their equity in the
Reorganized Debtor. In exchange for the infusion of at least
$100,000.00 into the Debtor, for the payments to the Landlord,
funding the payments to Allowed Unsecured Creditors and paying for
the Costs of Administration, along with guaranteeing the New Lease
and posting the Letter of Credit for the Security Deposit for the
New Lease, the New Equity Members shall own 100% of the Reorganized
Debtor.
All distributions under this Plan will be provided by the Debtor's
receipt of funds from operations or from a cash infusion by New
Equity.
A full-text copy of the Disclosure Statement dated April 4, 2024 is
available at https://urlcurt.com/u?l=NyozPu from PacerMonitor.com
at no charge.
The Debtor's Counsel:
Avrum J. Rosen, Esq.
LAW OFFICES OF AVRUM J. ROSEN, PLLC
38 New St
Huntington, NY 11743-3327
Tel: 631-423-8527
Fax: 631-423-4536
Email: arosen@ajrlawny.com
About CoWorkrs 3rd Street LLC
CoWorkrs 3rd Street LLC is primarily engaged in renting and leasing
real estate properties.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. N.Y. Case No. 23-44306) on November
27, 2023. In the petition signed by David Goldwasser, chief
restructuring officer, the Debtor disclosed $4,860,560 in assets
and $2,987,216 in liabilities.
Judge Elizabeth S. Stong oversees the case.
Avrum J. Rosen, Esq., at Law Offices of Avrum J. Rosen, PLLC,
represents the Debtor as legal counsel.
DIMITRI VLAHAKIS: Pledged Interests Up for Sale on April 30
-----------------------------------------------------------
In accordance with applicable provisions of the Uniform Commercial
Code as enacted in New York, by virtue of certain events of default
under certain pledged and security agreement dated as of Oct. 21,
2020 ("pledge agreements"), executed and delivered by Dimitri
Vlahakis and Zenova Vlahakis ("pledgor"), and in accordance with
its rights as holder of the security, Maguire Bay Ridge LLC
("secured party"), by virtue of possession of the certain share
certificates held in accordance with Article 8 of the Uniform
Commercial Code of the State of New York, and by virtue of the
certain UCC-1 Filing Statement made in favor of the Secured Party,
all in accordance with Article 9 of the Code, Secured Party will
offer for sale, at public auction, (i) all of pledgor's respective
right, title, and interest inn and to the following: (i) 1818 79th
Realty LLC, 901 73rd Street LLC, 7506 Fifth Avenue LLC ("pledged
entities"), and (ii) certain related rights and property.
The Secured Party's understanding is that the principal assets of
the pledged entities is that certain fee interest in the premise
located at 1818 79th Street, Brooklyn, New York 11214, 901 73rd
Street, Brooklyn, New York 11228, and 7506 Fifth Avenue, Brooklyn,
New York 11209 ("property").
Mannion Auctions LLC, under the direction of Matthew D. Mannion,
will conduct a public sale consisting of the collateral vial online
bidding on April 30, 2024, at 2:30 p.m., in satisfaction of an
indebtedness in the approximate amount of $14,685,868.19 including
principal, interest on principal, and reasonable fees and costs,
plus default interest through April 30, 2024, 2023 subject to open
charges and all additional costs, fees and disbursements permitted
by law. The Secured Party reserves the right to credit bid.
Online bidding will be made available via Zoom Meeting: Meeting
link:
https://us06web.zoom.us/j/89833826812?pwd=ejd0bkFNYm9aclo1RWhldlJVaFVvZz09
, Meeting ID: 898 3382 6812, Passcode: 485874. One Tap Mobile:
+16465588656,,89833826812#,,,,*485874# US (New York)
+16469313860,,89833826812#,,,,*485874# US Dial by your location: +1
646 931 3860 US; +1 646 931 3860 US; +1 301 715 8592 US (Washington
DC); +1 305 224 1968 US; +1 309 205 3325 US; +1 312 626 6799 US
(Chicago); +1 669 444 9171 US; +1 689 278 1000 US; +1 719 359 4580
US; +1 720 707 2699 US (Denver); +1 253 205 0468 US; +1 253 215
8782 US (Tacoma); +1 346 248 7799 US (Houston); +1 360 209 5623 US;
+1 386 347 5053 US; +1 507 473 4847 US; +1 564 217 2000 US.
Interested parties who intend to bid on the collateral must contact
DJ Johnston at B6 Real Estate Advisors, 355 Lexington Avenue, 3rd
Floor, New York, New York 10016, (646) 933-2619,
djohnston@b6realestate.com, to receive the terms and conditions of
sale and bidding instructions by April 26, 2023 by 4:00 p.m. Upon
Execution of a standard confidentiality and non-disclosure
agreement, additional documentation and information will be
available. Interested parties who do not contact Johnston and
qualify prior to the sale will not be permitted to enter a bid.
DISKIN SYSTEMS: Wins Interim Cash Collateral Access
---------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida, Tampa
Division, authorized Diskin Systems, Inc. to use cash collateral,
on an interim basis, in accordance with the budget, with a 10%
variance, pending a further hearing set for April 29, 2024 at 2
p.m.
As previously reported by the Troubled Company Reporter, the Debtor
requires the use of cash collateral to pay the Debtor's regular
operating expenses in the regular course of business, as well as
the administrative expenses in these Chapter 11 proceedings as they
become due.
There are two unknown creditors who may have a lien on the cash
collateral of Debtor by virtue of a UCC-1 filed by Corporation
Service Company, As Representative, on August 2, 2023, and March
11, 2023. Each of these UCC-1 Financing Statements were filed in
the Office of the Illinois Secretary of State.
There is one unknown creditor who may have a lien on the cash
collateral of Debtor by virtue of a UCC-1 filed by CT Corporation,
As Representative, on March 14, 2023. The UCC-1 Financing Statement
was filed in the Office of the Illinois Secretary of State.
The U.S. Small Business Administration may have a lien on the cash
collateral of the Debtor by virtue of a UCC-1 filed on June 27,
2020 in the Office of the Illinois Secretary of State.
Huntington National Bank may have a lien on the cash collateral of
the Debtor by virtue of a UCC-1 Financing Statement filed on June
9, 2020 in the Office of the Illinois Secretary of State.
Kapitus, LLC may have a lien on the cash collateral of the Debtor
by virtue of a Loan Agreement and Security Agreement executed on
March 9, 2023.
Mulligan Funding/FinWise Bank may have a lien on the cash
collateral of the Debtor by virtue of a Business Loan and Security
Agreement executed on March 10, 2023.
ODK Capital, LLC may have a lien on the cash collateral of the
Debtor by virtue of a Business Loan and Security Agreement.
The court said each creditor with a security interest in Cash
Collateral will have a perfected post-petition lien against cash
collateral to the same extent and with the same validity and
priority as the prepetition lien, without the need to file or
execute any document as may otherwise be required under applicable
non bankruptcy law.
The Debtor will maintain insurance coverage for its property in
accordance with the obligations under applicable loan and security
documents.
A copy of the order is available at https://urlcurt.com/u?l=g5zgR4
from PacerMonitor.com.
About Diskin Systems Inc.
Diskin Systems Inc filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No.
24-00669) on Feb. 9, 2024, listing $100,001 to $500,000 in assets
and $500,001 to $1 million in liabilities.
Judge Roberta A Colton presides over the case.
Craig I Kelley, Esq. at Kelley Kaplan & Eller, PLLC represents the
Debtor as counsel.
DISTRICT 9: Joins Other Breweries in Bankruptcy
-----------------------------------------------
Daniel Kline of The Street reports that beer sales are simply down
overall, and numerous big-named breweries and beer brands have
filed for Chapter 11 bankruptcy and many have closed their doors
for good.
The list of shuttered breweries starts with San Francisco's
nationally distributed Anchor Brewing, which had achieved a level
of success that craft-beer brands rarely reach. A number of other
regional breweries, including Chicago's Metropolitan Brewing, New
Jersey's Flying Fish, Denver's Joyride Brewing, Tampa's Zydeco Brew
Werks, and Cleveland's Terrestrial Brewing have also filed for
bankruptcy. That's not a complete list as it seems as if there a
new filing or closure every few days.
That speaks to the overall bleak market for regional breweries and
craft beer. Now, District 9 Brewing (known by many as D9 Brewing)
has joined the list of regional breweries filing for Chapter 11
bankruptcy.
The North Carolina brewery, which began in a garage in 2008, then
moved to a production location in 2014. D9 has grown steadily over
the course of its history but now its future remains very much in
doubt.
"After winning multiple prestigious medals in coveted sour beer
categories, D9 became one of the Charlotte area's largest
breweries," the company says on its website. "Staying true to
their roots, the founders focused on the creation of smaller
microbrewery locations throughout North Carolina where their
passion for "Unquestionably Original" ales could continue to grow
and connect with the local community."
In its Chapter 11 bankruptcy filing, the company disclosed that it
had less than $7.5 million in debt. The company did not provide a
financing or turnaround plan as part of its filing.
District 9 Brewing did say that it expected funds to be available
for unsecured creditors. The company said it owed money to between
50 and 99 creditors while its assets are less than $500,000.
District 9 appears to have closed its taprooms, perhaps
temporarily. Its website shows no upcoming events. The online
store linked to its website, which appears to be operated by an
unrelated third party, still enables purchase of D9 beers.
District 9 Brewing made supporting its community a core pillar of
its business philosophy.
"Our mission at D9 is to inspire and support the community through
the creation of exciting and originally crafted ales," the company
wrote. "As explorers of all beer styles, we offer a wide variety
of selections for exceptional craft drinking experiences. We
invest in the scientific exploration of the natural world to
produce the highest quality, and unquestionably original, crafted
ales."
The company also supported local charities with some of its
events.
"D9 greatly values coming alongside our local nonprofit community
partners in supporting efforts to drive meaningful change for our
neighbors," the brewery added.
About District 9 Brewing
District 9 Brewing, doing business as D9 Brewing, is a popular
brewing company that operates 3 microbreweries and 1 production
brewery, and operates a distribution center.
District 9 Brewing sought relief under Chapter 11 of the U.S.
Bankruptcy Code(Bankr. W.D.N.C. Case No. 24-30289) on March 29,
2024. In the petition filed by Andrew Durstewitz, as member
manager, the Debtor reports estimated assets between $100,000 and
$500,000 and estimated liabilities between $1 million and $10
million.
The Honorable Bankruptcy Judge J. Craig Whitley oversees the case.
The Debtor is represented by:
John C. Woodman, Esq.
ESSEX RICHARDS, P.A.
1701 South Blvd.
Charlotte, NC 28203
Tel: 704-377-4300
Fax: 704-372-1357
E-mail: jwoodman@essexrichards.com
DON'S BAREFOOT: Court OKs Interim Cash Collateral Access
--------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Texas
authorized Don's Barefoot Beach Marina, LLC to use cash collateral,
on an interim basis, in accordance with the budget, with a 10%
variance.
Plains Capital and U.S. Small Business Administration assert an
interest in the Debtor's cash collateral.
As adequate protection of Secured Lenders' interest in the cash
collateral pursuant to 11 U.S.C. sections 361 and 363(e) to the
extent of any diminution in value from the use of the Collateral,
the Secured Lenders are granted replacement security liens on and
replacement liens on all of the Debtor's Equipment, Inventory and
Accounts, whether such property was acquired before or after the
Petition Date.
As additional adequate protection, the Debtor will pay Plains
$3,000 per month beginning on May 1, 2024, and continuing on the
first day of each succeeding month thereafter through confirmation
of a plan.
The Debtor will maintain insurance on the Collateral as required
under the loan documents of Plains.
The Replacement Liens will be of the same validity and priority as
the liens of Secured Lenders on the respective prepetition
Collateral.
The Replacements Liens will be subject and subordinate to: (a)
professional fees and expenses of the attorneys, financial advisors
and other professionals retained by any statutory committee if and
when one is appointed; and (b) any and all fees payable to the
United States Trustee pursuant to 28 U.S.C. section 1930(a)(6), and
the Clerk of the Bankruptcy Court.
These events constitute an "Event of Default":
(a) The Debtor's Chapter 11 Case is converted to a case under
Chapter 7 of the Bankruptcy Code or is dismissed or any Secured
Lender is granted relief from the automatic stay;
(b) The Court removes the Debtor as debtor-in-possession under 11
U.S.C. Section 1181(a);
(c) Any default under, breach of or failure to comply with, any
provisions of the Final Order, which breach is not cured within
five business days after the Debtor's receipt of written notice
thereof.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=4I2cNj from PacerMonitor.com.
The Debtor projects $80,800 in gross profit and $56,965 in total
expenses.
About Don's Barefoot Beach Marina
Don's Barefoot Beach Marina, LLC filed its voluntary petition for
relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Tex.
Case No. 24-20024) on February 23, 2024, listing up to $50,000 in
assets and $1 million to $10 million in liabilities. The petition
was signed by Misty Thornton as managing member.
Judge Joshua P. Searcy oversees the case.
Robert T DeMarco, Esq. at DEMARCO MITCHELL, PLLC represents the
Debtor as counsel.
EGAE LLC: Unsecureds Owed $1.97M to Get $30K Annually for 5 Years
-----------------------------------------------------------------
EGAE LLC submitted a First Amended Disclosure Statement for Plan of
Reorganization, dated March 29, 2024.
The Debtor owns and manages a multifamily property in Anchorage,
Alaska that leases apartments primarily to Alaska residents and
military members. Debtor engaged Smith & Smith, PLLC as chapter 11
counsel to facilitate a reorganization.
In brief, the Plan provides for the restructuring of the senior and
junior liens and payment of unsecured creditors over time.
EGAE, LLC owns the McKinley Tower Apartments, a 100-unit mid-rise
apartment complex (the "Property") built in the 1950s and renovated
in approximately 2006. It is located at 337 East 4th Avenue,
Anchorage, Alaska 99501. This apartment complex contains an average
unit size of approximately 544 square feet. The Property is near
downtown Anchorage and offers a selection of floor plans and modern
conveniences to its residents.
The goal of the Plan is to pay creditors to the fullest extent
possible through the revenues generated by Debtor over time. The
Plan will be funded by a new value contribution from the current
equity owner of the Debtor, the Marlow Family Exempt Perpetual
Trust, via funds advanced to EGAE. The Plan further proposes that
MidCap's secured claim and other secured claims will be
restructured. Unsecured creditors will be paid in a fair and
equitable manner, receiving payments over the life of the Plan.
Under the Plan, Class 4 consists of General Unsecured Claims. Class
is estimated at $1,970,000, excluding disputed claims and excluding
a deficiency from Class 3, based on Debtor's Amended Schedule F. If
MidCap does not make the election under s 1111(b) to have its Class
3 Claim treated as fully secured, Class 4 shall receive the
following payments commencing on the Distribution Date and
continuing annually until the fifth anniversary of the Effective
Date: $30,000 in Years 1-5. In the event MidCap elects to be "fully
secured" by asserting an election to be treated under Section
1111(b), Class 4 shall receive payments in five equal annual
installments of $30,000. Payments shall commence on the
Distribution Date and continue annually until the fifth anniversary
of the Effective Date. All remaining amounts of Class 4 Claims
shall be discharged. Payments will be made from Debtor's
post-confirmation cash flow and equity contributions. Class 4 is
impaired.
On the Effective Date, the Marlow Family Exempt Perpetual Trust
shall contribute $200,000 to the Reorganized Debtor in order to
retain the equity of the Reorganized Debtor. Debtor believes that
this is a new substantial infusion of money that is necessary for a
successful reorganization and is at least equivalent to the
interest received on account of such contribution. In addition, the
Debtor's management company, Kenco Building Services, LLC, will
have a variable payment plan with a management fee based on 5% of
total revenues paid after payment of claims to creditors which will
allow for an effective guarantee in the event the Debtor has any
operating losses during the course of the Plan of Reorganization.
Stated more succinctly, and as demonstrated by the cash flow
projections, management will support cash flow by reducing its
management fee and by contributions as required in order to ensure
feasibility.
The total debt owed to the unsecured creditors is approximately
$1,970,000 and this $200,000 equity contribution is greater than
10% of the total debt being discharged. In addition, without
payment of this equity contribution to ensure administrative and
cure payments are made, the debtor would be unable to facilitate a
reorganization without this contribution. This $200,000
contribution is not de minimis and is substantial. It is almost
equivalent to a Federal Bankruptcy Judge's annual salary and more
than meets the standards as set out in Bank of America National
Trust and Sav. Ass'n v. 203 North LaSalle Street Partnership, 526
U.S. 434, 443, 119 S.Ct. 1411, 143 L.Ed.2d 607 (1999); see also In
re Red Mountain Machinery Co., 448 B.R. 1, 15 (2011) (an excellent
discussion on the 9th Circuit case law addressing new value by the
Honorable Randolph Haines). This also will allow Kenco Building
Services, LLC to pay back any transfers made to it which may be
deemed fraudulent after analysis of the Debtor's fraudulent
transfers. The source of the funding will be disclosed prior to
confirmation, but it is anticipated that it will be a loan from a
family member to the Manager, Mr. Marlow, who will provide the
proceeds to the Debtor.
Finally, the Debtor voluntarily waives its exclusivity to file a
Plan of Reorganization under 11 U.S.C. Sec. 1121(b) to allow an
opportunity to any party in interest to compete in the marketplace
by proposing an alternative plan of reorganization and thus allow
for the market's scrutiny of the Debtor's proposed Plan of
Reorganization and test the valuation of Equity's contribution to
the Plan of Reorganization.
Attorney for Debtor:
John C. Smith, Esq.
SMITH & SMITH
GERALD K. SMITH AND JOHN C. SMITH
LAW OFFICES, PLLC
ATTORNEYS AT LAW
6720 E. Camino Principal, Suite 203
Tucson, AZ 85715
Tel: (520) 722-1605
Fax: (520) 844-8070
Email: john@smithandsmithpllc.com
A copy of the Disclosure Statement dated March 29, 2024, is
available at https://tinyurl.ph/dCzfu from PacerMonitor.com.
About EGAE LLC
EGAE, LLC, a company that owns and operates an apartment building
in Anchorage, Alaska, sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. D. Ala. Case No. 23-00169) on Oct. 5,
2023. In the petition signed by Marc Marlow, manager, the Debtor
disclosed up to $50 million in assets and up to $10 million in
liabilities.
Judge Gary Spraker oversees the case.
John C. Smith, Esq., at Gerald K. Smith and John C. Smith Law
Offices, PLLC, serves as the Debtor's legal counsel.
EIGER BIOPHARMACEUTICALS: Incurs $75 Million Net Loss in 2023
-------------------------------------------------------------
Eiger BioPharmaceuticals, Inc. filed with the U.S. Securities and
Exchange Commission its Annual Report on Form 10-K disclosing a net
loss of $75 million for the year ended December 31, 2023, compared
to a net loss of $96.8 million for the years ended December 31,
2022.
As of December 31, 2023, the Company had $38.8 million in total
assets, $53.3 million in total liabilities, and $14.5 million in
total stockholders' deficit.
San Francisco, California-based KPMG LLP., the Company's auditor
since 2015, issued a "going concern" qualification in its report
dated April 8, 2024, citing that the Company's recurring losses
from operations, expectation of continuing operating losses and
negative cash flows, and the need to raise additional capital to
finance its future operations, raises substantial doubt about its
ability to continue as a going concern.
A full-text copy of the Company's Form 10-K is available at
https://tinyurl.com/28zh5bnw
About Eiger Biopharmaceuticals
Palo Alto, California-based Eiger BioPharmaceuticals, Inc., is a
commercial-stage biopharmaceutical company focused on the
development of innovative therapies for rare metabolic diseases.
The Company's shares traded on Nasdaq under the symbol "EIGR".
Eiger Biopharmaceuticals Inc. and its subsidiaries sought relief
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Tex. Lead
Case No. 24-80040) on April 1,2024. In its petition, Eiger listed
$38.8 million in assets and $53.1 million in liabilities as of the
bankruptcy filing.
Eiger is represented by Sidley Austin LLP as its legal counsel,
Alvarez & Marsal as its financial advisor and SSG Capital Advisors,
LLC as its restructuring investment banker. Kurtzman Carson
Consultants, LLC is the claims agent.
EIGER BIOPHARMACEUTICALS: Wins Interim Cash Collateral Access
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas,
Dallas Division, authorized Eiger Biopharmaceuticals, Inc. and
affiliates to use cash collateral, on an interim basis, in
accordance with the budget.
The Debtors require the use of cash collateral to, among other
things, (A) pay certain adequate protection payments; (B) pay the
costs of administration of their estates, including the payment of
professional fees and expenses; and (C) to satisfy other working
capital and general corporate needs of the Debtors.
Under the Loan and Security Agreement, dated June 1, 2022, among
Eiger BioPharmaceuticals, Inc., EB Pharma, LLC, and EBPI Merger,
Inc., and Innovatus Life Sciences Lending Fund I, LP, as Collateral
Agent, the Debtor obtained an aggregate principal amount of not
less than $41.685 million of Term A Loans.
As adequate protection, the Prepetition Term Loan Agent, for the
benefit of itself and the other Prepetition Term Loan Secured
Parties, is granted valid, binding, continuing, enforceable, fully
perfected, nonavoidable, first-priority senior, additional and
replacement security interests in and liens on (i) the Prepetition
Collateral and (ii) all of the Debtors' now-owned and
hereafter-acquired real and personal property, assets and rights.
As further adequate protection, and to the extent provided by 11
U.S.C. Sections 503(b) and 507(b), the Prepetition Term Loan Agent,
for the benefit of itself and the Prepetition Term Loan Secured
Parties, is granted an allowed superpriority administrative expense
claims in the Chapter 11 Cases ahead of and senior to any and all
other administrative expense claims in these Chapter 11 Cases to
the extent of any Diminution in Value, junior only to the Carve
Out.
A final hearing on the matter is set for April 23, 2024 at 9:30
a.m.
A copy of the order is available at https://urlcurt.com/u?l=xqqL3A
from PacerMonitor.com.
About Eiger Biopharmaceuticals
Palo Alto, California-based Eiger BioPharmaceuticals, Inc., is a
commercial-stage biopharmaceutical company focused on the
development of innovative therapies for rare metabolic diseases.
The Company's shares traded on Nasdaq under the symbol "EIGR".
Eiger Biopharmaceuticals Inc. and its subsidiaries sought relief
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Tex. Lead
Case No. 24-80040) on April 1,2024. In its petition, Eiger listed
$38.8 million in assets and $53.1 million in liabilities as of the
bankruptcy filing.
Eiger is represented by Sidley Austin LLP as its legal counsel,
Alvarez & Marsal as its financial advisor and SSG Capital Advisors,
LLC as its restructuring investment banker. Kurtzman Carson
Consultants LLC is the claims agent.
ELITE ENDEAVORS: U.S. Trustee Unable to Appoint Committee
---------------------------------------------------------
The U.S. Trustee for Region 20 disclosed in a court filing that no
official committee of unsecured creditors has been appointed in the
Chapter 11 case of Elite Endeavors, LLC.
About Elite Endeavors
Elite Endeavors, LLC, a company in Edmond, Okla., sought protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Kan. Case
No. 24-20222) on March 6, 2024, with up to $50,000 in assets and up
to $50 million in liabilities.
Judge Robert D. Berger oversees the case.
Erlene W. Krigel, Esq., at Krigel & Krigel, PC, represents the
Debtor as legal counsel.
ESJ TOWERS: Unsecureds Owed $27M to Get $750K in Plan
-----------------------------------------------------
ESJ Towers, Inc., d/b/a Mare St. Clair Hotel, filed a Second
Amended Plan as Supplemented under Section 1121 of Title 11 of the
United States Code.
Under the Plan, Class 6 Allowed General Unsecured Claims total
$26,898,382. From the proceeds of the sale of Debtor's assets,
Debtor will carve out $750,000 to be distributed on the Effective
Date, pro-rata, among the Holders of Allowed General Unsecured
Claims, including the claims of BMF Capital, LLC, Green Capital
Funding and High-Speed Capital, and any deficiency claim, of
Parliament High Yield Fund, LLC, Acrecent, Colebrook, and Oriental.
In addition on behalf of Holders of Allowed General Unsecured
Claims Debtor's Claims and Causes of Action, including those under
Chapter 5 of the Bankruptcy Code, Sections 542, 544, 545, 458, 549,
550 and 553, subject to any liens thereon, collection of money
actions will be transferred to the Committee for the benefit of the
Holders of Allowed General Unsecured Claims any net proceeds
arising therefrom to be distributed pro rata to the members of
Class 6. If for any reason the Committee is not reconstituted by
April 30, 2024, Debtor will prosecute such Claims and Causes of
Action on behalf and for the benefit of Holders of Allowed General
Unsecured Claims. If Debtor does not prevail on any pending
Objection to Claims, those Allowed Claims will be included in this
Class, and will receive, their pro-rata share of the $750,000 carve
out. Class 6 is impaired.
The Plan is supported and funded by the proceeds of the sale of
substantially all of Debtor's assets. After payment of
Administrative Expense Claims, Priority Claims and Priority Tax
Claims, and those in Classes 1 through 7, as applicable and set
forth above, Debtor shall transfer the its Claims and Causes of
Actions to the Litigation Trust for the Administrator to use any
proceeds arising therefrom as an additional pro-rata dividend to
Holders of Allowed General Unsecured Claims, after paying the
Administrator, and the Committee's personnel, including
professionals.
Counsel for the Debtor:
CHARLES A. CUPRILL P.S.C.
LAW OFFICES
356 Fortaleza Street
Second Floor
San Juan, PR 00901
Tel.: (787) 977–0515
Fax: (787) 977–0518
E–mail: ccuprill@cuprill.com
A copy of the Second Amended Plan dated March 27, 2024, is
available at https://tinyurl.ph/ybpqC from PacerMonitor.com.
About ESJ Towers
ESJ Towers, Inc. owns the ESJ Towers in Carolina, P.R. The luxury
apartments and condo units at ESJ Towers have direct access to Isla
Verde Beach, widely considered one of the best in Puerto Rico.
ESJ sought protection under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. D.P.R. Case No. 22-01676) on June 10, 2022, with as much as
50 million in both assets and liabilities. ESJ President Keith St.
Clair signed the petition.
Judge Enrique S. Lamoutte Inclan oversees the case.
The Debtor tapped Charles A. Cuprill, Esq., at Charles A. Cuprill,
PSC Law Offices as bankruptcy counsel; Ramon Luis Nieves, Esq., at
RL Legal Consulting Services, LLC and Luis Daniel Muniz, Esq., as
special counsels; Dage Consulting CPAS, PSC as financial advisor;
CPA Luis R. Carrasquillo & Co., P.S.C. as financial consultant; and
De Angel & Compania, PA, LLC as auditor.
The U.S. Trustee for Region 21 appointed an official committee of
unsecured creditors on Sept. 12, 2022. The committee tapped the Law
Office of Jonathan A. Backman as lead bankruptcy counsel; Julio
Cesar Alejandro Serrano, Esq., at JCAS Law as local counsel; and
Dage Consulting CPAS, PSC as financial advisor.
The Debtor filed its Chapter 11 plan of reorganization and
disclosure statement on June 1, 2023.
FARM LLC: Wins Cash Collateral Access Thru April 30
---------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida,
Orlando Division, authorized the Farm, LLC to use cash collateral
on an interim basis, in accordance with the budget, through April
30, 2024.
The Debtor is authorized to use cash collateral to pay: (a) amounts
expressly authorized by the Court, including payments to the United
States Trustee for quarterly fees; (b) the current and necessary
expenses set forth in the budget; and (c) additional amounts as may
be expressly approved in writing by Creditor within 48 hours of the
Debtor's request.
The entities that assert an interest in the Debtor's cash
collateral are Corporation Service Company, as representative, CT
Corporation System, as representative, Re Nectar Inc., Global
Merchant Cash Inc. dba Wall Street Funding, Parkview Advance LLL,
Lifetime Funding LLC, Smart Business, Syndicate Group USA, Inc.,
Imerchant Funding LLC, Celtic Advance, Cloudfund LLC, En OD, LLC,
Fundbox Inc., Meged Funding Group, Pinnacle Business Funding LLC,
Prescott & Fifth Capital LLC, Small Business Financial Solutions,
LLC dba Rapid Finance, Rapid Financial Services, Rocky Gaslin, Star
Advance, Syndicate Group USA, Inc. and Capital Assist LLC aka
Whitestone Funding.
As adequate protection, the Secured Creditors will have a perfected
post-petition lien against cash collateral to the same extent and
with the same validity and priority as the pre-petition lien,
without the need to file or execute any documents as may otherwise
be required under applicable non-bankruptcy law.
The Debtor will maintain insurance coverage for its property in
accordance with the obligations under the loan and security
documents with Secured Creditors.
A continued hearing on the matter is set for April 30 at 1:30 p.m.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=MBFtYy from PacerMonitor.com.
The Debtor projects total operating expenses, on a monthly basis,
as follows:
$685,696 for February 2024;
$710,696 for March 2024; and
$764,096 for April 2024.
About The Farm LLC
The Farm LLC offers luxury estate vacation.
The Farm LLC, doing business as Curated American Getaways LLC
sought relief under Subchapter V of Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Fla. Case No. 24-00362) on January 26,
2024. In the petition filed by Katie Martin Loane, as CFO, the
Debtor reports total assets of $624,659 and total liabilities
amounting to $4,393,655.
The Honorable Bankruptcy Judge Lori V. Vaughan handles the case.
Jeffrey Ainsworth, Esq., BransonLaw PLLC BransonLaw PLLC,
represents the Debtor as legal counsel.
FARZAN ALAMIRAD: Wins Cash Collateral Access Thru April 30
----------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California,
San Fernando Valley Division, authorized Farzan Alamirad, D.D.S.
Inc. dba Gentle BioDentistry to use cash collateral, on an interim
basis, in accordance with the budget, with a 15% variance, through
April 30, 2024.
The Debtor requires the use of cash collateral to pay operating
expenses.
As previously reported by the Troubled Company Reporter, while the
Debtor was generally cash flow positive prior to March 2020, it has
struggled to recover from the shutdown in 2020-2021 due to the
Covid-19 worldwide pandemic. Dr. Farzan Alamirad used much of his
own personal resources to keep the Debtor operating during this
period. The Debtor also kept its employees employed and paid by
obtaining an Economic Injury Disaster Loan from the SBA.
However, the Debtor stopped operating in the second half of 2022
because Dr. Alamirad fell ill and was unable to work. As a result,
the Debtor lost patients, its revenue dropped drastically, and did
not have sufficient cash flow to cover its monthly expenses. As
such, the Debtor turned to merchant cash advances to provide
immediate capital to cover its expenses. However, the MCAs
collection tactics were onerous as they made daily withdrawals of
the Debtor's business account. This exacerbated the cash flow
issues.
The Debtor breached the agreements and the MCAs filed actions
against it in the State of New York. One of the MCAs, Cloudfund,
LLC has served a notice of levy on the Debtor's accounts, which has
resulted in them being frozen and the Debtor has lost access to
those funds.
The Debtor entered into a master loan and security agreement with
WFB on April 21, 2015, for $253,485 at 6.4%. WFB filed its UCC
financing statement on April 13, 2015.
The Debtor entered into an equipment financing agreement with
Highland in 2016 for a lease to use a Pax-I 3D Green CBCT. The
Debtor believes that the current balance is $4,820, as of the
petition date. Highland filed its UCC financing statement on
December 22, 2016.
The Debtor entered into an Economic Injury Disaster Loan with the
SBA on May 18, 2020, for $150,000 and thereafter modified on July
9, 2021, for $500,000, at 3.75% interest. The Debtor believes that
the current balance is $1.8 million, as of the petition date. The
current monthly payments are $2,516. SBA filed its UCC financing
statement on May 26, 2020.
The Debtor entered into a Forward Purchase Agreement with Kapitus
on October 6, 2023, for $129,900. The Debtor believes that the
current balance is $183,159, as of the petition date. Although the
agreement purports to be a purchase agreement, the Debtor is
investigating whether it was a disguised loan. Kapitus filed its
UCC financing statement on October 9, 2023.
The Debtor cannot currently determine the identity of the creditor
that filed this UCC financing statement, as it is either
Capytal.com (agreement entered on October 11, 2023) or EBF Holding
LLC (agreement entered on October 12, 2023). The Debtor is
investigating and will revise accordingly once the identity is
discovered. HTD Company filed the UCC financing statement on
October 16, 2023.
The Debtor entered into a Future Receipts Sale and Purchase
Agreement with Cloudfund on October 17, 2023, for $45,000. The
Debtor believes that the current balance is $64,122, as of the
petition date. Although the agreement purports to be a purchase
agreement, the Debtor is investigating whether it was a disguised
loan. Cloudfund filed its UCC financing statement on October 17,
2023.
The Debtor is directed to provide the following adequate protection
to secured creditors:
a. The Debtor will pay Wells Fargo Bank $3,292/month (the
contractual payment), starting from February 2024.
b. The Debtor will pay Highland Capital Corporation $1,205/month
(the contractual payment), starting from February 2024.
c. The Debtor will pay U.S. Small Business Administration
$2,516/month, starting from February 2024.
d. Secured creditors are granted replacement liens on the Debtor's
postpetition cash collateral with the same validity, extent and
priority as their prepetition liens and as they would have under
non-bankruptcy law, to the extent that their cash collateral is
actually used.
e. The Debtor must segregate and hold in its cash collateral DIP
bank account all revenue exceeding the funds needed to pay the
expenses set forth on the Budget.
A continued hearing on the matter is set for April 30 at 1:30 p.m.
A copy of the order is available at https://urlcurt.com/u?l=GLon8r
from PacerMonitor.com.
About Farzan Alamirad, D.D.S. Inc.
Farzan Alamirad, D.D.S. Inc. is a provider of dental care to the
families located in the West Hills, California, area. Gentle
Biodentistry treats all ages and provides comprehensive oral
solutions catered to its patients' needs.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Case No. 24-10226) on February
14, 2024. In the petition signed by Farzan Alamirad, chief
executive officer, the Debtor disclosed up to $500,000 in assets
and up to to $10 million in liabilities.
Judge Martin R. Barash oversees the case.
Matthew D. Resnik, Esq., at RHM LAW, LLP, represents the Debtor as
legal counsel.
FCA CONSTRUCTION: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: FCA Construction LLC
5609 Crawford Street, Ste. A
Harahan, LA 70123
Business Description: FCA Construction is a general contractor
specializing in residential construction and
roofing, commercial construction and
roofing, disaster recovery, disaster roof
replacement, and electrical and mechanical
services.
Chapter 11 Petition Date: April 11, 2024
Court: United States Bankruptcy Court
Eastern District of Louisiana
Case No.: 24-10702
Judge: Hon. Meredith S. Grabill
Debtor's Counsel: Tristan Manthey, Esq.
FISHMAN HAYGOOD, L.L.P.
201 St. Charles Ave.
46th Fl
New Orleans, LA 70170
Tel: (504) 586-5252
Email: tmanthey@fishmanhaygood.com
Total Assets as of March 31, 2024: $3,417,686
Total Liabilities as of March 31, 2024: $7,768,774
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Albert Courcelle, III as member.
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/XDKNHZI/FCA_Construction_LLC__laebke-24-10702__0001.0.pdf?mcid=tGE4TAMA
FENDER MUSICAL: S&P Upgrades ICR to 'B' on Improved Performance
---------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating to 'B' from 'B-'
on U.S.-based Fender Musical Instruments Corp.
S&P said, "We also raised our issue-level rating on the company's
$400 million senior secured first-lien term loan to 'B' from 'B-'.
The recovery rating on this debt is '3', indicating our
expectations for meaningful (50%-70%; rounded estimate: 55%)
recovery in the event of a payment default.
"The stable outlook reflects our expectation that Fender will
increase volumes in 2024 and drive top-line growth while
maintaining its current level of profitability.
"We believe the oversaturation of channel inventories for guitars
has largely normalized across Fender's dealer network and
anticipate that Fender will be able to increase volumes in 2024.We
expect that Fender will benefit from increased sales of entry-level
guitars across channels, as well as the launch of new core series
guitars and the 70th anniversary of the Stratocaster in 2024. As
such, we believe the sales trough occurred during the first quarter
of 2023, and the return to sequential quarterly sales growth should
be sustainable. Absent a material decline in consumer demand, we
anticipate that sell-in to retailers will begin to more closely
track sell-out to consumers moving forward. Overall, we anticipate
that Fender will experience volume growth in the mid-single-digit
percentage area in 2024.
"We expect modest margin pressure in 2024 but Fender's growth
should buoy EBITDA. Gross margins will be negatively affected by
tougher competition as well as higher direct manufacturing labor
costs due to wage increases in California and Mexico, where Fender
has meaningful operations. Although we expect modest gross margin
compression, we anticipate lower warehousing costs and modest cost
savings related to end-to-end logistics will partially offset the
impact of the aforementioned factors. Overall, we expect absolute
EBITDA dollars in 2024 to be roughly in-line with last 12 months
EBITDA as of Sept. 30, 2023, despite some expected margin
compression, resulting in S&P Global Ratings-adjusted leverage of
5.5x by year-end after factoring in debt repayment.
"Over the next two years, we believe Fender will be able to pay off
a modest portion of outstanding debt. In 2024, Fender has a
mandatory term loan pre-payment of $20 million due in May which
could be funded with cash from the balance sheet and excess cash
flow generation, or temporarily funded with ABL borrowings. We
continue to believe that Fender will be able to generate enough
cash to pay off ABL borrowings over the next few years, along with
excess cash flow contractually required to be applied to the term
loan.
"Improved working capital management and lower capital expenditures
(capex) will help to sustain the company's current level of FOCF
generation. In 2024, we expect FOCF will be sustained above $25
million, underpinned by further modest inventory reduction, higher
accounts payable and accrued expenses, and less growth capex.
"The stable outlook reflects our expectation that Fender will
increase volumes in 2024 and drive top-line growth while
maintaining its current level of profitability. We also expect
annual FOCF to be sustained above $25 million over the next year."
S&P could lower the rating if it believes Fender's profitability
will be weaker than we currently expect, resulting in S&P Global
Ratings-adjusted leverage sustained above 6.5x. This could occur
if:
-- There is a prolonged recession, resulting in a decline in
demand for guitars;
-- Higher levels of working capital investment than we expect are
required to support volume growth; or
-- The company cannot manage its outsourced supply chain or is
unable to offset potential inflationary pressures, further reducing
its profitability.
While unlikely over the next 12 months, S&P could raise its ratings
on Fender if the company outperforms its expectations, leading to
S&P Global Ratings-adjusted leverage sustained below 5x, along with
the company's demonstrated commitment to maintain leverage at these
levels. This could occur if:
-- Demand for guitars, accessories, and pro audio products
consistently improves;
-- There are no major disruptions in ordering behavior at Fender's
largest retailer;
-- The company is able to expand profit margins through
operational efficiencies and cost-savings initiatives; and
-- The company continues to successfully manage its working
capital and liquidity.
FIRST QUALITY: Seeks Cash Collateral Access
-------------------------------------------
First Quality Laboratory, Inc. asks the U.S. Bankruptcy Court for
the Southern District of Florida, Broward Division, for authority
to use cash collateral and provide adequate protection.
The Debtor requires the use of cash collateral to pay the ordinary
and necessary operating expenses on according to the budget.
On October 13, 2017, the Debtor executed a note and security
agreement in favor of TD Bank, N.A. T.D. Bank filed a secured proof
of claim (Claim No. 2) for $66,262, plus attorney fees and
post-petition interest as a fully secured creditor.
The Debtor's review of the UCC-1 registry confirms that TD Bank,
N.A. is the first priority secured creditor by the filing of a
UCC-1 Financing Statement with the Florida Secured Transaction
Registry on November 3, 2017 under Filing No. 201703158049, and has
a lien on upon all assets of the Debtor.
The UCC-1s were filed thereafter:
a. Small Business Administration filed a UCC-1 Financing Statement
on July 3, 2020 under Filing No. 2020003113280;
b. Corporation Service Company, as Representative, filed a UCC-1
Financing Statement on October 15, 2020 under Filing No.
202005057159;
c. Corporation Service Company, as Representative, filed a UCC-1
Financing Statement on September 8, 2023 under Filing No.
202302471197; and
d. Corporation Service Company, as Representative, filed a UCC-1
Financing Statement on December 11, 2023 under Filing No.
202303350342.
The Subordinate Security Interests are junior and inferior to the
lien of TD Bank, N.A. on the cash collateral of Debtor, and Debtor
will file a separate motion to value and/or strip those liens.
The Debtor's schedules reflect that as of the Petition Date, Debtor
had $9,504 in deposit accounts, $118,703 in accounts receivable,
$39,499 in office equipment and furniture, $27,619 in computer
software, and $260,269 in other medical equipment.
The Debtor will pay TD Bank monthly adequate protection payments
due on the 1st of each month in the amount of $2,000 beginning as
of December 1, 2023, with the five catch-up payments for December
through April due no later than April 20, 2024, and to be paid
from, inter alia, postpetition receipts and the contemplated
postpetition working capital financing requested by the Debtor's
motion seeking approval of same.
The Debtor proposes three distinct and concrete methods of
providing adequate protection to TD Bank. First, the Debtor will
make the monthly adequate protection payments of $2,000, beginning
as of December 1, 2023. Second, the Debtor will give TD Bank a
replacement lien, pursuant to 11 U.S.C. Section 361(2), on and in
all property of the Debtor acquired or generated after the Petition
Date, but solely to the same extent and priority, and of the same
kind and nature, as the property of the Debtor securing the
prepetition obligations to TD Bank. Third, in the event that
diminution occurs in the value of TD Bank's collateral from and
after the Petition Date as a result of the Debtor's use of TD
Bank's Pre-Petition Collateral in an amount in excess of the value
of the replacement liens granted, TD Bank will be entitled to an
administrative claim under 11 U.S.C. Section 507(b) to the extent
of such diminution.
A copy of the motion is available at https://urlcurt.com/u?l=KKdMzu
from PacerMonitor.com.
About First Quality Laboratory
First Quality Laboratory, Inc., owns and operates a medical
laboratory in Hollywood, Fla.
First Quality Laboratory filed a petition under Chapter 11,
Subchapter V of the Bankruptcy Code (Bankr. S.D. Fla. Case No.
23-19831) on Nov. 29, 2023, with $1 million to $10 million in both
assets and liabilities. Luz F. Garcia, vice president, signed the
petition.
Judge Peter D. Russin oversees the case.
The Debtor is represented by Gary M. Murphree, Esq., at Am Law,
LLC.
FLANNERY LLC: Unsecured Creditors to Split $12K over 5 Years
------------------------------------------------------------
Flannery, LLC, filed with the U.S. Bankruptcy Court for the Eastern
District of Arkansas a Plan of Reorganization dated April 2, 2024.
On or about November 1, 2020, Thanh T. Flannery, along with her
ex-husband, Michael A. Flannery, entered into a business agreement
with SJY, Inc. to purchase the business described as "Japanese
restaurant at 605 Salem Rd, #10, Conway, AR, 72034."
Said agreement included all assets of the seller including "the
goodwill of the seller including the business name." After a
divorce from her husband on February 13, 2023, Thanh T. Flannery
became the sole owner of the business.
Subsequent to the divorce, in an attempt to keep her business
operating, Debtor committed to several short-term, high interest
loans. The payments were so high on these loans that Debtor could
not support the debt service, which caused it to fall behind with
Arkansas Department of Finance and Administration, resulting in a
potential business closure by the state. Debtor filed its Chapter
11 to prevent this business closure. With the relief expected from
the Chapter 11, and by not having to pay the high monthly payments
on the short-term high interest loans, debtor believes it can
remain current with its tax obligations to the state and catch up
on all prior tax obligations.
Class 1 consists of General Unsecured Creditor Pool. According to
the Debtor's Schedules, Debtor believes that it has an unsecured
pool of potentially $90,000.00. This amount is less than what is
listed in the Debtor's bankruptcy schedules because certain claims
have come in substantially less than listed. For example, the
Debtor listed the claim of unsecured Titan at around $97,500 and
the proof of claim filed by Titan was only $32,397.00. Debtor does
not intend to pay ongoing interest on these unsecured debts;
however, intends to pay the general unsecured debts as described in
this section over the 60-month reorganization period.
In a Plan of liquidation, it is estimated that at best, unsecured
creditors would not receive any money for the following reason. The
Debtor's assets are minimal at best. What assets the Debtor does
have, if sold at auction, would be substantially less than the
secured and priority claims of the Arkansas Department of Finance
and Administration. Therefore, in a chapter 7 liquidation, the
unsecured creditors would receive nothing.
The Debtor proposes to pay to the general unsecured creditors
$2,400.00 per year over a 5-year organization period resulting in a
total payout to unsecured creditors of $12,000.00. Said payment
would be paid out each year on the anniversary date of the Debtor's
confirmed plan. For illustrative purposes only, if the Debtor has a
confirmed plan on or about June 1, 2024, then, on the 1st day of
June each subsequent year, the unsecured creditor pool would
receive their pro-rata share of $2,400.00 on June 1, 2025, June 1,
2026 etc., for a period of 5 years. The claims of creditors in this
Class are impaired by the Plan.
Class 2 consists of Equity Holders Claims. Thanh "Nikki" Flannery
is the sole principal of the Debtor and shall retain her interest
in the shares of Debtor. Likewise, Ms. Flannery will continue to
operate and manage the business affairs of the Debtor
post-confirmation. It is the intent of the Debtor for Ms. Flannery
to continue in this capacity regardless of whether there is a
consensual or nonconsensual plan. The duties of Ms. Beverly
Brister, the appointed Subchapter V Trustee, in a consensual plan,
shall cease upon substantial consummation of the Debtor's Plan
unless for good cause, a party in interest has objected to the same
and the Court either sua sponte or after a hearing on the objection
decides it is not in the best interest of interested parties.
In a nonconsensual plan, the Debtor will retain control of
management of company and payment to creditors; however, Ms.
Brister will remain as Trustee for purposes of overseeing the
Debtor's compliance. Ms. Brister and the Debtor will discuss the
nature and extent of said oversight should the Plan be
nonconsensual. Since Ms. Bray is an insider as determined by the
Bankruptcy Code, she does not have a vote on this Plan.
The source of funds for the payments pursuant to the Plan is the
continued operation of the Business. Debtor's projections are based
on Debtor's previous business operations and projected future
business forecasts.
A full-text copy of the Plan of Reorganization dated April 2, 2024
is available at https://urlcurt.com/u?l=7i0EXY from
PacerMonitor.com at no charge.
Counsel to the Debtor:
Carl W. Hopkins, Esq.
CARL W. HOPKINS, PA
P. O. Box 7359
Van Buren, AR 72956
Phone: (479) 922-2175
Email: dbrady@hopkinslawoffices.com
About Flannery LLC
Flannery, LLC, filed a petition under Chapter 11, Subchapter V of
the Bankruptcy Code (Bankr. E.D. Ark. Case No. 24-10014) on Jan. 3,
2024, with up to $50,000 in assets and $100,001 to $500,000 in
liabilities.
Judge Richard D. Taylor oversees the case.
Carl W. Hopkins, Esq., represents the Debtor as legal counsel.
FLEXACAR LLC: Court OKs Cash Collateral Access on Final Basis
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Virginia,
Alexandria Division, authorized Flexacar LLC to use cash
collateral, on a final basis, in accordance with the budget, with a
10% variance.
The Debtor is permitted to use cash collateral for the maintenance
and preservation of its assets and the operation of its business by
payment of its actual and necessary expenses.
The Debtor's right to use cash collateral will terminate
automatically upon the first to occur of (i) an Event of Default,
unless waived in writing by Atlantic Union in its sole and absolute
discretion; or (ii) the effective date of any plan of
reorganization filed by the Debtor.
In exchange for Atlantic Union's consent to the use of its cash
collateral, the Debtor stipulates and agrees that it was indebted
and liable to Atlantic Union under the Promissory Note dated
December 28, 2018, in the initial principal amount of $1.440
million.
Atlantic Union is granted, in addition to its first-priority liens
granted under the Loan Documents, valid, binding, continuing,
enforceable, fully-perfected first-priority replacement liens on
all pre- and post-petition assets of the Debtor and all products
and proceeds thereof to the extent of any Diminution in Value. The
Debtor's other Creditors will be granted valid, binding,
continuing, and enforceable replacement liens with the same
validity, extent, and priority granted under their respective loan
documents to the extent of any Diminution in Value.
The events constitute an "Event of Default" include:
a. The Debtor's (a) actual cash receipts are, in the aggregate, 15%
less than budgeted cash receipts over any rolling one-month period,
(b) actual cash disbursements are, in the aggregate, 15% more than
budgeted cash disbursements over any rolling one-month period, or
(c) actual "Operating Free Cash Flow" is, in the aggregate, 15%
less than budgeted over any rolling one-month period;
b. The Debtor fails to deposit all future cash collateral into the
debtor- in-possession bank account established in connection with
this Bankruptcy Case; and
c. Cash collateral is used for any purpose or in an amount not set
forth on the Budget, subject to the variances.
A copy of the order is available at https://urlcurt.com/u?l=urSjYN
from PacerMonitor.com.
About Flexacar LLC
Flexacar LLC, filed a Chapter 11 bankruptcy petition (Bankr. W.D.
Va. Case No. 23-11984) on December 6, 2023. At the time of filing,
the Debtor estimated $500,001 to $1 million in both assets and
liabilities.
Judge Klinette H Kindred presides over the case.
The Debtor hires John P. Forest, II, Esq. as counsel.
FLEXACAR LLC: Rental Income to Fund Plan Payments
-------------------------------------------------
Flexacar LLC filed with the U.S. Bankruptcy Court for the Eastern
District of Virginia a Disclosure Statement describing Plan of
Reorganization dated April 4, 2024.
The Debtor is a limited liability company which owns a 4.2-acre
improved tract of land in Stafford County, Virginia with current
street addresses of 3845 Richmond Highway, Stafford, Virginia (the
"Property").
The Property is encumbered by a deed of trust in favor of Atlantic
Bank (as the successor by merger with Union Bank) property recorded
among the land records of Stafford County, Virginia1 which secures
a loan with a balance due (as of the date of the Petition for
Relief) was $1,311,272. 2 The Stafford County Department of
Taxation and Assessments has valued the Property at $1,635,240. The
Debtor believes the market value of the Property is $2,300.000.
The filing of this bankruptcy was the result of litigation brought
by American Credit Acceptance ("ACA") against Caspian, the Debtor,
Autoline of VA, Inc., 25350 Pleasant Valley LLC, Total Auto
Financing LLC, Elshan, and Babak in the U.S. District Court for the
District of South Carolina (the "South Carolina Action"). The
pendency of the South Carolina Civil Action and the pendency of a
preliminary injunction in the South Carolina Civil Action led to
the filing of this bankruptcy case, and the bankruptcy cases of
Total Auto and Pleasant Valley.
The Plan is a reorganizing plan. The Plan shows the payments
anticipated to be made on account of all allowed claims. The Plan
states whether each class of claims or equity interests is impaired
or unimpaired.
Class 4 consists of the general unsecured claims of American Credit
Acceptance and Automotive Finance Corporation. This class is
impaired. The holders of Class 4 Claims shall, on the first
Business Day of the first month after the Effective Date, after the
Debtor's required monthly payment to the holders of any Class 2 or
3 claims, monthly dividend equal to the fractional share (pro-rata
as between the holders of any allowed Class 4 and 5 claims) of any
Dividend available to creditors after the payment of any
administrative claims and Class 2 and 3 Claims.
Class 5 consists of the general unsecured claim of Total Auto
Finance, LLC. This class is impaired. The holders of Class 5 Claims
shall, on the first Business Day of the first month after the
Effective Date, after the Debtor's required monthly payment to the
holders of any Class 2 or 3 claims, monthly dividend equal to the
fractional share (pro-rata as between the holders of any allowed
Class 4 and 5 claims) of any Dividend available to creditors after
the payment of any administrative claims and Class 2 and 3 Claims.
Class 6 is the Equity Interest or Elshan Bayramov and Babak
Bayramov. This class is impaired. The holders of Class 6 claims may
not vote for confirmation of this Plan. This interest will be
retained but will receive no Plan distribution.
Payments and distributions under the Plan will be funded by rents
received from the Debtor's tenants.
A full-text copy of the Disclosure Statement dated April 4, 2024 is
available at https://urlcurt.com/u?l=dCeuyV from PacerMonitor.com
at no charge.
Counsel for the Debtor:
John P. Forest, II, Esq.
11350 Random Hills Rd., Suite 700
Fairfax, VA 22030
Telephone: (703) 691-4940
Email: john@forestlawfirm.com
About Flexacar LLC
Flexacar LLC, r is a limited liability company which owns a 4.2
acre improved tract of land in Stafford County, Virginia with
current street addresses of 3845 Richmond Highway, Stafford,
Virginia (the "Property").
The Debtor filed a Chapter 11 bankruptcy petition (Bankr. W.D. Va.
Case No. 23-11984) on December 6, 2023. At the time of filing, the
Debtor estimated $500,001 to $1 million in both assets and
liabilities.
Judge Klinette H Kindred presides over the case.
The Debtor hires John P. Forest, II, Esq. as counsel.
FLEXPOINT SENSOR: Fruci & Associates II Raises Going Concern Doubt
------------------------------------------------------------------
Flexpoint Sensor Systems, Inc. disclosed in a Form 10-K Report
filed with the U.S. Securities and Exchange Commission for the
fiscal year ended December 31, 2023, that its auditor expressed
that there is substantial doubt about the Company's ability to
continue as a going concern.
Spokane, Washington-based Fruci & Associates II, PLLC, the
Company's auditor since 2023, issued a "going concern"
qualification in its report dated April 5, 2024, citing that the
Company has net losses and an accumulated deficit. These factors,
among others, raise substantial doubt about the Company's ability
to continue as a going concern.
The Company suffered losses of $784,939 and $804,832 during the
years ended December 31, 2023 and 2022, respectively. At December
31, 2023, the Company had an accumulated deficit of $31,672,144.
From 2008 through 2023 the Company raised approximately $7 million,
which includes $453,024 raised in 2023, in additional capital,
including accrued interest, through the issuance of long and
short-term notes to related and other parties. All of the notes had
an annual interest rate of 10% or 15% and were secured by the
Company's business equipment. The notes also had a conversion
feature for restricted common shares ranging from $0.05 to $0.20
per share with maturity dates of December 31, 2018 through March
31, 2021. Management continues to work with investor groups to
provide funds for the Company's operations until its operations
produce a positive cash flow.
As of December 31, 2023, the Company had $5.2 million in total
assets, $5 million in total liabilities, and $254,482 in total
stockholders' equity.
A full-text copy of the Company's Form 10-K is available at
https://tinyurl.com/bbjmckpv
About Flexpoint Sensor Systems
West Jordan, Utah-based Flexpoint Sensor Systems, Inc. is
principally engaged in designing, engineering, and manufacturing
bend sensor technology and products using its patented Bend Sensor
technology, (a flexible potentiometer technology).
FROGGY FLATS: Montana Says Disclosures Inadequate
-------------------------------------------------
The Montana Department of Revenue ("MDOR") objects to Froggy Flats,
LLC's Second Amended Disclosure Statement and Second Amended Plan
of Reorganization dated February 29, 2024.
MDOR requests that the Court deny approval of the Second Amended
Disclosure Statement and deny confirmation of the Second Amended
Plan of Reorganization.
MDOR filed four proofs of claim total $92,707.98.
It is difficult for MDOR to meaningfully examine and assess
Debtor's Second Amended Disclosure Statement and Second Amended
Plan because of Debtor's inability to consistently file required
tax returns and remit the taxes on a timely basis, if done at all.
MDOR expends an inordinate amount of time tracking the various
entities, their filing status, the separate (and sometimes
interchangeable) FEINs, and estimating tax periods and tax years
when the entities have failed to file and pay. Debtor stated in the
Second Amended Disclosure Statement that Debtor would be operating
the property in 2024 and that East Glacier Motel Management, LLC,
would cease operating East Glacier Motel as of December 31, 2023.
However, as of the date of this filing, the Debtor has not opened
an any accounts with MDOR nor filed and paid any taxes with MDOR.
Debtor has left these duties with other entities which are owned by
either William Stewart or Noel Stewart, or both and are Debtor's
DBA alter egos.
Therefore, MDOR is left guessing each tax period or tax year which
entity is responsible for filing and paying the withholding taxes,
the Lodging Facility Sales and Use Taxes, and Small Business
Corporation taxes related to the East Glacier Motel and Cabins. The
Second Amended Disclosure Statement estimates taxes for 2024 which
include a generic "taxes" column and an "MDOR" column. However,
based upon Debtor's failure to register any tax accounts with MDOR,
MDOR is unable to confirm whether these amounts are reasonable and
whether the Second Amended Disclosure Statement contains adequate
information defined at 11 U.S.C. § 1125(a).
MDOR also objects to confirmation of the Second Amended Plan of
Reorganization because the Second Amended Plan does not comply with
appliable provisions of the Bankruptcy Code. 11 U.S.C. s
1129(a)(1). As demonstrated in Affidavit of Tammie Chenoweth and
MDOR's four proofs of claim, Debtor (or its dba East Glacier Motel,
Inc.) has breached its duty as debtor in possession to timely file
tax returns and other required government filings. See 11 U.S.C s
1116(6)(A). As evidenced by POC 3-1 and POC 4-1, certain periods
are estimated for Debtor's failure to file the returns for certain
tax periods. Therefore, Debtor's Second Amended Plan of
Reorganization cannot be confirmed.
The total amount of MDOR's priority claims total $92,707.98. A
portion of the total of priority tax claims are secured, however,
both POC 5-1 and POC 6-1 are priority taxes and to the extent that
the claims are under secured, the taxes must be treated as priority
tax claims. Debtor's Second Amended Plan of Reorganization does not
pay MDOR's priority claims in full and, as such, does not comply
with 11 U.S.C. s 1129(a)(9)(C).
Attorney for Montana Department of Revenue:
Teresa G. Whitney, Esq.
Senior Tax Counsel
MONTANA DEPARTMENT OF REVENUE
Legal Services Office
125 North Roberts Street
PO Box 7701
Helena, Montana 59604-7701
Tel: (406) 444-7990
E-mail: TWhitney@mt.gov
About Froggy Flats
Froggy Flats, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Mont. Lead Case No. 23-40050) on July
18, 2023. In the petition signed by William H. Stewart, member,
the Debtor disclosed up to $1 million in both assets and
liabilities.
Judge Benjamin P. Hursh oversees the case.
Gary S. Deschenes, Esq., at Deschenes & Associates Law Offices,
serves as the Debtor's counsel.
FTX GROUP: Bankruptcy Estate to Repay Customers by End of 2024
--------------------------------------------------------------
Ronak Kumar of The Crypto Times reports that the bankruptcy estate
of the cryptocurrency exchange FTX, managed by the Joint Official
Liquidators of FTX Digital in the Bahamas, aims to begin repaying
customers by the end of 2024.
This process involves two parallel procedures, a Chapter 11
bankruptcy in a Delaware court in the US and the official
liquidation of FTX Digital in the Bahamas due to complex accounting
issues.
The bankruptcy estate of the cryptocurrency exchange FTX, managed
by the Joint Official Liquidators of FTX Digital in the Bahamas,
aims to begin repaying customers by the end of 2024.
This process involves two parallel procedures, a Chapter 11
bankruptcy in a Delaware court in the US and the official
liquidation of FTX Digital in the Bahamas due to complex accounting
issues.
The notes from the meeting on March 15 stated, "a shared goal to
make the first interim distribution by the end of 2024 to creditors
with admitted claims and satisfactory KYC documentation."
Both entities are working together to ensure fair treatment for
creditors, allowing them to submit claims to either side without
receiving less than they're owed.
The bankruptcy estate of the cryptocurrency exchange FTX, managed
by the Joint Official Liquidators of FTX Digital in the Bahamas,
aims to begin repaying customers by the end of 2024.
This process involves two parallel procedures, a Chapter 11
bankruptcy in a Delaware court in the US and the official
liquidation of FTX Digital in the Bahamas due to complex accounting
issues.
The notes from the meeting on Mar. 15 stated, "a shared goal to
make the first interim distribution by the end of 2024 to creditors
with admitted claims and satisfactory KYC documentation."
Both entities are working together to ensure fair treatment for
creditors, allowing them to submit claims to either side without
receiving less than they're owed.
Creditors have been able to submit claims since March 1 via FTX's
claims portal, with a deadline initially set for May 15, 2024 but
now expected to extend to at least June 2024. Claims will be valued
as of November 11, 2022, the original bankruptcy date.
The cooperative approach between Chapter 11 Debtors and Joint
Official Liquidators aims to facilitate timely repayments to
creditors with admitted claims and proper KYC documentation.
This development signifies progress in resolving FTX's financial
obligations and provides clarity for creditors seeking
restitution.
About FTX Group
FTX is the world's second-largest cryptocurrency firm. FTX is a
cryptocurrency exchange built by traders, for traders. FTX offers
innovative products including industry-first derivatives, options,
volatility products and leveraged tokens.
Then CEO and co-founder Sam Bankman-Fried said Nov. 10, 2022, that
FTX paused customer withdrawals after it was hit with roughly $5
billion worth of withdrawal requests.
Faced with liquidity issues, FTX on Nov. 9, 2022, struck a deal to
sell itself to its giant rival Binance, but Binance walked away
from the deal amid reports on FTX regarding mishandled customer
funds and alleged US agency investigations. Bankman-Fried agreed
to step aside, and restructuring vet John J. Ray III was quickly
named new CEO.
FTX Trading Ltd (d/b/a FTX.com), West Realm Shires Services Inc.
(d/b/a FTX US), Alameda Research Ltd. and certain affiliated
companies then commenced Chapter 11 proceedings (Bankr. D. Del.
Lead Case No. 22-11068) on an emergency basis on Nov. 11, 2022.
Additional entities sought Chapter 11 protection on Nov. 14, 2022.
FTX Trading and its affiliates each listed $10 billion to $50
billion in assets and liabilities, making FTX the biggest
bankruptcy filer in the US this year.
According to Reuters, SBF shared a document with investors on Nov.
10, 2022, showing FTX had $13.86 billion in liabilities and $14.6
billion in assets. However, only $900 million of those assets were
liquid, leading to the cash crunch that ended with the company
filing for bankruptcy.
The Hon. John T. Dorsey is the case judge.
The Debtors tapped Sullivan & Cromwell, LLP as bankruptcy counsel;
Landis Rath & Cobb, LLP as local counsel; and Alvarez & Marsal
North America, LLC as financial advisor. Kroll is the claims
agent, maintaining the page
https://cases.ra.kroll.com/FTX/Home-Index
The Official Committee of Unsecured Creditors tapped Paul Hastings
as counsel, FTI Consulting, Inc., as financial advisor, and
Jefferies LLC as the investment banker. Young Conaway Stargatt &
Taylor LLP is the Committee's Delaware and conflicts counsel.
Montgomery McCracken Walker & Rhoads LLP, led by partners Gregory
T. Donilon, Edward L. Schnitzer, and David M. Banker, is
representing Sam Bankman-Fried in the Chapter 11 cases.
White-collar crime specialist Mark S. Cohen has reportedly been
hired to represent SBF in litigation. Lawyers at Paul Weiss
previously represented SBF but later renounced representing the
entrepreneur due to a conflict of interest.
G & I SOLUTIONS: L. Todd Budgen Named Subchapter V Trustee
----------------------------------------------------------
The U.S. Trustee for Region 21 appointed L. Todd Budgen, Esq., a
practicing attorney in Longwood, Fla., as Subchapter V trustee for
G & I Solutions, Inc.
Mr. Budgen will be paid an hourly fee of $400 for his services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Mr. Budgen declared that he is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
L. Todd Budgen, Esq.
P.O. Box 520546
Longwood, FL 32752
Tel: (407) 232-9118
Email: Todd@C11Trustee.com
About G & I Solutions
G & I Solutions, Inc., a company in Orlando, Fla., filed a petition
under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. M.D.
Fla. Case No. 24-01659) on April 3, 2024, with $500,000 to $1
million in assets and $1 million to $10 million in liabilities.
Ivaylo Boyanov, president, signed the petition.
Judge Lori V. Vaughan presides over the case.
Daniel A. Velasquez, Esq., at Latham, Luna, Eden & Beaudine, LLP
represents the Debtor as legal counsel.
GALLERIA 2425: Court OKs Cash Collateral Access on Final Basis
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas,
Victoria Division, authorized Christopher R. Murray, the Chapter 11
trustee of Galleria 2425 Owner LLC, to use cash collateral on a
final basis in accordance with the budget, with a 5% variance.
National Bank of Kuwait, S.A.K.P., New York Branch asserts that the
Debtor was indebted to NBK under a prepetition loan and that the
Debtor's obligations under the Prepetition Loan are evidenced by,
among others, the following loan documents:
i. the Loan Agreement by and among NBK and the Debtor, dated
May 23, 2018;
ii. the Promissory Note executed by the Debtor in favor of NBK,
dated May 23, 2018; and
iii. the Deed of Trust, Assignment of Leases and Rents and
Profits, Security Agreement and Fixture Filing, dated May 23, 2018,
recorded RP2018-235600 in the Real Property Records of Harris
County, Texas covering the Property.
NBK asserts that the Prepetition Loan Documents are secured by
various instruments, assignments, and certificates, including deeds
of trust, which: (a) were filed of record in appropriate
jurisdictions; and (b) granted NBK first-priority, properly
perfected, senior liens and security interests upon and in all of
the Debtor's personal and real property, fixtures, improvements,
and rents and proceeds derived therefrom.
The The Trustee is directed to abide by the following case
milestones:
i. On or before March 22, 2024, the Trustee will file a motion
for the approval of JLL's retention as property manager for the
Premises.
ii. On or before April 5, 2024, the Trustee will file a motion
seeking the approval of a process to market and sell the Premises
pursuant to 11 U.S.C. Section 363(b).
As partial adequate protection for any diminution in value of NBK's
interest in the cash collateral, NBK is granted a replacement lien
in all currently owned or hereafter acquired property of the Estate
excluding avoidance or other causes of action arising under chapter
5 of the Bankruptcy Code, and all proceeds and products of the
foregoing. The Replacement Lien granted will have the same priority
as NBK's prepetition liens but will be subject to the Carve-Out.
As additional partial adequate protection for the Trustee's use of
the cash collateral, to the extent of any Diminution in Value and a
failure of the other adequate protection provided by the Order, NBK
will have an allowed super-priority administrative expense claim
against the Estate as provided in and to the fullest extent
permitted by 11 U.S.C. Sections 503(b) and 507(b) or otherwise.
The NBK Lien, Replacement Lien, Adequate Protection Super-Priority
Claim will be subject to the following: (a) unpaid fees payable to
the Clerk of the Court or the United States Trustee; (b)
court-approved administrative expense claims of estate
professionals, employed pursuant to an order of the Court, for
incurred by unpaid fees, expenses, and other costs in an amount not
to exceed $150,000 less any amounts paid by the Estate pursuant to
the Budget, provided, however, that the Carve-Out related to fees
and expenses incurred by Estate Professionals relating to any
investigation concerning any claims held or potentially held by the
Estate against NBK will not exceed $50,000 and the Trustee may not
otherwise use any cash collateral to investigate or pursue any
claim against NBK; and (c) court-approved compensation to the
Trustee in an amount not to exceed the amounts set forth in 11
U.S.C. Section 326(a) less any amounts paid by the Estate pursuant
to the Budget.
A copy of the Court's order is available at
https://urlcurt.com/u?l=G3WB1B from PacerMonitor.com.
About Galleria 2425 Owner LLC
Galleria 2425 Owner LLC is a Single Asset Real Estate as defined in
11 U.S.C. Section 101(51B).
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Tex. Case No. 23-60036) on July 5,
2023. In the petition signed by Dward Darjean, manager, the Debtor
disclosed up to $50 million in assets and up to $100 million in
liabilities.
Judge Christopher M. Lopez oversees the case.
Melissa S. Hayward, Esq., at Hayward PLLC, represents the Debtor as
legal counsel.
GARNER ROAD: Court OKs Cash Collateral Access on Final Basis
------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of North
Carolina, Raleigh Division, authorized Garner Road Community
Center, Inc. to use cash collateral, on a final basis, in
accordance with the budget, with a 10% variance.
The U.S. Small Business Administration asserts an interest in the
Debtor's cash collateral.
As adequate protection, the Cash Collateral Creditor is granted a
postpetition replacement lien on the same assets to which their
liens attached pre-petition, to the same extent, and with the same
validity and priority as existed on the petition date. The liens
created will be deemed perfected by the entry of this Order without
further actions or filing by the Cash Collateral Creditor.
The Order will remain in full force and effect until the earlier of
the (a) entry of an Order by the Court modifying the terms of the
Order; (b) entry of an Order by the Court terminating the Order for
cause, including but not limited to breach of its terms and
conditions; (c) upon filing of a notice of default, or (d) entry of
a subsequent Order modifying the terms of the Debtor's continued
use of cash collateral.
These events constitute an "Event of Default":
a. the Debtor will fail to comply with any of the terms or
conditions of the Order;
b. the Debtor will fail to maintain insurance;
c. the Debtor will use cash collateral other than as set forth in
the Order; or
d. appointment of a trustee, other than the Subchapter V Trustee,
or examiner in the proceeding, or the conversion of the case to a
proceeding under Chapter 7 of the Bankruptcy Code.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=PUMFVw from PacerMonitor.com.
The Debtor projects $104,552 in total revenue and $104,505 in total
expenses.
About Garner Road Community Center
Garner Road Community Center, Inc. sought protection under Chapter
11 of the U.S. Bankruptcy Code (Bankr. E.D.N.C. Case No. 24-00790)
on Mar. 8, 2024. In the petition signed by Antonio Knox or Joseph
Lee, board designees, the Debtor disclosed up to $10 million in
assets and up to $500,000 in liabilities.
Judge David M. Warren oversees the case.
William H. Kroll, Esq., at Everett Gaskins Hancock Tuttle Hash, LLP
serves as the Debtor's counsel.
GARUDA HOTELS: Court OKs Cash Collateral Access
-----------------------------------------------
The U.S. Bankruptcy Court for the Northern District of New York
authorized Jeffrey A. Dove, the Chapter 11 Trustee of Garuda
Hotels, Inc. and Welcome Motels II, Inc., to use cash collateral on
an interim basis, in accordance with the budget, with a 10%
variance.
The Debtors assert that RSS Comm 201-LC15 NY GHI LLC holds a duly
perfected senior security interest in all of their real and
personal property, including the proceeds thereof, by virtue of a
Mortgage and Mortgage Note2 in the original principal amount of
$7.970 million, secured by, among other things, liens on the
Debtors' real and personal property pursuant to a Loan Agreement,
Mortgage and Assignment of Rents, each dated February 28, 2014 and
UCC-1 Financing Statements filed in connection therewith.
The Court said that, in addition to the existing rights and
interests of RSS and for the purpose of adequately protecting RSS
from diminution in value of the Collateral, RSS is granted
replacement liens in the cash collateral, to the extent the liens
were valid, perfected and enforceable as of the Petition Date and
in the continuing order of priority of the Pre-Petition Liens
without determination as to the nature, extent and validity of said
pre-petition liens and claims, and solely to the extent Collateral
Diminution occurs during the Bankruptcy Cases.
The replacement liens are subject to: (i) any United States Trustee
fees incurred by the Debtors pursuant to 28 U.S.C. Section 1930 and
interest thereon pursuant to 31 U.S.C. Section 3717; (ii) the
payment of any claim of any subsequently appointed Chapter 7
Trustee to the extent of $10,000; and (iii) estate causes of action
and the proceeds of any recoveries of estate causes of action under
Chapter 5 of the Bankruptcy Code. No portion of the cash collateral
may be used to challenge, attack or otherwise seek to avoid RSS's
liens under chapter 5 of the Bankruptcy Code or applicable
non-bankruptcy law.
As additional adequate protection, the Debtors will pay to RSS
monthly payments of interest-only, at the contract (non-default)
rate of interest (per diem of $1,056), as set forth in the RSS Loan
Documents.
To the extent the Replacement Liens fail to adequately protected
RSS for the diminution in the cash collateral, RSS reserves all
rights to request allowance of a superpriority administrative
expense claim to the extent provided in 11 U.S.C. Section 507(b),
subject only to the Carve-Outs.
The Replacement Liens and security interests granted are
automatically deemed perfected upon entry of the Order without the
necessity of RSS having to take possession, file financing
statements, mortgages or other typical security documents.
The Debtors' authorization to use cash collateral will immediately
terminate without further Court Order on the earlier of: (a) April
11, at 11:59 p.m. EST; (b) the entry of and order granting any
party relief from the automatic stay with respect to any property
of the Debtors in which RSS claims a lien or security interest,
whether pursuant to this Order or otherwise; (c) the entry of an
order dismissing the Bankruptcy Cases or converting the proceedings
to cases under Chapter 7 of the Bankruptcy Code; (d) the entry of
an order confirming a plan or plans of reorganization; or (e) the
entry of an order by which the Order is reversed, revoked, stayed,
rescinded, modified or amended without the consent of RSS thereto.
A copy of the order is available at https://urlcurt.com/u?l=h6mU4o
from PacerMonitor.com.
About Garuda Hotels, Inc.
Garuda Hotels, Inc. is the operator of a Country Inn and Suites
Hotel and owns the real property upon which the hotel is located at
110 Danby Road, Ithaca, NY.
Welcome Motels II, Inc. is the operator of an Econolodge Hotel and
owns the real property upon which the hotel is located at 2303
Triphammer Road, Ithaca, NY.
Garuda Hotels, Inc. and Welcome Motels II, Inc. sought protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D.N.Y. Case
Nos. 22-30296 and 22-30296) on May 13, 2022.
In the petitions signed by Jay Bramhandkar, their president, each
of the Debtors disclosed up to $10 million in both assets and
liabilities.
Judge Wendy A. Kinsella oversees the cases.
Erica Aisner, Esq., at Kirby Aisner & Curley LLP is the Debtors'
counsel.
GAUCHO GROUP: Delays Filing of 2023 Annual Report
-------------------------------------------------
Gaucho Group Holdings, Inc. was unable to file its Annual Report on
Form 10-K for the year ended Dec. 31, 2023 by April 1, 2024, the
due date for such filing because the audit for the Company's
consolidated financial statements for the year ended Dec. 31, 2023
has not been finalized.
As a result, the Company could not, without unreasonable effort or
expense, file its Form 10-K on or prior to the original due date.
The Company anticipates that it will be able to file the Form 10-K
within the extension period provided pursuant to Rule 12b-25.
About Gaucho Group
Headquartered in New York, NY, Gaucho Group Holdings, Inc.'s
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. With a concentration on fine wines
(algodonfinewines.com & algodonwines.com.ar), hospitality
(algodonhotels.com), and luxury real estate
(algodonwineestates.com) associated with its proprietary Algodon
brand, as well as the leather goods, ready-to-wear and accessories
of the fashion brand Gaucho - Buenos Aires (gaucho.com), these are
the luxury brands in which Argentina finds its contemporary
expression.
Gaucho 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 Sept. 30, 2023, the Company had $18.91
million in total assets, $11.02 million in total liabilities, and
$7.89 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.
The Company's operating needs include the planned costs to operate
its business, including amounts required to fund working capital
and capital expenditures. Based upon projected revenues and
expenses, the Company believes that it may not have sufficient
funds to operate for the next twelve months from the date these
financial statements are made available. Since inception, the
Company's operations have primarily been funded through proceeds
received from equity and debt financings. The Company believes it
has access to capital resources and continues to evaluate
additional financing opportunities. There is no assurance that
the
Company will be able to obtain funds on commercially acceptable
terms, if at all. There is also no assurance that the amount of
funds the Company might raise will enable the Company to complete
its development initiatives or attain profitable operations. The
aforementioned factors raise substantial doubt about the Company's
ability to continue as a going concern for a period of one year
from the issuance of these financial statements, according to the
Company's Quarterly Report for the period ended Sept. 30, 2023.
GAUCHO GROUP: Unveils Strategic Measures to Streamline Operations
-----------------------------------------------------------------
Gaucho Group Holdings, Inc. announced a series of strategic
measures to streamline operations and cost efficiencies. These
efforts are expected to yield approximately $1.5 million in expense
savings over the next 12 months, with the anticipation of up to an
additional $1 million in expenses saved in 2025. By eliminating
certain functions and offshoring others to its offices in
Argentina, the Company aims to capitalize on the cost-effective
labor and specialized skills available in the region. Furthermore,
the savings accrued from these strategic initiatives are planned to
be allocated towards marketing expenses, aiming to promote its
portfolio of brands, including Gaucho - Buenos Aires and Maison
Gaucho, Algodon Fine Wines, Algodon Wine Estates, and its
hospitality projects.
This restructuring is not just about cost-saving; it represents a
strategic pivot towards maximizing the potential of Gaucho
Holdings' operations in Argentina, particularly in the realm of
luxury real estate. The Company is poised to recognize revenue
from the deeding of real estate projects in 2025, with a primary
focus on the vineyard estate lots at Algodon Wine Estates in San
Rafael, Mendoza, Argentina. To date, approximately 15% of the
total lots have been sold, leaving significant room for future
sales and development. The potential revenue from these sales,
coupled with interest income from the Company's self-financing
options to buyers, is expected to significantly enhance financial
results in the coming years.
Furthermore, Gaucho Holdings is closely monitoring the evolving
economic landscape in Argentina, particularly the potential
adoption of the USD as the country's primary currency. This shift,
championed by President Milei, could drastically change the
dynamics of the real estate market by enabling leverage through
bank lending, a move that could significantly boost real estate
values across the nation. This transition to a more stable
currency for transactions could unveil substantial growth
opportunities for Gaucho Holdings' real estate assets.
Scott Mathis, CEO and founder of Gaucho Group Holdings, provided
insight into the significance of these developments, stating, "We
anticipate a potential binary event on the horizon that could
markedly enhance Argentina's real estate values: It's a
little-known fact that the Argentine real estate market is
predominantly non-leveraged, a unique characteristic that has
historically shaped its valuation dynamics. The introduction of
leverage—providing the ability for buyers to finance their
purchases with borrowed funds—could catalyze a significant boom
in real estate values. This would be a credit to President Milei,
who is pushing to take Argentina away from the peso and use the USD
as its currency. This adoption of the USD could pave the way for
banks to resume their lending activities. Currently, the
volatility and consistent devaluation of the peso deter banks from
lending, as repayments made in a depreciating currency erode the
value of the returned capital. A shift to using the USD could
stabilize the lending environment by offering a more reliable and
sustainable currency for financial transactions. This potential
shift presents an unprecedented opportunity for growth and
investment, underscoring the untapped potential of the market and
positioning our real estate assets for considerable appreciation."
Gaucho Holdings remains committed to its core mission of offering
unparalleled luxury experiences through its diverse portfolio while
fostering sustainable growth and operational excellence. These
strategic initiatives are expected to lay a solid foundation for
the Company's endeavors moving forward, demonstrating a proactive
approach to navigating the challenges and opportunities of the
global market landscape.
About Gaucho Group
Headquartered in New York, NY, Gaucho Group Holdings, Inc.'s
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. With a concentration on fine wines
(algodonfinewines.com & algodonwines.com.ar), hospitality
(algodonhotels.com), and luxury real estate
(algodonwineestates.com) associated with its proprietary Algodon
brand, as well as the leather goods, ready-to-wear and accessories
of the fashion brand Gaucho - Buenos Aires (gaucho.com), these are
the luxury brands in which Argentina finds its contemporary
expression.
Gaucho 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 Sept. 30, 2023, the Company had $18.91
million in total assets, $11.02 million in total liabilities, and
$7.89 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.
The Company's operating needs include the planned costs to operate
its business, including amounts required to fund working capital
and capital expenditures. Based upon projected revenues and
expenses, the Company believes that it may not have sufficient
funds to operate for the next twelve months from the date these
financial statements are made available. Since inception, the
Company's operations have primarily been funded through proceeds
received from equity and debt financings. The Company believes it
has access to capital resources and continues to evaluate
additional financing opportunities. There is no assurance that
the
Company will be able to obtain funds on commercially acceptable
terms, if at all. There is also no assurance that the amount of
funds the Company might raise will enable the Company to complete
its development initiatives or attain profitable operations. The
aforementioned factors raise substantial doubt about the Company's
ability to continue as a going concern for a period of one year
from the issuance of these financial statements, according to the
Company's Quarterly Report for the period ended Sept. 30, 2023.
GENESIS GLOBAL: Sells Its GBTC Shares, Will Buy 32,041 Bitcoin
--------------------------------------------------------------
Jonathan Randles of Bloomberg News reports that bankrupt Genesis
Global Capital said Friday, April 5, 2024, its finished monetizing
its Grayscale Bitcoin Trust shares and used the proceeds to buy
32,041 Bitcoin, which the bankrupt crypto lender will use to repay
customers.
Genesis lawyers said in a court filing that, as of April 2, 2024 it
fully monetized nearly 36 million GBTC shares to purchase Bitcoin.
Judge Sean Lane had approved Genesis's request to monetize its GBTC
shares in February as the company readied its proposal for repaying
creditors with billions of dollars in cash and crypto.
About Genesis Global
Genesis Global Holdco, LLC, through its subsidiaries, and Global
Trading, Inc., provide lending and borrowing, spot trading,
derivatives and custody services for digital assets and fiat
currency.
Genesis Global Capital, LLC (GGC) and Genesis Asia Pacific PTE.
LTD. (GAP) provide lending and borrowing, spot trading, derivatives
and custody services for digital assets and fiat currency. Genesis
Global Holdco, LLC owns 100% of GGC and GAP.
Genesis Global Holdco, LLC, GGC and GAP each filed a voluntary
petition for relief under Chapter 11 of the Bankruptcy Code (Bankr.
S.D.N.Y. Lead Case No. 23-10063) on Jan. 19, 2023. The cases are
pending before the Honorable Sean H. Lane.
At the time of the filing, Genesis Holdco reported $100 million to
$500 million in both assets and liabilities.
Genesis Holdco is a sister company of Genesis Global Trading, Inc.
("GGT") and 100% owned by Digital Currency Group, Inc. ("DCG").
GGT, DCG and certain of the Holdco subsidiaries are not included in
the Chapter 11 filings. The non-debtor subsidiaries include
Genesis UK Holdco Limited, Genesis Global Assets, LLC, Genesis Asia
(Hong Kong) Limited, Genesis Bermuda Holdco Limited, Genesis
Custody Limited ("GCL"), GGC International Limited ("GGCI"), GGA
International Limited, Genesis Global Markets Limited, GSB 2022 II
LLC, GSB 2022 III LLC and GSB 2022 I LLC.
The Debtors tapped Cleary Gottlieb Steen & Hamilton, LLP as
bankruptcy counsel; Morrison Cohen, LLP as special counsel; Alvarez
& Marsal Holdings, LLC as financial advisor; and Moelis & Company,
LLC as investment banker. Kroll Restructuring Administration, LLC,
is the Debtors' claims and noticing agent and administrative
advisor.
The ad hoc group of creditors is represented by Kirkland & Ellis,
LLP and Kirkland & Ellis International, LLP. The ad hoc group of
Genesis lenders is represented by Proskauer Rose, LLP. The U.S.
Trustee for Region 2 appointed an official committee to represent
unsecured creditors in the Debtors' Chapter 11 cases. The
committee tapped White & Case, LLP as bankruptcy counsel; Houlihan
Lokey Capital, Inc., as investment banker; Berkeley Research Group,
LLC as financial advisor; and Kroll as information agent.
GLOBAL FERTILITY: Court OKs Appointment of Chapter 11 Trustee
-------------------------------------------------------------
Judge Philip Bentley of the U.S. Bankruptcy Court for the Southern
District of New York approved the appointment of Eric Huebscher as
Chapter 11 trustee for Global Fertility & Genetics, New York, LLC.
Mr. Huebscher disclosed in a court filing that he is a
"disinterested person" within the meaning of Section 101(14) of the
Bankruptcy Code.
A copy of the appointment order is available for free at
https://urlcurt.com/u?l=av0rqw from PacerMonitor.com.
About Global Fertility & Genetics
Global Fertility & Genetics, New York, LLC, is a reproductive
endocrinology and fertility center in New York.
The Debtor filed Chapter 11 petition (Bankr. S.D.N.Y. Case No.
23-10905) on June 6, 2023, with $289,407 in assets and $1,123,740
in liabilities. Judge Philip Bentley oversees the case.
Michael J. Kasen, Esq., at Kasen & Kasen, P.C., is the Debtor's
legal counsel.
David Crapo is the patient care ombudsman appointed in the Debtor's
Chapter 11 case.
GNSP CORP: Wins Cash Collateral Access Thru April 25
----------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida, Tampa
Division, granted GNSP Corp. authority to use cash collateral on an
interim basis, in accordance with the budget, pending a further
hearing set for April 25, 2024, at 2:30 p.m.
Specifically, the Debtor is permitted to use cash collateral to
pay: (a) amounts expressly authorized by the Court, including any
required monthly payments to the Subchapter V Trustee; (b) the
current and necessary expenses set forth in the budget, plus an
amount not to exceed 10% for each line item; and (c) additional
amounts as may be expressly approved in writing by the Lenders.
The Office of the United States Trustee for the Middle District of
Florida, the Small Business Administration, and McKesson Corp.
assert an interest in the Debtor's cash collateral.
Each creditor with a security interest in cash collateral will have
a perfected post-petition lien against cash collateral to the same
extent and with the same validity and priority as the prepetition
lien, without the need to file or execute any document as may
otherwise be required under applicable non bankruptcy law.
The Debtor will maintain insurance coverage for its property in
accordance with the obligations under applicable loan and security
documents.
A copy of the Court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=quPqt0 from PacerMonitor.com.
The Debtor projects $198,577 in revenues and $48,955 in total
operating expenses for the period from April 1 to 30, 2024.
About GNSP Corp.
GNSP Corp. filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. M.D. Fla. Case No. 24-00300) on January 22,
2024, with $1 million to $10 million in both assets and
liabilities. Todd Tortoretti, GNSP Corp.'s president, signed the
petition.
Judge Catherine Peek McEwen oversees the case.
Amy Denton Mayer, Esq., at Stichter, Riedel, Blain & Postler, P.A.
represents the Debtor as legal counsel.
GREENIDGE GENERATION: Lowers Net Loss to $29.5 Million in 2023
--------------------------------------------------------------
Greenidge Generation Holdings Inc. filed with the Securities and
Exchange Commission its Annual Report on Form 10-K reporting a net
loss of $29.51 million on $70.39 million of total revenue for the
year ended Dec. 31, 2023, compared to a net loss of $271.07 million
on $89.98 million of total revenue for the year ended Dec. 31,
2022.
As of Dec. 31, 2023, the Company had $71.18 million in total
assets, $122.20 million in total liabilities, and a total
stockholders' deficit of $51.02 million.
Houston, Texas-based MaloneBailey, LLP, the Company's auditor since
2023, issued a "going concern" qualification in its report dated
April 9, 2024, citing that the Company has suffered recurring
losses from operations and generated negative cash flows from
operations that raises substantial doubt about its ability to
continue as a going concern.
Fourth Quarter 2023 Financial Results:
* Total revenue of $19.6 million;
* Net income from continuing operations of $2.7 million, above
guidance of $1.4 million to $2.4 million;
* Adjusted EBITDA of $3.6 million, above guidance of $1.6
million to $2.6 million;
* Earnings per share of $0.36, above guidance of $0.18 to
$0.32;
* Cryptocurrency datacenter self-mining revenue of $7.2
million;
* Cryptocurrency datacenter hosting revenue of $10.7 million;
and
* Power and capacity revenue of $1.7 million.
Greenidge ended the fourth quarter with $13.3 million of cash and
$68.7 million of debt at book value. In aggregate, Greenidge
reduced its debt by $85.3 million in 2023, representing over 54% of
its total debt. For the full year of 2023, Greenidge produced
2,938 bitcoin, of which 891 were produced by Greenidge-owned miners
and 2,047 were produced through our datacenter hosting.
Management Comments
Greenidge CEO Jordan Kovler commented: "The strong progress we made
throughout 2023 has helped us to better position Greenidge for the
future. After significantly reducing both our debt load and future
SG&A expenses, we focused our efforts this quarter on the prudent
deployment of idle miners as well as on increasing our access to
low-cost power for datacenter development and bitcoin hosting and
self-mining. Our team's collective efforts enabled us to deliver
$0.36 in earnings per share and $3.6 million in adjusted EBITDA in
the fourth quarter, beating our previous guidance. We are excited
about the opportunities ahead as we continue to execute on our plan
to further expand our reach into low-cost power centers, grow our
EPCM business and AI infrastructure/data center footprint, while
developing innovative approaches to embrace increased interest in
Bitcoin."
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/0001844971/000162828024015540/gree-20231231.htm
About Greenidge Generation
Greenidge Generation Holdings Inc. (NASDAQ: GREE) is a vertically
integrated power generation company, focusing on cryptocurrency
mining, infrastructure development, engineering, procurement,
construction management, operations and maintenance of sites.
GUR-MEAT INC: Unsecured Claims Under $50K to Recover 3.56% in Plan
------------------------------------------------------------------
Gur-Meat, Inc., submitted a First Amended Disclosure Statement
describing Amended Reorganization Plan dated April 4, 2024.
Since the date of filing, the Debtor has acted as Debtor-in
possession and focused all its efforts on developing all available
means to fund its Reorganization Plan to provide for payments to
creditors in such plan.
Class 1 consists of the allowed secured claim of Banco Popular,
arising from liens and security interests under the Loan Documents
and the Cash Collateral Stipulation over the Debtor's accounts
receivable and inventory with a loan, in the amount of
$1,028,018.87, as further detailed in Proof of Claim No. 2 and as
modified by agreement of the Parties in a stipulation being filed
concurrently with this Disclosure Statement.
Under the stipulated terms for repayment, effective upon the
confirmation of the Plan and after the approval of Stipulation,
BPPR Claim No. 2, shall be paid in the amount of $427,365.82 as a
secured claim. The Monthly Payments are based on an amortization
period of 180 months and shall be paid in full, through the Lump
Sum Payment, upon the occurrence of the Maturity Date.
Additional payments; Commencing on September 15, 2024, and
consecutively every 3 months (on the 15th), the Debtor shall make
additional payments in the amount of at least $7,000.00 (for an
aggregate total of at least $140,000), provided, however, that the
amount payable by the Debtor in connection with the Additional
Payments may exceed $7,000.00, at the Debtor's discretion,
Additional Payments will be applied in reverse order at maturity,
i.e., they will be applied to the principal balance.
Class 2 consists of the allowed secured claim of Island Portfolio,
arising from a lien over certain Debtor assets in accordance with a
loan, secured by Debtor's accounts receivables related to contracts
with Administracion para el Desarrollo de Empresas Agropecuarias
("ADEA"), in the combined amount of $756,695.79, and machinery as
further detailed in Proof of Claim #4,5 and 6. Debtor's last
contract with ADEA expired on December 31, 2017, and there will not
be any further contracts with ADEA.
Under the terms of the proposed Plan, the claim will be paid in the
aggregate amount of $57,903.00, an amount that conforms to the
value of the collateral for the machinery. The remaining portion of
$643,528.00 will be treated as an allowed general unsecured claim
sharing distribution under Class 5. The allowed secured amount of
$57,903.00 plus annual interest of 5.00% will be satisfied with
amortization of 10 years and with a monthly installment of
approximately $614.15 until payment in full.
Class 4 consists of the allowed unsecured claims under or equal to
$50,000.00. 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 $3,000.00 on the
effective date. Based on the currently allowed amounts, each
claimholder in this class will receive approximately 3.56% of the
allowed amount of their claim.
Class 5 consists of the allowed unsecured claims over $50,001.00.
Each claim holder under this class will receive pro-rata
distributions, as per the allowed amounts. The debtor's plan
proposes a monthly cash dividend of $1,750.00 for 60 months
beginning on the effective date. Based on the currently allowed
amounts, each claimholder in this class will receive approximately
4.86% of the allowed amount of their claim.
The Plan will be implemented as required under Section 1123(a)(5)
of the Bankruptcy Code with the continued operation of Debtor's
endeavors and business growth.
A full-text copy of the First Amended Disclosure Statement dated
April 4, 2024 is available at https://urlcurt.com/u?l=v3AgzR from
PacerMonitor.com at no charge.
Counsel for the Debtor:
Javier Vilariño, Esq.
VILARIÑO & ASSOCIATES LLC
PO BOX 9022515
San Juan, PR 00902-2515
Tel: (787) 565-9894
E-mail: jvilarino@vilarinolaw.com
About Gur-Meat Inc.
Gur-Meat Inc. is engaged in the business of processing meat
products and the selling of pre-packaged food products to fast food
restaurants and other constituents of the food industry since March
2009.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. P.R. Case No. 23-01914) on June 23,
2023. In the petition signed by Mariely Ramos Rojas, president,
the Debtor disclosed $292,906 in assets and $3,598,904 in
liabilities.
Judge Maria De Los Angeles Gonzalez oversees the case.
Javier Vilarino, Esq., at Villarino and Associates, represents the
Debtor as legal counsel.
IBIO INC: Lynx1 Capital, Weston Nichols Report 9.99% Stake
----------------------------------------------------------
Lynx1 Capital Management LP and Weston Nichols disclosed in
Schedule 13G Report filed with the U.S. Securities and Exchange
Commission that as of March 26, 2024, they beneficially owned
878,492 shares of iBio, Inc.'s Common Stock (including 278,492
shares of Common Stock issuable upon the exercise of warrants),
representing 9.99% of the shares outstanding.
The percentages are calculated based upon an aggregate of 8,515,226
shares of Common Stock outstanding as of April 1, 2024, as reported
in the iBio's Current Report on Form 8-K filed with the Securities
and Exchange Commission on April 1, 2024, and assumes the exercise
of warrants held by the Lynx1 Fund, subject to the 9.99% Blocker.
Pursuant to the terms of certain warrants, the Lynx1 Fund cannot
exercise such warrants to the extent the Reporting Persons would
beneficially own, after such exercise, more than 9.99% of the
outstanding shares of Common Stock. The percentage for each
Reporting Person give effect to the 9.99% Blocker. Consequently, at
this time, the Reporting Persons are not able to exercise all the
warrants held by the Reporting Persons due to the 9.99% Blocker.
About iBio Inc.
iBio, Inc. -- http://www.ibioinc.com-- is a preclinical stage
biotechnology company that leverages the power of Artificial
Intelligence (AI) for the development of precision antibodies. Its
proprietary technology stack is designed to minimize downstream
development risks by employing AI-guided epitope-steering and
monoclonal antibody (mAb) optimization.
iBio reported a net loss available to the Company's stockholders of
$65.01 million for the year ended June 30, 2023, compared to a net
loss available to stockholders of $50.39 million for the year ended
June 30, 2022. As of June 30, 2023, the Company had $41.21 million
in total assets, $25.83 million in total liabilities, and $15.38
million in total stockholders' equity.
Holmdel, New Jersey-based CohnReznick LLP, the Company's auditor
since 2010, issued a "going concern" qualification in its report
dated Sept. 27, 2023, citing that the Company has suffered
recurring losses from operations and negative cash flows from
operating activities for the years ended June 30, 2023 and 2022 and
has an accumulated deficit as of June 30, 2023. These matters,
among others, raise substantial doubt about its ability to continue
as a going concern.
IBIO INC: Secures $15 Million Private Placement
-----------------------------------------------
iBio, Inc. announced that it has entered into a securities purchase
agreement for a private investment in public equity financing that
is expected to result in gross proceeds to the Company of
approximately $15.0 million, before deducting placement agent fees
and offering expenses.
The fully subscribed PIPE financing included participation from
ADAR1 Capital Management, Lynx1 Capital Management, Ikarian Capital
and other institutional and accredited investors. The Company
intends to use the net proceeds from the offering for general
corporate purposes, including research and development and working
capital. The Company also expects the net proceeds will extend its
cash runway to fund its operating plan through fiscal year 2025.
"We appreciate the support of this outstanding group of healthcare
specialist investors that shares the vision of leveraging our
cutting-edge AI/Machine learning platform to deliver best-in-class
drugs," said iBio's Chief Executive Officer and Chief Scientific
Officer, Martin Brenner, DVM, Ph.D.
Pursuant to the terms of the securities purchase agreement, the
Company is selling an aggregate of 5,287,278 shares of common stock
(or pre-funded warrant in lieu thereof) and common warrants to
purchase up to 5,287,278 shares of common stock at a purchase price
of $2.85 per share (or pre-funded warrant in lieu thereof), subject
to certain beneficial ownership limitations set by each holder. The
warrants issued in the offering are exercisable six (6) months upon
issuance at an exercise price of $2.64 per share and will expire
five years from the date of issuance.
Chardan acted as the sole placement agent for the PIPE financing.
The unregistered shares of common stock, pre-funded warrants and
warrants sold in the PIPE financing described above were offered
under Section 4(a)(2) of the Securities Act of 1933, as amended and
Regulation D promulgated thereunder and, along with the shares of
common stock underlying the pre-funded warrants and warrants, have
not been registered under the Act or applicable state securities
laws. Accordingly, the shares of common stock, the pre-funded
warrants, the warrants and the shares of common stock underlying
the pre-funded warrants and warrants 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. The securities were offered only to
accredited investors. Pursuant to the terms of the securities
purchase agreement with the investors, the Company has agreed to
file one or more registration statements with the SEC covering the
resale of the unregistered shares of common stock and the shares
issuable upon exercise of the unregistered pre-funded warrants and
warrants.
A full-text copy of the Company's report filed on Form 8-K with the
Securities and Exchange Commission is available at
https://tinyurl.com/ybjdefkh
About iBio Inc.
iBio, Inc. -- http://www.ibioinc.com-- is a preclinical stage
biotechnology company that leverages the power of Artificial
Intelligence (AI) for the development of precision antibodies. Its
proprietary technology stack is designed to minimize downstream
development risks by employing AI-guided epitope-steering and
monoclonal antibody (mAb) optimization.
iBio reported a net loss available to the Company's stockholders of
$65.01 million for the year ended June 30, 2023, compared to a net
loss available to stockholders of $50.39 million for the year ended
June 30, 2022. As of June 30, 2023, the Company had $41.21 million
in total assets, $25.83 million in total liabilities, and $15.38
million in total stockholders' equity.
Holmdel, New Jersey-based CohnReznick LLP, the Company's auditor
since 2010, issued a "going concern" qualification in its report
dated Sept. 27, 2023, citing that the Company has suffered
recurring losses from operations and negative cash flows from
operating activities for the years ended June 30, 2023 and 2022 and
has an accumulated deficit as of June 30, 2023. These matters,
among others, raise substantial doubt about its ability to continue
as a going concern.
INDIEV INC: Unsecureds Owed $17M to Get 1% of Claims in Plan
------------------------------------------------------------
Indiev, Inc., submitted an Amended Chapter 11 Liquidating Plan.
The Amended Plan that provides for payment to holders of allowed
claims over 12 months.
Under the Plan, Class 2 consists General Unsecured Claims. The
Debtor estimates that there are approximately $16,970,317.78 in
general unsecured debts. General unsecured claims are classified in
Class 2 and will receive a total of approximately 1% of their
claims in monthly payments over 12 months from the Effective Date.
Holders of General Unsecured Claims will receive their pro-rata
share of $14,141.93 per month for a total of $169,703.16 over 12
months of the Amended Plan. The payments will start on the first
day of the first month following the month within which the
Effective Date occurs. Based on the proposed payments, the
unsecured class will receive approximately 1% of their claims.
Class 2 is impaired.
The Debtor will fund the Amended Plan from the liquidation of its
assets.
A hearing on Adequacy of Amended Disclosure Statement will be held
on April 24, 2024 at 1:30 p.m. in Ctrm: 5C, 411 West Fourth Street,
Santa Ana, CA 92701-4593.
Attorneys for Indiev, Inc.:
Michael Jay Berger, Esq.
LAW OFFICES OF MICHAEL JAY BERGER
9454 Wilshire Blvd. 6th Floor
Beverly Hills, CA 90212-2929
Tel: (310) 271-6223
Fax: (310) 271-9805
E-mail: Michael.Berger@bankruptcypower.com
A copy of the Liquidating Plan dated March 27, 2024, is available
at https://tinyurl.ph/bcrfR from PacerMonitor.com.
About Indiev Inc.
Indiev Inc. was formed in August 2017 and has been in the business
of manufacturing electric vehicles.
The Debtor filed Chapter 11 petition (Bankr. C.D. Calif. Case No.
23-12036) on Oct. 2, 2023, with $1 million to $10 million in assets
and $10 million to $50 million in liabilities.
Judge Scott C. Clarkson oversees the case.
Michael Jay Berger, Esq., at the Law Offices of Michael Jay Berger,
and Jennifer Liu, owner of JMLIU CPA Accountancy Corp., serve as
the Debtor's bankruptcy counsel and accountant, respectively.
INNOVATE CORP: Further Extends Rights Offering Subscription Period
------------------------------------------------------------------
Innovate Corp. announced that its Board of Directors has extended
the subscription period for its rights offering to 5:00 p.m.
Eastern Time on April 19, 2024, in order to allow stockholders and
noteholders who are entitled to participate in the rights offering
(holders of record of the Company's common stock, Series A-3
Preferred Stock, Series A-4 Preferred Stock and 2026 Convertible
Notes as of 5:00 p.m. Eastern Time on March 6, 2024) additional
time to participate. The rights offering was initially scheduled
to expire at 5:00 p.m. Eastern Time on March 25, 2024, and the
expiration date was previously extended until 5:00 p.m. Eastern
Time on April 9, 2024.
The rights offering is being made pursuant to INNOVATE's effective
shelf registration statement on Form S-3, filed with the SEC on
Sept. 29, 2023, and declared effective on Oct. 6, 2023, and a
prospectus supplement containing the detailed terms of the rights
offering originally filed with the SEC on March 8, 2024, as amended
on March 23, 2024, and April 9, 2024. The rights offering was made
only by means of a prospectus and a related prospectus supplement,
copies of which were distributed to all eligible rights holders as
of the rights offering record date and may also be obtained free of
charge at the website maintained by the SEC at www.sec.gov or by
contacting the information agent for the rights offering.
About Innovate
New York-based Innovate Corp. -- www.innovatecorp.com -- is a
diversified holding company that has a portfolio of subsidiaries in
a variety of operating segments. The Company seeks to grow these
businesses so that they can generate long-term sustainable free
cash flow and attractive returns in order to maximize value for all
stakeholders. As of Dec. 31, 2023, its three operating platforms
or reportable segments, based on management's organization of the
enterprise, are Infrastructure, Life Sciences and Spectrum, plus
its Other segment, which includes businesses that do not meet the
separately reportable segment thresholds.
Innovate incurred a net loss of $38.9 million in 2023, compared to
a net loss of $42 million in 2022. As of Dec. 31, 2023, the
Company had $1.04 billion in total assets, $1.18 billion in total
liabilities, $15.4 million in total temporary equity, and a total
stockholders' deficit of $151.7 million.
Innovate disclosed in a Form 8-K filed with the Securities and
Exchange Commission that on Feb. 26, 2024, it received a written
notice from the New York Stock Exchange that it was not in
compliance with the continued listing standard set forth in Section
802.01C of the NYSE's Listed Company Manual, as the average closing
price of the Company's common stock was less than $1.00 per share
over a consecutive 30 trading-day period.
* * *
As reported by the TCR on May 17, 2023, S&P Global Ratings lowered
its issuer credit rating on Innovate Corp. to 'CCC+' from 'B-'. S&P
said, "We expect Innovate to maintain less than adequate liquidity
over the next 12 months. This reflects our expectation that while
the company has enough liquidity to continue operating for the next
12 months, we believe the cushion is very thin and could quickly
erode."
INNOVATE CORP: Lancer Capital, 2 Others Report Stakes
-----------------------------------------------------
In a Schedule 13D/A filed with the U.S. Securities and Exchange
Commission, the following entities and individuals disclosed that
as of March 28, 2024, they beneficially owned shares of Innovate
Corp.'s common stock:
Reporting Person Shares Owned Percent of Class
Lancer Capital LLC 19,852,790 24.9%
Avram Glazer 23,207,390 29.1%
Avram Glazer 22,992,195 28.9%
Irrevocable Exempt Trust
The shares owned include 468,594 shares of Common Stock of Innovate
Corp. issuable upon conversion of $2,000,000 principal amount of
the Issuer's 7.5% Convertible Senior Notes due 2026.
The percentage is based on 79,234,991 shares of Common Stock of the
Issuer outstanding as of February 29, 2024, as reported in the
Innovate's Annual Report on Form 10-K filed with the Securities and
Exchange Commission on March 6, 2024.
A full-text copy of the Report is available at
https://tinyurl.com/y2jvw7t9
About Innovate
New York-based Innovate -- www.innovatecorp.com -- is a diversified
holding company that has a portfolio of subsidiaries in a variety
of operating segments. The Company seeks to grow these businesses
so that they can generate long-term sustainable free cash flow and
attractive returns in order to maximize value for all stakeholders.
As of Dec. 31, 2023, its three operating platforms or reportable
segments, based on management's organization of the enterprise, are
Infrastructure, Life Sciences and Spectrum, plus its Other segment,
which includes businesses that do not meet the separately
reportable segment thresholds.
Innovate incurred a net loss of $38.9 million in 2023, compared to
a net loss of $42 million in 2022. As of Dec. 31, 2023, the
Company had $1.04 billion in total assets, $1.18 billion in total
liabilities, $15.4 million in total temporary equity, and a total
stockholders' deficit of $151.7 million.
Innovate disclosed in a Form 8-K filed with the Securities and
Exchange Commission that on Feb. 26, 2024, it received a written
notice from the New York Stock Exchange that it was not in
compliance with the continued listing standard set forth in Section
802.01C of the NYSE's Listed Company Manual, as the average closing
price of the Company's common stock was less than $1.00 per share
over a consecutive 30 trading-day period.
* * *
As reported by the TCR on May 17, 2023, S&P Global Ratings lowered
its issuer credit rating on Innovate Corp. to 'CCC+' from 'B-'. S&P
said, "We expect Innovate to maintain less than adequate liquidity
over the next 12 months. This reflects our expectation that while
the company has enough liquidity to continue operating for the next
12 months, we believe the cushion is very thin and could quickly
erode."
INNOVEREN SCIENTIFIC: Issues Common Shares, Options to Executives
-----------------------------------------------------------------
Innoveren Scientific, Inc. disclosed in a Form 8-K Report filed
with the Securities and Exchange Commission that on March 26, 2024,
the Company issued to certain executive officers an aggregate of
186,048 shares of common stock in lieu of accrued salary at a rate
of $0.25 per share for amounts owed and an aggregate of 213,952
shares for payment of directors' fees owed.
In addition, the Company issued its officers and directors an
aggregate of 400,000 options to purchase common stock at $0.03 per
share, which was above the closing price of the Company's common
stock on March 25, 2024.
About Innoveren Scientific
Innoveren Scientific Inc. (formerly H-CYTE Inc.), --
www.InnoverenScientific.com -- is a life science and biotech
incubator company, focused on advancing new technologies in areas
of unmet need across multiple indications, with the ultimate goal
of improving patient lives. The company invests in and fosters
innovative technologies that are supported by a strong scientific
foundation, which have relatively short timelines and low costs to
achieve meaningful value inflection points.
H-Cyte reported a net loss of $10.30 million for the year ended
Dec. 31, 2022, compared to a net loss of $4.80 million for the year
ended Dec. 31, 2021. As of March 31, 2023, the Company had $349,355
in total assets, $11.68 million in total liabilities, and a total
stockholders' deficit of $11.33 million.
Tampa, Florida-based Frazier & Deeter, LLC, the Company's auditor
since 2018, issued a "going concern" qualification in its report
dated May 10, 2023, citing that the Company has negative working
capital, has an accumulated deficit, has a history of significant
operating losses and has a history of negative operating cash flow
that raise substantial doubt about its ability to continue as a
going concern.
JAIRRABRANDY REALTY: Voluntary Chapter 11 Case Summary
------------------------------------------------------
Debtor: Jairrabrandy Realty Enterprises LLC
9304 Avenue L
Brooklyn NY 11235
Case No.: 24-41537
Business Description: Jairrabrandy Realty is a Single Asset Real
Estate debtor (as defined in 11 U.S.C.
Section 101(51B)).
Chapter 11 Petition Date: April 11, 2024
Court: United States Bankruptcy Court
Eastern District of New York
Judge: Hon. Nancy Hershey Lord
Debtor's Counsel: Vivian M. Williams, Esq.
VMW LAW PC
733 3rd Avenue FL 16
New York NY 10017
Tel: 212-561-5312
Email: wwilliams@thewilliamsfirmnyc.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Angaad Sooknandan as sole member.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/6KK7XRQ/Jairrabrandy_Realty_Enterprises__nyebke-24-41537__0001.0.pdf?mcid=tGE4TAMA
JD MOTORSPORTS: Seeks Cash Collateral Access
--------------------------------------------
JD Motorsports, Inc. asks the U.S. Bankruptcy Court for the
District of South Carolina for authority to use cash collateral and
provide adequate protection.
The Debtor requires the use of cash collateral to pay operational
expenses, such as employee wages, property leases, inventory,
utilities, taxes, and insurance.
FNB PA loaned money to the Debtor which was perfected by a UCC
Financing Statement by June 7, 2018 with a claim estimated by the
Debtor in the amount of $49,930. UCB made a loans to the Debtor
perfected by UCC Financing Statements filed on December 24, 2018
and refiled on March 20, 2024. The balance of the Debtor's loan
with UCB is $75,000. U.S. Small Business Administration's claim is
based upon the COVID EIDL loan program, which was perfected by
filing a UCC Financing Statement on July 22, 2021 and is estimated
by the Debtor in the amount of $1.947 million.
As adequate protection for the use of cash collateral, Debtor
agrees to provide FNB PA, UCB and SBA with replacement liens on
post-petition cash collateral to the same extent and in the same
priority as their pre-petition liens, for any post-petition
diminution in the prepetition cash collateral as well as
replacement liens on all other property that may be acquired
post-petition by the Debtor with such replacement liens having the
same extent and priority as their prepetition liens on such
property.
A copy of the motion is available at https://urlcurt.com/u?l=EMXLFe
from PacerMonitor.com.
About JD Motorsports, Inc.
JD Motorsports, Inc. is a professional racing team that is now the
number 1 non-NASCAR Cup Series Affiliated team in the NASCAR
Xfinity Series. The Debtor earned its first playoffs birth in 2018,
finishing tenth in the NASCAR Xfinity Series standings. The Debtor
has had a driver finish in the top-20 of the Xfinity Series Driver
points twenty times. The Debtor operates from its garage located at
1210 Champion Ferry Road, Gaffney, South Carolina.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. S.D. Case No. 24-01274-hb) on April 8,
2024. In the petition signed by Johnny K. Davis. president, the
Debtor disclosed up to $1 million in assets and up to $10 million
in liabilities.
W. Harrison Penn, Esq., at Penn Law Firm LLC, represents the Debtor
as legal counsel.
JLK CONSTRUCTION: Seeks Cash Collateral Access Thru July 27
-----------------------------------------------------------
JLK Construction, LLC asks the U.S. Bankruptcy Court for the
Western District of Missouri for authority to use cash collateral
and provide adequate protection.
The Debtor requires the use of cash collateral to operate its
business and to honor contracts for work.
Newtek Small Business Finance asserts an interest in the Debtor's
cash collateral.
During the proposed period from April 28, 2024 through July 27,
2024, the Debtor projects that its total receipts will be $1.050
million, its total disbursements including costs of goods sold and
expenses will be $1.084 million, and its projected net income will
be $34,161. The value of the Debtor's monies and receivables in the
aggregate will not decline. The Debtor intends that the terms of
the Court's present operative Order on the use of cash collateral
be the same as the terms for the next period of use except modified
as necessary for the passage of time.
The Debtor proposes forms of adequate protection including
continued adequate protection payment and replacement liens.
The Debtor also requests the court to conduct a hearing on the
matter on April 25, 2024 at 9 a.m.
A copy of the motion is available at https://urlcurt.com/u?l=0RHNoz
from PacerMonitor.com.
About JLK Construction, LLC
JLK Construction, LLC moves dirt, excavates dirt and does basic
concrete flatwork. It is a union shop.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Mo. Case No. 23-50034) on February 13,
2023. In the petition signed by Jesse L. Kagarice, managing member,
the Debtor disclosed up to $10 million in both assets and
liabilities.
Judge Brian T. Fenimore oversees the case.
Colin N. Gotham, Esq., at Evans and Mullinix, P.A., and Steven R.
Fox, Esq., at The Fox Law Corp., Inc., represent the Debtor as
legal counsel.
Newtek Small Business Finance, LLC, as lender, is represented by
Jonathan A. Margolies, Esq.
KIDDE-FENWAL INC: Insurers Fight Foam Suits Coverage Bid
--------------------------------------------------------
Ganesh Setty of Law360 reports that two AIG units and another
insurer have told a Delaware bankruptcy court it should reject
fire-suppression company Kidde-Fenwal Inc.'s bid to secure their
coverage for a bevy of underlying suits alleging the company
exposed those plaintiffs to so-called forever chemicals via its
production of firefighting foam.
On May 14, 2023, Kidde-Fenwal, Inc., filed a voluntary petition for
relief under Chapter 11 of Title 11, United States Code. KFI
asserts that it has been named as a defendant in thousands of
product liability actions relating to aqueous film-forming foam
(“AFFF”). KFI further asserts that these potential liabilities
were a significant factor in its decision to commence these
bankruptcy proceedings.
On Nov. 9, 2023, KFI commenced adversary proceeding No. 23-50758
against multiple insurers alleged to have issued policies pursuant
to which KFI seeks insurance coverage for the underlying AFFF
claims.
+ About Kidde-Fenwal
Kidde-Fenwal Inc. -- https://www.kidde-fenwal.com/ -- manufactures
fire protection systems. It offers products such as fire control
systems, explosion aircraft protection, laser-based smoke detection
devices, electronic gas ignitions, and fire suppressions.
Kidde-Fenwal markets its products to mining, manufacturing,
education, and commercial sectors.
Kidde-Fenwal sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. D. Del. Case No. 23-10638) on May 14, 2023. In the
petition filed by its chief transformation officer, James
Mesterharm, the Debtor reported assets between $100 million and
$500 million and estimated liabilities between $1 billion and $10
billion.
The Debtor tapped Sullivan & Cromwell, LLP and Morris Nichols Arsht
& Tunnell, LLP, as legal counsels; and Guggenheim Securities, LLC,
as investment banker. Stretto, Inc., is the claims and noticing
agent and administrative advisor.
KOHL'S CORP: Moody's Alters Outlook on 'Ba2' CFR to Stable
----------------------------------------------------------
Moody's Ratings changed Kohl's Corporation's outlook to stable from
negative. At the same time, Moody's Ratings affirmed Kohl's
corporate family rating at Ba2, its probability of default rating
at Ba2-PD and its senior unsecured ratings at Ba3. Its speculative
grade liquidity rating (SGL) remains unchanged at SGL-2.
The affirmations and stable outlook reflect improved execution by
its new leadership, particularly in merchandising and inventory
management, during a difficult consumer environment in 2023.
Moody's Ratings expects Kohl's to continue to make operational
progress with the benefits of sales stabilitization and gross
margin improvement to mainly offset the negative impact of the cap
on credit card late fees later this summer. Moody's Ratings
projects Kohl's to continue to reduce debt with leverage to be
approximately 4.2x at the end of 2024.
The SGL-2 reflects Moody's Ratings view that profitability and free
cash flow generation will be positive over the next twelve months,
such that its $1.5 billion secured revolver will be undrawn at the
end of fiscal 2024 and cash balances will begin to rebuild toward
historic levels.
RATINGS RATIONALE
Kohl's Ba2 CFR reflects its significant market position and scale
with approximately $17.5 billion of revenue. The company has a
long-term track record of innovative merchandising which includes a
high level of private label and exclusive merchandise which
resonates with its value-oriented customers. Kohl's enacted a
realignment of its inventories in the fourth quarter of 2022 which
has been followed by material operational improvement in 2023.
Moody's Ratings debt/EBITDA has improved to 4.2x at the end of 2023
relative to 5.7x at the end fiscal 2022. Operating margins, albeit
below historical levels, improved despite a comparable sales
decline of 4.7% driven primarily by its resetting of its e-commerce
platform. The ratings also reflect governance considerations
including its commitment to a 2.5x leverage target (per the
company's definition) and a continued moratorium on share
repurchases. Moody's Ratings expects operational progress in 2024
to continue to be supported by reduced product costs, improved
inventory management, its Sephora rollout and new merchandising
efforts. Nonetheless, Kohl's consumer still remains pressured and
the economic environment uncertain. Kohl's must also decrease its
dependency on proprietary credit cards that tend to have higher
balances and less of their profitability dependent on late fees
than co-branded. Kohl's expects $250-300 million of incremental
revenue from a shift to co-brand brand offerings in 2025 which
should offset the upcoming loss in late fees.
The stable outlook reflects the assumption that Kohl's new product
initiatives including Sephora and its new Babies "R" Us, rollout
which will be in 200 stores later this year, will support sales
stabilization and gross margins will be enhanced by improved
inventory turns. The outlook also assumes that income lost from the
cap on credit card late fees can be mitigated significantly by its
rollout of its co-branded credit cards to current proprietary card
holders. The outlook also assumes that Kohl's will continue to
pursue a balanced financial strategy with share purchases delayed
until cash balances return to historical levels.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ratings could be upgraded if operating margins reflect consistent
and significant improvement toward historical levels as comparable
sales growth reflects stable to improving market positioning. An
upgrade would also require Kohl's to maintain at least good
liquidity including significant free cash flow generation while its
financial strategy remains balanced. Quantitatively ratings could
be upgraded should debt/EBITDA be sustained below 4.0x and
EBIT/interest coverage is sustained above 2.75x.
Ratings could be downgraded if strategies implemented are not
successful, reflecting an inability to improve operating margins
significantly and stabilize its market position. Rating could also
be downgraded should liquidity deteriorate for any reason or
financial strategies become more aggressive. Quantitatively,
ratings could be downgraded should debt/EBITDA be sustained above
4.75x and EBIT/interest coverage is sustained below 2.25x.
Headquartered in Menomonee Falls, Wisconsin, Kohl's Corporation is
a leading department store retailer with 1,174 stores in the US.
Total revenue is approximately $17.5 billion for the fiscal year
ended February 3, 2024.
The principal methodology used in these ratings was Retail and
Apparel published in November 2023.
L AND L CARE: Court OKs Cash Collateral Access Thru Sept 30
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of California,
Oakland Division, authorized L and L Care Home, LLC to use cash
collateral, on a final basis, in accordance with the budget,
through September 30, 2024.
The Debtor is permitted to use cash collateral for the purposes,
and in the amount, reflected in the Profit and Loss Statement, with
the exception of professional fees, which will not be paid absent
Court approval in advance.
The Debtor will pay to Itria Ventures, LLC monthly payments in the
amount of $5,000, which payments will be due on the first day of
each month. The first payment will commence on May 1, 2024.
Itria Ventures' claim is secured by all the Debtor's assets and
accounts as described in the UCC financing statement recorded on
September 6, 2023 by Itria Ventures with the Secretary of State for
the State of California, File Number U230063772021.
As adequate protection for the use of cash collateral, Itria
Ventures is granted a replacement security interest in, and lien
upon, all of its prepetition collateral and all assets and proceeds
acquired or generated by the Debtor's use thereof, to the same
extent, validity and priority that such security interest and lien
existed prior to the date of the Debtor's bankruptcy filing;
provided, however, that Itria Ventures will not be granted a
security interest in, or lien upon, the Debtor's claims arising
under Chapter 5 of the Bankruptcy Code.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=MnrszF from PacerMonitor.com.
The Debtor projected $264,000 in total income and $238,268 in total
expenses for March 1, 2024-May 31, 2024 period.
About L and L Care Home, LLC
L and L Care Home, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Cal. Case No. 24-40340) on March
11, 2024. In the petition signed by Melissa Lipardo, chief
executive officer, the Debtor disclosed up to $100,000 in assets
and up to $500,000 in liabilities.
Judge Charles Novack oversees the case.
Anthony O. Egbase, Esq., at A.O.E. Law & Associates, APC,
represents the Debtor as legal counsel.
LEXARIA BIOSCIENCE: Incurs $653K Net Loss in Second Quarter
-----------------------------------------------------------
Lexaria Bioscience Corp. filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q reporting a net loss
of $652,733 on $145,000 of revenue for the three months ended Feb.
29, 2024, compared to a net loss of $1.31 million on $20,025 of
revenue for the three months ended Feb. 28, 2023.
For the six months ended Feb. 29, 2024, the Company reported a net
loss of $1.84 million on $296,278 of revenue, compared to a net
loss of $3.08 million on $117,760 of revenue for the six months
ended Feb. 28, 2023.
As of Feb. 29, 2024, the Company had $6.35 million in total assets,
$204,203 in total liabilities, and $6.15 million in total
stockholders' equity.
Since inception, the Company has incurred significant operating and
net losses. Net losses attributable to shareholders were $1.8
million and $3.1 million for the six months ended Feb. 29, 2024,
and Feb. 28, 2023, respectively. As of Feb. 29, 2024, the Company
had an accumulated deficit of $47.6 million.
Lexaria said, "We expect to continue to incur significant
operational expenses and net losses in the upcoming 12 months. Our
net losses may fluctuate significantly from quarter to quarter and
year to year, depending on the stage and complexity of our research
and development (R&D) studies and corporate expenditures,
additional revenues received from the licensing of our technology,
if any, and the receipt of payments under any current or future
collaborations we may enter into. The recurring losses and
negative net cash flows raise substantial doubt as to the Company's
ability to continue as a going concern."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/0001348362/000164033424000589/lxrp_10q.htm
About Lexaria
Lexaria Bioscience Corp. -- http://www.lexariabioscience.com-- is
a biotechnology company developing the enhancement of the
bioavailability of a broad range of fat-soluble active molecules
and active pharmaceutical ingredients using its patented
DehydraTECH drug delivery tecnnology. DehydraTECH combines
lipophilic molecules or APIs with specific long-chain fatty acids
and carrier compounds that improve the way they enter the
bloodstream, increasing their effectiveness and allowing for lower
overall dosing while promoting healthier oral ingestion methods.
Lexaria Bioscience incurred a net loss of $6.71 million for the
year ended Aug. 31, 2023, a net loss of $7.38 million for the year
ended Aug. 31, 2022, a net loss and comprehensive loss of $4.19
million for the year ended Aug. 31, 2021, a net loss and
comprehensive loss of $4.08 million for the year ended Aug. 31,
2020, and a net loss and comprehensive loss of $4.16 million for
the year ended Aug. 31, 2019.
LMSRQ LLC: Property Sale Proceeds to Fund Plan Payments
-------------------------------------------------------
LMSRQ, LLC, filed with the U.S. Bankruptcy Court for the Middle
District of Florida a Disclosure Statement for Plan of Liquidation
dated April 4, 2024.
The Debtor owns approximately 38.18 acres of partially developed
property located at 830 17th Street East in Palmetto, Florida 34221
(the "Property").
Illinois Bank & Trust ("IBT") is owed approximately $40 million
based on a loan made to the Debtor on July 29, 2022. IBT asserts
that it has a perfected lien on the Property. The loan with IBT
matured pursuant to the loan documents in January 2024. However,
the parties were negotiating an extension of the maturity date but
unfortunately were unable to agree on the terms of an extension of
the maturity date.
In addition, SFG Properties, LLC, has filed a lawsuit (the "SFG
Lawsuit") for return of a $6 million deposit posted under a
contract for SFG's purchase of the Property. It is the Debtor's
position that SFG forfeited the deposit. As of the Petition Date,
the SFG Lawsuit was pending in the United Sattes District Court for
the Middle District of Florida, Tampa Division. The Debtor filed
this case to preserve the value of the Property and treat all
creditors fairly and equitably.
Both Eastdil and JLL have been actively marketing the sale of the
Property for over four months. As a result of such marketing
efforts, the Debtor received eleven offers for the sale of the
Property. The Debtor requested that each of the potential bidders
submit their highest and best offer by March 25, 2024. PIX Palmetto
Industrial Owner, LLC, a Delaware limited liability company
("Buyer") submitted a bid of $45,000,000.00 ("Purchase Price") with
no financing contingencies.
The Debtor, in the exercise of its business judgment, accepted that
offer from the Buyer and began extensive negotiations with the
Buyer to memorialize the transaction and execute a purchase and
sale agreement. On March 28, 2024, the Debtor and the Buyer
executed a Purchase and Sale Agreement (as amended, the "Purchase
Agreement"). On April 1, 2024, the Debtor and the Buyer entered
into the First Amendment to the Purchase Agreement.
On April 3, 2024, the District Court entered a further Order on the
Motion to Refer. On April 4, 2024, the Debtor filed the Sale
Motion.
Class 5 consists of all Allowed General Unsecured Claims not
otherwise classified in the Plan. Each Holder of an Allowed Class 5
General Unsecured Claim shall receive on such date determined by
the Debtor, in full and final satisfaction of such Holder's Allowed
Class 5 General Unsecured Claim, such Holder's Pro Rata Share of
the Net Sale Proceeds and cash on hand after reserving for U.S.
Trustee fees and payment of Allowed Secured Claims, Allowed
Administrative Expense Claims, Allowed Priority Tax Claims, and
Allowed Priority Claims in full. Class 5 is Impaired and,
therefore, is entitled to vote to accept or reject the Plan.
Class 6 consists of Equity Interests. The Holders of Class 6 Equity
Interests shall be entitled to receive the remaining Net Sale
Proceeds and cash on hand, if any, only after all Allowed Claims in
Classes senior to Class 6 have been paid in full pursuant to the
terms of the Plan and after reserving for U.S. Trustee fees. Class
6 is Unimpaired. Each Holder of an Equity Interest is presumed to
have accepted the Plan and, therefore, is not entitled to vote to
accept or reject the Plan.
The Plan provides for a prompt sale of the Property and for
distributions to be made to the Holders of Allowed Claims against
the Debtor in accordance with the priorities set forth in the
Bankruptcy Code. The Debtor believes that conversion of the case to
Chapter 7 would simply add a layer of administrative expenses
reducing distributions to the Holders of Allowed Claims.
A full-text copy of the Disclosure Statement dated April 4, 2024 is
available at https://urlcurt.com/u?l=5Ceihf from PacerMonitor.com
at no charge.
Attorneys for the Debtors:
Edward J. Peterson, Esq.
Johnson Pope Bokor Ruppel & Burns, LLP
400 N Ashley Dr., Ste. 3100
Tampa, FL 33602
Telephone: (813) 225-2500
Email: edwardp@jpfirm.com
About LMSRQ LLC
LMSRQ LLC owns approximately 38.18 acres of partially developed
property located at 830 17th Street East in Palmetto, Florida 34221
(the "Property").
LMSRQ LLC sought Chapter 11 protection (Bankr. M.D. Fla.Case No.
24-00987) on Feb. 28, 2024, listing as much as $50 million to $100
million in both assets and liabilities. John A. Folvig, III, as
manager, signed the petition.
Judge Catherine Peek Mcewen oversees the case.
JOHNSON, POPE, BOKOR, RUPPEL & BURNS, LLP serves as the Debtor's
legal counsel.
LTR INTERMEDIATE: S&P Alters Outlook to Stable, Affirms 'B-' ICR
----------------------------------------------------------------
S&P Global Ratings revised its outlook to stable from negative on
LTR Intermediate Holdings Inc.'s (doing business as Liberty Tire
Recycling). At the same time, S&P affirmed all ratings, including
its 'B-' issuer credit rating.
S&P said, "The outlook revision to stable reflects our expectation
that liquidity will remain adequate and credit metrics will remain
appropriate for the rating. Following improved revenues in 2023 and
an enhanced focus on working capital management, LTR has been able
to improve working capital metrics leading to stronger cash flow
generation and, as such, liquidity for the year ended Dec. 31,
2023. For 2023, LTR was able to increase top line revenues across
all business lines due to solid demand growth in end markets and
pricing initiatives. LTR's margins continued to be strained by cost
inflation in 2023 and the lag in passing through price increases.
Going forward, we expect LTR to continue focusing on cash flow
management while improving inbound pricing and outbound product
mix, this should lead to positive free cash flow generation.
Additionally, the AR securitization put in place in early 2023 has
helped improve liquidity. Given the improved working capital
management and revenue growth expected, we expect credit measures
of S&P Global Ratings-adjusted debt to EBITDA between 6.0x and 7.0x
over the next 12 months.
"LTR remains susceptible to changing industry dynamics, but we
believe the company has improved its fundamentals and end-use
diversity. The company has been a leader and established player in
the tire collection and processing space for several years. We
believe LTR's fundamentals have improved since its restructuring in
2015 (after a foreign competitor entered the industry in 2014) and
view its capital structure as much more manageable. However, we
remain wary that it may be susceptible to challenging industry
dynamics and external factors, including more aggressive
competition, tire collection volumes being tied to miles driven,
and potentially stricter environmental regulations. Historically,
LTR focused and depended on the field and turf sales end market,
though it has since expanded its end uses to enhance its presence
as a leading tire recycler.
"The stable outlook on LTR reflects our expectation that pricing
actions in its inbound business, cost-savings initiatives, and
improved outbound product mix will support improved cash flow
generation, while maintaining weighted average leverage below 7.0x.
Under our base case assumptions, we do not expect LTR to fund any
acquisitions with debt.
"We could lower our ratings on LTR within the next 12 months if a
significant decline in its operating performance leads to leverage
approaching double digits, which we would view as unsustainable
leverage levels. This could occur if there was a 300 basis points
(bps) deterioration in EBITDA margins, in addition to a sustained
period for negative free cash flow generation, which could
constrain liquidity and lead to a negative rating action. We could
also consider a lower rating if the company does not maintain
prudent financial policies that support credit metrics we view as
commensurate with the current rating. We would view the pursuit of
debt-funded growth initiatives or dividend distributions to owners
as inconsistent with our current financial policy expectations.
Finally, if LTR were to propose a transaction that we viewed as a
distressed exchange, we would take a negative rating action.
"We could take a positive rating action on LTR within the next 12
months if its S&P Global Ratings-adjusted leverage improves below
6x for consecutive quarters, which could occur with a 300 bps
improvement in EBIDA margins, combined with positive free cash flow
generation and our belief that its financial sponsor is committed
to maintaining financial policies that support improved metrics."
M & J HOME: Unsecureds to Get 100 Cents on the Dollar in Plan
-------------------------------------------------------------
M&J Home Improvement, Inc., submitted a Plan of Reorganization,
dated March 29, 2024.
The Debtor is a Massachusetts Corporation that was formed on June
1, 2011, by Matthew J. Sullivan. The Debtor is in the business of
providing roofing services, consisting of the repair, replacement
and construction of roofs for individuals' residential real
estate.
In 2020, the Debtor's operations were also negatively impacted by
the onset of the COVID-19 Pandemic. As a result, the Debtor began
to experience a reduction in available projects, which in turn
caused the Debtor to fall behind on its obligations to vendors and
other business expenses. Debtor was forced to take out loans to
finance cash flow during down periods at interest rates which were
unsustainable in the long term. Unable to make payments on the debt
obligations, Debtor's secured creditor, OU Financial, Inc. filed a
complaint against the debtor on July 13, 2023 in the Cobb County
Superior Court in Georgia. After receiving notice of the lawsuit,
the Debtor was forced to seek relief under Chapter 11.
The Debtor's financial projections show that the Debtor will have
projected disposable income (as defined by Sec. 1191(d) of the
Bankruptcy Code) for the period described in Sec. 1191(c)(2) of
$6,151, for FY2024, $7,133 for FY2025, $8,076 for FY2026, $9,108
for FY2027, and $9,996 for FY2028.
The final Plan payment is expected to be paid on the date that is
53 months following the date of confirmation of the Plan, or sooner
based upon the actual net profit generated as set forth in the
accompanying financial projections.
This Plan of Reorganization (the Plan) under chapter 11 of the
Bankruptcy Code (the Code) proposes to pay creditors of M & J Home
Improvement, Inc. (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 100 cents on the dollar.
Under the Plan, Class 2 Non-priority unsecured creditors will be
paid in full during month 32 through month 53. Class 2 is
impaired.
The Plan will be implemented by the Debtor making a series of
monthly payments to the Subchapter V Trustee, who shall be the
distribution agent for all payments made to Administrative Expense
Claim Holders listed in Section 3.02, Priority Tax Claim Holders
listed in Section 3.03, and creditors in Classes 1 and 2 in Article
IV of this Plan ("Payment Recipients"). A Payment Schedule for
payments to be made by the Debtor is set forth in Exhibit C
attached hereto. From the monthly payments received by the
Subchapter V Trustee, the Trustee may retain a portion of each said
payment, not to exceed 5% of ail distributions to be made by him to
Payment Recipients.
A copy of the Disclosure Statement dated March 29, 2024, is
available at https://tinyurl.ph/hAFFD from PacerMonitor.com.
About M & J Home Improvement
M & J Home Improvement, Inc., sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. D. Mass. Case No. 23-40874) on
Oct. 20, 2023. In the petition signed by Matthew Sullivan,
manager, the Debtor disclosed up to $500,000 in assets and up to $1
million in liabilities.
Judge Elizabeth D. Katz oversees the case.
Christopher L. Murray, Esq., at Murray Law Firm, P.C., represents
the Debtor as legal counsel.
METRO COURIER: Seeks Cash Collateral Access Thru July 31
--------------------------------------------------------
Metro Courier, Inc. asks the U.S. Bankruptcy Court for the District
of Kansas for authority to use cash collateral and provide adequate
protection, through July 31, 2024.
The Debtor requires the use of cash collateral to pay expenses of
its ongoing operations and administrative expenses in accordance
with the Budget.
The Debtor owns accounts receivable which totaled approximately
$305,651 as of the Petition Date.
The Lenders with claimed liens in the Debtor's accounts receivable
are Fora Financial Business Loans, LLC, Birchwood Funding, Mark
Brady, ODK Capital, LLC, MonteFi, Cloudfund, LLC, United First,
LLC, and Capifi Funding.
The Debtor proposes as adequate protection to the Secured Lender a
replacement lien in post-petition accounts receivable generated by
the Debtor to the extent of the Debtor's use of the cash
collateral.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=uWYkDq from PacerMonitor.com.
The Debtor projects total expenses, on a monthly basis, as
follows:
$439,929 for April 2024;
$439,929 for May 2024;
$439,929 for June 2024;
$439,929 for July 2024;
About Metro Courier, Inc.
Metro Courier, Inc. owns and operates a courier business in
Wichita, Kansas.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Kan. Case No. 24-10263) on April 5,
2024. In the petition signed by Anita L. Vara, president, the
Debtor disclosed up to $50,000 in both assets and liabilities.
Mark J. Lazzo, Esq., at Mark J. Lazzo PA, represents the Debtor as
legal counsel.
MICROVISION INC: Extends Term of CEO Employment Agreement
---------------------------------------------------------
MicroVision, Inc. disclosed in a Form 8-K filed with the Securities
and Exchange Commission that on April 8, 2024, it extended the term
of its existing employment agreement with its Chief Executive
Officer Sumit Sharma.
The extension delays the expiration of the agreement until the new
agreement currently being negotiated and expected to be completed
in the near future is executed by the parties. No other terms of
Mr. Sharma's employment arrangement were amended or modified.
About Microvision
Microvision, Inc. -- @ www.microvision.com -- is a global developer
and supplier of lidar hardware and software solutions focused
primarily on automotive lidar and advanced driver-assistance
systems (ADAS) markets where it can deliver safe mobility at the
speed of life. The Company offers a suite of light detection and
ranging, or lidar, sensors and perception and validation software
to automotive OEMs, for ADAS and autonomous vehicle (AV)
applications, as well as to complementary markets for
non-automotive applications including industrial, robotics and
smart infrastructure.
MicroVision reported a net loss of $82.84 in 2023, a net loss of
$53.09 in 2022, a net loss of $43.20 million in 2021, a net loss of
$13.63 million in 2020, a net loss of $26.48 million in 2019, and a
net loss of $27.25 million in 2018.
MOBIQUITY TECHNOLOGIES: Incurs $6.5 Million Net Loss in 2023
------------------------------------------------------------
Mobiquity Technologies, Inc. filed with the Securities and Exchange
Commission its Annual Report on Form 10-K reporting a net loss of
$6.53 million on $860,090 of revenues for the year ended Dec. 31,
2023, compared to a net loss of $8.06 million on $4.17 million of
revenues for the year ended Dec. 31, 2022.
As of Dec. 31, 2023, the Company had $4.20 million in total assets,
$1.99 million in total liabilities, and $2.21 million in total
stockholders' equity.
Margate, Florida-based Assurance Dimensions, the Company's auditor
since 2023, issued a "going concern" qualification in its report
dated April 8, 2024, citing that the Company has incurred operating
losses and has incurred negative cash flows from operations and has
an accumulated deficit. These and other factors raise substantial
doubt about the Company's ability to continue as a going concern.
The Company has incurred significant losses since its inception in
1998 and has not demonstrated an ability to generate sufficient
revenues from the sales of its products and services to achieve
profitable operations. There can be no assurance that profitable
operations will ever be achieved, or if achieved, could be
sustained on a continuing basis. In making this assessment the
Company performed a comprehensive analysis of its current
circumstances including: the Company's financial position, cash
flows and cash usage forecasts for the year ended December 31,
2023, and current capital structure including equity-based
instruments and the Company's obligations and debts.
"Without sufficient revenues from operations, if the Company does
not obtain additional capital, the Company will be required to
reduce the scope of its business development activities or cease
operations," Mobiquity said.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1084267/000168316824002214/mobq_i10k-123123.htm
About Mobiquity Technologies Inc.
Headquartered in Shoreham, NY, Mobiquity Technologies, Inc., is a
next-generation advertising technology, data compliance and
intelligence company which operates through its various proprietary
software platforms. The Company's product solutions are comprised
of three proprietary software platforms: Advertising Technology
Operating System (ATOS Platform); Data Intelligence Platform; and
publisher Platform for Monetization and Compliance.
MV REALTY: Accused of Abusing Chapter 11 Bankruptcy Process
-----------------------------------------------------------
State prosecutors, federal agencies and consumer advocates have
called on a Florida bankruptcy judge to dismiss or convert MV
Realty's case because the firm is allegedly using the Chapter 11
process to avoid enforcement and enshrine a set of predatory
agreements designed to extract millions in junk fees from
homeowners over the next 40 years.
The Attorneys General of the states of Arizona, Colorado,
Connecticut, Florida, Georgia, Kentucky, Maryland, Massachusetts,
Minnesota, New Jersey, North Carolina, Ohio and Pennsylvania said
in court filings that they support the United States Trustee's
Motion to dismiss or convert the Chapter 11 cases of the Debtors.
The U.S. Trustee, a branch agency of the Department of Justice,
asserts that the continued diminution of the estate and absence of
reasonable likelihood for rehabilitation are cause for dismissal or
conversion.
The Committee of Homeowner Benefit Agreement Holders has filed a
separate motion to dismiss the Chapter 11 case of MV Realty.
The National Consumer Law Center, a nonprofit organization that
works for consumer justice and economic security for low-income and
other disadvantaged people, says it supports the Committee's bid
for dismissal.
Attorneys General in ten states have now filed lawsuits against MV
Realty alleging that the company's business model violated state
and federal laws, including false and misleading advertising,
telemarketing sales practices, unfair and deceptive acts and
practices, real estate agency and licensing, and consumer lending
laws. MV Realty targeted low-income, vulnerable homeowners by
advertising its HBA program to homeowners who were seeking
immediate cash or small loans.
The National Consumer Law Center likens MV Realty to the National
Rifle Association of America, which sought chapter 11 relief but
saw the case dismissed. The NRA's case was dismissed after the New
York bankruptcy court found that the NRA filed the bankruptcy case
"for the purpose of avoiding a state regulatory scheme."
"MV Realty filed for chapter 11 relief for reasons similar to those
that motivated the NRA. Despite its claims about wanting to reduce
litigation costs, the debtor, in truth, aims to avoid the
application of state consumer protection laws to its transactions.
MV Realty wants to escape regulators with experience and expertise,
and most importantly, regulators who have access to an array of
effective state law remedies to protect consumers. These remedies
include injunctive relief, restitution orders, penalties, and
orders clearing title to real estate located in each state. These
remedies cannot be transferred simply into a dollar amount on a
proof of claim form filed by the rare consumer who succeeds in
filing a timely proof of claim," the National Consumer Law Center
said.
About MV Realty PBC
MV Realty PBC, LLC, is a real estate brokerage firm based in Boca
Raton, Fla.
MV Realty and its affiliates filed Chapter 11 petitions (Bankr.
S.D. Fla. Lead Case No. 23-17590) on Sept. 22, 2023. In the
petitions signed by Antony Mitchell, authorized party, MV Realty
disclosed $10 million to $50 million in assets and $50 million to
$100 million in liabilities.
Judge Erik P. Kimball oversees the cases.
The Debtors tapped Seese, PA as bankruptcy counsel; Young Moore and
Henderson, PA as local counsel; and Carpenter Lipps LLP and
Frascona Joiner Goodman and Greenstein PC as special litigation
counsel.
N.E.L. TRUCKING: Case Summary & 19 Unsecured Creditors
------------------------------------------------------
Debtor: N.E.L. Trucking, Inc.
261 Chapanoke Rd.
Hertford, NC 27944
Business Description: The Debtor operates in the general freight
trucking industry.
Chapter 11 Petition Date: April 11, 2024
Court: United States Bankruptcy Court
Eastern District of North Carolina
Case No.: 24-01205
Judge: Hon. Pamela W. Mcafee
Debtor's Counsel: C. Scott Kirk, Esq.
SCOTT KIRK
1025C Director Court
Greenville, NC 27858
Tel: (252) 689-6249
E-mail: scott@csklawoffice.com
Total Assets: $330,000
Total Liabilities: $1,019,517
The petition was signed by Michael W. Miller as president/owner.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 19 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/OW3YPOQ/NEL_Trucking_Inc__ncebke-24-01205__0001.0.pdf?mcid=tGE4TAMA
NASH ENGINEERING: Ch. 7 Trustee's $59.7M Case Could Go Before Jury
------------------------------------------------------------------
Aaron Keller of Law360 reports that pump company Nash Engineering's
Chapter 7 trustee's $59.7 million case could be headed for a jury
trial. The Chapter 7 trustee and the owners of the Connecticut
pump manufacturer will square off in federal district court over
claims that executives raided $59.7 million from the Nash
Engineering Co.'s coffers, lined its stockholders' pockets and
plunged the entity into bankruptcy to avoid paying asbestos injury
claims.
About Nash Engineering Co.
Nash Engineering Co. is a Connecticut pump manufacturer.
Nash Engineering Co. sought relief under Chapter 7 of the U.S.
Bankruptcy Code (Bankr. D. Conn. Case No. 21-50644) on October 19,
2021.
Honorable Bankruptcy Judge Julie A Manning handles the case.
NAVACORD INTERMEDIATE: Fitch Assigns B LongTerm IDR, Outlook Stable
-------------------------------------------------------------------
Fitch Ratings has assigned a first-time Long-Term Issuer Default
Rating (IDR) of 'B' to Navacord Intermediate Holdings, Inc.
(Navacord). Fitch has also affirmed the IDR of Navacord's wholly
owned borrower subsidiary, Jones DesLauriers Insurance Management
Inc., at 'B'. The Rating Outlook is Stable. Fitch has also
withdrawn the Long-Term IDR 'B' rating for Navacord Corp. given it
is no longer the financial filer of the company.
Fitch has additionally affirmed the company's senior revolving
credit facility at 'B+'/'RR3', first lien term loan at 'B+'/'RR3',
senior secured notes at 'B+'/'RR3' and affirmed its senior
unsecured notes at 'CCC+'/'RR6'.
While proforma leverage is notably high at low 8.0x at FYE 2023,
Navacord's 'B' rating is reflective of the company's resilient
organic, growth profile and strong operating margin profile. The
rating also reflects the company's position as a top four
commercial brokerage firm in Canada. Limitations to the rating
include an aggressive financial policy and the expectation to
maintain an elevated leverage profile.
Fitch is withdrawing the Long-Term IDR 'B' rating for Navacord
Corp. because it is no longer the company's financial filer and
hence not considered to be relevant to Fitch's coverage.
KEY RATING DRIVERS
Solid Market Position: Fitch views Navacord's solid position in the
Canadian insurance distribution market as a credit positive, with
it being the fourth largest commercial brokerage and benefits firm
in Canada. The insurance brokerage industry is highly fragmented
and competitive, but Navacord realized solid organic revenue growth
at least in the mid-single digit range since 2017 (double digit
organic growth from 2019-2023). This compares favorably against
other Fitch-rated brokers in North America.
Fitch expects the industry to grow mid- to high single digits over
time but certain higher growth brokers such as Navacord may exceed
this growth rate. Navacord also sustained solid EBITDA margins in
the high-20% to mid-30% range in the past five years.
High Leverage: Fitch views high leverage as a limiting factor for
the IDR and will likely constrain the rating to the 'B' rating
category in the near-term. Fitch calculated proforma EBITDA
leverage (debt/EBITDA) is low 8.0x at FYE 2023, while net leverage
is in the mid-6.0x range.
Fitch expects Navacord will continue to maintain an elevated
leverage profile due to its aggressive M&A strategy. Well-managed
insurance brokerage firms can tolerate a higher degree of financial
leverage versus other Corporates sectors given the industry's high
degree of stability throughout the economic cycle, with large
brokers having only experienced organic sales declines in the
low-single digit range following the 2008 global financial crisis.
However, Navacord's leverage is higher versus other Fitch-rated
peers.
M&A Growth Strategy: Fitch views Navacord's aggressive M&A growth
strategy as a key rating consideration that constrains the IDR to
the 'B' category. The company spent nearly $1.4 billion on 97 deals
since FY 2019, and Fitch expects acquisitions will remain core to
its future strategy.
Numerous Fitch-rated issuers in the North American insurance
brokerage industry have focused on roll-up M&A. However, Navacord
is among the largest issuers purely focused on Canada. Acquisitions
were historically funded largely by debt, which presents financial
risk in a high interest rate environment. However, integration risk
is more manageable given the nature of the business model and these
deals are likely more about acquiring customers and brokers.
Diversification: Navacord benefits from broad client, broker, and
carrier diversification although it solely operates in Canada. It
operates throughout Canada, with more than 50,000 commercial
clients and its top 20 customers only comprise 4% of revenue. Its
top 10 producers are less than 10% of revenue and it is also
diversified by insurance carrier partners. It is also fairly well
diversified by lines of business, with a mix of commercial property
& casualty (P&C), personal P&C, and benefits offerings. Its
geographic concentration does not constrain the rating to its
current IDR, given its strong market position. However, Fitch
believes the company could expand outside Canada over time but
there would be an execution risk associated with the geographical
diversification.
Stable Business Model: Fitch believes the company operates a fairly
predictable business model in an industry that performs well
throughout the economic cycle. Navacord was founded in 2014 and has
a more limited operating history versus other Fitch-rated brokers,
but Fitch expects the industry to exhibit much lower revenue and
earnings declines in a recession versus other sectors given the
highly sticky nature of insurance. Many large global insurance
brokers grew organically each year since 2007, except for a modest
decline during 2009, and also grew during the 2020 coronavirus
pandemic. However, Navacord faces more unique risk given its
geographic exposure solely to the Canadian market.
Cash Flow Ratios Constrained: Fitch-defined FCF will likely be
constrained over the ratings horizon due to debt-financed M&A that
has led to high financial leverage and rising interest costs.
Interest coverage is also low in the near-term and near Fitch's
negative sensitivity threshold for the 'B' IDR, however, Fitch
views the recent re-pricing on the first lien term loan as credit
positive and expects interest coverage to improve marginally over
the forecast period.
Importantly, much of the constrained FCF is a derivative of its M&A
roll-up strategy, and Fitch views the underlying cash generation
profile of the business as healthy. If the company were to
significantly slow its M&A strategy, Fitch believes cash flow
generation would improve materially unless all of excess cash flow
were then diverted to shareholder capital returns.
DERIVATION SUMMARY
Navacord competes in a fragmented landscape of insurance brokerage
and benefits services providers that includes other local/regional
companies, national agents and large multi-national brokers. Fitch
rates numerous companies in the insurance brokerage industry that
are comparable in terms of scale, operating profile and business
model.
Navacord maintains a top four position among commercial brokers in
Canada and has established reasonable size with revenue of more
than CAD500 million and annual premium near CAD3.0 billion.
However, it remains relatively small and has meaningfully higher
financial leverage versus larger global brokers such as Marsh &
McLennan Companies, Inc. (A-), Aon plc (BBB+), among others. Fitch
also rates Truist Insurance Holdings, LLC (B/Stable) which is
larger in size but similar to Navacord is highly levered.
The 'B' rating is reflective of the company's strong historic
growth profile, solid profitability, and diversification among its
customers and business segments. This is offset by an aggressive,
debt-financed M&A strategy, that has led to high gross leverage.
KEY ASSUMPTIONS
- Organic revenue growth in the mid-single digit percentage range
over the ratings horizon plus contributions from incremental M&A
through FY27;
- EBITDA margins estimated in the low-30% range, with some
forecasted pressures from cost/wage inflation and additional growth
investments;
- Interest rates assumptions are as follows: SOFR to decline to the
high-4% range over the ratings horizon;
- Cash taxes and working capital remain a modest use of cash flow
in the next few years;
- Fitch assumes Navacord will continue its growth-driven M&A
strategy and will incur cash outflows related to purchase and
integration costs. Fitch assumes this remains the primary use of
cash flow and incremental M&A is funded via internal cash flow and
incremental debt.
RECOVERY ANALYSIS
- For entities rated 'B+' and below, where default is closer and
recovery prospects are more meaningful to investors, Fitch
undertakes a tailored, or bespoke, analysis of recovery upon
default for each issuance. The resulting debt instrument rating
includes a Recovery Rating or published 'RR' (graded from RR1 to
RR6), and is notched from the IDR accordingly. In this analysis,
there are three steps: (i) estimating the distressed enterprise
value (EV); (ii) estimating creditor claims; and (iii) distribution
of value.
- Fitch assumes Navacord would emerge from a default scenario under
the going concern approach liquidation. Key assumptions used in the
recovery analysis are as follows:
(i) Going concern EBITDA -- Fitch estimates a going concern EBITDA
of approximately CAD185 million, or 25% below the company's current
run-rate EBITDA. This lower level of EBITDA considers competitive
and/or company-specific pressures that hurt earnings in the future
while also considering that its M&A strategy could lead to a much
higher EBITDA base before any risk of bankruptcy.
(ii) EV Multiple -- Fitch assumes a 6.5x multiple, which is
validated by historic public company trading multiples, industry
M&A and past reorganization multiples Fitch has seen across various
industries.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- EBITDA Leverage, or Debt/EBITDA, sustained below 6.5x;
- (CFO-capex)/Debt sustained in low double digits.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Deterioration in operating fundamentals that lead to weaker
revenue trends, margin underperformance, and compression of cash
flows;
- Interest Coverage, or EBITDA/Interest paid, sustained below
1.5x;
- (CFO-capex)/Debt sustained near 1% or below, excluding M&A
related costs;
- EBITDA Leverage sustained above 8.0x.
LIQUIDITY AND DEBT STRUCTURE
Strong Liquidity: Navacord has a fairly well-positioned balance
sheet with CAD364 million of unrestricted cash on its balance at
January 2024. Additionally, it has full access to its CAD160
million senior secured revolving credit facility. Cash needs are
fairly minimal given the nature of its business that has low
capital intensity and working capital needs, along with fairly
manageable debt amortization and cash taxes. This should provide
sufficient liquidity to both operate its current business as well
as invest for organic growth and M&A.
Debt Structure: The company's debt capital consists of: (i) a
CAD160 million senior secured revolver (ii) USD375 million of
senior secured first lien term loans; (iii) USD 725 million of
senior secured notes and (iv) USD300 million of senior unsecured
notes. Its revolver and term loans are floating rate while the
senior notes will have a fixed coupon. There are no near-term
maturities with the first lien term debt and senior notes maturing
in 2030. Fitch expects its debt will grow in the future as the
company continues its M&A driven growth strategy.
ISSUER PROFILE
Navacord was founded in 2014 and competes in the Canadian
commercial insurance brokerage space. It was incorporated under
Navacord in 2018. The company is a top four commercial insurance
broker and benefits provider in Canada. Navacord has a network of
over 40 offices serving in excess of 50,000 commercial clients.
Madison Dearborn Partners completed its investment in Navacord in
August 2018, currently owning 51% of the company. Navacord's
management and employees account for the 49% remaining ownership.
The company has approximately 3,000 employees.
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
----------- ------ -------- -----
Jones Deslauriers
Insurance
Management Inc. LT IDR B Affirmed B
senior unsecured LT CCC+ Affirmed RR6 CCC+
senior secured LT B+ Affirmed RR3 B+
Navacord Corp. LT IDR WD Withdrawn B
Navacord
Intermediate
Holdings Inc. LT IDR B New Rating
NEW HAVEN TRUCK: Wins Cash Collateral Access Thru April 30
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Connecticut, New
Haven Division, authorized New Haven Truck and Auto Body, Inc. to
use cash collateral on an interim basis in accordance with the
budget, with a 20% variance, through April 30, 2024.
Citizens Bank, National Association asserts an interest in the
Debtor's cash collateral.
As adequate protection, the Lender is granted replacement or
substitute liens in all post-petition assets of the Debtor and
proceeds thereof, and the replacement liens will have the same
validity, extent, and priority that the Lender possessed as to said
liens on the Petition Date.
The Lender's liens and any replacement thereof pursuant to the
order, will be subject and subordinate to a carve-out of such liens
for amounts payable by the Debtor for (i) fees of the United
States
Trustee under 28 U.S.C. Section 1930(a)(6); (ii) wages and benefits
due the Debtor's employees and (iii) court approved fees of the
Debtor's professionals.
The Debtor and the Lender have agreed to an adequate protection
payment of $3,300 per month to be made by the 26th day of each
month commencing with April 26.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=uPox9z from PacerMonitor.com.
The Debtor projects $43,000 in gross profit and $41,730 in total
expenses.
About New Haven Truck and Auto Body, Inc.
New Haven Truck and Auto Body, Inc. is a complete vehicle collision
and body repair shop located in East Haven, Connecticut.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Conn. Case No. 23-30298) on April 28,
023. In the petition signed by William S. Snow, Jr., president, the
Debtor disclosed up to $10 million in both assets and liabilities.
Judge Ann M. Nevins oversees the case.
Stuart H. Caplan, Esq., at the Law Offices of Neil Crane, LLC,
represents the Debtor as legal counsel.
NORDSTROM INC: Moody's Cuts CFR to Ba2 & Alters Outlook to Stable
-----------------------------------------------------------------
Moody's Ratings downgraded Nordstrom, Inc.'s long term ratings
including its corporate family rating to Ba2 from Ba1, its
probability of default rating to Ba2-PD from Ba1-PD and its senior
unsecured ratings to Ba2 from Ba1. Moody's Ratings also affirmed
its commercial paper rating at Not Prime ("NP"). Nordstrom's
speculative grade liquidity rating ("SGL") remains unchanged at
SGL-1. The outlook was changed to stable from negative.
The downgrades reflect Nordstrom's challenge to expand operating
margins such that they return to historical levels despite progress
made in 2023 to improve its supply chain and revise its Nordstrom
Rack strategy while completing the divestiture of its unprofitable
Canada business. Nordstrom continues to face an uncertain economic
backdrop and Moody's Ratings expects limited earnings growth in
2024 as it continues to add stores to its off-price footprint.
Moody's Ratings expects leverage to be 3.1x at the end of fiscal
2024 as Nordstrom has repaid its $250 million April 2024 maturity.
However, EBIT/interest remains below 3.0x at approximately 2.7x, as
operating margins, while improving, remain depressed.
RATINGS RATIONALE
Nordstrom's Ba2 corporate family rating is supported by its solid
market positioning in both the full price and off-price segments as
well as its conservative approach to funded debt. The company has
maintained very good liquidity supported by its $800 million
secured revolving credit facility that has $770 million available
after letters of credit, a cash balance of $628 million as of
February 3, 2024 and unencumbered real estate. The company has made
significant investments historically to provide superior customer
service whether in-store, online or through its mobile app and
continues to invest. Nordstrom Rack, which was approximately 34% of
sales in 2023, has been refocused successfully on its core brands
and has returned to new store growth with 22 planned in 2024. The
company has also taken additional steps to improve profitability as
evidenced by its exit from the Canadian market and improvements to
its supply chain. Nordstrom Rack's strategy revision have included
a refocus on new store development, key designer brands, and
termination of the fulfillment of digital sales from its store
locations. Nordstrom's focus on fashion apparel and the secular
trends that face the department store industry remain credit
challenges as well as its concentration in California. The company
must also manage its vendor partners globally and navigate changing
demographic, lifestyle and workplace trends which may ultimately
impact purchasing patterns.
The stable outlook reflects Nordstrom's very good liquidity, its
continued improvement on its operational initiatives and its
conservative financial strategy including its commitment to debt
reduction. The outlook also assumes Nordstrom Rack's growth
strategy continues to be successful and that its full-line business
can maintain its market position.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ratings could be upgraded should Nordstrom consistently grow sales
at both its full line and off-price segments and return operating
margins to levels at least approaching what it achieved
historically. Diversification as its off-price business and its
marketplace grows would also be viewed favorably. An upgrade would
require operating performance, margin improvements and leverage
reductions such that EBIT to interest expense will be sustained
above 3.25x and debt to EBITDA is sustained below 3.25x while
maintaining very good liquidity. An upgrade would also require
Nordstrom to maintain financial strategies that would support its
credit metrics remaining at or better than these levels.
Ratings could be downgraded should Nordstrom's operating margins
not show improvement, its changes to its off-price strategy are not
successful, financial strategies become more aggressive or
liquidity weakens. Quantitatively, ratings could be downgraded if
EBIT to interest expense is sustained below 2.25x and debt to
EBITDA is sustained above 4.0x.
Headquartered in Seattle, Washington, Nordstrom, Inc. is a leading
fashion retailer based in the US. Nordstrom operates 93 full-line
stores, 258 Nordstrom Rack stores, two clearance stores and six
Nordstrom Local service concept stores. Additionally, the company
operates Nordstrom.com, and Nordstromrack.com. Revenue for the
latest twelve months ended February 3, 2024 was approximately $14.7
billion.
The principal methodology used in these ratings was Retail and
Apparel published in November 2023.
OCEAN POWER: Inks Strategic Alliance for Maritime Defense Solutions
-------------------------------------------------------------------
Ocean Power Technologies, Inc. announced a strategic alliance with
Red Cat Holdings, Inc., a drone technology firm specializing in the
integration of robotic hardware and software across military,
government, and commercial sectors. This collaboration signifies a
material step forward in enhancing maritime domain awareness
capabilities for air, sea, and subsea defense and security
missions.
Through this relationship, OPT's PowerBuoy and WAM-V platforms will
be integrated with Red Cat's Teal 2 Drones, facilitating a new era
of autonomous vehicle deployment. This integration aims to provide
real-time, actionable intelligence to counter maritime threats,
thereby revolutionizing situational awareness and operational
safety for reconnaissance and defense forces.
Matt Burdyny, chief commercial officer of Ocean Power Technologies,
highlighted the importance of this alliance, stating, "Our
collaboration with Red Cat aligns perfectly with our mission to
advance maritime autonomy for defense and security missions among
other applications. By combining our sustainable, ocean-powered
solutions with Red Cat's advanced drone technology, we are setting
a new standard for naval and border protection operations, ensuring
increased mission endurance and range."
The PowerBuoy system, an Uninterruptable Power Supply (UPS)
leveraging wave energy, and the WAM-V, a class-leading autonomous
surface vehicle (ASV), represent OPT's commitment to clean,
reliable, and innovative maritime solutions. These platforms are
designed to operate in a wide range of ocean depths and conditions,
providing a sustainable and adaptable solution for powering and
supporting maritime operations.
Red Cat's Teal 2 drones, known for their exceptional night vision
capabilities and modular design, complement OPT's platforms by
offering air support that extends the operational capabilities of
maritime surveillance and reconnaissance missions. This
integration supports the Pentagon's Replicator Initiative,
emphasizing drone and swarming capabilities across multiple
domains.
About Ocean Power Technologies
Headquartered in Monroe Township, New Jersey, OPT --
www.OceanPowerTechnologies.com. -- provides intelligent maritime
solutions and services that enable safer, cleaner, and more
productive ocean operations for the defense and security, oil and
gas, science and research, and offshore wind markets. The
Company's PowerBuoy platforms provide clean and reliable electric
power and real-time data communications for remote maritime and
subsea applications. The Company also provides WAM-V autonomous
surface vessels (ASVs) and marine robotics services.
For the nine months ended Jan. 31, 2024 and through the date of
filing of this Form 10-Q (March 13, 2024), management has not
obtained any material additional capital financing. Management
believes the Company's current cash balance at Jan. 31, 2024 of
$4.9 million and short term investments balance of $4.4 million may
not be sufficient to fund its planned expenditures through at least
March 2025. Ocean Power said these conditions raise substantial
doubt about the Company's ability to continue as a going concern.
The ability to continue as a going concern is dependent upon the
Company's operations in the future and/or obtaining the necessary
financing to meet its obligations and repay its liabilities arising
from normal business operations when they become due.
OLD SCHOOL POWER: Lender Seeks to Prohibit Cash Collateral Access
-----------------------------------------------------------------
Louis Ouellette asks the U.S. Bankruptcy Court for the Eastern
District of Texas, Sherman Division, to prohibit Old School Power,
LLC from using cash collateral.
On September 1, 2021, the Debtor executed a Promissory Note in the
original principal amount of $1.5 million and payable to CanAm
Oklahoma Petroleum, Ltd.
Effective as of the same date, the Debtor executed that certain
Pledge and Security Agreement to secure the Note.
CanAm perfected its security interests against the Personalty by
filing its UCC Financing Statement with the Texas Secretary of
State on September 21, 2021.
Additionally, CanAm perfected its security interests against the
Personalty and the Production by filing its UCC Financing Statement
with the State of Oklahoma on September 21, 2021.
On March 7, 2023, Old School assigned to Ouellette all of its
rights, tile, and interest in and to the Note and the Security
Agreement, pursuant to the Assignment of Note.
Additionally, the UCC Financing Statements in both Texas and
Oklahoma were assigned from CanAm to Ouellette.
The Debtor defaulted on the Note commencing in April, 2023.
Initially, Ouellette agreed to accept half-payments on the Note and
to change the due dates under the Note to accommodate the Debtor,
without waiving his rights. Thereafter, commencing in July, 2023,
the Debtor ceased making any payments on the Note, blaming cash
flow issues. Thus, by notice dated October 3, 2023, Ouellette
informed the Debtor of his intention to accelerate the Note if the
Debtor did not timely cure its defaults.
The Debtor failed to cure its defaults, and Ouellette accelerated
the Note by notice dated December 4, 2023.
When the Debtor still failed to pay any amounts on the Note,
Ouellette filed suit against the Debtor in the 481st Judicial
District Court for Denton County, Texas on December 11, 2023,
thereby initiating Cause No. 23-11374-481.
On January 18, 2024, Ouellette filed his motion for summary
judgment with the State Court, which motion was set for a hearing
on February 26, 2024. The hearing did not proceed in light of the
automatic stay.
Separately, because the Debtor had raised an issue that the filing
of the Oklahoma UCC Financing Statement was insufficient to perfect
a security interest against the Production, Ouellette recorded a
UCC fixture filing Financing Statement against the underlying real
property with the Jackson County Oklahoma Clerk on November 8,
2023.
On February 15, 2024, the Debtor filed its Adversary Complaint
against Ouellette with the Court, thereby initiating Adversary
Proceeding No. 24-04007. The sole relief sought by the Debtor in
the Adversary Proceeding is the avoidance of the Fixture Filing as
a preference. Ouellette has answered the complaint and denies that
the Debtor is entitled to any relief, including because it was not
insolvent at the time of the Fixture Filing and because the Fixture
Filing did not enable Ouellette to receive more than he otherwise
would in a hypothetical Chapter 7 case because: (i) the Debtor was
solvent; and (ii) the prior Oklahoma UCC Financing Statement
perfected a security interest.
As of the Petition Date, the amount of $970,388 was due and owing
to Ouellette. All of this amount remains due and owing and the
Debtor has made no payment to Ouellette postpetition. The Debtor
has scheduled a partially secured claim in favor of Ouellette for
$884,690, as an undisputed, liquidated, non-contingent claim.
The Debtor has been using Ouellette's cash collateral without
authorization from the Court or from Ouellette.
The Debtor is not operationally cash-flowing, and its production is
down dramatically. Again, the Debtor has suffered a substantial
decline in revenue, and lacks the funds to make necessary repairs.
Ouellette, and his interests against the Personalty and the
Production, are not protected, even as the value of his collateral
continues to decline through use and wear, not to mention the lack
of insurance.
Ouellette asserts that the Court should enter an order prohibiting
the Debtor from using any of the Production or proceeds from the
"Walls" well in Jackson County, Oklahoma, except to pay working
interest holders, unless Ouellette agrees otherwise or the Court
orders otherwise pursuant to motion, budget, notice, and a hearing,
and only if adequate protection is paid to Ouellette or escrowed
pending adjudication of the Adversary Proceeding.
A copy of the motion is available at https://urlcurt.com/u?l=IGkwhR
from PacerMonitor.com.
About Old School Power, LLC
Old School Power, LLC is a Texas entity. The Debtor owns various
oil wells, related equipment, and production from wells located in
Jackson County, Oklahoma.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Tex. Case No. 24-40275) on February 5,
2024. In the petition signed by J. Michael Issa, manager, the
Debtor disclosed up to $1 million in both assets and liabilities.
Jason P. Kathman, Esq., at Spencer Fane, represents the Debtor as
legal counsel.
OMNIQ CORP: All Six Proposals Passed at Annual Meeting
------------------------------------------------------
OmniQ Corp. disclosed in a Form 8-K filed with the Securities and
Exchange Commission that it held its 2024 Annual Meeting of
Stockholders on April 8, 2024, during which the Company's
shareholders:
(1) elected Shai Lustgarten, Mina Teicher, Yaron Shalem, Guy
Elhanani, and Israel Singer as directors to hold office until the
next meeting of the Company's stockholders or until their
successors are elected;
(2) approved the ratification of the appointment of Haynie &
Company as the Company's independent registered public accounting
firm for the fiscal year ending Dec. 31, 2024;
(3) approved a non-binding proposal on executive compensation;
(4) recommended "Every Three Years" as the frequency of future
non-Binding advisory votes on executive compensation;
(5) approved the amendment of the Company's Certificate of
Incorporation to increase the amount of authorized common stock to
35,000,000 shares; and
(6) approved the adoption of the Company's 2023 Equity Incentive
Plan for the year ending Dec. 31, 2024.
About omniQ Corp.
Headquartered in Salt Lake City, Utah, omniQ Corp. (OTCQB: OMQS) --
http://www.omniq.com-- provides computerized and machine vision
image processing solutions that use patented and proprietary AI
technology to deliver data collection, real time surveillance and
monitoring for supply chain management, homeland security, public
safety, traffic and parking management and access control
applications. The technology and services provided by the Company
help clients move people, assets and data safely and securely
through airports, warehouses, schools, national borders, and many
other applications and environments.
Salt Lake City, Utah-based Haynie & Company, the Company's auditor
since 2019, issued a "going concern" qualification in its report
dated April 1, 2024, citing that the Company has a deficit in
stockholders' equity, and has sustained recurring losses from
operations. This raises substantial doubt about the Company's
ability to continue as a going concern.
OUTKAST ELECTRICAL: Wins Cash Collateral Access Thru May 1
----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Massachusetts
authorized Outkast Electrical Contractors, Inc. to use cash
collateral, on an interim basis through May 1, 2024, to pay the
expenses set forth in the budget, with a 10% variance.
As adequate protection for any diminution in the value of their
collateral due to the Debtor's use of cash collateral, the U.S.
Small Business Administration, BDC Community Capital Corp., and
Mill Cities Community Investments will continue to have the benefit
of the replacement liens in postpetition assets granted pursuant to
the Order dated February 15, 2024. As provided in the First Interim
Order, such liens will be in postpetition assets of the same kind,
type, and nature as their prepetition collateral and any proceeds
thereof. The postpetition liens will have the same priority as the
prepetition liens of such Lien Holder and will be deemed valid,
enforceable and perfected only to the extent that the prepetition
lien of a Lien Holder is valid, enforceable and perfected.
A further hearing on the matter is set for April 30 at 11 a.m.
A copy of the order is available at https://urlcurt.com/u?l=f1pLQl
from PacerMonitor.com.
About Outkast Electrical Contractors, Inc.
Outkast Electrical Contractors, Inc. provides full-service
commercial electrical construction and renovation services
throughout the greater Boston area. The company is based in
Dorchester Center, Mass.
Outkast filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. D. Mass. Case No. 24-10272) on February 13,
2024, with $500,000 to $1 million in assets and $1 million to $10
million in liabilities. Paul Gray, president, signed the petition.
Judge Janet E. Bostwick oversees the case.
John Sommerstein, Esq., at John F. Sommerstein represents the
Debtor as legal counsel.
OVAINNOVATIONS LLC: Seeks Cash Collateral Access
------------------------------------------------
Anada, Inc., Ovalnnovations, LLC and Crimson Holdings, LLC ask the
U.S. Bankruptcy Court for the Western District of Wisconsin for
authority to use cash collateral and provide adequate protection to
IsoNova Technologies, LLC and Dairy Farmers of America, Inc.
The Debtor requires the use of cash collateral to run their
production of egg and chicken waste into high quality dried egg
protein for cost-effective use in premium pet foods.
IsoNova and DFA assert an interest in the Debtor's cash
collateral.
IsoNova has a security interest in all assets of the Debtors, a
lien on all ownership interests of the Debtors, accounts
receivables, and junior lien on the mortgage on the Michigan
property by virtue of a Settlement Agreement in the United States
District Court for the Northern District of Iowa, Case No.
20-CV-71-CJW-KEM.
DFA has a promissory note secured with a first position mortgage on
the Michigan property of Crimson Holdings, LLC in the city of
Adrian, County of Lenawee. DFA also has a perfected security
interest in Crimson Holdings equipment, machinery, and other
personal property other than consumable goods.
In exchange for the continued use of the cash collateral, the
Debtors will provide adequate protection to IsoNova and DFA for the
purpose of carrying on their reasonable and necessary costs of
operations.
The Debtors' attorneys reasonably believe that IsoNova holds a
first priority security interest in the bulk of the accounts
receivable.
For adequate protection of the mortgage and security interests of
DFA, the Debtors will provide adequate protection as follows:
a. DFA will retain a first position mortgage on the Michigan
property and security interest to equipment and machinery to the
same extent it held a perfected prepetition security interest in
Debtors' assets identified in its UCC- financing statements filed
with Michigan Department of State on December 1,2021.
b. The Debtors will make monthly payments for adequate protection
in the amount of $36,000 a month by the 15th of each month.
c. This payment is calculated by taking the outstanding balance of
$2.265 million on the note and applying an interest rate of 15%o
over the course of a l0-year amortization period.
For adequate protection of the security interests of IsoNova the
Debtors will provide adequate protection as follows:
a. IsoNova will retain a perfected post-petition security interest
to the same extent it held a perfected pre-petition security
interest in any of the Debtors' assets, extending to cash
collateral received by the Debtors post-petition;
b. Interest will accrue on the outstanding debt with IsoNova at the
contractual nondefault interest rate as specified in the underlying
loan agreements.
c. The Debtors will make adequate protection payments to IsoNova in
the form of monthly payments in the amount of $60,000 per month.
The payments will be made on or before the 15th day of each month
with the first payment due April 15, 2024. This payment is an
interest-only payment calculated by taking the outstanding balance
of 9,500,000.00 on the note and applying an interest rate of 3%
over the course of a 17-year loan amortization period.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=DsvhFP from PacerMonitor.com.
The Debtor projects total inedible expenses, on a monthly basis, as
follows:
$625,764 for April 2024;
$625,764 for May 2024; and
$625,764 for June 2024.
About OvaInnovations, LLC
OvaInnovations, LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Wisc. Case No. 24-10663) on April 8,
2024. In the petition signed by David Rettig, president, the Debtor
disclosed up to $10 million in assets and up to $50 million in
liabilities.
Judge Catherine J. Furay oversees the case.
Kristin J. Sederholm, Esq., at Krekeler Law, SC, represents the
Debtor as legal counsel.
PALM CC: Unsecureds Owed $90K to Get 10% Under Plan
---------------------------------------------------
Palm CC Inc. submitted a Disclosure Statement in support of
Debtors' Plan of Reorganization.
The Plan proposes the reorganization of the Debtor and
distributions to creditors in accordance with the priorities set
forth in the Bankruptcy Code and as agreed under the Plan. The Plan
contemplates the continuation of Debtor's operation of the real
property known as 913 Lafayette Avenue, Brooklyn, New York
Brooklyn, New York 11221, Block: 1606; Lot: 68 (the "Property").
Financing for the Plan will come from approximately $1.8 Million in
Short Term Financing, from the revenues of the Property, ongoing
business operations and/or owners' contributions.
Upon information and belief, the Debtor asserts that the
approximate present value of the Property is $2,300,000.
The Debtor has claims to general unsecured creditors in an
aggregate of approximately $90,000
Under the Plan, Class 4 consists General Unsecured Claims total
$90,000. Beginning 30 days after the Effective Date, the
Reorganized Debtor shall make payments in equal installments for a
period of 5 years, paying 10% of each claim. The payments
contemplated under this provision shall be made from the revenues
of the Property, ongoing business operations and/or owners'
contributions. Payment in full or partial satisfaction of the
Allowed Class 3 Claim may be made at any time without pre-payment
penalty.
After the Confirmation Date, as well as after the Effective Date,
the Reorganized Debtor shall be empowered to and shall continue its
ordinary course business operations. The Reorganized Debtor's
primary focus shall be to continue to hold and operate the
Property.
The Debtor has secured financing in the amount of $1.8 million upon
court approval and on the Effective Date, the Debtor will
distribute $1.8 million to SLVN. The payments contemplated under
this provision shall be made from the revenues of the Property,
ongoing business operations and/or owners' contributions. At the
end of the year, the Debtor will secure traditional financing and
continue operations.
Counsel for PALM CC INC.:
Vivian Sobers, Esq.
SOBERS LAW, PLLC
11 Broadway, Suite 615
New York, New York 10004
Tel: (917) 225 -4501
A copy of the Disclosure Statement dated March 29, 2024, is
available at https://tinyurl.ph/NPZbz from PacerMonitor.com.
About Palm CC Inc.
Palm CC Inc. owns the real property located at 913 Lafayett Avenue,
Brooklyn, New York 11221, valued at $3 million. On Feb. 29, 2024,
Palm CC filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No.
24-40921). SOBERS LAW, PLLC is serving as the Debtor's legal
counsel.
PARADOX ENTERPRISES: Files Emergency Bid to Use Cash Collateral
---------------------------------------------------------------
Paradox Enterprises, LLC asks the U.S. Bankruptcy Court for the
Eastern District of Tennessee, Winchester Division, for authority
to use cash collateral and provide adequate protection.
The Debtor requires the use of cash collateral for ordinary and
necessary operating expenses of business operations.
Based upon a pre-petition lien review, it is believed that Legalist
DIP Fund I, LP and/or Legalist DIP SPV II, LP may assert an
interest in the Debtor's cash collateral. The lien review revealed
that, on August 29, 2023, Legalist filed a UCC-1 financing
statement, Document No. 439013762, with the Tennessee Secretary of
State, asserting a lien on all of the Debtor's assets.
As for adequate protection, the Debtor intends to provide Legalist
with interim adequate protection payments in the amount of $3,000
per week.
A hearing on the matter is set for April 11, 2024 at 9 a.m.
A copy of the motion is available at https://urlcurt.com/u?l=Xb5EkJ
from PacerMonitor.com.
About Paradox Enterprises, LLC
Paradox Enterprises, LLC owns various properties valued at $6.1
million.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. Tenn. Case No. 24-10826) on April 5,
2024. In the petition signed by Eric Shelley, managing member, the
Debtor disclosed $6,174,373 in assets and $13,012,125 in
liabilities.
Judge Nicholas W. Whittenburg oversees the case.
Gray Waldron, Esq., at DUNHAM HILDEBRAND, PLLC, represents the
Debtor as legal counsel.
PARTNERS IN HOPE: Lender Seeks to Prohibit Cash Collateral Access
-----------------------------------------------------------------
West Town Bank & Trust f/k/a West Town Savings Bank, asks the U.S.
Bankruptcy Court for the District of South Carolina, to prohibit
Partners In Hope, Inc., dba Inlet Oaks and dba Oaks of Loris from
using cash collateral.
The Debtor and Lender executed the Loan Agreement and Security
Agreement dated as of August 26, 2014, whereby Lender agreed to
loan to the Debtor $1 million to facilitate the Debtor's
improvements to an assisted living facility, and the Debtor granted
Lender a security interest, and lien upon, all assets of Debtor.
To further secure the repayment of the amounts owned to Lender in
connection with the Loris Loan Agreement, the Debtor executed a
mortgage and assignment of rents in favor of Lender, granting
Lender a lien on the Debtor's real property located at 260 Watson
Heritage Road, Loris, South Carolina and 1401 Heritage Road, Loris,
South Carolina. The mortgage was filed with the Register of Deeds
of Horry County on August 26, 2014.
The Debtor and Lender executed a Loan Agreement and Security
Agreement dated as of September 29, 2015, whereby Lender agreed to
loan to Debtor $2 million to facilitate the Debtor's improvements
to an assisted living facility, and the Debtor granted Lender a
security interest, and lien upon, all assets of the Debtor.
To further secure the repayment of the amounts owned to Lender in
connection with the Murrells Inlet Loan Agreement, the Debtor
executed a mortgage and assignment of leases and rents in favor of
Lender, granting Lender a lien on the Debtor's real property
located 12287 Hwy 707, Murrells Inlet, South Carolina.
The Debtor and the United States of America, acting through the
Rural Housing Service, Rural Business-Cooperative Service, or Rural
Utilities Services within the Rural Development Mission Area, the
Farm Service Agency also entered into two loans concerning the
Loris Property and the Murrells Inlet Property:
a. Promissory Note from Debtor to the USDA dated December 12, 2013,
in the original amount of $6.490 million, secured by a mortgage in
favor of USDA granting USDA a lien on the Loris Property and the
rents, issues, and profits thereof; and
b. Promissory Note from Debtor to the USDA dated May 14, 2014, in
the original amount of $6.420 million, secured by a mortgage in
favor of USDA granting USDA a lien on the Murrells Inlet Property
and the rents, issues, and profits thereof.
The USDA's security interests in the Debtor's personal property
created as part of the Loris USDA Loan and the Murrells Inlet USDA
Loan were perfected by filing of a Financing Statement with the
South Carolina Secretary of State on December 12, 2013, and
thereafter continued on December 6, 2018, and December 7, 2023.
Lender and the USDA have executed intercreditor agreements as to
both the Loris Loan and the Murrells Inlet Loan, and, as a result,
both the Lender and the USDA have first priority security interests
in the real and personal property assets of the Debtor. See Claim
Nos. 3 and 4.
The Debtor has not paid any amounts due under either the Loris Loan
or the Murrells Inlet Loan since December 6, 2022.
As to the Loris Loan, as of March 13, 2024, the Debtor owes the
total amount of $1.2 million, which includes interest, fees, costs,
and expenses.
Of the total amount outstanding on the Loris Loan, the Debtor has
failed to make regular monthly payments since March 29, 2023, for a
total arrearage of $245,054, and thus has defaulted upon the Loris
Loan and the underlying Note and Mortgage.
As to the Murrells Inlet Loan, as of March 13, 2024, the Debtor
owes the total amount of $2.3 million.
Of the total amount outstanding on the Murrells Inlet Loan, the
Debtor has failed to make regular monthly payments since March 29,
2023, for a total arrearage of $407,804.
On March 20, 2024, counsel for the Lender sent the Debtor's counsel
a letter notifying Debtor that Lender does not consent to the
Debtor's use of cash collateral, and should the Debtor continue to
use cash collateral without getting permission from the Court,
Lender may file appropriate motions related to the post-petition
use of cash collateral.
A hearing on the matter is set for May 2, 2024 at 10:30 a.m.
A copy of the motion is available at https://urlcurt.com/u?l=TDfP1D
from PacerMonitor.com.
About Partners In Hope, Inc.
Partners In Hope, Inc. owns an assisted living facility located at
Loris Oaks, 260 Watson Heritage Rd, Loris SC 29569 valued at $12
million.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Codee (Bankr. D. S.C. Case No. 24-00935) on March 13,
2024. In the petition signed by Terry Mclean, treasurer, the Debtor
disclosed $24,501,256 in assets and $16,893,875 in liabilities.
Jane H. Downey, Esq., at BAKER DONELSON, represents the Debtor as
legal counsel.
PEACOCK INTERMEDIATE: S&P Affirms 'B-' ICR, Outlook Negative
------------------------------------------------------------
S&P Global Ratings affirmed all its ratings, including its 'B-'
issuer credit rating on Peacock Intermediate Holding II L.P. and
Pelican Products and our 'B-' issue-level rating on the company's
$525 million first-lien term loan due in 2028 with a '3' (rounded
estimate: 50%) recovery rating.
S&P said, "The negative outlook reflects our view that operating
cash flow (OCF) will be negligible and leverage will remain
elevated in the mid- to high-8x area in 2024. We could downgrade
Pelican Products within the next 12 months if we believe leverage
or liquidity will underperform our base-case forecast."
Pelican Products' demand continues to be weak from destocking
activities and market softness. For the 12 months ended Dec. 31,
2023, the company reported a total revenue decline of about 4.7%
from 2022, with its Pelican Products segment expanding 2.7% and its
BioThermal segment declining nearly 20%. BioThermal was
significantly impaired by key customers reducing inventory after
high levels of purchases in 2022 and a weaker biopharmaceutical
market. Pelican's revenues were further hurt by a decline in sales
of specialty cases to the U.S. government in the second half within
the Pelican Products segment. However, this was more than offset by
favorable pricing and continued resilience in consumer spending.
S&P said, "In 2024, we expect demand in both segments to improve as
key customers restart orders, military funding increases, and
Peacock rolls out new product introductions from recent strategic
investments. However, issues related to destocking are likely to
sequentially improve, leading to an overall soft first half with
greater recovery expected in the second half of the year.
"Although we anticipate moderate margin improvement, leverage is
likely to remain elevated. In 2023, Pelican Products increased its
S&P Global Ratings-adjusted EBITDA margins over 400 basis points
(bps), primarily on pricing initiatives and the roll-off of
manufacturing inefficiency costs that significantly degraded
margins in the first quarter of 2022. In 2024, we anticipate the
company's margins to improve 75-100 bps, driven by better
price-cost dynamics, the roll-off of one-time costs associated with
a third-party logistics issue in the first quarter of 2023, and
modestly lower restructuring-related charges. This will be
partially offset by higher salary and wage-related expenses.
However, due to underperformance in 2023, leverage is likely to
remain elevated for the third consecutive year at about 8.8x in
2024 compared to our prior forecast of 7.7x. Should the company
underperform our base-case forecast over the next several quarters,
high leverage and weak cash flow could lead to liquidity pressure.
"We do not expect material improvement in FOCF or liquidity over
the next 12 months. In early 2023, Pelican Products began
increasing capital spending to build out capacity in its
manufacturing facilities and service assets. The company plans to
continue these strategic initiatives in 2024 with expected total
capital expenditure (capex) of about $30 million-$35 million. While
we recognize that investments in strategic initiatives should
provide growth opportunities, higher capex will likely result in a
$20 million-$30 million FOCF deficit. FOCF has already been
negative the past three years. To fund capex and cash flow
deficits, Pelican Products has utilized availability on its credit
facilities and a newly placed equipment financing facility. While
it has maintained adequate liquidity over the past year, we expect
more limited headroom over the next 12 months that could mean
additional pressure in the event of a prolonged downturn in the
BioThermal segment."
Pelican Products aims to strengthen its presence in consumer-facing
markets that could increase market share and drive longer-term
profitability. In the third quarter of 2023 and into early 2024,
Pelican announced several leadership changes across its executive
and segment levels. The company also announced its intention to
focus on increasing its presence in consumer-oriented markets by
offering its high-quality products across a greater variety of
distribution channels. While these initiatives could have a
positive impact on the long-term profitability and sustainability
of the business, S&P has not yet included any potential upside in
its forecast. Furthermore, large-scale strategic transformations
could entail upfront costs.
S&P said, "The negative outlook reflects our view that Peacock's
OCF will be negligible and leverage will remain elevated in 2024.
Specifically, the company could underperform our base-case forecast
if it cannot improve its revenues and margin profile over the next
6-12 months, which would pressure its credit metrics and ability to
maintain adequate liquidity."
S&P could lower its rating on Peacock over the next 12 months if:
-- The company cannot meet our expectations for demand and margin
improvement such that leverage remains above 9x and EBITDA to
interest coverage falls below 1x with limited prospects for
improvement; or
-- Significantly weaker FOCF or an overreliance on its credit
facilities worsen its liquidity profile.
S&P could revise its outlook on Peacock to stable if:
-- It improves S&P Global Ratings-adjusted OCF;
-- The company improves and maintains leverage below 9x and EBITDA
interest coverage above 1x; and
-- Liquidity and covenant headroom remain adequate.
Governance factors are a moderately negative consideration in S&P's
credit rating analysis of Pelican Products, as is the case for most
rated entities owned by private-equity sponsors. It believes the
company's highly leveraged financial risk profile points to
corporate decision-making that prioritizes the interests of
controlling owners. This also reflects the generally finite holding
periods and a focus on maximizing shareholder returns.
PEGASUS HOME: Plan Exclusivity Period Extended to June 20
---------------------------------------------------------
Judge Mary F. Walrath of the U.S. Bankruptcy Court for the District
of Delaware extended PHF, Inc. f/k/a Pegasus Home Fashions, Inc.
and Its Affiliated Debtors' exclusive periods to file a plan of
reorganization and obtain acceptance thereof to June 20 and August
19, 2024, respectively.
As shared by Troubled Company Reporter, the Debtors commenced these
Chapter 11 Cases with the paramount goal to maximize the value of
their estates for the benefit of the Debtors' creditor
constituencies and other stakeholders through the sale of
substantially all of their assets.
Since the Petition Date, the Debtors and their advisors committed
all of their resources to maximizing value for the benefit of their
creditors and estates, including by contacting dozens of strategic
and financial potential buyers, providing access to a data room,
and answering diligence questions. Ultimately, as a result of these
efforts, the Debtors proposed a value-maximizing sale to the Court
which recently closed.
The Debtors explain that with the Sale process behind them, the
companies and their advisors have re-directed their attention to
confirmation of the Combined Disclosure Statement and Plan.
Counsel to the Debtors:
Michael R. Nestor, Esq.
Kenneth J. Enos, Esq.
S. Alexander Faris, Esq.
Kristin L. McElroy, Esq.
Rodney Square
1000 North King Street
Wilmington, DE 19801
Telephone: (302) 571-6000
Facsimile: (302) 571-1253
Email: mnestor@ycst.com
kenos@ycst.com
afaris@ycst.com
kmcelroy@ycst.com
About Pegasus Home Fashions
Pegasus Home Fashions Inc., is a manufacturer of house furnishing
products based in Elizabeth, N.J.
Pegasus and its affiliates filed Chapter 11 petitions (Bankr. D.
Del. Lead Case No. 23-11236) on Aug. 24, 2023. In the petition
filed by its chief executive officer, Timothy Boates, Pegasus
reported $100 million to $500 million in both assets and
liabilities.
The Debtors tapped Michael R. Nestor, Esq., at Young Conaway
Stargatt & Taylor, LLP as bankruptcy counsel; SSG Advisors, LLC as
investment banker; Reindeer Consulting Group, LLC as tax
consultant; Prager Metis CPAs, LLC as tax preparer and tax services
provider; and Timothy Boates of RAS Management Advisors, LLC as
interim chief executive officer. Epiq Corporate Restructuring, LLC
serves as the Debtors' administrative advisor and notice, claims,
solicitation and balloting agent.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee to represent unsecured creditors in the Debtors' Chapter
11 cases. Lowenstein Sandler, LLP and Morris James, LLP serve as
the committee's bankruptcy counsel and Delaware counsel,
respectively.
* * *
The Company filed for bankruptcy protection with a stalking horse
credit bid from an affiliate of Blue Torch Capital LP in August
2023 to secure additional funding and explore available
alternatives to the stalking horse proposal. With no competing
bids received, the Company cancelled an auction and proceeded with
the Blue Torch offer. The transaction closed in December 2023.
Blue Torch is a direct lender and investment manager that seeks to
invest in middle-market companies.
PERFECTOS CIGAR: Wins Cash Collateral Access Thru April 30
----------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida,
Orlando Division, authorized Perfectos Cigar Lounge, Inc. to use
cash collateral, on an interim basis, in accordance with the
budget, with a 10% variance, through April 30, 2024.
Caymus Funding Inc. is the holder of UCC-1 #202300794939 filed on
March 23, 2023. The Caymus's all asset encumbering claim for
$38,000 is secured up to the available equity of $18,730.
The Debtor is authorized to use the cash collateral with monthly
adequate protection payments to Caymus Funding Inc. in the amount
of $341 per month on an interim basis.
There will be a carve-out in the budget for the inclusion of fees
due the Clerk of Court and the U.S. Trustee pursuant to 28 U.S.C.
section 1930, and to the extent not already included in the budget
for the adequate protection payments.
A final hearing on the matter is set for April 30 at 3 p.m.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=hyenoN from PacerMonitor.com.
The Debtor projects total expenses, on a monthly basis, as
follows:
$76,490 for April 2024;
$45,046 for May 2024; and
$46,046 for June 2024.
About Perfectos Cigar Lounge, Inc.
Perfectos Cigar Lounge, Inc. sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No.
6:24-bk-01376-LVV) on March 21, 2024. In the petition signed by
Jeffrey Rivera, president, the Debtor disclosed up to $50,000 in
assets and up to $500,000 in liabilities.
Judge Lori V. Vaughan oversees the case.
Chad Van Horn, Esq., at Van Horn Law Group, P.A., represents the
Debtor as legal counsel.
PERSPECTIVES INC: Court OKs Cash Collateral Access Thru April 28
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Minnesota authorized
Perspectives, Inc. to use cash collateral, on an interim basis, in
accordance with the budget, through April 26, 2024.
Specifically, the Debtor is authorized to use up to $64,384 of
cash, including cash collateral, that may be subject to the liens
of Propel Nonprofits, Bremer Bank, Minnesota Housing Finance
Agency, Hennepin County, and Family Housing Fund.
To the extent of the use of prepetition cash collateral in which
the Prepetition Lenders have security interests, the Debtor is
authorized to grant to the Prepetition Lenders replacement liens,
pursuant to 11 U.S.C. section 552, in the Debtor's postpetition
assets of the same priority, dignity, and effect as the prepetition
liens, if any, on the Debtor's prepetition property.
A final hearing on the matter is set for April 24, 2024 at 10 a.m.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=UqnZUT from PacerMonitor.com.
The Debtor projects total cash out, on a weekly basis, as follows:
$20,102 for the week beginning April 15, 2024;
$20,743 for the week beginning April 22, 2024; and
$35,354 for the week beginning April 29, 2024.
About Perspectives, Inc.
Perspectives, Inc. is a human service program that addresses
society's most pressing issues: equity, diversity, inclusion,
homelessness, poverty, addiction, mental illness, food security,
and lack of access to life-changing opportunities for
disenfranchised women and children.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Minn. Case No. 24-40832) on March 28,
2024. In the petition signed by Susan Grafton, chair of the Board
of Directors, the Debtor disclosed up to $10 million in both assets
and liabilities.
Judge Katherine A. Constantine oversees the case.
Steven R. Kinsella, Esq., at FREDRIKSON & BYRON, P.A., represents
the Debtor as legal counsel.
PLANT BAE: Wins Interim Cash Collateral Access
----------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Alabama
authorized Plant Bae, LLC to use cash collateral, on an interim
basis, in accordance with the budget.
As previously reported by the Troubled Company Reporter, the Debtor
requires the use of cash collateral for administrative, general and
necessary costs and expenses including, but not limited to,
services, utilities, taxes, rent, supplies, fuel, payroll,
insurance, and miscellaneous expenses relative to the operating of
a timber harvesting or logging business.
The Debtor has suffered financial problems that began due to the
negative economic impacts of the COVID Pandemic. The Debtor's
business was shut down during COVID for several months, causing the
Debtor to fall behind on obligations. The Debtor was forced to take
on high interest loans, which increased the financial issues.
Recently, the Debtor received notice that the State of Alabama
Department of Revenue intends to place a lock on the door of the
business due to past due taxes.
Based upon information available at this time through the records
of the Alabama Secretary of State, the following entities acquired
or may have acquired security interests in, among other property,
Debtor's cash and cash equivalents:
a. ADOR/Sales and Use Tax Division UCC-1 Filed May 24, 2023
b. ADOR/Sales and Use Tax Division UCC-1 Filed March 1, 2023
c. ADOR/Sales and Use Tax Division UCC-1 Filed June 26, 2023
d. ADOR/Sales and Use Tax Division UCC-1 Filed July 27, 2023
e. ADOR/Sales and Use Tax Division UCC-1 Filed December 27, 2023
f. Quick Bridge Funding, LLC UCC-1 Filed February 12, 2024
As of the Petition Date, the Debtor's account reflected that
approximately $3,500 was on deposit with PNC Bank. This amount
takes into consideration a deposit that was made on the Petition
Date.
The court said the final hearing on the matter is set for April 25,
2024, at 11 A.M.
A copy of the order is available at https://urlcurt.com/u?l=tWIvyQ
from PacerMonitor.com.
About Plant Bae, LLC
Plant Bae, LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Ala. Case No. 24-30639) on March 22,
2024. In the petition signed by Quebe Merritt, member, the Debtor
disclosed up to $50,000 in assets and up to $100,000 in
liabilities.
Judge Christopher L. Hawkins oversees the case.
Paul D. Esco, Esq., at Paul D. Esco, Attorney at Law, LLC,
represents the Debtor as legal counsel.
POLARIS PARENT: S&P Alters Outlook to Negative, Affirms 'B-' ICR
----------------------------------------------------------------
S&P Global Ratings revised its outlook on U.S.-based provider of
automotive risk and asset management software and services Polaris
Parent LLC (Solera) to negative from stable and affirmed its 'B-'
issuer credit rating. S&P also affirmed its existing 'B-'
issue-level ratings on its first-lien term loan tranches.
S&P said, "The negative outlook reflects our forecast that the
company's total available liquidity could decrease significantly in
fiscal 2025 largely due to elevated cash interest expenses.
Nonetheless, we believe the absence of some one-off costs
experienced in fiscal 2024, organic revenue growth of 4%-6%, and
ongoing cost savings should support high-single-digit percent
EBITDA growth and thus leverage decreasing to about 8x at the end
of fiscal 2025 from the high-8x area in fiscal 2024. We also
believe continued EBITDA growth and a potentially lower interest
rate environment could result in significantly improved FOCF and
liquidity in fiscal 2026.
"We expect Solera's total available liquidity to decrease in fiscal
2025 due to greater cash interest expenses.Given the company's
large variable-rate debt balance, primarily used to fund its
aggressive fiscal 2022 acquisition activity, its FOCF generation
has become sensitive to interest rate levels. The rapid rise in
base interest rates over the past two years has largely contributed
to its cash interest expenses increasing to our expectation of $710
million-$730 million in fiscal 2024 from about $500 million in
fiscal 2022. These outflows are largely offsetting the company's
EBITDA growth from sizable cost savings and synergies, resulting in
our forecasts of reported FOCF for fiscal 2024 of below $100
million and total liquidity of $280 million-$300 million as of
March 31, 2024. This is despite about $190 million saved from a
temporary payment-in-kind (PIK) period on the company's second-lien
term loan for two quarters through August 2023.
"We expect greater cash interest in fiscal 2025 due to interest
rates remaining elevated for most of the year, and the post-PIK
loan margin on the second-lien term loan being 100 basis points
higher and applying to a larger debt principal amount. Therefore,
we expect modest FOCF of less than $50 million, EBITDA cash
interest coverage decreasing to 1.2x and lower total liquidity of
$210 million-$230 million at the end of fiscal 2025 despite EBITDA
growth and decreasing non-recurring outflows, including annual
earnout payments reducing to an expected $25 million-$30 million
from $75 million in fiscal 2024.
"Nonetheless, we did not lower our ratings because we forecast
total liquidity improving to above $300 million at the end of
fiscal 2026 given our expectations for lower interest rates then
and further EBITDA growth. We also note the company's deleveraging
profile, and we expect leverage to decrease to about 8x at the end
of fiscal 2025. At the same time, we note the company will need to
address its revolver maturity in June 2026 as it is significantly
drawn (over $400 million outstanding as of Dec. 31, 2023) and it
may have reduced operating flexibility if it significantly
underperforms by then.
"The negative outlook reflects our view that Solera's total
available liquidity could decrease significantly in fiscal 2025
largely due to greater cash interest expenses, which also reduce
EBITDA cash interest coverage to about 1.2x from 1.4x in fiscal
2024. Nonetheless, we believe the absence of one-off costs
experienced in fiscal 2024 related to the remediation of billing
issues, organic revenue growth of 4%-6%, and ongoing cost savings
should support high-single-digit percent EBITDA growth and thus
leverage reducing to about 8x at the end of fiscal 2025 from the
high-8x area in fiscal 2024. We also believe continued EBITDA
growth and potentially lower interest rates should result in
significantly improved FOCF and liquidity in fiscal 2026."
S&P could lower its rating on Solera within the next 12 months if
it views its capital structure as unsustainable due to:
-- Sustained high interest rates or a weak operating performance
that leads to negative FOCF generation or weaker-than-expected
total available liquidity;
-- The company's leverage remaining elevated and FOCF generation
weak beyond fiscal 2025, such that we believe there could be
significant risk in refinancing upcoming debt maturities, including
the revolver expiring in June 2026. This could be caused by revenue
declines and EBITDA margin pressures from key customer losses or
business disruptions related to its restructuring and integration
efforts; or
-- An increased risk of the company needing to consider an
amendment or exchange for one or more of its existing debt
instruments that we view as offering less than the original promise
of its debt obligations to lenders.
S&P would return its outlook to stable if:
-- The company maintains sustained organic revenue growth, which
could be helped by a stabilization in the fleet solutions business,
greater transaction volumes and pricing in other business segments,
or market share gains;
-- S&P expects long-term EBITDA cash interest coverage will
improve toward the mid-1x area and FOCF to debt to at least 2% on a
sustained basis helped by EBITDA growth from cost savings or a
sustained decrease in base interest rates; and
-- The company significantly improves its long-term liquidity
position even after accounting for potential seasonality and debt
servicing outflows. In addition to greater FOCF, this could be due
to an equity capital infusion or another transaction that supports
liquidity.
S&P said, "Governance factors are a modestly negative consideration
in our credit rating analysis of Solera. We believe Solera's highly
leveraged financial risk profile points to corporate
decision-making that prioritizes the interests of the controlling
owners." This also reflects the generally finite holding periods
and a focus on maximizing shareholder returns.
PREDICTIVE ONCOLOGY: KPMG In, BDO USA Out as Auditor
----------------------------------------------------
Predictive Oncology Inc. disclosed in a Form 8-K Report filed with
the U.S. Securities and Exchange Commission that on April 3, 2024,
the Audit Committee of the Board of Directors of the Company
approved the engagement of KPMG LLP as the Company's independent
registered public accounting firm for the year ending December 31,
2024, effective immediately.
During the fiscal years ended December 31, 2023 and December 31,
2022, and through April 3, 2024, neither the Company nor anyone
acting on its behalf, consulted with KPMG on (i) any matters
regarding the application of accounting principles to a specified
transaction, either completed or proposed, or the type of audit
opinion that might be rendered with respect to the Company's
consolidated financial statements, and no written report or oral
advice was provided to the Company by KPMG that was an important
factor considered by the Company in reaching a decision as to any
accounting, auditing or financial reporting issue, or (ii) any
matter that was the subject of any disagreement (as described in
Item 304(a)(1)(iv) of Regulation S-K and the related instructions
thereto) or a reportable event (as defined in Item 304(a)(1)(v) of
Regulation S-K). As of the date of this report, KPMG is in the
process of its standard client evaluation procedures and has not
accepted the engagement.
In connection with the engagement of KPMG, the Company notified BDO
USA, P.C.that it would be dismissed as the Company's independent
registered public accounting firm, effective immediately. The
decision to dismiss BDO was approved by the Company's Audit
Committee.
The report of BDO on the Company's audited consolidated financial
statements as of and for the year ended December 31, 2023 did not
contain an adverse opinion or a disclaimer of opinion, nor was it
qualified or modified as to uncertainty, audit scope, or accounting
principles, except that the BDO Report contained an explanatory
paragraph regarding substantial doubt about the Company's ability
to continue as a going concern.
Minneapolis, Minnesota-based BDO USA, P.C., issued a "going
concern" qualification in its report dated March 28, 2024, citing
that the Company has suffered recurring losses from operations and
has an accumulated deficit that raises substantial doubt about its
ability to continue as a going concern.
The BDO Report also indicated that BDO had audited the adjustments
to the 2022 consolidated financial statements to retrospectively
apply the changes in the share and per share amounts to reflect the
reverse stock split and in the change in the reportable segments.
BDO was first appointed as the Company's independent registered
public accountant for the fiscal year ended December 31, 2023, and
did not audit the Company's financial statements for the fiscal
year ended December 31, 2022 or any prior period.
During the year ended December 31, 2023 (the only fiscal year BDO
served as the Company's independent registered public accountant)
(the "Relevant Period"), there were no disagreements with BDO on
any matter of accounting principles or practices, financial
statement disclosures, or auditing scope or procedures which if not
resolved to the satisfaction of BDO, would have caused BDO to make
reference to the subject matter of the disagreements in connection
with their audit report.
During the Relevant Period, there were no reportable events of the
type described in Item 304(a)(1)(v) of Regulation S-K except for
material weaknesses in the Company's internal control over
financial reporting related to (i) inadequate accounting resources
necessary to properly identify and assess the accounting treatment
for new complex transactions in accordance with U.S. GAAP and (ii)
information technology general controls in the areas of user access
management, administrative user access, and segregation of duties
within the Company's financial information systems and other
financial reporting controls relevant to the Company's preparation
of financial statements, and related manual business process
controls.
About Predictive Oncology Inc.
Predictive Oncology Inc. is a knowledge and science-driven company
that applies artificial intelligence to support the discovery and
development of optimal cancer therapies, which can ultimately lead
to more effective treatments and improved patient outcomes. The
Company uses AI and a proprietary biobank of 150,000+ tumor
samples, categorized by tumor type, to provide actionable insights
about drug compounds to improve the drug discovery process and
increase the probability of drug compound success and offers a
suite of solutions for oncology drug development from early
discovery to clinical trials.
QHT-US INC: Seeks Cash Collateral Access Thru June 3
----------------------------------------------------
QHT-US Inc. asks the U.S. Bankruptcy Court for the Central District
of Utah, Central Division, for authority to use cash collateral and
provide adequate protection, through June 3, 2024.
The Debtor requires the use of cash collateral to cover ordinary
and necessary operating expenses in accordance with the budget,
with a 10% variance.
The creditors that assert an interest in the Debtor's cash
collateral are RFFC FInancial LLC, Everett Business Financing, and
Empire Recovery Solutions.
The Debtor believes that RFFC Financing LLC's secured claim has
priority over the interest of the other Cash Collateral Creditors.
And because the value of the Pre-Petition Cash Collateral is
substantially less than the amount of RFFC's claim, the Debtor
believes that RFFC will be the sole Cash Collateral Creditor that
will, ultimately, be treated has having a secured claim in the
Pre-Petition Cash Collateral.
As of the petition date, the Debtor's collateral that is, or will
become, cash, through the Debtor's manufacturing process, has a
value of approximately $109,715.
There are several line items projected in the Budget which
represent prospective payment for pre-petition debt—namely, for
Isomalt ($44,757, owed to Beneo Inc.), for Pouches Menthol and
Pouches HC ($31,876, owed to Aspen Press); and for Wrapping Film
($8,980, owed to Futamura Group).
As adequate protection of the Cash Collateral Creditors' interests
in the Pre-Petition Cash Collateral actually used by the Debtor,
the Debtor offers adequate protection as follows:
1. The Debtor will continue to operate the Debtor's business and
will exercise best efforts to preserve and enhance the value of its
business in the ordinary course and in accordance with the Budget;
2. On a weekly basis (beginning on Monday, April 15, 2024) and each
Monday thereafter, the Debtor will render a written accounting of
all cash used by the Debtor in satisfying the ordinary and
necessary expenses incurred by the Debtor in accordance with the
Budget;
3. The Court will grant a perfected, post-petition lien to the Cash
Collateral Creditors in post-petition inventory, accounts
receivable, deposit accounts, and cash generated by its
post-petition operations (but not including funds that may be
received by the Debtor from post-petition loans or employee
retention tax credits that may be received by the Debtor
post-petition or through chapter V avoidance actions) to replace
the value of any Pre-Petition Cash Collateral used by the Debtor
(the "Post-Petition Replacement Collateral").
4. During the eight-week budget period, the Debtor will maintain
the value of the Post-Petition Replacement Collateral so that, on
average, it does not fall below the value of the Pre-Petition Cash
Collateral actually used on a rolling basis and will render a
weekly accounting (beginning on Monday April 15,2024 and continuing
each Monday thereafter) of value the Post-Petition Replacement
Collateral subject to the Cash Collateral Creditors' Replacement
Liens.
A copy of the motion is available at https://urlcurt.com/u?l=VqYbHL
from PacerMonitor.com.
About QHT-US, Inc.
QHT-US, Inc. is a family owned healthy lozenge manufacturer located
in Utah.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Utah Case No. 24-21569) on April 8,
2024. In the petition signed by John W. Taylor, president/CEO, the
Debtor disclosed up to $500,000 in assets and up to $10 million in
liabilities.
Judge Kevin R Anderson oversees the case.
Adam S. Affleck, Esq., at Richards Brandt Miller Nelson, oversees
the case.
QUALITY CARE: U.S. Trustee Appoints Joseph Tomaino as PCO
---------------------------------------------------------
William Harrington, U.S. Trustee for Region 2, appointed Joseph
Tomaino as patient care ombudsman for Quality Care Physical
Therapy, P.C.
The appointment was made pursuant to the order from the U.S.
Bankruptcy Court for the Eastern District of New York on March 11.
Section 333(b) of the Bankruptcy Code provides that the patient
care ombudsman shall:
* monitor the quality of patient care provided to patients of
the debtor, to the extent necessary under the circumstances,
including interviewing patients and physicians;
* not later than 60 days after the date of this appointment,
and not less frequently than at 60 day intervals thereafter, report
to the court after notice to the parties in interest, at a hearing
or in writing, regarding the quality of patient care provided to
patients of the debtor; and
* if such ombudsman determines that the quality of patient
care provided to patients of the debtor is declining significantly
or is otherwise being materially compromised, file with the court a
motion or written report, with notice to the parties in interest
immediately upon making such determination.
Mr. Tomaino of Grassi Healthcare Advisors, LLC disclosed in a court
filing that he is a "disinterested person" pursuant to Section
101(14) of the Bankruptcy Code.
The ombudsman may be reached at:
Joseph Tomaino
Grassi Healthcare Advisors, LLC
750 Third Avenue, 28th Floor
New York, NY 10017
Tel: (212) 223-5020
Email: jtomaino@grassihealthcareadvisors.com
About Quality Care Physical Therapy
Quality Care Physical Therapy, P.C. sought protection under Chapter
11 of the U.S. Bankruptcy Code (Bankr. E.D.N.Y. Case No. 24-40865)
on February 27, 2024, with up to $50,000 in assets and up to
$500,000 in liabilities.
Judge Nancy Hershey Lord presides over the case.
Brian J. Hufnagel, Esq., at Morrison Tenenbaum, PLLC represents the
Debtor as legal counsel.
R&P LAND: Court OKs Interim Cash Collateral Access
--------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Alabama,
Southern Division, authorized R&P Land Company, LLC to use cash
collateral, on an interim basis, in accordance with the budget.
The Debtor requires the use of cash collateral to pay necessary
operating expenses such as utility, payroll, payroll taxes, sales
taxes, insurance and other necessary operating expenses.
Community Loan Servicing claims a first priority lien on all of the
Debtor's cash accounts and receivable: approximately $950,000 and
cash: approximately $1,076.
As adequate protection, the Debtor will pay to Community Loan
Servicing, LLC, payments of $2,900 monthly as adequate protection
for the use of cash collateral. The Debtor's first adequate
protection payment shall be paid and received by the date of the
final hearing.
As further adequate protection for the Debtor's use of cash
collateral, pursuant to 11 U.S.C. section 361(2), to the extent
that (i) any cash collateral is used and not repaid by the Debtor
or (ii) any item of non-cash collateral is depleted, disposed of,
or otherwise declines in value, Community Loan Servicing, LLC, is
granted a replacement lien and security interest in and to all
property acquired by the Debtor after the Petition Date of the same
type or nature as the collateral, and all proceeds thereof to the
same extent and in the same nature as provided under the terms of
the loan agreement, subject to the payment of the quarterly fees of
the Bankruptcy Administrator pursuant to 28 U.S.C. section 1930.
A copy of the order is available at https://urlcurt.com/u?l=JbqKiM
from PacerMonitor.com.
About R & P Land Company, LLC
R & P Land Company, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Ala. Case No. 24-00938) on March
27, 2024. In the petition signed by Charles P. Sanford, managing
member, the Debtor disclosed $1,910,383 in assets and $588,990 in
total liabilities.
Judge Sims Crawford oversees the case.
Robert C. Keller, Esq., at RUSSO, WHITE & KELLER, P.C., represents
the Debtor as legal counsel.
RANIER VIEW: Court OKs Cash Collateral Access on Final Basis
------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Washington
authorized Rainier View Court III, LLC authorized Rainier View
Court III, LLC to use cash collateral, on a final basis, in
accordance with the budget, with a 10% variance.
The Debtor requires the use of cash collateral to continue its
ongoing operations in the ordinary course of business and to avoid
disruption of such operations.
Tryon Street Acquisition Trust I, Fidelis Equity and Real Estate
Fund A, LLC ISAOA/ATIMA, Civic Financial Services, Civic Real
Estate Holdings III, LLC, and Nexus Capital, LLC assert an interest
in the Debtor's cash collateral.
As adequate protection for the Debtor's use of cash collateral, the
Secured Lenders are granted valid, binding, enforceable and
perfected replacement liens on and security interests in all
Postpetition Collateral, in same extent and with the same validity
and priority as Secured Lenders' liens in Prepetition Collateral,
to secure an amount equal to the decrease, if any, in the value of
Secured Lenders' interest in cash collateral as of the Petition
Date.
As additional adequate protection, the Debtor will make monthly
payments to Tryon in the amount of $34,000 for so long as the
Debtor's right to use cash collateral exists.
The Debtor will continue to maintain insurance on its assets as the
same existed as of the Petition Date.
Secured Lenders will have a claim allowable under 11 U.S.C. section
507(a)(2) arising from the stay of action against the Prepetition
Collateral from the use, sale, or lease of such collateral, or from
the granting of any lien on the collateral, then Secured Lenders'
claims will have priority over every other claim allowable under 11
U.S.C. section 507(a)(2), in any amount equal to the decrease, if
any, in the value of Secured Lenders' interests in the Prepetition
Collateral as a result of the Debtors' use of cash collateral.
These events constitute a Termination Event:
(a) the Debtor's breach of any material provision of the Final
Order that remains uncured 10 business days following the Debtor's
receipt of notice of such breach from any party in interest;
(b) conversion of the Debtor's case to a case under chapter 7 of
the Bankruptcy Code; or
(c) the appointment of a trustee in the chapter 11 case.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=oktOzS from PacerMonitor.com.
The Debtor projects total expenses, on a monthly basis, as
follows:
$27,474 for April 2024;
$62,799 for May 2024; and
$62,249 for June 2024.
About Ranier View Court III, LLC
Ranier View Court III, LLC owns three properties located in the
state of Washington having a total current value of $14.05
million.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Wash. Case No. 24-40549) on March 14,
2024. In the petition signed by Vance Ostrander, managing member,
the Debtor disclosed $14,114,687 in total assets and $9,550,128 in
total liabilities.
Judge Brian D Lynch oversees the case.
Thomas A Buford, Esq., at Bush Kornfield, LLP, represents the
Debtor as legal counsel.
REDHILL BIOPHARMA: Kesselman & Kesselman Raises Going Concern Doubt
-------------------------------------------------------------------
RedHill Biopharma Ltd. disclosed in a Form 10-K Report filed with
the U.S. Securities and Exchange Commission for the fiscal year
ended December 31, 2023, that its auditor expressed that there is
substantial doubt about the Company's ability to continue as a
going concern.
Tel-Aviv, Israel-based Kesselman & Kesselman., the Company's
auditor since 2010, issued a "going concern" qualification in its
report dated April 5, 2024, citing that the Company has an
accumulated deficit and its activities have been funded primarily
through offerings of the Company's securities and borrowing.
There is no assurance that the Company's business will generate
sustainable positive cash flows to fund its business. Management
expects that the Company will incur additional losses as it
continues to focus its resources on advancing the development of
its therapeutic candidates, as well as advancing its commercial
operations, that will result in negative cash flows from operating
activities. Management believes that there is presently
insufficient funding available to allow the Company to fund its
activities for a period exceeding one year from the date of
issuance of the consolidated financial statements. These conditions
and events indicate that a material uncertainty exists that may
cast significant doubt (or raise substantial doubt, as contemplated
by PCAOB standards) about the Company's ability to continue as a
going concern.
During the year ended December 31, 2023, the Company's net cash
used in operating activities was $35.8 million leaving a cash
balance of $6.5 million, including $0.8 million of restricted cash
held in the escrow account. Because the Company does not have
sufficient resources to fund its operations for the next 12 months
from the date of this filing, management has substantial doubt of
the Company's ability to continue as a going concern. The Company
has determined that the Company's available cash at December 31,
2023, together with proceeds raised in the January 2024 Offering
and the April 2024 Offering, will not be sufficient to fund current
liabilities and capital expenditure requirements for a period
exceeding one year from the date of its Annual Report. The
Company's operational costs include the payment of the remaining
pre-closing liabilities relating to Movantik, which its subsidiary,
RedHill U.S., retained under its agreement with HCRM for the
extinguishment of all its debt obligations under the Credit
Agreement in exchange for the transfer of its rights in Movantik to
an affiliate of HCRM. The Company will need to raise significant
additional capital to finance its losses and negative cash flows
from operations. The Company is also actively pursuing and in
discussions with multiple parties regarding strategic business
transactions, including potential divestment of certain of its
assets. If it were to fail to raise sufficient capital or on
favorable terms or successfully conclude a strategic business
transaction, the Company may need to cease operations. There are no
assurances that the Company will be able to raise significant
additional capital on terms favorable to it or at all, particularly
given the current difficult conditions in the capital markets and
very low market capitalization which makes it more difficult to
raise significant amounts of capital. In addition, following the
sale of its rights to Movantik in 2023, the Company has lost its
primary revenue source and its ability to operate as a financially
viable commercial business has been significantly more difficult.
The Company reported a net income of $23.9 million for the year
ended December 31, 2023, as compared to a net loss of $71.7 million
for the year ended December 31, 2022.
As of December 31, 2023, the Company had $23 million in total
assets, $21 million in total liabilities, and $2.1 million in total
equity.
A full-text copy of the Company's Form 10-K is available at
https://tinyurl.com/mtyd85cy
About RedHill Biopharma
RedHill Biopharma Ltd is a biopharmaceutical company primarily
focused on gastrointestinal diseases and infectious diseases. The
Company's pipeline includes several drug candidates in clinical
development and promoting several specialty gastrointestinal
products. RedHill Biopharma serves customers worldwide.
RENNOVA HEALTH: Delays 2023 Annual Report to Complete Audit
-----------------------------------------------------------
Rennova Health, Inc. was unable to file, without unreasonable
effort and expense, its Annual Report on
Form 10-K for the year ended Dec. 31, 2023, within the prescribed
time period because the Company is still compiling information for
the Form 10-K and its auditors have not completed their audit of
the financial statements for the year then ended.
The Company expects to file its Form 10-K on or prior to the 15th
calendar day following the prescribed due date.
About Rennova Health
Rennova Health, Inc. -- http://www.rennovahealth.com-- is a
provider of health care services for its patients. The Company
owns one operating hospital in Oneida, Tennessee, a hospital
located in Jamestown, Tennessee that it plans to reopen, and
operate and an operating rural clinic in Kentucky. In addition,
the Company owns a subsidiary providing services in the behavioral
health sector on the campus of its hospital in Oneida, Tennessee.
Rennova Health reported a net loss available to common stockholders
of $334.17 million for the year ended Dec. 31, 2022, compared to a
net loss available to common stockholders of $500.87 million for
the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had
$20.57 million in total assets, $49.67 million in total
liabilities, and a total stockholders' deficit of $29.09 million.
Salt Lake City, Utah-based Haynie & Company, the Company's auditor
since 2018, issued a "going concern" qualification in its report
dated April 17, 2023, citing that the Company has recognized
recurring losses and negative cash flows from operations. This
raises substantial doubt about the Company's ability to continue as
a going concern.
At September 30, 2023, the Company had a working capital deficit
and a stockholders' deficit of $41.5 million and $27.6 million,
respectively. While the Company had net income of $1.5 million for
the nine months ended September 30, 2023, it incurred a net loss of
$0.5 million and $3.3 million for the three months ended September
30, 2023, and the year ended December 31, 2022, respectively. As
of the date of this report, its cash is deficient and payments for
its operations in the ordinary course are not being made. Losses
in
prior years and other related factors, including past due accounts
payable and payroll taxes, as well as payment defaults under the
terms of outstanding notes payable and debentures, raise
substantial doubt about the Company's ability to continue as a
going concern for 12 months from the filing date of this report.
RESHAPE LIFESCIENCES: Has Until Oct. 7 to Regain Nasdaq Compliance
------------------------------------------------------------------
Reshape Lifesciences Inc. reported in a Form 8-K filed with the
Securities and Exchange Commission that on April 9, 2024, the
Company received a written notice from Listing Qualifications
department of The Nasdaq Stock Market that the Company has not
regained compliance with the minimum $1.00 bid price requirement.
However, the Nasdaq Staff has determined that the Company is
eligible for an additional 180-calendar day period, or until Oct.
7, 2024, to regain compliance.
If at any time during this period the closing bid price of the
Company's common stock is at least $1.00 per share for a minimum of
10 consecutive business days, the Nasdaq Staff will provide the
Company with a written confirmation of compliance and the matter
will be closed. If compliance cannot be demonstrated by Oct. 6,
2024, the Nasdaq Staff will provide written notification that the
Company's common stock will be delisted. At that time, the Company
may appeal the Nasdaq Staff's determination to a Hearings Panel.
The Company intends to actively monitor its performance with
respect to the listing standards and will consider available
options to resolve the deficiency and regain compliance with the
Nasdaq rules, including, if necessary, implementing a reverse stock
split at a ratio within the range of 1-for-10 to 1-for-60 that was
approved by the Company's stockholders at the Company's annual
meeting of stockholders on Feb. 23, 2024.
As previously disclosed by ReShape on Current Report on Form 8-K
filed with the SEC on Oct. 10, 2023 the Company received a written
notice from Nasdaq indicating that the Company was not in
compliance with the $1.00 minimum bid price requirement set forth
in Nasdaq Listing Rule 5550(a)(2) for continued listing on The
Nasdaq Capital Market. The Initial Bid Price Notice provided the
Company with a compliance period of 180 calendar days in which to
regain compliance.
About ReShape Lifesciences
ReShape Lifesciences Inc. (Obalon Therapeurtics, Inc.) is a weight
loss and metabolic health-solutions company, offering an integrated
portfolio of proven products and services that manage and treat
obesity and metabolic disease.
ReShape Lifesciences reporting a net loss of $11.38 million for the
year ended Dec. 31, 2023, compared to a net loss of $46.21 million
for the year ended Dec. 31, 2022. As of Dec. 31, 2023, the Company
had $10.66 million in total assets, $4 million in total
liabilities, and $6.66 million in total stockholders' equity.
Irvine, California-based RSM US LLP, the Company's auditor since
2022, issued a "going concern" qualification in its report dated
April 1, 2024, citing that the Company has suffered recurring
losses from operations and negative cash flows. The Company
currently does not generate revenue sufficient to offset operating
costs and anticipates such shortfalls to continue. This raises
substantial doubt about the Company's ability to continue as a
going concern.
RESOURCE FOR EDUCATION: Unsecureds to Get Remaining Funds in Plan
-----------------------------------------------------------------
Resource for Education, Advocacy, Communication and Housing
submitted a First Amended Chapter 11 Plan of Reorganization, dated
March 27, 2024.
The Plan is a reorganizing plan. The Debtor's Plan will be funded
from Debtor's income. Allowed administrative claims will be paid in
full on the Effective Date, unless otherwise agreed to by the
administrative claimant. The funds remaining after payment of
allowed administrative claims and any priority tax claim will be
paid pro rata to holders of allowed general unsecured claims over 3
years.
Incorporated in 1969, the Debtor is a not-for-profit entity
dedicated to assisting persons with intellectual and developmental
disabilities. Originally named the Whittier Area Parents
Association for the Developmentally Handicapped, Inc., Debtor was
organized by parents of persons with disabilities to provide
rehabilitation services and for the continuing welfare of those
needing the services. In 2015, Debtor's name was changed to
Resource for Education, Advocacy, Communication and Housing
("REACH") to align Debtor's name with its mission and the services
it provides. As its name now reflects, Debtor seeks to find
comprehensive, individualized help to allow persons with
disabilities to be their best selves and live their best lives.
In 2023, two lawsuits were filed that contributed significantly to
Debtor's decision to file this Chapter 11 case. On August 24, 2023,
Jesus Esparza filed an action against the Debtor, asserting claims
on behalf of an alleged class seeking a recovery under California's
private attorney general act ("PAGA") for alleged violations of
certain employment laws ("Esparza Action"). On September 6, 2023,
Robert Sandoval filed an action against the Debtor ("Sandoval
Action"). Like the Esparza Action, the Sandoval Action asserts PAGA
claims on behalf of an alleged class for purported violations of
certain employment laws. The Debtor denies the allegations in both
the Esparza Action and the Sandoval Action.
Under the Plan, Class 3 General Unsecured Claims total $24,670,498.
Any Allowed Claim in this Class shall be paid pro rata with other
Class claims.
The Debtor is dedicating all of its projected disposable income for
a period of 3 years. In addition, the Debtor will make a one-time
contribution of up to $1 million from cash reserves in month 36 of
the plan to ensure that creditors are paid at least the amount
projected for unsecured creditors in the liquidation analysis.
Distributions to Class 3 claimants will be made twice per year by
the Disbursing Agent, with the first distribution due on or before
December 31, 2024. The second distribution will be made on or
before June 30, 2025. The third distribution will be made on or
before December 31, 2025. The remaining distributions will be made
on or before June 30 and December 31 of each subsequent year.
Class 3 is impaired.
The Debtor anticipates funding the plan from three sources. First,
the Debtor is dedicating its projected disposable income over three
(3) years to pay its creditors. The Plan will conclude at the
earlier of payment in full to creditors holding Allowed Claims or
the date of the sixth (6th) distribution to class 3 claim holders.
To ensure its ongoing viability, the Debtor has determined that it
needs a cash reserve equal to its average operational costs for
three months, which is approximately $1,725,000 ("Reserve Amount").
Debtor's projected disposable income is all amounts held by the
Debtor in excess of the Reserve Amount at the end of a calendar
month. The Debtor will turn over to the Disbursing Agent its
projected disposable income monthly. Throughout the life of the
Plan, for months in which Debtor's total ending cash is less than
the Reserve Amount, the Debtor will turn over $2,500 to the
Disbursing Agent for the payment of claims.
Second, the Debtor is owed approximately $123,150 from E-Quality
Care, which the Debtor anticipates collecting over the life of the
Plan. The Debtor will dedicate the amounts collected from E-Quality
Care to pay creditors.
Third, the Debtor will make a one-time contribution of up to $1
million from its cash reserves in month 36 to ensure that Class 3
receive at least the amount set forth in the liquidation analysis
as being available to general unsecured creditors in this case.
Attorneys for the Debtor:
Matthew W. Grimshaw, Esq.
David A. Wood, Esq.
MARSHACK HAYS WOOD LLP
870 Roosevelt
Irvine, CA 92620
Tel: 949-333-7777
Fax: 949-333-7778
E-mail: grimshaw@marshackhays.com
dwood@marshackhays.com
A copy of the Plan of Reorganization dated March 27, 2024, is
available at https://tinyurl.ph/HzvvG from PacerMonitor.com.
About Resource For Education, Advocacy,
Communication and Housing
Resource for Education, Advocacy, Communication and Housing sought
protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr.
C.D. Cal. Case No. 8:23-bk-12429-SC) on November 17, 2023. In the
petition signed by Adriana Garcia, chief executive officer, the
Debtor disclosed up to $10 million in both assets and liabilities.
Judge Scott C. Clarkson oversees the case.
Matthew W. Grimshaw, Esq., at Marshack Hays Wood LLP, is the
Debtor's legal counsel.
RESTIERI HEALTHCARE: Seeks Cash Collateral Access
-------------------------------------------------
Restieri Healthcare Services, LLC asks the U.S. Bankruptcy Court
for the Middle District of Florida, Jacksonville Division, for
authority to use cash collateral and provide adequate protection.
The Debtor intends to use cash collateral to pay operating expenses
and the costs of administering the Chapter 11 case.
The Debtor's primary secured creditors are the Internal Revenue
Service and CRF Small Business Loan Company. The obligations to CRF
are secured by liens on substantially all assets of the Debtor, as
reflected in a UCC-1 Financing Statement filed in August 2019.
The IRS asserts liens on the Debtor's assets by virtue of various
tax liens, recorded with the Florida Secretary of State in November
2015 and later dates.
Additionally, it appears that the Debtor is obligated on loans or
similar facilities to (a) WebBank or Can Capital under a Business
Loan Agreement dated November 10, 2022 and September 28, 2023 and
(b) Celtic Bank Corporation or BlueVine, Inc., dated August 3,
2022. No UCC-1 filings appear to have been filed by either entity,
so these claims appear to be unsecured and without an interest in
cash collateral.
CRF and the IRS may have an interest in the Debtor's cash
collateral within the meaning of 11 U.S.C. section 363(a).
As of the Petition Date, the Debtor had cash in accounts totaling
approximately $7,000 and the Debtor's accounts receivable total
approximately $12,000.
In exchange for the Debtor's ability to use cash collateral in the
operation of its business, the Debtor proposes to grant to the
secured creditors as adequate protection, replacement liens to the
same extent, validity, and priority as existed on the Petition
Date.
If allowed to use cash collateral, the Debtor believes that it can
stabilize its business operations and maintain going concern
value.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=eQP9L5 from PacerMonitor.com.
The Debtor projects $8,000 in total revenue and $6,860 in total
expenses.
About Restieri Healthcare Services, LLC
Restieri Healthcare Services, LLC provides regenerative therapy for
joint pain and other conditions which services the Gainesville,
Florida area. The Debtor sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No. 3:21-bk-01843) on
July 28, 2021. In the petition signed by Dr. Lawrence T. Restie,
manager, the Debtor disclosed up to $1 million in assets and up to
$10 million in liabilities.
Judge Karen K. Specie oversees the case.
Jason A. Burgess, Esq. at The Law Offices of Jason A. Burgess, LLC
is the Debtor's counsel.
RESTORATION FOREST: Court Approves Disclosures, Confirms Plan
-------------------------------------------------------------
Judge Karen B. Owens has entered an order approving the Disclosure
Statement of Restoration Forest Products Group, LLC, et al. as
providing holders of Claims entitled to vote on the Plan with
adequate information to make an informed decision as to whether to
vote to accept or reject the Plan in accordance with section
1125(a)(1) of the Bankruptcy Code.
The Plan is confirmed under Section 1129 of the Bankruptcy Code.
All objections, responses to, and statements and comments, if any,
in opposition to, the Plan or the Disclosure Statement,
respectively, other than those resolved or withdrawn with prejudice
in their entirety prior to, or on the record at, the Combined
Hearing, are overruled in their entirety for the reasons stated on
the record.
The Debtors shall fund distributions under the Plan with: (a) Cash
on hand, including Cash from operations; (b) the proceeds of the
DIP Loans; (c) the Exit Facility; and (d) the Reorganized Company
Equity Interests.
On the Effective Date, the Debtors or Reorganized Debtors shall
establish and fund the Wind Down Account with the Wind Down Amount.
The Wind Down Account (i) shall not be and shall not be deemed
property of the Debtors or the Reorganized Debtors, (ii) shall be
held in reserve to fund the Debtors' wind down expenses and the
fees and expenses of the General Unsecured Claims Administrator and
Ombudsman, in accordance with the Wind Down Budget; and (iii) may
be subject to a Lien securing the Exit Facility, which Lien shall
be subject in all respects to payment of Claims provided for in the
Wind-Down Budget. As soon as reasonably practicable after all
distributions have been made to the Consenting GUC Holders and the
final fees and expenses of the General Unsecured Claims
Administrator and Ombudsman have been paid, any and all Cash
remaining in the Wind Down Account shall be indefeasibly paid to
the Reorganized Debtors.
Only Holders of Claims in Class 3 (Bridge Loan Claims), Class 4
(Senior Series A Bond Claims), and Class 5 (Subordinated Series B
Bond Claims) were entitled under the Plan to vote to accept or
reject the Plan (the "Voting Classes"). As evidenced by the Voting
Declaration, Kroll Restructuring Administration LLC ("Kroll" or the
"Noticing and Claims Agent") adhered to the Solicitation Procedures
and distributed Solicitation Packages (including Ballots) to
holders of Claims in the Voting Classes. As further evidenced by
the Voting Declaration, each Voting Class has voted to accept the
Plan in accordance with the requirements of section 1124, 1126, and
1129 of the Bankruptcy Code.
Article III of the Plan specifies that Class 1 (Other Priority
Claims) and Class 2 (Other Secured Claims) are unimpaired under the
Plan within the meaning of section 1124 of the Bankruptcy Code,
thereby satisfying section 1123(a)(2) of the Bankruptcy Code.
Article III of the Plan designates Class 3 (Bridge Loan Claims),
Class 4 (Senior Series A Bond Claims), and Class 5 (Subordinated
Series B Bond Claims) as impaired within the meaning of section
1124 of the Bankruptcy Code and specifies the treatment of the
Claims in those Classes, thereby satisfying section 1123(a)(3) of
the Bankruptcy Code. Article III of the Plan designates Class 6
(Lateral Loan Claims), Class 7 (General Unsecured Claims), Class 9
(Subordinated Claims), and Class 10 (Equity Interests in RFPG) as
impaired and deemed not entitled to vote within the meaning of
section 1124 of the Bankruptcy Code and specifies the treatment of
the Claims in that Class, thereby satisfying section 1123(a)(3) of
the Bankruptcy Code.
Article III of the Plan designates Class 8 (Intercompany Claims)
and Class 11 (Intercompany Equity Interests) as impaired or
unimpaired within the meaning of section 1124 of the Bankruptcy
Code and specifies the treatment of the Claims or Equity Interests
in that Class, thereby satisfying sections 1123(a)(2) and
1123(a)(3) of the Bankruptcy Code.
Pursuant to Article III of the Plan, as set forth in Section
1123(b)(1) of the Bankruptcy Code, (a) Class 1 (Other Priority
Claims) and Class 2 (Other Secured Claims) are Unimpaired; (b)
Class 3 (Bridge Loan Claims), Class 4 (Senior Series A Bond
Claims), Class 5 (Subordinated Series B Bond Claims), Class 6
(Lateral Loan Claims), Class 7 (General Unsecured Claims), Class 9
(Subordinated Claims), and Class 10 (Equity Interests in RFPH) are
Impaired; and (c) and Class 8 (Intercompany Claims) and Class 11
(Intercompany Equity Interests) are Impaired/Unimpaired.
Class 1 (Other Priority Claims) and Class 2 (Other Secured Claims)
are Classes of Unimpaired Claims or Equity Interests that are
conclusively presumed to have accepted the Plan in accordance with
section 1126(f) of the Bankruptcy Code. Class 6 (Lateral Loan
Claims), Class 7 (General Unsecured Claims), Class 9 (Subordinated
Claims), and Class 10 (Equity Interests in RFPG) are Classes of
Impaired Claims or Equity Interests that are conclusively deemed to
have rejected the Plan in accordance with section 1126(g) of the
Bankruptcy Code. Class 8 (Intercompany Claims) and Class 11
(Intercompany Equity Interests) are a Class of Claims or Equity
Interests that are conclusively deemed not to have accepted the
Plan in accordance with section 1126(g) of the Bankruptcy Code or
conclusively presumed to have accepted the Plan according to
section 1126(f) of the Bankruptcy Code. Effective as of February 1,
2024, Class 3 (Bridge Loan Claims) is a vacant Class of Claims.
Class 4 (Senior Series A Bond Claims) is an Impaired Class that has
voted to accept the Plan in accordance with sections 1126(b) and
(c) of the Bankruptcy Code, without regard to the votes of insiders
of the Debtors. Class 5 (Subordinated Series B Bond Claims) is
Class of Impaired Claims that voted to accept the Plan in
accordance with sections 1126(b) and (c) of the Bankruptcy Code,
however, such holders are insiders. Thus, Section 1129(a)(8) of the
Bankruptcy Code is not satisfied; however, the Plan can
nevertheless be confirmed pursuant to section 1129(b) of the
Bankruptcy Code.
The Plan may be confirmed pursuant to Section 1129(b) of the
Bankruptcy Code because the Debtors have demonstrated by a
preponderance of the evidence that the Plan (a) satisfies all of
the other requirements of section 1129(a) of the Bankruptcy Code
and (b) does not "discriminate unfairly" and is "fair and
equitable" with respect to the Rejecting Classes. Class 6 (Lateral
Loan Claims), Class 7 (General Unsecured Claims), Class 9
(Subordinated Claims), and Class 10 (Equity Interests in RFPG) are
conclusively deemed to have rejected the Plan, and Class 8
(Intercompany Claims) and Class 11 (Intercompany Equity Interests)
are either conclusively presumed to have accepted the Plan or
conclusively deemed to have rejected the Plan. Based upon the
evidence proffered, adduced, and presented by the Debtors at the
Combined Hearing, the Plan does not discriminate unfairly and is
fair and equitable with respect to the aforementioned Classes, as
required by sections 1129(b)(1) and (b)(2) of the Bankruptcy Code,
because no holder of any interest that is junior to each such Class
will receive or retain any property under the Plan on account of
such junior interest, and no holder of a Claim or Equity Interest
in a Class senior to such Classes is receiving more than 100%
recovery on account of its Claim or Equity Interest. Thus, the Plan
may be confirmed notwithstanding the deemed rejection of the Plan
by these Classes.
Plan of Reorganization
The Debtors filed an Amended Joint Prepackaged Chapter 11 Plan of
Reorganization.
Although proposed jointly for administrative purposes, the Plan
constitutes a separate Plan for each Debtor for the resolution of
outstanding Claims and Equity Interests pursuant to the Bankruptcy
Code. The Debtors seek to consummate the Restructuring Transactions
on the Effective Date of the Plan. Each Debtor is a proponent of
the Plan within the meaning of section 1129 of the Bankruptcy Code.
The classifications of Claims and Equity Interests set forth in
Article III of the Plan shall be deemed to apply separately with
respect to each Plan proposed by each Debtor, as applicable. The
Plan does not contemplate substantive consolidation of any of the
Debtors.
Under the Plan, Class 7 consists of General Unsecured Claims. On
the Effective Date, all General Unsecured Claims shall be
cancelled, released, and discharged, and shall be of no further
force or effect. Thereafter, Holders of General Unsecured Claims
shall not receive any distributions on account of such General
Unsecured Claims.
Notwithstanding the above treatment, each Holder of an Allowed
General Unsecured Claim shall be eligible to receive the
consideration being provided to Holders of Allowed General
Unsecured Claims that timely elect to opt-in to the Releases, as
described in Article IV of the Plan.
Pursuant to the Committee Settlement, each Holder of an Allowed
Deficiency Claim and each Holder of a Lateral Unsecured Claim will
be deemed to have waived the right to receive any distribution from
the Claims Cash Pool on account of their Allowed Deficiency Claims
or Allowed Lateral Unsecured Claim, as applicable.
Class 7 is impaired.
The Debtors shall fund distributions under the Plan with: (a) Cash
on hand, including Cash from operations; (b) the proceeds of the
DIP Loans; (c) the Exit Facility; and (d) the Reorganized Company
Equity Interests. Cash payments to be made pursuant to the Plan
will be made by the Reorganized Debtors. The Reorganized Debtors
shall 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.
Except as set forth herein, any changes in intercompany account
balances resulting from such transfers shall be accounted for and
settled in accordance with the Debtors' historical intercompany
account settlement practices and shall not violate the terms of the
Plan.
From and after the Effective Date, subject to any applicable
limitations set forth in any post-Effective Date agreement
(including, without limitation, the Exit Facility Documents), the
Reorganized Debtors shall have the right and authority without
further order of the Bankruptcy Court to raise additional capital
and obtain additional financing as the boards of directors of the
applicable Reorganized Debtors deem appropriate.
On the Effective Date or as soon as reasonably practicable
thereafter, the Reorganized Debtors may take all actions as may be
reasonably necessary or appropriate, including those set forth in
the Restructuring Transactions Exhibit, to effect any transaction
described in, approved by, contemplated by or necessary to
effectuate the transactions described in, approved by, or necessary
to, effectuate the Plan, including: (a) the execution and delivery
of appropriate agreements or other documents of merger,
consolidation, or reorganization containing terms that are
consistent with the terms of the Plan and that satisfy the
requirements of applicable Law; (b) the execution and delivery of
appropriate instruments of transfer, assignment, assumption, or
delegation of any property, right, liability, duty, or obligation
on terms consistent with the terms of the Plan; (c) the filing of
appropriate certificates of formation or incorporation, merger, or
consolidation with the appropriate governmental authorities
pursuant to applicable Law; and (d) all other actions that the
Reorganized Debtors reasonably determine are necessary or
appropriate. For the purposes of effectuating the Plan, none of the
Restructuring Transactions contemplated herein shall constitute a
change of control under any agreement, contract, or document of
the
Debtors.
On the Effective Date, the Reorganized Debtors shall have access to
debt financing in the form of the Exit Facility in an initial
aggregate amount equal to $35,000,000. The Reorganized Debtors may
use the Exit Facility for any purpose permitted by the Exit
Facility Documents, including the funding of obligations under the
Plan and satisfaction of ongoing working capital needs.
Counsel to the Debtors:
M. Blake Cleary, Esq.
Brett M. Haywood, Esq.
Gregory J. Flasser, Esq.
Katelin A. Morales, Esq.
Shannon Forshay, Esq.
POTTER ANDERSON & CORROON LLP
1313 N. Market Street, 6th Floor
Wilmington, DE 19801
Telephone: (302) 984-6000
Facsimile: (302) 658-1192
E-mail: bcleary@potteranderson.com
bhaywood@potteranderson.com
gflasser@potteranderson.com
kmorales@potteranderson.com
sforshay@potteranderson.com
A copy of the Order dated March 27, 2024, is available at
https://tinyurl.ph/aewsB from PacerMonitor.com.
A copy of the Plan of Reorganization dated March 27, 2024, is
available at https://tinyurl.ph/XQjLu from PacerMonitor.com.
About Restoration Forest Products Group
Initially founded in 2008, Restoration Forest Products Group, LLC
is a sustainable forestry and wood products manufacturing company.
By operating as a vertically-integrated wood processer with
in-house harvesting, manufacturing, and distribution capabilities,
the company works to thin and restore the forests of Northern
Arizona. The company is based in Bellemont, Ariz.
Restoration Forest and three of its affiliates filed Chapter 11
petitions (Bankr. D. Del. Lead Case No. 24-10120) on Jan. 29, 2024,
with $100 million to $500 million in assets against $100 million to
$500 million in debt. Judge Karen B. Owens oversees the cases.
The Debtors tapped Potter Anderson & Corroon, LLP as bankruptcy
counsel; Intrepid Investment Bankers, LLP as investment banker; and
Riveron Management Services, LLC as restructuring and management
services provider. Kroll Restructuring Administration, LLC is the
Debtors' claims and noticing agent and administrative advisor.
The U.S. Trustee for Region 3 appointed an official committee to
represent unsecured creditors in the Debtors' Chapter 11 cases.
Kelley Drye & Warren LLP as lead counsel. Cole Schotz P.C. as
Delaware co-counsel. Province, LLC as financial advisor.
REVA HOSPITALITY: Brad Odell of Mullin Named Subchapter V Trustee
-----------------------------------------------------------------
The U.S. Trustee for Region 7 appointed Brad Odell, Esq., at Mullin
Hoard & Brown, LLP, as Subchapter V trustee for Reva Hospitality
Wylie, LLC.
Mr. Odell 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. Odell declared that he is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Brad W. Odell
Mullin Hoard & Brown, LLP
P.O. Box 2585
Lubbock, TX 79408
Direct: 806-712-1238
Office: 806-765-7491
Mobile: 469-449-3690
Email: bodell@mhba.com
About Reva Hospitality Wylie
Reva Hospitality Wylie, LLC, doing business as Holiday Inn Express
Wylie, filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. N.D. Texas Case No. 24-30973) on April 1,
2024, with $1 million to $10 million in both assets and
liabilities. Mehul Gajera, manager, signed the petition.
Judge Scott W. Everett oversees the case.
Joyce W. Lindauer, Esq., at Joyce W. Lindauer Attorney PLLC
represents the Debtor as bankruptcy counsel.
RISE DEVELOPMENT: Unsecureds Owed $2.5M to Get $14K in Plan
-----------------------------------------------------------
Rise Development Partners, LLC, filed an Amended Plan of
Liquidation for Small Business Under Subchapter V of Chapter 11.
The Debtor is a New York limited liability company which was
established in 2016. The Debtor began operations in 2017 and
operates as a general contracting and commercial and residential
construction company, primarily in the area of interior renovations
and new construction. The Debtor operates its business at 444 Coney
Island Avenue, Brooklyn, New York 11218. The Debtor is operated by
Lawrence Rafalovich, President. Lawrence Rafalovich owns 99% of the
outstanding shares of the Debtor and Sabina Rafalovich owns 1%.
The Debtor did not have the ability to perform under those Rise
Concrete contracts. In or about June 2022, Caldwell abruptly left
the business without notice. Caldwell had abandoned all Rise
Concrete projects, without paying vendors and subcontractors for
those projects. Those vendors and subcontractors then turned to the
Debtor seeking payment. As a result, multiple lawsuits were
commenced against the Debtor for obligations incurred as a result
of Caldwell's failure to complete the projects of Rise Concrete.
Such litigation had caused the Debtor significant and irreparable
financial distress.
With the breathing spell and powers and protections afforded by and
under the Bankruptcy Code, the Debtor elected to file this Chapter
11 case, on November 10, 2023 (the "Filing Date") in order to
reorganize its financial affairs, and presently proposes this
liquidating Plan to make distributions to creditors. The Debtor
currently has three (3) remaining construction projects to
complete.
The Plan proposes to pay creditors of the Debtor from funds
generated by the Debtor's wind down of operations and liquidation
in accordance with the priorities of the Bankruptcy Code.
Under the Plan, Class 4 - General Unsecured Claims total
$2,486,953. Upon the Effective Date, or as soon as reasonably
practicable after receipt of the funds from the Debtor's remaining
construction projects5, and after all objections to Class 4 Claims
have been resolved and/or adjudicated by the Bankruptcy Court, in
full satisfaction of its Allowed General Unsecured Claim, each
holder of an Allowed Class 4 Claim will receive a distribution on
account of its Allowed General Unsecured Claim in the amount of its
Pro Rata share of such funds, after payment in full of Allowed
Class 1 Claims, Allowed Class 2 Claims, Allowed Administrative
Expense Claims and Allowed Priority Tax Claims, except as otherwise
agreed with the holder of such Claims, as set forth in Exhibit
"B".
The aggregate sum of funds after payment of the higher classes of
Claims available for Pro Rata distribution to Allowed Class 4
Claims is approximately $14,000, as set forth in Exhibit B.
Class 4 Claims are impaired, and therefore holders of Class 4
Claims are entitled to vote to accept or reject the Plan.
The distributions that are to be made on and/or after the Effective
Date under this Plan shall be funded by the Debtor from the funds
received from its 3 remaining construction projects. In the event
the Court approves this liquidating Plan as a consensual Plan, the
Confirmed Debtor shall be the Disbursing Agent responsible for
making any and all post-Confirmation payments that are required
under the Plan. In the event this Plan is approved via
nonconsensual cramdown, the Debtor requests that the Court approve
the Debtor as the Disbursing Agent under the Plan.
Counsel for the Debtor:
Adam P. Wofse, Esq.
LAMONICA HERBST & MANISCALCO, LLP
3305 Jerusalem Avenue, Suite 201
Wantagh, NY 11793
Tel. (516) 826-6500
A copy of the Disclosure Statement dated March 27, 2024, is
available at https://tinyurl.ph/gloNB from PacerMonitor.com.
About Rise Development Partners
Rise Development Partners LLC is a full-service construction
company in Brooklyn, N.Y., offering a wide range of services,
specializing in real estate development and commercial and
residential renovations.
Rise Development Partners LLC sought relief under Subchapter V of
Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D.N.Y. Case No.
23-44119) on Nov. 10, 2023, with $1,709,308 in assets and
$6,302,176 in liabilities. Lawrence Rafalovich, president, signed
the petition.
Judge Elizabeth S. Stong oversees the case.
The Debtor is represented by Adam P. Wofse, Esq., at Lamonica
Herbst & Maniscalco, LLP.
RITE AID: April 22 Combined Hearing on Plan & Disclosures
---------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey will hold
a combine hearing to approve the adequacy of the disclosure
statement explaining the second amended joint Chapter 11 plan of
reorganization of Rite Aid Corporation and its debtor-affiliates,
and confirm the Debtor's amended Chapter 11 Plan on April 22, 2024,
at 10:00 a.m., before the Hon. Michael B. Kaplan, U.S. Bankruptcy
Judge, Clarkson S. Fisher United States Courthouse, 402 East State
Street, Second Floor, Courtroom 8, Trenton, New Jersey 08608.
Objections to the approval of the Debtors' disclosure statement and
confirmation of their amended Chapter 11 Plan, if any, must be
filed no later than 4:00 p.m. (prevailing Eastern Time) on April
15, 2024.
Deadline to vote to accept or reject the Debtors' amended Chapter
11 Plan is April 15, 2024, at 4:00 p.m.
According to the Troubled Company Reporter on April 4, 2024, Rite
Aid Corp. and its Debtor Affiliates submitted a Second Amended
Joint Chapter 11 Plan of Reorganization dated March 28, 2024.
Although for purposes of administrative convenience and efficiency
the Plan has been filed as a joint plan for each of the Debtors and
presents together Classes of Claims against, and Interests in, the
Debtors, the Plan does not provide for substantive consolidation of
any of the Debtors.
In the event of a MedImpact Term Loan Sale, Sale Transaction
Restructuring, or an Other Asset Sale, any and all consent rights
of the Purchasers set forth in the Purchase Agreement(s) with
respect to the form and substance of this Plan, the Confirmation
Order, the Disclosure Statement, the Disclosure Statement Order,
any Definitive Documents and any other documents related to the
MedImpact Term Loan Sale, Sale Transaction Restructuring, or the
Other Asset Sale, as applicable, including any amendments,
restatements, supplements, or other modifications to such
agreements and documents, and any consents, waivers, or other
deviations under or from any such documents, shall be incorporated
herein by this reference and be fully enforceable as if stated in
full herein until such time as the Purchase Agreement(s) is
terminated in accordance with its terms.
As of the Effective Date, the Claims of the AHG New-Money
Commitment Parties and the MedImpact Term Loan Backstop Parties on
account of the AHG Notes Ticking Fee and the MedImpact Termination
Fee shall be Allowed and deemed to be Allowed Claims in the full
amount outstanding under the AHG New-Money Commitment Agreement and
the MedImpact Term Loan Backstop Commitment Agreement. The
MedImpact Termination Fee, if any, and the AHG Notes Ticking Fee,
shall each be an Allowed Administrative Claim under section 503(b)
of the Bankruptcy Code.
Except to the extent that a Holder of an Allowed MedImpact
Termination Fee Claim (if any) agrees to a less favorable
treatment, in full and final satisfaction, compromise, settlement,
and release of, and in exchange for each such Claim, each Holder
thereof shall receive payment in full in Cash on or prior to the
Effective Date.
Except to the extent that a Holder of an Allowed AHG Notes Ticking
Fee Claim agrees to a less favorable treatment, in full and final
satisfaction, compromise, settlement, and release of, and in
exchange for each such Claim, each Holder thereof shall receive (i)
if the AHG New-Money Commitment Agreement is not terminated, AHG
Notes issued on or prior to the Effective Date or (ii) if the AHG
New-Money Commitment Agreement is terminated, payment in full in
Cash, if so entitled, in each case, in accordance with the terms
and conditions of the AHG New-Money Commitment Agreement.
Class 5 consists of all Senior Secured Notes Claims against any
Debtor. Except to the extent that a Holder of an Allowed Senior
Secured Notes Claim and a Debtor against which such Allowed Senior
Secured Notes Claim is asserted agree to less favorable treatment,
on the Effective Date, each Holder of a Senior Secured Notes Claim
shall receive, in full and final satisfaction, compromise,
settlement, and release of and in exchange for its Claim:
* in the event of a Plan Restructuring:
-- its Pro Rata share of (A) 90% of the New Common Stock,
subject to dilution on account of the New Common Stock issued
pursuant to the Management Incentive Plan, (B) the Takeback Notes,
(C) the CMSR Recovery, and (D) the Litigation Trust Class B
Interests; and
-- (A) if the MedImpact Term Loan Backstop Parties acquire the
MedImpact Term Loan pursuant to the MedImpact Term Loan Bidding
Procedures, (I) such Holder's MedImpact NewCo Subscription Rights
and (II) such Holder's Pro Rata share of the MedImpact NewCo Notes
issued on account of the Final MedImpact Term Loan Bid –
Senior Secured Notes Claims Amount, subject to dilution by the
MedImpact Backstop Fee NewCo Notes, the MedImpact Rights Offering
NewCo Notes, and the MedImpact Unsubscribed NewCo Notes; or (B) if
the MedImpact Term Loan Backstop Parties do not acquire the
MedImpact Term Loan pursuant to the MedImpact Term Loan Bidding
Procedures, such Holder's Pro Rata share of Cash available for
distribution to Holders of Senior Secured Notes Claims in
accordance with Section (II)(A) of Exhibit E of the Final Financing
Order; or
* in the event of a Sale Transaction Restructuring, its Pro Rata
share of the Distributable Proceeds, if any, pursuant to the
Waterfall Recovery.
Class 6 consists of all General Unsecured Claims. As a settlement
of all open disputes with the Debtors and the Holders of Senior
Secured Notes Claims each Holder of an Allowed General Unsecured
Claim shall receive, in full and final satisfaction, compromise,
settlement, and release of and in exchange for its Claim:, a por
tion of the Litigation Trust Assets and the GUC Equity Trust
Interests, as set forth in the UCC/TCC Recovery Allocation
Agreement and in accordance with the Litigation Trust Documents,
the GUC Equity Trust Documents, and any GUC Sub-Trust Documents,
including:
* (A) the Committees Initial Cash Consideration, (B) the
Committees Post-Emergence Cash Consideration, (C) 100% of the GUC
Equity Trust Interests; and (D) Litigation Trust Class A
Interests.
As of the Effective Date, in accordance with the Plan and the
Litigation Trust Documents, any and all liability of the Debtors
and/or the Reorganized Debtors for any and all Tort Claims shall
automatically, and without further act, deed or court order, be
channeled exclusively to, and all of the Debtors' and Reorganized
Debtors' liability for such claims shall be assumed by, the
Litigation Trust or any applicable GUC Sub-Trust. Each Tort Claim
shall be asserted exclusively against the Litigation Trust or GUC
Sub-Trust and resolved solely in accordance with the terms,
provisions and procedures of the Litigation Trust Documents or GUC
Sub-Trust Documents. The sole recourse of any Person on account of
any Tort Claim, whether or not the Holder thereof participated in
the Chapter 11 Cases and whether or not such Holder Filed a Proof
of Claim in the Chapter 11 Cases, shall be to the Litigation Trust
or GUC Sub-Trust as and to the extent provided in the Litigation
Trust Documents and GUC Sub-Trust Documents. Holders of Tort Claims
are enjoined from asserting against any Debtor or any Reorganized
Debtor any Tort Claim and may not proceed in any manner against any
Debtor or Reorganized Debtor on account of any Tort Claim in any
other forum whatsoever, including any state, federal, or non-U.S.
court or administrative or arbitral forum, and are required to
pursue Tort Claims exclusively against the Litigation Trust, solely
as and to the extent provided in the Litigation Trust Documents and
GUC Sub-Trust Documents.
Pursuant to section 1123 of the Bankruptcy Code and Bankruptcy Rule
9019, the Plan shall constitute and be deemed a good-faith
compromise and settlement of all Claims, Interests, Causes of
Action and controversies related to Tort Claims in the amount of
$[] (the "Settlement of Tort Claims"). In exchange for the
settlement of their Claims, Holders of Tort Claims shall receive
such treatment as set forth in this Plan, but subject to the
allocation of recoveries on account of such treatment as set forth
in the UCC/TCC Recovery Allocation Agreement. Nothing in the Plan
or the Committee Settlement Documents, including the UCC/TCC
Recovery Allocation Agreement, is intended to, and shall not be
construed to, limit the amount of Tort Claim Insurance Proceeds
available to Holders of Tort Claims [or other beneficiaries of the
Litigation Trust to the extent applicable in accordance with the
UCC/TCC Recovery Allocation Agreement], and the Litigation Trustee,
on behalf of the Holders of Tort Claims, shall retain the right to
pursue the full agreed settlement value of the Tort Claims from
Insurance Policies pursuant to the Assigned Insurance Rights
subject to the terms and conditions of the Plan.
All amounts necessary for the Debtors and, if applicable, the
Wind-Down Debtors, to make payments or distributions pursuant
hereto shall be (in each case subject to the terms of the Purchase
Agreement(s) and the Sale Order, as applicable) obtained from the
proceeds of the issuance of New Common Stock, Exit Facilities,
Takeback Notes, the MedImpact NewCo Notes (if any), the CMSR
Distribution, the AHG Notes, Cash of the Debtors, and any
additional Cash consideration provided under one or more Purchase
Agreements, in accordance with the terms thereof. Unless otherwise
agreed, distributions required by this Plan on account of Allowed
Claims that are Assumed Liabilities under a Purchase Agreement
shall be the sole responsibility of the applicable Purchaser.
A full-text copy of the Second Amended Joint Plan dated March 28,
2024 is available at https://urlcurt.com/u?l=gBadOD from Kroll
Restructuring, claims agent.
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, and Alvarez & Marsal North America, LLC, as financial, tax
and restructuring advisor. Kroll Restructuring Administration is
the claims and noticing agent.
ROCKET SOFTWARE: Fitch Assigns 'B' LongTerm IDR, Outlook Stable
---------------------------------------------------------------
Fitch Ratings has assigned a first-time Long-Term Issuer Default
Rating (IDR) of 'B' to Rocket Software Inc (Rocket). The Rating
Outlook is Stable. Fitch has also assigned a 'BB-'/'RR2' rating to
Rocket's existing and incremental first-lien secured indebtedness
and a 'CCC+'/'RR6' rating to the existing unsecured notes. Rocket
will fund the $2.275 billion acquisition of Application
Modernization & Connectivity (AMC) business, with $1 billion
incremental term loan, $1 billion other secured debt, $200 million
additional equity and remaining $159 million from cash in hand.
The ratings reflect Rocket's strengthened consolidated operating
profile post AMC's acquisition, which offsets the near-term
increased leverage profile since the transaction is expected to be
primarily funded by debt. Fitch expects EBITDA margins to improve
to mid-50%, driven by AMC's higher margin business and
cross-selling opportunities. The ratings are supported by Rocket's
very sticky business model, recurring revenues, and high retention
rates that are consistent with enterprise infrastructure software
peers. Fitch expects the company to prioritize tuck-in acquisitions
as part of its growth strategy over accelerated deleveraging.
KEY RATING DRIVERS
Resilient Operating Profile: Fitch forecasts Rocket to grow its
organic revenue in the low to mid-single digits while maintaining
above-industry average EBITDA margins in the 50%-range supported by
its resilient business model. Rocket's products provide solutions
for critical business needs, ensuring interoperability between
mainframe workloads and cloud-based workflows. Fitch believes the
alignment across Rocket's focused strategy and operations enhance
the resiliency and predictability of its business segments,
particularly with over 70% of total revenue being derived from
subscriptions and fixed duration maintenance contracts.
AMC Acquisition: With the acquisition of AMC, the combined company
will have an annualized total revenue of over $1.3 billion. The
closing is expected to take place in Q2 2024. The AMC business is
expected to broaden Rocket's hybrid cloud capabilities and enable
access to prominent public cloud vendors, including AWS, Google
Cloud, and Azure. Fitch expects pro forma EBITDA leverage to be
approximately 6.7x by the end of fiscal 2024, and gradually reduce
to 6.0x through the rating period. Fitch expects Rocket to hire
additional professionals in connection with AMC's integration, the
incremental cost of which will still be less than AMC's standalone
cost base. This is expected to drive cost synergies of $29 million
due to the avoided cost of not needing to hire for certain
functions that will be handled by existing Rocket employees.
High Switching Costs Drive Strong Retention: Consistent with
mission-critical enterprise software products, Rocket has gross
retention in the mid-90% and net retention of over 102% as it
benefits from cross-selling and up-selling opportunities. Rocket's
client base consists predominantly of large, conservative
enterprises (government, banking, insurance, healthcare) that
exhibit hesitancy towards adopting new technological advancements,
particularly concerning their vital IT infrastructure and
critical-highly regulated data. The substantial costs, regulations
and complexities tied to transitioning away from mainframe systems,
coupled with the imperative to sustain critical operations, result
in high switching costs and high customer retention rates for
Rocket.
Moderate Financial Leverage: Fitch expects Rocket's leverage to
gradually decline to approximately 6.0x, driven by good recurring
revenue and above-industry average EBITDA margins. Given the
private equity ownership that is likely to prioritize ROE, Fitch
does not anticipate accelerated debt repayment. Fitch expects
capital to be used for acquisitions to accelerate growth or for
dividends to equity owners with financial leverage remaining at
moderate levels.
Strong FCF Generation: Fitch expects fiscal 2024 free cash flow
generation to be weaker due to AMC's acquisition. However, driven
by strong profitability, sticky business model, and high retention
rates, FCF margins should normalize at low to mid-teens through
Fitch's forecast period. This results in (CFO-Capex)/Debt ratios
approaching 5% through the forecast period. The strong FCF
generation provides Rocket with ample financial flexibility for
investments to further strengthen its capabilities around hybrid
cloud and data analytics/AI.
M&A Central to Company's Growth Strategy: Fitch expects Rocket will
remain acquisitive in the infrastructure software space, given
still considerable industry fragmentation and in its effort to
expand technology platform. The company has made a number of
acquisitions in the past, including ASG Technologies, Zumasys,
Uniface, KRI Security and BOS Digitec. In June 2024, the company is
expected to complete AMC's acquisition that provides complementary
infrastructure and application modernization solutions to Rocket's
existing product offerings. Fitch believes M&A remains a central
growth strategy to drive organic revenue and reduce dependency on
IBM-led revenues, that has reduced from 55% in 2019 to 23% in 2023.
Despite the acquisitive nature of the company, its EBITDA leverage
has historically ranged between 6.0x to 7.0x.
Secular Tailwind Supporting Growth: Digital transformation and
hybrid cloud continue to be growth catalysts within the technology
industry, as businesses continue to digitalize workflow to increase
efficiency. The future of IT is steering towards a hybrid IT
management framework, with mainframes anticipated to play a crucial
function in this evolving landscape. Mainframe workload continues
to grow mid- to high single digits per year.
Although Fitch anticipates a gradual reduction in the reliance on
mainframe systems as newer workloads migrate to cloud environments,
these systems continue to be a bedrock of critical infrastructure.
They are responsible for processing billions of daily transactions
across vital sectors such as banking, retail, insurance,
healthcare, transportation, and government. Fitch maintains that
essential mainframe workloads, integral to legacy operations, are
likely to remain on these systems well into the future.
Significant Customer Diversification: Rocket has a diversified
customer base of over 12,500 customer accounts, with approximately
50% exposure to banking, insurance and services industries. The
company is geographically well-diversified and no single customer
contributed more than 10% of revenues, and top 10 customers
contributed 14% to the 2023 revenues (excluding IBM). The diverse
customer base effectively minimizes idiosyncratic risks that are
associated with individual industry verticals and helps to reduce
revenue volatility for Rocket.
DERIVATION SUMMARY
Rocket's consolidated hybrid cloud solutions, including AMC's
portfolio are considered mission-critical as they encompass the
entire mainframe lifecycle for enterprise customers. Rocket's
large, diverse base of customers spans over various countries and a
broad range of industries and businesses, with particular strengths
in banking, insurance, and governmental agencies. The company
enables customers to modernize proven applications on legacy
environments without losing valuable business logic or decades of
investment. Rocket benefits from high top-line visibility with a
majority of revenues comprised of subscriptions and fixed duration
maintenance contracts.
The acquisition of AMC business provides Rocket with broad product
coverage and limited customer overlaps. This provides the company
with opportunities for cross-selling of products as a driver for
revenue growth and will further strengthen its stickiness. With the
completion of integration between AMC and Rocket, Rocket is poised
to benefit from operating leverage and AMC'S higher margin profile.
Fitch expects revenue growth to remain in the low to mid-single
digit through the medium term with EBITDA margins expanding to
mid-50%.
Fitch believes Rocket is solid for the 'B' rating with its strong
operating profile offset by a track record for debt-funded
acquisitions weighing on credit metrics. The company's robust
profit margins, end-market and customer diversification and market
share positioning is supporting its operating profile strength.
Meanwhile, higher profitability and low capital intensity are
driving FCF growth and strengthening the financial profile, even as
upcoming AMC deal is primarily debt-funded.
Within the infrastructure software market, Rocket primarily
competes with BMC, and Broadcom (BBB-/Stable). Broadcom is
substantially larger than Rocket with EBITDA leverage of
approximately 3.0x and much more diversified. Rocket has a very
similar operating and credit profile as BMC. Like BMC, Rocket's
EBITDA margins are above industry-average, translating to strong
free cash flows, and have a moderate leverage profile. In Fitch's
view, while the three companies have product overlaps in some
areas, Rocket has a more hybrid cloud-centric product, supporting
customers with exposure to mainframe industry.
Fitch also compares Rocket to other software peers in the 'B' to
'B+' rating categories. Rocket's revenue scale compares favorably
to peers. Rocket's leverage and FCF generation are consistent with
peers in the 'B' to 'B+' rating categories. With additional debt to
fund AMC's acquisition, Fitch expects Rocket's pro forma leverage
to reduce in the range of 6.0x with successful acquisition
integration over the next two years. Fitch believes the private
equity ownership is likely to prioritize ROE optimization over
accelerated deleveraging, resulting in leverage remaining
elevated.
KEY ASSUMPTIONS
- Organic revenue growth in the low to mid-single digit;
- EBITDA margins gradually expands by 500 bps through fiscal 2027
from fiscal 2023 level;
- Capital intensity 1% of revenue;
- Debt repayment limited to mandatory amortization;
- Floating interest rate forecasted to be 5.0% in FY24, going down
to 3.5% and 3.2% in FY25 and FY26, respectively;
- Aggregate acquisitions of $300 million assumed through 2027;
- No dividend payments through 2027.
RECOVERY ANALYSIS
- The recovery analysis assumes that Rocket would be recognized as
a going concern in bankruptcy rather than liquidated;
- Fitch has assumed a 10% administrative claim.
Going-Concern (GC) Approach
- Fitch assumed a distress scenario where a combination of
operational under-performance and capital misallocation result in
unsustainable capital structure. This could be a result of elevated
customer churn, inability to maintain strong EBITDA margins, and
debt-financed dividends or M&As;
- In such event, Fitch expects Rocket's revenue base to decline
resulting in EBITDA margin contraction on lower revenue scale.
Fitch assumes that due to competitive pressure, revenue to suffer a
10% reduction along with margin contraction resulting in GC EBITDA
of $600 million, approximately 20% lower than pro forma 2025
EBITDA.
- Fitch assumes that Rocket will receive going-concern recovery
multiple of 7.0x. The estimate considers several factors, including
the highly sticky and resilient business model, recurring nature of
the revenue, high customer retention, company's strong FCF
generation and the competitive dynamics. The enterprise value (EV)
multiple is supported by:
- The historical bankruptcy case study exit multiples for
technology peer companies ranged from 2.6x to 10.8x, with 5.9x
median;
- Of these companies, only three were in the Software sector: Allen
Systems Group, Inc., Avaya, Inc. and Aspect Software Parent, Inc.,
which received recovery multiples of 8.4x,8.1x and 5.5x,
respectively;
- The highly recurring nature of Rocket's revenue and mission
critical nature of the product support the high-end of the range.
- Fitch arrived at an EV of $4.2 billion. After applying the 10%
administrative claim, adjusted EV of $3.78 billion is available for
claims by creditors.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Fitch's expectation of EBITDA leverage sustaining below 5.5x;
- (CFO-Capex)/Debt sustaining above 6.5%;
- Organic revenue growth sustaining above the mid-single digit.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Fitch's expectation of EBITDA leverage sustaining above 7.5x;
- (CFO-Capex)/Debt sustaining below 3.5%;
- Organic revenue growth sustaining near or below 0%.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: The company's liquidity is projected to be
ample, supported by its strong FCF generation, an undrawn $375
million RCF, and readily available cash on balance sheet. Fitch
forecasts Rocket's normalized FCF margins in mid-teens, supported
by EBITDA margin expanding to mid-50% range.
Debt Structure: Pro forma for the transaction, Rocket's debt will
consist of $575 million unsecured notes and $4.039 billion first
lien secured debt, including an undrawn $375 million revolver
credit facility. The earliest material maturity is the first lien
due FY28 and unsecured bonds maturing in FY29.
ISSUER PROFILE
Rocket Software Inc. (Rocket) is a leading global infrastructure
software provider helping governments, financial institutions,
insurance agencies and other corporations manage and optimize
hybrid infrastructure environments and support mission-critical
workloads. Rocket helps customers in their technology modernization
journey in three core areas, including infrastructure, data and
application modernization.
DATE OF RELEVANT COMMITTEE
05 April 2024
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
----------- ------ --------
Rocket Software, Inc. LT IDR B New Rating
senior unsecured LT CCC+ New Rating RR6
senior secured LT BB- New Rating RR2
SANTOS RANCH: Case Summary & One Unsecured Creditor
---------------------------------------------------
Debtor: Santos Ranch Holdings, LLC
455 East Boulderville Road
Oakley, UT 84055
Business Description: Santos Ranch is a Single Asset Real Estate
debtor (as defined in 11 U.S.C. Section
101(51B)).
Chapter 11 Petition Date: April 11, 2024
Court: United States Bankruptcy Court
District of South California
Case No.: 24-01272
Judge: Hon. Christopher B. Latham
Debtor's Counsel: Ruben F. Arizmendi, Esq.
ARIZMENDI LAW FIRM
2667 Camino Del Rio South 2310460
San Diego, CA 92108
Tel: (619) 231-0460
Email: rfalaw@gmail.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $100,000 to $500,000
The petition was signed by Dawn Santos as Sole member of Santos
Ranch Holdings, LLC.
The Debtor listed PHH Mortage, PO Box 24738, West Palm Beach, FL
33416 as its sole unsecured creditor holding a claim of $255,432.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/LGXIFXQ/Santos_Ranch_Holdings_LLC__casbke-24-01272__0001.0.pdf?mcid=tGE4TAMA
SC HEALTHCARE: U.S. Trustee Appoints Creditors' Committee
---------------------------------------------------------
The U.S. Trustee for Region 3 appointed an official committee to
represent unsecured creditors in the Chapter 11 cases of SC
Healthcare Holding, LLC and its affiliates.
The committee members are:
1. Select Rehabilitation, LLC
Attn: Neal Deutsch
2600 Compass Road
Glenview, IL 60026
Phone: 847-441-5593
Fax: 847-441-4130
Email: ndeutsch@selectrehab.com
2. Martin Brothers Distributing Company, Inc.
Attn: David Rue
406 Viking Road
Cedar Falls, IA 50613
Phone: 319-859-9569
Email: drue@martinbros.com
3. Omnicare Inc.
Attn: Greg Day
6825 W. Galveston Street, #3
Chandler, AZ 85226
Phone: 928-848-9643
Email: gregory.day@cvshealth.com
4. McKesson Corporation
Attn: Ben Hill
6555 State Hwy 161
Irving, TX 75039
Phone: 469-516-5817
Email: benjamin.hill@mckesson.com
5. Onestaff Medical, LLC
Attn: Travis Marr
10802 Farnam Drive
Omaha, NE 68154
Phone: 877-783-1483
Email: tmarr@onestaffmedical.com
6. Lawrence Recruiting Specialists, Inc.
Attn: Jay D. Mitchell
2655 Northwinds Parkway
Atlanta, GA 30009
Phone: 770-643-5530
Email: jmitchell@jacksonhealthcare.com
7. Darlena Moore, Independent Administrator
Estate of Linda I. Johnson
Attn: Eva Golabek, Esq.
60 W. Randolph Street, 4th Floor
Chicago, IL 60601
Phone: 312-782-2525
Fax: 312-855-0068
Email: egolabek@sj-lawgroup.com
Official creditors' committees serve as fiduciaries to the general
population of creditors they represent. They may investigate the
debtor's business and financial affairs. Committees have the right
to employ legal counsel, accountants and financial advisors at a
debtor's expense.
About SC Healthcare Holding
SC Healthcare Holding, LLC and its affiliates comprise one of the
largest nursing home operators in the United States and work in
partnership with physicians, skilled nurses, and other health care
providers in order to provide various healthcare and rehabilitation
services for elderly citizens in Illinois, Missouri, and Iowa.
On March 20, 2024, SC Healthcare and its affiliates, including
Petersen Health Care, Inc., filed Chapter 11 petitions (Bankr. D.
Del. Lead Case No. 24-10443). In the petition signed by David R.
Campbell as authorized signatory, SC Healthcare disclosed $100
million to $500 million in both assets and liabilities.
Judge Thomas M Horan oversees the cases.
Young Conaway Stargatt & Taylor, LLP and Winston & Strawn, LLP
represent the Debtors as legal counsels.
SCHMOLDT CONSTRUCTION: Unsecureds to Split $150K over 5 Years
-------------------------------------------------------------
Schmoldt Construction, Inc., filed with the U.S. Bankruptcy Court
for the Eastern District of Texas a Plan of Reorganization dated
April 2, 2024.
The Debtor is a small construction business that faced a decline in
revenue coupled with a large obligation dues and owing to the Texas
State Comptroller. Those events prompted the filing of this
bankruptcy case with the hopes being able to resolve its issues
with the Texas State Comptroller.
The Plan provides for a reorganization and restructuring of the
Debtor's financial obligations.
The Plan provides for a distribution to Creditors in accordance
with the terms of the Plan from the Debtor over the course of 5
years from the Debtor's continued business operations.
Class 3 consists of Allowed Claims against Debtor (including Claims
arising from the rejection of executory contracts and/or unexpired
leases) other than: (i) Administrative Claims; (ii) Priority Tax
Claims; or (iii) Claims included within any other Class designated
in this Plan. Class 3 shall be deemed to include those Creditor(s)
holding an alleged Secured Claim against Debtor, for which: (y) no
collateral exists to secure the alleged Secured Claim; and/or (z)
liens, security interests, or other encumbrances that are senior in
priority to the alleged Secured Claim exceed the fair market value
of the collateral securing such alleged Secured Claims as of the
Petition Date.
Each holder of an Allowed Unsecured Claim in Class 3 shall be paid
by Reorganized Debtor from an unsecured creditor pool, which pool
shall be funded at the rate of $2,500 per month. Payments from the
unsecured creditor pool shall be paid quarterly, for a period not
to exceed 5 years (20 quarterly payments) and the first quarterly
payment will be due on the 20th day of the first full calendar
month following the last day of the first quarter.
The Debtor estimates the aggregate of all Allowed Class 3 Claims is
$5,690,000 based upon Debtor’s review of the Court's claim
register, Debtor's bankruptcy schedules, and anticipated Claim
objections. This Class is impaired.
The Plan provides for a $150,000 dividend to all unsecured
creditors over a period of 5 years. Debtor contends the Plan
provides for a greater dividend to all creditors than would a
liquidation of assets under chapter 7.
Class 4 consists of the holders of Allowed Interests in the Debtor.
The holder of an Allowed Class 4 Interest shall retain their
interests in the Reorganized Debtor.
From and after the Effective Date, in accordance with the terms of
this Plan and the Confirmation Order, the Reorganized Debtor shall
perform all obligations under all executory contracts and unexpired
leases assumed in accordance with Article 6 of this Plan.
A full-text copy of the Plan of Reorganization dated April 2, 2024
is available at https://urlcurt.com/u?l=LguNit from
PacerMonitor.com at no charge.
Attorneys for the Debtor:
Robert T. DeMarco, Esq.
Michael S. Mitchell, Esq.
DeMarco Mitchell, PLLC
1255 W. 15th Street, 805
Plano, TX 75075
Telephone: (972) 578-1400
Facsimile: (972) 346-6791
Email: robert@demarcomitchell.com
mike@demarcomitchell.com
About Schmoldt Construction
Schmoldt Construction, Inc., is a small construction business.
The Debtor sought protection for relief under Chapter 11 of the
Bankruptcy Code (Bankr. E.D. Tex. Case No. 24-40041) on Jan. 3,
2024, listing $100,001 to $500,000 in both assets and liabilities.
Judge Brenda T. Rhoades oversees the case.
DeMarco Mitchell, PLLC, serves as the Debtor's counsel.
SELECTIS HEALTH: Delays Filing of 2023 Annual Report
----------------------------------------------------
Selectis Health, Inc. disclosed in a Form 12b-25 filed with the
Securities and Exchange Commission that its Annual Report on Form
10-K for the year ended Dec. 31, 2023 could not be filed in a
timely manner without unreasonable effort and expense.
The Company requires additional time to review and prepare certain
information in connection with completing their audited financial
statements. The Company expects to file the Annual Report within
the time period permitted by SEC Rule 12b-25.
About Selectis Health
Headquartered in Greenwood Village, Colo., Selectis Health, Inc.
owns and operates, through wholly-owned subsidiaries, Assisted
Living Facilities, Independent Living Facilities, and Skilled
Nursing Facilities across the South and Southeastern portions of
the US. In 2019 the Company shifted from leasing long-term care
facilities to third-party, independent operators towards a model
where a wholly owned subsidiary would operate but is owned by
another wholly owned subsidiary.
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 the Company had operating cash flows of
$2,390,891 and negative net working capital of $8.8 million for the
nine months ended September 30, 2023. As a result of its losses
and its projected cash needs, substantial doubt exists about the
Company's ability to continue as a going concern.
SIDEATS INC: Court OKs Cash Collateral Access Thru April 30
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida
authorized Sideats, Inc. to use cash collateral, on an interim
basis, in accordance with the budget, through April 30, 2024.
Specifically, the Debtor is authorized to use cash collateral to
pay: (a) amounts expressly authorized by the Court, including
payments to the United States Trustee and payroll obligations
incurred post-petition in the ordinary course of business; (b) the
current and necessary expenses set forth in the budget, plus an
amount not to exceed 10% for each line item. However, the Debtor is
not authorized to pay any compensation to insiders or professionals
absent Court approval of said compensation.
The Debtor executed a Promissory Note, Chattel Mortgage and
Security Agreement to Newtek Small Business Finance, LLC in the
original principal amount of $2.2 million in which the rents,
accounts receivables, chattel paper, contracts, documents, cash,
bank accounts, etc. were pledged as collateral.
The entities that also assert an interest in the Debtor's cash
collateral are North Mill Credit Trust, CT Corporation System,
Sysco Southeast Florida, LLC, and Riteway Service, Inc.
As adequate protection, Secured Creditors will have a perfected
post-petition lien against cash collateral to the same extent and
with the same validity and priority as the prepetition lien,
without the need to file or execute any documents as may otherwise
be required under applicable nonbankruptcy law.
As further adequate protection for Newtek, the Debtor will make
monthly payments beginning April 1, 2024 and continuing on the
first day of each month while the order is in effect in the amount
of $2,500.00. However, this payment will not be a determination of
the proper amount of adequate protection due and owing to Newtek
and will be without prejudice to Newtek's rights to seek a
modification of the same by motion to the Court.
The Debtor will maintain insurance coverage for its property in
accordance with the obligations under all applicable loan and
security documents.
A continued preliminary hearing on matter is set for April 30 at 3
P.M.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=tKm0YE from PacerMonitor.com.
The Debtor projects total expenses, on a monthly basis, as
follows:
$417,194 for April 2024;
$426,177 for May 2024; and
$435,428 for June 2024.
About Sideats, Inc.
Sideats, Inc. in Port Orange, FL, filed its voluntary petition for
Chapter 11 protection (Bankr. M.D. Fla. Case No. 24-01321) on March
19, 2024, listing $562,000 in assets and $6,369,802 in
liabilities.
Sidharth Sethi as president, signed the petition.
Judge Lori V Vaughan oversees the case.
LAW OFFICES OF MICKLER & MICKLER, LLP serve as the Debtor's legal
counsel.
SIYATA MOBILE: Barzily and Co. Raises Going Concern Doubt
---------------------------------------------------------
Siyata Mobile Inc. disclosed in a Form 20-F Report filed with the
U.S. Securities and Exchange Commission for the fiscal year ended
December 31, 2023, that its auditor expressed that there is
substantial doubt about the Company's ability to continue as a
going concern.
Jerusalem, Israel-based Barzily and Co., the Company's auditor
since 2023, issued a "going concern" qualification in its report
dated April 3, 2024, citing that the Company incurred recurring
losses from operations and has an accumulated deficit, which raise
substantial doubt about its ability to continue as a going
concern.
The Company incurred a net loss of $12,931,794 during the year
ended December 31, 2023 (2022 - net loss of $15,299,251), and, as
of that date, the Company's total deficit was $90,750,457 (2022 -
$77,818,663). As of December 31, 2023, the Company had an
outstanding bank loan of $89,298 and an outstanding balance in
respect of the sale of future receipts of $1,467,899. The Company's
continuation as a going concern is dependent upon the success of
the Company's implementation of its business plan, the existing
cash flows, and the ability of the Company to obtain additional
debt or equity financing, all of which are uncertain. These
material uncertainties raise substantial doubt on the Company's
ability to continue as a going concern.
As of December 31, 2023, $15,512,405 in total assets, $5,805,065 in
total liabilities, and $9,707,340 in total shareholders' equity.
A full-text copy of the Company's Form 20-F is available at
https://tinyurl.com/mt9z78jt
About Siyata Mobile
British Columbia, Canada-based Siyata Mobile Inc. is a B2B global
developer and vendor of next-generation Push-To-Talk over Cellular
handsets and accessories. Its portfolio of rugged PTT handsets and
accessories enables first responders and enterprise workers to
instantly communicate over a nationwide cellular network of choice,
to increase situational awareness and save lives. Police, fire, and
ambulance organizations as well as schools, utilities, security
companies, hospitals, waste management companies, resorts and many
other organizations use Siyata PTT handsets and accessories today.
SKILLZ INC: Receives NYSE Notice Regarding Late Form 10-K Filing
----------------------------------------------------------------
Skillz Inc. announced that, on April 2, 2024, it received a notice
from the New York Stock Exchange that the Company is not in
compliance with the NYSE's continued listing requirements under the
timely filing criteria established in Section 802.01E of the NYSE
Listed Company Manual, because the Company has not timely filed its
Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2023
with the Securities and Exchange Commission.
The NYSE Notice has no immediate effect on the listing of the
Company's common stock on the NYSE. The NYSE Notice informed the
Company that, under NYSE rules, the Company has six months from
March 15, 2024, to regain compliance with the NYSE listing
standards by filing the Form 10-K with the SEC. The NYSE further
noted that, if the Company fails to file the Form 10-K within the
six-month period, the NYSE may grant, at its sole discretion, an
extension of up to six additional months for the Company to regain
compliance, depending on the specific circumstances. The NYSE
Notice also notes that the NYSE may nevertheless commence delisting
proceedings at any time if it deems that the circumstances
warrant.
As previously reported in the Company's Notification of Late Filing
on Form 12b-25 filed with the SEC on March 14, 2024, the Company
was unable to file the Form 10-K within the prescribed period
because the Company requires more time to complete the procedures
relating to its year-end process, including the completion of the
audit of the Company's financial statements by the Company's
independent auditors for inclusion in the Form 10-K. Subsequent to
filing the Form 12b-25, the Company continued to dedicate
significant resources to the completion of such procedures but was
unable to file the Form 10-K by April 1, 2024, the end of the
extension period provided by the Form 12b-25. The Company requires
additional time to complete such procedures.
Based on currently available information and subject to the
completion of the audit procedures, the Company does not expect any
material change to the financial results to be included in the Form
10-K compared to the preliminary financial information reported in
the earnings release the Company furnished to the SEC on the
Company's Current Report on Form 8-K filed on March 14, 2024.
The Company is working diligently to complete the necessary work to
file the Form 10-K as soon as practicable and currently expects to
file the Form 10-K within the six-month period granted by the NYSE
Notice; however, there can be no assurance that the Form 10-K will
be filed within such period.
About Skillz Inc.
Headquartered in San Francisco, California, Skillz Inc. --
www.skillz.com -- is a mobile games platform dedicated to bringing
out the best in everyone through competition. The Skillz platform
helps developers create multi-million dollar franchises by enabling
social competition in their games. Leveraging its patented
technology, Skillz hosts billions of casual eSports tournaments for
millions of mobile players worldwide, with the goal of building the
home of competition for all.
Skillz reported a net loss of $438.87 million in 2022, a net loss
of $187.92 million in 2021, and a net loss of $149.08 million in
2020. As of March 31, 2023, the Company had $612.16 million in
total assets, $357.77 million in total liabilities, and $254.38
million in total stockholders' equity.
* * *
As reported by the TCR on April 28, 2023, Moody's Investors Service
downgraded Skillz Inc.'s corporate family rating to Caa2 from Caa1
following the company's recent repurchase of more than 50% of its
outstanding debt at sizable discount to par, reducing available
liquidity to fund projected cash flow deficits. Moody's said the
Caa2 CFR reflects the increased risk that Skillz's debt capital
structure is unsustainable due to reduced liquidity to fund
projected cash flow deficits.
As reported by the TCR on Jan. 19, 2024, S&P Global Ratings
retained its ratings on Las Vegas-based Skillz Inc., including its
'CCC+' issuer credit rating, following the assignment of the new
management and governance (M&G) assessment.
SNG INVESTMENTS: Melissa Haselden Named Subchapter V Trustee
------------------------------------------------------------
The U.S. Trustee for Region 7 appointed Melissa Haselden, Esq., at
Haselden Farrow, PLLC as Subchapter V trustee for SNG Investments
and Properties, LLC.
Ms. Haselden will be paid an hourly fee of $550 for her services as
Subchapter V trustee and will be reimbursed for work-related
incurred.
Ms. Haselden declared that she is a disinterested person according
to Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Melissa A. Haselden, Esq.
Haselden Farrow, PLLC
700 Milam, Suite 1300
Pennzoil Place
Houston, TX 77002
Telephone: (832) 819-1149
Facsimile: (866) 405-6038
Email: mhaselden@haseldenfarrow.com
About SNG Investments
SNG Investments and Properties, LLC is a Houston-based company
primarily engaged in renting and leasing real estate properties.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. S.D. Texas Case No. 24-31513) on April 2,
2024, with $10 million to $50 million in assets and $1 million to
$10 million in liabilities. Brandon Sam, managing member, signed
the petition.
Judge Jeffrey P. Norman presides over the case.
James Q. Pope, Esq., at The Pope Law Firm represents the Debtor as
bankruptcy counsel.
STERETT COMPANIES: US Trustee Says Disclosures Inadequate
---------------------------------------------------------
Paul A. Randolph, the Acting United States Trustee for Region 8,
objects to the adequacy of the disclosures contained in the
Disclosure Statement for Joint Plan of Reorganization for Sterett
Companies, LLC, and its Affiliated Debtors Dated March 1, 2024.
The U.S. Trustee objects to the adequacy of the disclosures
contained in the Disclosure Statement on these grounds:
(i) the Disclosure Statement does not contain a liquidation
analysis or identify retained causes of actions;
(ii) the Disclosure Statement does not adequately detail the
condition and performance of the Debtors while in bankruptcy as no
summary or detail of monthly operating reports is included;
(iii) the Disclosure Statement provides insufficient information
regarding postpetition management and compensation of officers and
executives;
(iv) the Disclosure Statement fails to address intercompany
claims;
(v) it is unclear if there are ongoing business transactions
with insiders or insider claims;
(vi) with respect to non-debtor releases and third-party
consideration, there should be some financial information with
respect to the nondebtor's ability to pay;
(vii) the Disclosure Statement does not identify the source of
the information contained in it;
(viii) the Disclosure Statement does not adequately detail the
possible success and impact on the Plan with respect to
non-bankruptcy litigation against the Debtors, their insurers, and
non-debtors;
(ix) the tax consequences from the sale of 442 pieces of
depreciated equipment is not discussed; and
(x) the Disclosure Statement should not be approved because the
Plan it describes provides for impermissible releases of third
parties and the grant of discharge to liquidating debtors in
violation of Sec. 1141(d)(3) and is therefore unconfirmable as a
matter of law.
Unless the Disclosure Statement is modified to satisfy these
objections, as set forth in more detail herein, the U.S. Trustee
says the Disclosure Statement must not be approved.
About Sterett Companies
Sterett Companies, LLC, sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. W.D. Ky. Case No. 23-40625) on Oct.
27, 2023. In the petition signed by William L. Sterett, III, CEO,
the Debtor disclosed up to $50,000 in assets and up to $50 million
in liabilities.
Judge Charles R. Merrill oversees the case.
Neil C. Bordy, Esq., at Seiller Waterman LLC, is the Debtor's legal
counsel.
SUMMIT MIDSTREAM: S&P Affirms 'B' ICR, Outlook Positive
-------------------------------------------------------
S&P Global Ratings affirmed its 'B' issuer credit rating on Summit
Midstream Partners L.P. (SMLP) and its 'BB-' issue-level rating on
Summit Midstream Holdings LLC and Summit Midstream Finance Corp.'s
second-priority senior secured notes. The recovery rating on this
debt remains '1'.
At the same time, S&P affirmed its 'B-' issue-level rating on
SMLP's senior unsecured notes. The recovery rating on this debt
remains '5'. Its 'D' issue-level rating on SMLP's preferred stock
is unchanged because S&P continues to view the ongoing distribution
deferral as a default on the security until SMLP begins paying a
distribution on the preferred units (including the accrued
amount).
The positive outlook reflects that SMLP's S&P Global
Ratings-adjusted debt-to-EBITDA ratio could deleverage to below 5x
by year-end 2024 if SMLP successfully executes its deleveraging
plan and remains disciplined with its capital spending.
On March 22, 2024, SMLP completed the sale of its Utica position to
a subsidiary of MPLX L.P. (MPLX) for approximately $625 million.
This includes its approximately 36% interest in Ohio Gathering Co.
LLC (OGC), 38% interest in Ohio Condensate Co. LLC (OCC), and
wholly owned Utica assets. The partnership used net proceeds to
repay its outstanding revolver credit facility due 2026. At close,
the revolver is undrawn.
S&P said, "SMLP's scale is relatively smaller compared with peers
as a result of the asset divestiture. In our base-case scenario, we
continue to proportionally consolidate Double E Pipeline LLC
(Double E) to reflect the partnership's 70% ownership, which
supports EBITDA growth as production remains strong in the Permian
Basin. SMLP outperformed in 2023 with over 300 wells connected and
generated approximately $270 million of S&P Global Ratings-adjusted
EBITDA. Following the sale of its Utica position, we expect SMLP
will generate approximately $210 million to $220 million of EBITDA
in 2024 which is considerably lower than our previous forecast of
$300 million including its assets that were sold."
SMLP could deleverage to below 5x over the next several years. The
partnership's upcoming debt maturities of approximately $1 billion
due 2026 highlights potential liquidity pressure if it fails to
alleviate its upcoming refinancing risk. However, net proceeds from
the asset sale bolster its liquidity. S&P said, "With SMLP's
current cash position, we believe SMLP has the ability to
deleverage to below 5x by year-end 2024 if the partnership uses
cash on hand to repay outstanding debt and remains disciplined with
its capital spending. We assume the partnership's capital spending
remains modest and expect it to generate free operating cash flow
(FOCF) of over $40 million in 2024."
The positive outlook reflects that SMLP's S&P Global
Ratings-adjusted debt-to-EBITDA ratio could deleverage to below 5x
by year-end 2024 if SMLP successfully executes its deleveraging
plan and remains disciplined with its capital spending.
S&P could revise the outlook on SMLP to stable if the partnership
does not use cash on hand to repay a significant amount of debt
such that we believe its adjusted debt-to-EBITDA will remain above
5x. This could occur if:
-- The partnership pursues a more aggressive financial policy than
our current expectations such that it does not use its cash on hand
to repay a significant amount of debt or it funds growth
initiatives through incremental debt or debt-like instruments; or
-- SMLP's assets experience operational underperformance for a
prolonged period resulting in lower than anticipated EBITDA level.
S&P said, "We could consider an upgrade on SMLP if the partnership
maintains adjusted debt-to-EBITDA below 5x and alleviates its
upcoming refinancing risk.
"Environmental factors are a negative consideration in our credit
rating analysis of SMLP. SMLP is focused on developing, owning, and
operating midstream energy infrastructure assets that are in
resource basins, primarily shale formations, in the continental
U.S. The partnership's gathering and processing business faces
multiple risks relating to climate change, including volume
declines and general energy transition pressures facing the
midstream industry. We believe SMLP has improved its commitment to
its environmental presence, as demonstrated by its system
investments at the Blacktail Creek site and across its entire asset
footprint."
SURGE TRANSPORTATION: Unsecureds Get Share of Exit Loan Facility
----------------------------------------------------------------
Surge Transportation, Inc., submitted a Disclosure Statement, dated
March 29, 2024.
Once a petition for reorganization is filed, actions to collect
pre-petition debts are stayed, and other contractual obligations
may not be enforced. These protections give debtors the opportunity
to restructure their operations under court supervision and
guarantee that all creditors will receive fair and equitable
treatment. After the commencement date, debtors are given the
opportunity to restructure their operations and may obtain credit,
sell assets, and reject executory contracts and lease obligations,
subject to court approval. The debtor may then propose a plan of
reorganization to restructure their obligations. Substantially all
liabilities of a debtor as of the commencement date are subject to
settlement under a plan of reorganization and are to be voted upon
by all impaired. The approval of a plan of reorganization allows a
debtor to emerge from bankruptcy and to continue operating its
business without continued court supervision.
Founded in 2016 by Omar Singh, Surge is a Jacksonville, Florida
based trucking/freight broker licensed with the U.S. Department of
Transportation and the United States Federal Motor Carrier Safety
Administration. It specializes in sourcing extra truckload capacity
during peak seasons and other periods of high demand.
The dramatic increase in volume during the pandemic ended rather
abruptly, however, beginning in April or May 22 when inflation, the
war in Ukraine and the easing of Covid-l9 restrictions began to
suppress product demand and increase the cost of shipping. Surge,
like many others in the industry, suffered from the rapid change in
the demand for shipping services and failed to reduce overheads in
a timely fashion. As a result, Surge became increasingly delinquent
in the payment of carrier claims to the point where accounts
payable totaled nearly $13 million owed to approximately 5,000
carriers.
This reorganization was filed on July 24, 2023 (the "Petition
Date") as a means of addressing those claims in an orderly
fashion.
Surge does not own the real estate from which it conducts business.
There is therefore no value to be attributed to such assets. Its
assets instead consisted almost entirely of cash in the bank,
receivables, a vehicle and a limited amount of office furniture and
equipment having a total value of $11,847,687.06.
The balance of the indebtedness owed by the Debtor consisted of
trade payables due the various carriers who provided transportation
services to Surge or their factors. Unsecured claims totaled
approximately $13,183,952 on the Petition Date (scheduled values).
In its efforts to stem operating losses, Debtor laid off the
majority of its employees, closed its Chicago, Illinois office, and
terminated its overseas support operations. The foregoing changes
have allowed Debtor to reduce its monthly overhead from a peak of
$1.7 million per month in March of 2022, to roughly $125,000 per
month presently.
At the same time, Debtor has sought to re-establish its
relationships with its customers. Those efforts were recently
rewarded when Kraft awarded Surge with contracts to place over
9,940 loads per year with approved Carriers. Though overall load
volume is significantly below pre-petition levels, greater care is
being taken to ensure that margins on the loads are net positive.
For example, for the week ending February 10,2024, Surge placed 73
loads with Carriers, for which it received 9179,720 in revenues,
with average margins of 11.77%. These improving results have helped
establish Surge's continuing viability, allowing it to propose the
plan of reorganization.
The plan will be funded by the Exit Loan Facility described below
and the net proceeds of certain Avoidance Actions. The Exit Loan
Facility will enable the Debtor to fund distributions to creditors
under the Plan and to settle Declaratory Relief Actions. The
proceeds of Avoidance Actions will enable the Debtor to make a
supplemental distribution to Unsecured Creditors.
The Exit Loan Facility will be secured by (i) a blanket lien on all
Assets of the Debtor, existing on and after the Confirmation Date,
excluding Avoidance Actions (as defined in the Plan), and (ii) a
mortgage and security interest in the real property and
improvements owned directly or indirectly by Debtor's principal,
Omar Singh, and located at (a) 20651 Holyoke Drive, Ashburn,
Virginia, and (b) 44390 Cedar Heights Drive, Ashburn, Virginia (the
"Exit Facility Collateral"). From this $2 million Exit Loan
Facility, $400,000 will be utilized to settle the Declaratory
Relief Actions with the remaining $1.6 million being utilized to
fund, in order of priority, distributions to Allowed Administrative
Claims, Priority Tax Claims, and the initial distribution to
Allowed Claims of Unsecured Creditors in Classes 2 and 3. The Exit
Loan Facility will be amortized and paid by the reorganized Debtor
over seven years with no interest, secured by the Exit Facility
Collateral, and documented in the form of a Secured Promissory Note
and Deeds of Trust to secure the real estate. The Exit Loan
Facility is conditioned upon the entry of a Confirmation Order,
which (i) approves the settlement and compromise of the Declaratory
Relief Actions; (ii) approves the Debtor's assumption of the
Factoring Agreement; and (iii) allows the Debtor to execute the
Secured Promissory Note.
The Plan will also be funded by the proceeds of Avoidance Actions
pursued by the Debtor, net of all costs, expenses, and attorney
fees incurred in connection therewith. The Debtor will make a
supplemental pro-rata distribution to the Holders of Allowed Claims
in Classes 2 and3 after all of the Avoidance Actions have been
adjudicated or settled. As set forth in Section I .2 of the Plan,
Factors may elect to receive a release from an Avoidance Action in
exchange for (i) a 30%o reduction of their Allowed Unsecured Claim,
and (ii) a commitment to permit their carrier customers to factor
Surge receivables post-confirmation.
Under the Plan, Class 3 consists of General Unsecured Claims.
Allowed Unsecured Claims, excluding Triumph's Allowed Unsecured
Claim, will share pro rata the balance of the Exit Loan Facility
proceeds after payment of all Administrative and Priority Claims in
full, with payment to be made within 120 days of the Effective
Date. The Exit Loan Facility proceeds shall be free and clear of
Triumph's security interests and, after payment of Administrative
and Priority Claims, shall be held in a segregated account pending
disbursement, at which time the proceeds will be transferred to
TriumphPay or such other agent as Debtor may determine for
disbursement. Debtor may seek an extension of the initial
distribution date if necessary to accommodate resolution of claims
objections which may have a material impact on the distributions to
other creditors or as a matter of administrative convenience. In
addition, the Debtor will make a supplemental distribution of the
net proceeds of Avoidance Actions, if any, within sixty (60) days
following the conclusion of all such actions.
There shall be no distribution on account of any Disputed Claim
until such objection or dispute is resolved by Final Order. In
accordance with Section 10.1 of the Plan, Debtor shall, however,
reserve funds to make the proportionate distribution to such
creditors until such time as all claim objections have been finally
determined. All funds reserved on account of Disallowed Claims
shall be distributed pro-rata to the holders of Allowed Unsecured
Claims concurrently with the supplemental distribution of the net
proceeds of Avoidance Actions in the manner and time periods
described above. Debtor may, in its sole discretion, delay making
the initial distribution if it expects resolution of a Disputed
Claim within a reasonable time.
Pursuant to s 502(d) of the Bankruptcy Code, no payments shall be
made to any entity from which property is recoverable under ss 542,
543,550 or 553 of the Bankruptcy Code or that is a transferee of a
transfer avoidable under ss 522(0, 522(h),544,545,547, 548, 549 or
724(a) of the Bankruptcy Code, unless such entity or transferee has
paid the amount, or turned over any such property from which such
entity or transferee is liable under ss 522(i), 542,543,550 or 553
of the Bankruptcy Code. The Claim of any recipient of a payment
avoidable under ss 542, 543, 550 or 553 of the Bankruptcy Code who
fails to pay or turnover the amount of the payment to Debtor within
60 days of a judgment or order avoiding the transfer or requiring
such turnover shall be extinguished and forever barred.
Class 3 is impaired by the Plan and is entitled to vote to accept
or reject the Plan.
For purposes of the Plan, Debtor believes the feasibility test is
satisfied by Triumph's commitment to fund the Exit Loan Facility.
Nonetheless, attached hereto as Exhibit A is a 24 month forecast of
projected income and expenses for the Debtor from and after the
anticipated Effective Date which (i) attests to the feasibility of
the Plan, and (ii) shows that the Debtor cannot support additional
distributions to creditors from operations. The projections were
developed by Dundon Advisors after consultation with Debtor and a
review of Debtor's historical records and assume that the Plan will
be implemented in accordance with its terms. Although Debtor
believes the assumptions inherent in the projections are accurate
and reasonable in light of the circumstances under which they were
made, no assurances can be given that the projections will be
realized, or that Debtor's income or expenditures will actually
conform to the projections.
Attorneys for Surge Transportation, Inc:
Richard R. Thames, Esq.
Bradley R. Markey, Esq.
THAMES IMARKEY
50 North Laura Street, Suite 1600
Jacksonville, FL 32202
Tel: (904) 358-4000
and
Stephen Leach, Esq.
David I. Swan, Esq.
HIRSCHLER FLEISCHER
167 International Drive, Suite 1 350
Tysons, VA 22102- 4940
Tel: (703) 584-8900
A copy of the Disclosure Statement dated March 29, 2024, is
available at https://tinyurl.ph/BHxXF from PacerMonitor.com.
About Surge Transportation
Founded in 2016 by Omar Singh, Surge Transportation, Inc., is a
Jacksonville-based trucking and freight broker licensed with the
U.S. Department of Transportation and the United States Federal
Motor Carrier Safety Administration. It specializes in sourcing
extra truckload capacity during peak seasons and other periods of
high demand. Surge Transportation maintains satellite offices in
Chicago, Ill. and Ashburn, Va.
Surge Transportation filed a Chapter 11 petition (Bankr. M.D. Fla.
Case No. 23-01712) on July 24, 2023, with $10 million to $50
million in both assets and liabilities. Mr. Singh signed the
petition.
Judge Jacob A. Brown oversees the case.
Bradley R. Markey, Esq., at Thomas Markey, is the Debtor's legal
counsel.
TAPATIO KISSIMMEE: L. Todd Budgen Named Subchapter V Trustee
------------------------------------------------------------
The U.S. Trustee for Region 21 appointed L. Todd Budgen, Esq., a
practicing attorney in Longwood, Fla., as Subchapter V trustee for
Tapatio Kissimmee, Inc.
Mr. Budgen will be paid an hourly fee of $400 for his services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Mr. Budgen declared that he is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
L. Todd Budgen, Esq.
P.O. Box 520546
Longwood, FL 32752
Tel: (407) 232-9118
Email: Todd@C11Trustee.com
About Tapatio Kissimmee
Tapatio Kissimmee, Inc. filed a petition under Chapter 11,
Subchapter V of the Bankruptcy Code (Bankr. M.D. Fla. Case No.
24-01634) on April 2, 2024, with $100,001 to $500,000 in assets and
liabilities.
Judge Tiffany P. Geyer presides over the case.
Lawrence M Kosto at Kosto & Rotella, P.A. represents the Debtor as
legal counsel.
TERRAFORM LABS: Firm, Founder Found Liable for Securities Fraud
---------------------------------------------------------------
Reuters reports that a Manhattan federal jury on Friday, April 5,
2024, quickly found bankrupt cryptocurrency startup Terraform Labs
and its founder Do Kwon liable for securities fraud, agreeing with
the U.S. Securities and Exchange Commission that they lied to
investors about the company's stability and business prospects.
Reuters notes that the jury delivered the verdict in federal court
in the two-week trial after hearing closing arguments earlier on
the day.
The SEC claimed that the company and Kwon misled investors in 2021
about the stability of TerraUSD, a stablecoin designed to maintain
a value of $1. THe regulator also accused them of falsely claiming
that Korean mobile payment application Chai used the Terra
blockchain to process commercial payments between merchants and
customers.
At the beginning of May 2022, the $60 billion Terra blockchain
ecosystem collapsed after its algorithmic stablecoin, Terra USD,
lost its crucial $1 price peg and experienced a bank run.
"We allege that Terraform and Do Kwon failed to provide the public
with full, fair and truthful disclosure as required for a host of
crypto asset securities, most notably for LUNA and Terra USD," said
SEC Chair Gary Gensler in February 2023.
About Terraform Labs
Terraform Labs Pte. Ltd. -- https://www.terra.money -- is a startup
that created Terra, a blockchain protocol and payment platform used
for algorithmic stablecoins. It was co-founded by Do Kwon and
Daniel Shin in 2018 in Seoul, South Korea.
Terraform Labs introduced its first cryptocurrency token, TerraUSD,
in 2019. Investment firms like Arrington Capital, Coinbase
Ventures, Galaxy Digital, and Lightspeed Venture Partners helped
Terraform Labs raise more than $200 million.
The collapse of the stablecoins TerraUSD (UST) and Luna in May 2022
caused the temporary suspension of the Terra network, wiping out
over $45 billion in market capitalization in a single week.
Both of Terra Form Labs' founders encountered legal problems as a
result of the devaluation of the company's currency. In September
2022, South Korean prosecutors filed a warrant for Do Kwon's
arrest. He was also added to Interpol's Red Notice list, which
urges other law enforcement to find and detain him.
Terraform Labs Pte. Ltd. sought relief under Chapter 11 of the
Bankruptcy Code (Bankr. D. Del. Case No. 24-10070) on Jan. 22,
2024. In the petition filed by Chris Amani, as chief executive
officer, the Debtor estimated assets and liabilities between $100
million and $500 million each.
The Debtor is represented by:
Zachary I Shapiro, Esq.
Richards, Layton & Finger, P.A.
1 Wallich Street
#37-01
Guoco Tower 078881
THRASIO HOLDINGS: ESR Says Plan Patently Unconfirmable
------------------------------------------------------
ESR, LLC, filed an objection with respect to approval of the
Disclosure Statement for the Joint Plan of Reorganization of
Thrasio Holdings, Inc. and its Debtor Affiliates Pursuant to
Chapter 11 of the Bankruptcy Code.
ESR is a general unsecured creditor of Debtor Frosty Dream and is
owed $2 million. The Disclosure Statement does not contain
information that would enable ESR or the Court to determine whether
Frosty Dream is solvent or insolvent. Upon information and belief,
Frosty Dream remains profitable and is a marquee performer among
the Debtors' various brands and entities.
ESR asserts that the Debtors' Disclosure Statement describes a
patently unconfirmable plan because the Plan runs afoul of the
Third Circuit's mandate in In re Owens Corning, 419 F.3d 195 (3d
Cir. 2007). Specifically, the Plan represents a "deemed
consolidation" of all Debtors because the Plan consolidates Frosty
Dream with all of the other (mostly poorly performing) Debtors for
the purpose of valuing and satisfying creditor claims and making
distributions for allowed claims under the Plan. Despite the fact
that the Debtors are seeking to substantively consolidated the
Debtors through the Plan, which, if confirmed, would pay ESR
approximately .001% of its claim, the Debtor has not—and
cannot—make the necessary showing to consolidate the Debtors and
incorrectly denies that it is consolidating the Chapter 11 Cases.
Furthermore, ESR argues that the Plan violates the classification
provisions of 11 U.S.C. Sec. 1122 by grouping all of the Debtors'
general unsecured creditors into one class for purposes of
distribution even though the Chapter 11 Cases are not substantively
consolidated.
The Disclosure Statement, ESR notes, does not provide adequate
information to allow ESR to determine (a) the solvency of Frosty
Dream or (b) whether the Plan unfairly discriminates against the
general unsecured creditors by treating the First Lien Claims
(which may be undersecured) differently than the general unsecured
creditors.
Finally, according to ESR, the Debtors have not filed schedules and
statements of financial affairs, which will provide critical
insight into the Debtors' financial situation, including that of
Frosty Dream.
As currently proposed, the Disclosure Statement does not provide
adequate information as required under 11 U.S.C. Sec. 1125, ESR
tells the Court.
Counsel for ESR, LLC:
HOLLAND & KNIGHT LLP
Barbra R. Parlin, Esq.
31 West 52nd Street,
New York, NY 10019
Tel.: (212) 513-3200
Fax: (212) 385-9010
E-mail: barbra.parlin@hklaw.com
-and-
Morris D. Weiss, Esq. (admitted pro hac vice)
100 Congress Ave., Suite 1800
Austin, Texas 78701
Tel.: (512) 685-6400
Fax: (512) 684-6417
E-mail: morris.weiss@hklaw.com
About Thrasio
Thrasio LLC -- https://www.thrasio.com/ -- specializes in buying
Amazon third-party private label businesses. Its portfolio includes
Angry Orange pet odor eliminators and stain removers, Wise Owl
Outfitters camping and outdoor gear, and more than 200 other Amazon
and ecommerce brands. Thrasio was co-founded in 2018 by Joshua
Silberstein.
Thrasio has significant overseas operations and partnerships across
the world, including in the United Kingdom, Germany, and China.
Thrasio Holdings, Inc. and several affiliates sought protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.N.J. Lead
Case No. 24-11840) on Feb. 28, 2024, with $1 billion to $10 billion
in assets and $500 million to $1 billion in liabilities. Josh
Burke, the Debtors' chief financial officer, signed the petitions.
Judge Christine M. Gravelle oversees the case.
The Debtors tapped KIRKLAND & ELLIS LLP and KIRKLAND & ELLIS
INTERNATIONAL LLP as general bankruptcy counsel; COLE SCHOTZ P.C.
as co-bankruptcy counsel; ALIXPARTNERSS, LLP as financial advisor;
and KURTZMAN CARSON CONSULTANTS LLC as claims and noticing agent.
An Ad Hoc Group of First Lien Lenders retained Gibson, Dunn &
Crutcher LLP as legal counsel and Sills Cummis & Gross P.C. as New
Jersey co-counsel.
THRASIO LLC: S&P Assigns 'CCC+' Rating on $360MM DIP Facility
-------------------------------------------------------------
On April 10, 2024, S&P Global Ratings assigned a point-in-time
'CCC+' issue-level rating to Thrasio LLC's $360 million
debtor-in-possession (DIP) facility, which consists of a $90
million new money term loan and $270 million roll-up term loan. The
company has been under Chapter 11 bankruptcy protection since its
filing on Feb. 28, 2024.
The 'CCC+' issue-level rating reflects S&P's view of the credit
risk borne by DIP term loan lenders and does not indicate ratings
it may assign to exit facilities or the reorganized company after
it emerges from bankruptcy.
The DIP issue-level rating is a point-in-time rating that is
effective only as of the date of this report. S&P Global Ratings
will not monitor, review, or provide ongoing surveillance of this
rating.
S&P's 'CCC+' rating on Thrasio LLC's $360 million DIP term loan
reflects our view of the credit risk borne by DIP lenders.
S&P said, "Our view considers the company's ability to meet its
financial requirements during bankruptcy through our debtor credit
profile (DCP) assessment. This reflects the prospects for full
repayment through the company's reorganization and emergence from
Chapter 11 using our capacity for repayment at emergence (CRE)
assessment and the prospects for full repayment in a liquidation
scenario using our additional protection in a liquidation scenario
(APLS) assessment. Our assessment of each of these factors is as
follows:
"Our 'b-' DCP reflects our view of the company's vulnerable
business risk profile and highly leveraged financial risk profile,
together with our consideration of applicable ratings modifiers in
bankruptcy.
"We believe the DIP term loan has weak potential for full coverage
in an emergence scenario for our CRE assessment (100%
TIMOTHY HILL: Unsecureds Will Get 100% of Claims in Plan
--------------------------------------------------------
Timothy Hill Children's Ranch, Inc., filed with the U.S. Bankruptcy
Court for the Eastern District of New York a Disclosure Statement
for the Plan of Reorganization dated April 4, 2024.
The Debtor is a New York State not for profit organization.
The Debtor is in the business of providing necessary support to
troubled youth and young adults by providing group homes and
transitional housing programs to help restore lives and discover
hope for the future and to provide multiday scheduled retreats.
The Debtor has continued to operate its business and has operated
profitably during the Chapter 11 Case. As a result of the Debtor's
operations and settlement with three of the four lawsuits, the
Debtor is now in a position to successfully emerge from Chapter 11
and effectuate the Plan.
Class 4 consists of the claims of John Joseph Barci, John J.
Gubitosi and Andres Alexander Ramons, three plaintiffs who
commenced a lawsuit in the Supreme Court of the State of New York,
County of Suffolk against the Debtor, members of the Debtors board
of directors both past and current and various employees of the
Debtor pursuant to the Child Victim Act.
The parties have agreed to resolve the pending lawsuits and each
claimant shall receive the sum of $566,666.66 in full satisfaction
of any and all claims against the Debtor and all named defendants
in the pending actions. This class will be paid the settlement
amount in full within 30 days of the effective date of the Plan.
Upon receipt of the amount set forth, claimants shall file a
stipulation of discontinuance, with prejudice, in the State Court
for all actions pending.
Class 7 consists of 37 holders of Allowed General Unsecured Claims.
This Class totals approximately $561,123.65. In full satisfaction,
compromise, settlement, release and discharge of an in exchange for
such Allowed General Unsecured claim, each holder thereof shall
receive 30 days of the effective date of the Plan, or as soon as
reasonably practicable thereafter, 100% of its Allowed Claim.
This Class also includes a claim filed by Jayme Thode, Claim No: 10
filed on November 27, 2023. The claim of Ms. Thode also arises out
of an action pursuant to the Child Victims Act. Ms. Thode filed a
claim without designating an amount. The Debtor believes the claim
is worth no more than $50,000.00 and will escrow this amount with
its attorneys. The General Unsecured Creditors are impaired
pursuant to Section 1124 of the Bankruptcy Code because they are
being paid 100% of the claim without interest and are entitled to
vote.
The Debtor will be paying all allowed claims in full within 30 days
of the effective date of the Plan. The Debtor believes it will
require $2,261,124.00 for confirmation and will have the necessary
funds in escrow before confirmation of the Plan, which shall be
effectuated from ongoing business operations and contributions from
its network of private supporters donations.
A full-text copy of the Disclosure Statement dated April 4, 2024 is
available at https://urlcurt.com/u?l=DQMYOk from PacerMonitor.com
at no charge.
Counsel to the Debtor:
Heath S. Berger, Esq.
BERGER FISCHOFF SHUMER WEXLER & GOODMAN LLP
6901 Jericho Turnpike #230
Syosset, NY 1179
Phone: (800) 806-1136
Email: hberger@bfslawfirm.com
About Timothy Hill Children's Ranch
Timothy Hill Children's Ranch, Inc. owns and operates transitional
housing programs for troubled teens and young adults.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. N.Y. Case No. 23-73821) on October 16,
2023. In the petition signed by Thaddaeis Hill, executive director,
the Debtor disclosed $13,637,708 in assets and $4,841,336 in
liabilities.
Judge Louis A. Scarcella oversees the case.
Heath S. Berger, Esq., at Berger, Fischoff, Shumer, Wexler &
Goodman, LLP, represents the Debtor as legal counsel.
TLG CAPITAL: Case Summary & Five Unsecured Creditors
----------------------------------------------------
Debtor: TLG Capital Development, LLC
d/b/a TLG Capital Developments
d/b/a TLG Capital Developments, LLC
824 Masonic Ave.
San Francisco, CA 94117
Business Description: The Debtor is engaged in activities related
to real estate.
Chapter 11 Petition Date: April 10, 2024
Court: United States Bankruptcy Court
Northern District of California
Case No.: 24-30241
Judge: Hon. Hannah L. Blumenstiel
Debtor's Counsel: Matthew D. Metzger, Esq.
BELVEDERE LEGAL, PC
1777 Borel Place, Suite 314
San Mateo, CA 94402
Tel: 415-513-5980
Fax: 415-513-5985
E-mail: info@belvederelegal.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $0 million
The petition was signed by Valerie Lee as managing member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's five unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/VWV2OVI/TLG_Capital_Development_LLC__canbke-24-30241__0001.0.pdf?mcid=tGE4TAMA
TRANSOCEAN LTD: Secures $195M Ultra-Deepwater Drillship Contract
----------------------------------------------------------------
Transocean Ltd. announced a 365-day contract extension for the
Deepwater Asgard with an independent operator in the U.S. Gulf of
Mexico.
The program is expected to commence in June 2024 in direct
continuation of the rig's current program and includes additional
services. The total contract value of approximately $195 million
includes a $10.9 million lump sum payment, which is not included in
the estimated backlog of approximately $184 million.
About Transocean
Transocean Ltd. is an international provider of offshore contract
drilling services for oil and gas wells. The Company specializes
in technically demanding sectors of the offshore drilling business
with a particular focus on ultra-deepwater and harsh environment
drilling services.
* * *
Egan-Jones Ratings Company, on January 30, 2024, maintained its
'CCC-' foreign currency and local currency senior unsecured ratings
on debt issued by Transocean Ltd. EJR also withdrew the rating on
commercial paper issued by the Company.
Moreover, as reported by the TCR on Sept. 28, 2023, S&P Global
Ratings raised its issuer credit rating on offshore drilling
contractor Transocean Ltd. to 'CCC+' from 'CCC'. S&P said, "The
upgrade reflects improved rig demand, higher day rates, and our
view that there is reduced near-term risk of a distressed debt
exchange or balance sheet restructuring."
TREES CORP: Incurs $7.1 Million Net Loss in 2023
------------------------------------------------
Trees Corporation filed with the Securities and Exchange Commission
its Annual Report on Form 10-K reporting a net loss of $7.08
million on $18.14 million of total revenue for the year ended Dec.
31, 2023, compared to a net loss of $9.47 million on $13.44 million
of total revenue for the year ended Dec. 31, 2022.
As of Dec. 31, 2023, the Company had $23.25 million in total
assets, $23.10 million in total liabilities, and $148,159 in total
stockholders' equity.
Salt Lake City, Utah-based Haynie & Company, the Company's auditor
since 2021, issued a "going concern" qualification in its report
dated April 10, 2024, citing that the Company has suffered
recurring losses from operations and has a negative working capital
that raise substantial doubt about its ability to continue as a
going concern.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/0001477009/000121390024031818/ea0202425-10k_trees.htm
About Trees Corp
TREES Corporation is a cannabis retailer and cultivator in the
States of Colorado and Oregon. The Company presently operates six
cannabis dispensaries. The Company's principal business model is
to acquire, integrate and optimize cannabis companies in the retail
and cultivation segments utilizing the combined experience of
entrepreneurs and synergistic operations of its vertically
integrated network.
TURF APPEAL: U.S. Trustee Unable to Appoint Committee
-----------------------------------------------------
The U.S. Trustee for Region 20 disclosed in a court filing that no
official committee of unsecured creditors has been appointed in the
Chapter 11 case of Turf Appeal, Inc.
About Turf Appeal
Turf Appeal, Inc. is a lawn care company located in Oklahoma City.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Okla. Case No. 24-10590) on March 12,
2024, with $324,921 in assets and $1,080,537 in liabilities.
Stephen Moriarty, Esq., at Fellers, Snider, Blankenship, Bailey &
Tippens, P.C., is the Subchapter V trustee.
Judge Janice D. Loyd presides over the case.
Amanda R. Blackwood, Esq., at Blackwood Law Firm, PLLC represents
the Debtor as bankruptcy counsel.
TWO RIVERS: Unsecured Creditors to Recover 100% Under Plan
----------------------------------------------------------
Two Rivers Corporate Centre Limited Partnership submitted a
Combined Disclosure Statement and Chapter 11 Plan of
Reorganization.
The Debtor is Two Rivers Corporate Centre Limited Partnership
("TRCC" or the "Debtor"). TRCC was formed in 2001 and is the owner
of the Office Park, a 3-building 283,789 SF single story office
park situated on one parcel of 33 acres located at 2501 McGavock
Pike, Nashville, Tennessee. The land is zoned CA (Commercial
Attraction) which also allows for high density residential and
industrial development by right in addition to office space and
retail uses.
TRCC filed the Chapter 11 case on February 7, 2024 to protect the
substantial equity in the Office Park and to maximize the return to
all creditors, including Wells Fargo.
According to the Debtor's financial projections, the Office Park
will generate income from rents during the 24-month Plan period to
make substantial interest payments until a sale that fully pays
Wells Fargo and all other Claims. Specifically, the Plan provides
for $1.2 million in interest payments to Wells Fargo over the
24-month life of the Plan. Any accrued and unpaid interest due to
Wells Fargo will be paid in full upon closing of a sale.
The Debtor has engaged the Nashville office of CBRE, Inc. to market
and sell the Office Park over a period not to exceed 24 months
after the Effective Date. A copy of the Exclusive Listing Agreement
between TRCC and CBRE (the "CBRE Listing Agreement"). The CBRE
Listing Agreement is being assumed in connection with this Combined
Disclosure Statement and Plan. The Debtor anticipates selling the
three occupied buildings first at a sales price sufficient to pay
Wells Fargo in full. Following the residential subdivision
discussed above, the remainder of the Office Park will be sold.
Under the Plan, Class 4 consists of General Unsecured claims and
will recover 100% of their claims. Each Holder of an Allowed Class
4 Claim shall be paid its Allowed Claim in full without interest no
later than 30 days after the Confirmation Date. Class 4 is
impaired.
The Debtor shall use proceeds from operations and the sale of the
Office Park to make all required payments on the Effective Date and
all payments due under the Plan on an on-going basis.
The Debtor, as landlord, is and will be obligated to make certain
tenant improvements pursuant to existing and future leases with
tenants. After Confirmation, the Debtor shall be authorized but
not obligated to borrow up to $4,688,990 for such purposes on terms
reasonably acceptable to the Debtor secured by a first-priority
priming lien on the Office Park.
Counsel to the Debtor:
Robert J. Gonzales, Esq.
Nancy B. King, Esq.
EMERGELAW, PLC
4235 Hillsboro Pike, Suite 300
Nashville, TN 37215
Tel: (615) 815-1535
E-mail: robert@emerge.law
nancy@emerge.law
A copy of the Combined Disclosure Statement and Chapter 11 Plan of
Reorganization dated March 27, 2024, is available at
https://tinyurl.ph/WWTHj from PacerMonitor.com.
About Two Rivers Corporate Centre
Two Rivers Corporate Centre was formed in 2001 and is the owner of
a 3-building, 283,789 square foot single story office park situated
on one parcel of 33 acres located at 2501 McGavock Pike, Nashville,
Tennessee. The land is zoned CA (Commercial Attraction) which also
allows for high density residential and industrial development by
right in addition to office space and retail uses. The property has
a number of Tenants that are government agencies with long-term
leases in place as well as government contractors that serve
governmental agencies.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Tenn. Case No. 3:24-bk-00399) on Feb.
7, 2024. In the petition signed by Floyd Shechter, chief manger
of GP, RS Development of Nashville, LLC, the Debtor disclosed up to
$50 million in both assets and liabilities.
Robert J. Gonzales, Esq., at EmergeLaw, PLC, is the Debtor's legal
counsel.
UPHEALTH INC: Enforces $110M Arbitration Award
----------------------------------------------
UpHealth, Inc. provided an update on the efforts of UpHealth
Holdings, Inc., a wholly-owned direct subsidiary of UpHealth, to
enforce the International Court of Arbitration of the International
Chamber of Commerce (the "ICA")'s Final Award to Holdings and
against Glocal Healthcare Systems and several of Glocal's officers
and shareholders.
Holdings, pursuant to a Share Purchase Agreement dated October 30,
2020, acquired a supermajority of the shares of Glocal in a series
of transactions from November 20, 2020 to August 27, 2021 and, as
the Tribunal noted, "it is incontrovertible that [Holdings] holds
94.81% of the shares in Glocal". In particular, the Tribunal found
that the Respondents "failed to give [Holdings] control of
[Glocal]" after the closing of the acquisition, despite the payment
in full of the acquisition consideration, and noted that the
Calcutta High Court also agreed that Holdings has invested
approximately Rs 2100 crores in Glocal.
Holdings acquired Glocal in order to provide it with the capital
and advanced technology required to increase the number of
comprehensive primary care and specialty consultations provided to
vulnerable populations in India's rural and dense urban centers
through Glocal's hospitals and onsite digital dispensaries and
clinics. In addition to investing millions of U.S. dollars in
working capital to fund Glocal's growth, UpHealth also commissioned
a strategic study by McKinsey & Co. and hired local Indian
executives with extensive multinational experience to enable even
more patients across India to receive high quality, affordable
healthcare services.
In the Final Award transmitted on March 18, 2024, the arbitral
tribunal ("Tribunal") found the Respondents liable for breach of
contract and directed them to pay Holdings up to $110.2 million in
damages, as well as most of the legal costs and other expenses that
Holdings incurred in the arbitration. The $110.2 million damages
are apportioned based on the shareholders percentage of each of the
Indian directors and shareholders of Glocal: 34.38% to be paid by
Dr. Syed Sabahat Azim, 34.38% by Richa Sana Azim, 4.69% by Mr.
Gautam Chowdhury, 22.54% by Mr. Meleveetil Damodaran, and 4.02% by
Kimberlite Social India Private Limited.
Holdings is in the process of filing an 'Enforcement Petition' to
immediately enforce certain portions of the Final Award and has
filed a petition, which is expected to be heard on April 2, 2024,
under Section 9 of the (Indian) Arbitration and Conciliation Act,
1996 seeking certain interim reliefs in aid of the Final Award
including requiring Respondents to disclose and to not alienate
their assets and requiring each Respondent to fund capital in
amounts equal to their apportionment of the Final Award.
"UpHealth Holdings acquired Glocal in 2021 to embark in a
purposeful mission to provide high-quality medical care to the
underserved communities in India's rural and dense urban centers
through Glocal's hospitals and onsite digital dispensaries and
clinics and we continue to believe in this mission. As the ICA
confirmed and validated UpHealth's ownership of Glocal as per the
lawfully executed purchase agreement, it is critically important to
pursue enforcement of the Tribunal's Final Award to recover and
take control of our assets. This will provide further confidence
with other foreign investors to continue to invest in India in
order to better the access of vulnerable populations to high
quality, cost-effective healthcare services," said Martin Beck,
Chief Executive Officer of UpHealth.
About UpHealth
UpHealth -- https://uphealthinc.com/ -- is a global digital health
company that delivers digital-first technology, infrastructure, and
services to dramatically improve how healthcare is delivered and
managed. The UpHealth platform creates digitally enabled "care
communities" that improve access and achieve better patient
outcomes at lower cost, through digital health solutions and
interoperability tools that serve patients wherever they are, in
their native language. UpHealth's clients include health plans,
healthcare providers and community-based organizations.
VENUS CONCEPT: Incurs $37.1 Million Net Loss in 2023
----------------------------------------------------
Venus Concept Inc. filed with the U.S. Securities and Exchange
Commission its Annual Report on Form 10-K disclosing a net loss of
$37.1 million on $76.4 million of total revenue for the year ended
December 31, 2023, compared to a net loss of $43.6 million on $99.5
million of total revenue for the year ended December 31, 2022.
As of December 31, 2023, the Company had $93.7 million in total
assets, $107.1 million in total liabilities, and $13.4 million in
total stockholders' deficit.
Toronto, Canada-based MNP LLP, the Company's auditor since 2019,
issued a "going concern" qualification in its report dated April 1,
2024, 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.
Management Commentary:
"Our fourth quarter revenue results reflect softer-than-expected
system sales in the U.S. due to macroeconomic conditions and
tighter credit markets, and by the impact of our accelerated
restructuring activities in certain international markets," said
Rajiv De Silva, Chief Executive Officer of Venus Concept. "We have
successfully executed our strategic turnaround plan, and our
efforts to reposition and restructure the business resulted in a
20% reduction in operating expenses. Importantly, we delivered on
our primary objective for 2023 to reduce cash burn by 50% or more
year over year. We remain in active dialogue with our lenders and
investors to find ways to best enable Venus Concept to achieve our
strategic objectives and to accelerate the path to long-term,
sustainable, profitability and growth. We also continue to explore
strategic alternatives with various interested parties to maximize
shareholder value."
A full-text copy of the Company's Form 10-K is available at
https://tinyurl.com/4skc9h68
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.
VERITAS FARMS: Needs Additional Time to File Annual Report
----------------------------------------------------------
Veritas Farms, Inc. has determined that it is unable to file its
Annual Report on Form 10-K for the year ended Dec. 31, 2023, within
the prescribed time period.
Despite working diligently to timely file its 2023 Annual Report,
the Company will be unable to complete all work necessary to timely
file its 2023 Annual Report as the Company needs additional time to
provide information to its independent registered public accounting
firm necessary to complete the audit of the financial statements
for the year ended Dec. 31, 2023.
About Veritas
Fort Lauderdale, Florida-based Veritas Farms, Inc. --
https://www.TheVeritasFarms.com -- is a vertically-integrated
agribusiness focused on growing, producing, marketing, and
distributing whole plant, full spectrum hemp oils and extracts
containing naturally occurring phytocannabinoids. Veritas Farms
owns and operates a 140-acre farm in Pueblo, Colorado, capable of
producing over 200,000 proprietary full spectrum hemp plants which
can potentially yield a minimum annual harvest of 250,000 to
300,000 pounds of outdoor-grown industrial hemp.
Veritas Farms reported a net loss of $5.14 million for the year
ended Dec. 31, 2022, compared to a net loss of $7.07 million for
the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had
$6.79 million in total assets, $7.40 million in total liabilities,
and a total shareholders' deficit of $606,277.
Hackensack, NJ-based Prager Metis CPAs LLC, the Company's auditor
since 2018, issued a "going concern" qualification in its report
dated April 17, 2023, citing that the Company has sustained
substantial losses from operations since its inception. As of and
for the year ended Dec. 31, 2022, the Company had an accumulated
deficit of $39,474,622, and a net loss of $5,543,908. These
factors, among others, raise substantial doubt about the ability of
the Company to continue as a going concern within a year from the
date the financial statements are issued. Continuation as a going
concern is dependent on the ability to raise additional capital and
financing, though there is no assurance of success.
VICTORIA'S SECRET: Moody's Alters Outlook on 'Ba3' CFR to Negative
------------------------------------------------------------------
Moody's Ratings changed Victoria's Secret & Co.'s (VS) outlook to
negative from stable. At the same time, Moody's Ratings affirmed
all ratings including the Ba3 corporate family rating, Ba3-PD
probability of default rating, Ba2 senior secured bank credit
facility rating and B1 senior unsecured notes rating. The company's
speculative grade liquidity rating (SGL) remains unchanged at
SGL-2.
"The company's operating performance has been weak with sales being
hurt by a tough consumer environment and margins being pressured
resulting in weaker than expected profitability", Moody's Ratings'
Vice President Mickey Chadha stated. "The negative outlook reflects
that Moody's expect the US intimate apparel sector to remain weak
and that competitive pressures will exacerbate the already
challenging consumer environment causing 2024 operating profit to
be lower than fiscal 2023", Chadha further stated.
RATINGS RATIONALE
Victoria's Secret & Co.'s Ba3 corporate family rating is supported
by the company's solid market position as a leading intimates
apparel retailer through its Victoria's Secret brand ("Victoria's
Secret") and PINK brand as well as its formidable beauty business.
The company continues to implement strategic initiatives to improve
its operational performance which has required the rationalization
of its fleet, addressing its assortments and imagery, remodeling to
improve store presentation and reducing cost. The company has also
expanded its third party product assortment. VS' rating is also
supported by its conservative capital structure and good liquidity.
VS has also grown its e-commerce business rapidly and in December
2022 acquired an intimate apparel company called Adore Me which
primarily sells its products online powered by a proprietary
technology platform. VS intends to leverage Adore Me's technology
to scale differentiated and digital shopping experiences. Adore Me
has a younger customer base with over a million active customers.
The company's operating performance has been pressured due to a
challenging consumer environment for apparel retailers with lower
demand for intimate apparel. Ongoing inflationary pressures have
resulted in consumers pulling back on non-essential retail
categories. Additionally, the company's PINK brand has
underperformed as products have not resonated with its customer
base. As a result credit metrics have deteriorated. While leverage
is still expected to remain modest with debt/EBITDA expected to
remain around 3.0x in the next 12 months, EBIT/interest will remain
weak and below 2.0x. The company's rating is constrained by its
narrow product focus which has a significant fashion element which
can lead to earnings volatility.
The negative outlook reflects Moody's expectation that operating
performance including sales and margins will remain pressured and
interest coverage will remain weak and company may not be able to
weather the risk of future operational volatility given the
significant fashion component of its products and the potential for
demand weakening as alternative apparel categories and services
increase in favorability.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Given the negative outlook, an upgrade is currently unlikely.
However, ratings could be upgraded to the extent the company
continues to post consistent sales and operating earnings growth
while maintaining good liquidity. An upgrade would require a
conservative and clearly articulated financial strategy.
Quantitatively, an upgrade would require operating margins
sustained in excess of 10% and Moody's Ratings' debt/EBITDA
sustained below 1.75x.
Ratings could be downgraded if liquidity deteriorates for any
reason or financial strategies become more aggressive. Ratings
could also be downgraded if revenue and operating profit does not
improve. Quantitatively, ratings would be downgraded should Moody's
Ratings' adjusted debt/EBITDA remain above 3.25x or EBIT/interest
is sustained below 2.25x.
Headquartered in Reynoldsburg, Ohio, Victoria's Secret & Co. is a
specialty retailer of women's lingerie, other apparel, personal
care and beauty products through its global retail stores. VS
operates 831 stores in North America with 463 stores outside North
America. The company also has 70 stores in a joint venture in China
and 6 Adore Me stores. Products are sold under two leading two
brands, Victoria's Secret and PINK. Its beauty products business
comprises over 15% of its North America retail sales. Revenue was
about $6.2 billion for the twelve months ended February 3, 2024.
The principal methodology used in these ratings was Retail and
Apparel published in November 2023.
VISTRA OPERATIONS: Fitch Gives 'BB' Rating on 2032 Unsecured Notes
------------------------------------------------------------------
Fitch Ratings has assigned a 'BBB-'/'RR1' rating to Vistra
Operations Company LLC's proposed issuance of senior secured notes
due in 2034 and a 'BB'/'RR4' rating to the proposed issuance of
senior unsecured notes due in 2032. The 'RR1' Recovery Rating
denotes outstanding recovery and the 'RR4' Recovery Rating denotes
average recovery in the event of default.
The Fitch-rated Long-Term Issuer Default Rating (IDR) for Vistra
Operations and its parent company, Vistra Corp. (Vistra) is 'BB'.
The Rating Outlook is Stable. The net proceeds from the issuance
will be used to refinance upcoming $1.5 billion of 2024 senior
secured maturities.
The new senior secured notes will be pari passu with Vistra
Operations' existing first lien debt. Vistra Operations' first lien
secured debt receives an upstream guarantee from the asset
subsidiaries under Vistra Operations, which consists of a
substantial portion of property, assets and rights owned by Vistra
Operations.
KEY RATING DRIVERS
Strong 2023 Results: Per Fitch's calculations, Vistra's 2023 EBITDA
leverage was at 3.8x vs. 4.5x in 2022. The improvement in leverage
was driven by strong operating results across both the retail and
wholesale segment driven by demand growth and a decrease in
liquidity requirements due to a reduction in the average collateral
requirements vs. 2022. Natural gas and power prices have fallen
from their highs in 2022, resulting in a material release of
collateral requirements in 2023. As of the end of the 4Q23, Vistra
had close to $1.2 million of cash collateral postings, which is
close to historical averages.
Deleveraging Capacity: Fitch projects total consolidated leverage
post acquisition to trend toward 3.5x by 2026. Fitch's leverage
calculations reflect 50% debt allocated to approximately $2.5
billion preferred stock. Fitch assigned a 50% equity credit to the
preferred stock based on the ability to defer dividend payments for
at least up to five years. Fitch expects an improvement in EBITDA
over time as a result of improved energy margins at EH following
the roll off below market hedges and merger synergies from EH
integration. However, the trajectory of credit metrics will largely
be driven by management's financial policy. Management is committed
to net debt/EBITDA leverage below 3.0x, and calculates 2023 net
debt/EBITDA of 2.7x excluding preferred equity, which adds about 20
bps to the leverage calculation.
Fitch expects planned investments into renewable and battery
storage opportunities will be mostly financed by third-party
non-recourse debt, of which $700 million was issued in March 2024.
Fitch consolidates all the debt in the calculation of the
leverage.
Acquisition Provides Diversification: Fitch views the acquisition
of Energy Harbor (EH) as positive for Vistra's credit profile. The
acquisition of four nuclear plants located in PJM provides
geographical diversification while adding strong baseload assets to
Vistra's generation portfolio, including relatively low fuel cost
dynamics and assets that run at capacity factors in excess of 90%.
The Inflation Reduction Act (IRA) establishes a nuclear Production
Tax Credit (PTC) mechanism, thereby providing a revenue floor for
nuclear plants. In Fitch's view, the nuclear PTCs provide a key
credit strength. EH's assets, including synergies from integration,
should contribute close to 20% of Vistra's consolidated EBITDA by
2025.
Despite the positive aspects of nuclear assets, Fitch regards
nuclear generation as having higher operating risk. EH's nuclear
fleet is mature with an average age of over 40 years, but plants
are permitted for the next 20+ years, excluding the Perry facility,
which is currently in the process of license renewal. No nuclear
asset in the U.S. has failed to be permitted in the last 30 years.
Fitch believes the company's strong operating performance record
largely mitigates re-licensing risk. Over the last five years, EH's
average outage rates have been lower than 5%. Fitch believes the
company can reliably generate about 32TWh of power annually.
Hedges Provide Earnings Visibility: Vistra (standalone) is well
hedged for 2023 to 2025 (~99% hedged for 2024 and 87% hedged for
2025), providing increased confidence in Vistra's ongoing
operations adjusted EBITDA expectations. The addition of EH's
nuclear assets provides additional revenue security supported by
Nuclear PTCs starting in 2024 providing a high degree of revenue
visibility for those assets.
In addition, Vistra's retail business provides revenue stability
with relatively high renewal rates and stable margins,
in-particular given its strong presence in Texas. Retail margins in
the commercial and industrial segments generally remain range-bound
during commodity cycles, and residential retail margins are usually
countercyclical, given the length and stickiness of the customer
contracts. TXU Energy Company LLC, Vistra's largest retail
electricity operation in Texas, has demonstrated strong brand
recognition, tailored customer offerings and effective customer
service, which are driving high customer retention and growth.
DERIVATION SUMMARY
Vistra is well-positioned relative to Calpine Corporation
(B+/Stable) and NRG Energy (BB+/Stable) in terms of size, scale and
geographic and fuel diversity. Vistra is the largest independent
power producer in the country, with approximately 40GW of
generation capacity compared with Calpine's 26GW. Vistra's
generation capacity is well-diversified by fuel, compared with
Calpine's natural gas-heavy portfolio. Vistra's portfolio is less
diversified geographically, with more than 70% off its consolidated
EBITDA coming from operations in Texas, while Calpine's fleet is
more geographically diversified across PJM, Texas and California.
The addition of EH will provide diversification from Texas and a
larger presence in PJM, a credit positive. In addition, EH's
nuclear fleet supported by federal nuclear PTC program provides a
high degree of revenue visibility for the next decade. NRG's
acquisition of Vivint will continue the company's transformation
from its origins as a power generator and provide additional
revenue channels, further diversifying NRG's revenue stream
compared to Vistra.
Vistra, like NRG benefits from its ownership of large and well
entrenched retail electricity businesses in Texas, compared to
Calpine, which has a smaller retail business. Calpine's younger and
predominant natural gas fired fleet bears less operational and
environmental risk compared to Vistra's portfolio that also has
nuclear and coal generation assets. In addition, Calpine's EBITDA
is more resilient to changes in natural gas prices and heat rates
as compared to its peers. NRG is short generation compared to
Vistra and Calpine, and serves load from sources other than its own
generation.
Fitch projects Vistra's leverage to remain in the range of
3.5x-4.0x in 2024-2026, which compares favorably to Calpine's
leverage, which is forecasted to remain around 5.0x. Fitch expects
NRG to allocate FCF to maintain leverage within rating thresholds
of 3.0x-3.5x beyond 2023.
KEY ASSUMPTIONS
- Acquisition of EH for $3 billion cash and a 15% equity interest
in Vistra Vision;
- Hedged generation in 2024-2026 per management's guidance;
- Power prices in key markets such as PJM and ERCOT at a discount
to current forward prices;
- Annual retail load of approximately 100TWH for Vistra and about
25TWH for EH;
- Capacity revenues per past auction results; future PJM capacity
auctions in-line with the last auction results;
- Share repurchases of approximately $4.0 billion over 2023-2026;
- Common dividends of about $300 million annually;
- Run rate synergies of about $125 million by 2025.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- While Fitch does not anticipate positive rating actions in the
near to medium term, demonstrated EBITDA leverage lower than 3.5x
on a sustainable basis coupled with track record of stable EBITDA
generation and continued emphasis on an integrated wholesale-retail
platform could lead to a positive rating action.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Gross debt/EBITDA above 4.0x on a sustained basis;
- Weaker power demand and/or higher than expected supply depressing
wholesale power prices and capacity auction outcomes in its core
regions;
- Unfavorable changes in regulatory constructs and markets;
- Lack of access to adequate liquidity to meet collateral
requirements;
- An aggressive growth strategy that diverts a significant
proportion of FCF toward merchant generation assets and/or
overpriced retail acquisitions.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: As of Dec. 31, 2023, the company had
approximately $5.8 billion of liquidity available consisting of
$3.5 billion of cash in hand and around $2.3 billion was available
under various revolving facilities. There were no short-term
borrowings outstanding under the Commodity-Linked Facility and the
Revolving Credit Facility as of Dec. 31, 2023. Vistra's revolving
credit facility agreement, has a $3.175 billion commitment expiring
in April 2027.
The Commodity-Linked Facility matures in October 2024 and has
aggregate available commitments of $1.575 billion. As of Dec. 31,
2023, the borrowing base under the facility was $1.1 billion, which
is lower than the facility limit of $1.575 billion. The reduction
in the borrowing base is due to a decrease in commodity prices and
would increase in size in a rising commodity price environment in
accordance with the terms of the facility.
The increase in cash as of Dec. 31, 2023 includes proceeds from the
issuance of $1.75 billion and $750 million principal amount of
Vistra Operations senior secured and senior unsecured notes in
September 2023 and December 2023, respectively. Proceeds from the
September 2023 issuance were used, together with cash on hand, to
fund the EH acquisition. Proceeds from the December 2023 issuance
were used to settle the Senior Secured Notes Tender Offers in
January 2024.
The company's proposed issuances are being used to refinance the
$1.5 billion of debt maturities in 2024. After that, the
refinancing declines to $750 million in 2025 and $1.0 billion in
2026.
ISSUER PROFILE
Vistra is the largest independent power generator in the U.S. with
approximately 37 GW of capacity. Vistra Retail is one of the
largest retail providers in the country with roughly 100 TWHs of
load and approximately four million customers.
Criteria Variation
Variation from Criteria: Fitch looks to its Corporate Rating
Criteria dated Oct. 28, 2022, which outlines and defines a variety
of quantitative measures used to assess credit risk. As per
criteria, Fitch's definition of Total Debt is all encompassing.
However, Fitch's criteria is designed to be used in conjunction
with experienced analytical judgment, and as such, adjustments may
be made to the application of the criteria that more accurately
reflects the risks of a specific transaction or entity.
Fitch does not consider the proposed P-Caps as debt, which is a
variation from the Corporate Rating Criteria's definition of Total
Debt. Absent the exercise of the issuance right, P-Caps are treated
as off-balance sheet for analytical purposes and excluded from
Fitch's leverage and interest coverage metrics. If Vistra
Operations were to exercise issuance rights, the amount of debt
issued to the trust would be included in Vistra's total debt
calculation and therefore its credit metrics.
DATE OF RELEVANT COMMITTEE
10 May 2023
PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS
Vistra has an ESG Relevance Score of '4', for Exposure to
Environmental Impacts due to exposure to deficiencies in ERCOT's
energy only market construct caused by extreme weather events,
which has a negative 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
----------- ------ --------
Vistra Operations
Company, LLC
senior secured LT BBB- New Rating RR1
senior unsecured LT BB New Rating RR4
VS HOLDING: S&P Rates New $1.96BB First-Lien Term Loan 'B'
----------------------------------------------------------
S&P Global Ratings assigned its 'B' issue-level and '3' recovery
rating (rounded estimate: 50%) to the proposed $1.96 billion
first-lien term loan due 2031 on VS Holding I Inc. (d/b/a Veeam
Software Holding Ltd. [Veeam]).
S&P affirmed all its issue-level ratings.
The stable outlook reflects S&P's expectation that Veeam will
continue its topline growth this year with EBITDA margins in the
23%-24% range, supporting modest deleveraging within the next 12
months.
On April 1, 2024, VS Holding I Inc. (d/b/a Veeam Software Holding
Ltd. [Veeam]), a leading provider of recovery and backup solutions,
announced its plan to refinance its existing $1,203 million term
loan B and $746 million seller note by raising a new seven-year
$1.96 billion term loan B. Veeam also plans to upsize its revolving
credit facility to $250 million and extend the maturity to 2029.
Rating Action Rationale
S&P said, "We anticipate modest deleveraging to mid-5x in 2024,
supported by at least high single-digit revenue growth and EBITDA
margins in the 23%-24% range. We view Veeam's new capital
structure--a uni-tranche $1.96 billion term loan with 1% mandatory
amortization--as a broadly neutral credit event. The replacement of
payment-in-kind (PIK) debt will stabilize debt levels and support
the company's organic deleveraging efforts, at the cost of
moderately higher cash interest payments. We do not believe this
increase in cash interest will significantly affect the company's
overall cash flow profile, given the anticipated steady growth in
EBITDA and low capital expenditure needs of less than $10 million
annually. Veeam generated approximately $40 million- $50 million in
free cash flow in 2023 (including the one-time costs related to the
Russia exit), and we anticipate FOCF to reach $100 million or above
in 2024-2025.
"We expect Veeam will continue to experience strong demand for its
products despite a conservative information technology (IT)
spending environment. We consider Veeam's products to be
mission-critical for its customers, especially given the rising
ransomware cyber threats and increased importance placed on
securing and protecting data as businesses transition to cloud
environments. Therefore, the business is less affected by IT budget
constraints and macroeconomic weakness in our view. Robust demands
have been observed across product groups, particularly in its
solutions for newer cloud-based workloads, as Veeam's data cloud
protection offers flexibility for customers to back up across
different platforms such as Microsoft 365, AWS, Azure, and
Kubernetes, Veeam achieved total annual recurring revenue (ARR)
growth of 17% in 2023 (37% for subscription growth) and revenue
growth of about 12%. Its total 2023 billings approached $1.5
billion for the year, almost double since 2019.
"While we anticipate Veeam will continue to grow market share and
maintain its technological leadership, our assessment of the
business also considers its narrow product scope with a focus on
backup and recovery, smaller scale, and competition against much
larger and capitalized players like International Business Machines
Corp., as well as some rapidly expanding competitors such as Datto
Inc., Commvault, and Carbonite Inc. Additionally, financial sponsor
Insight Partners, Veeam's majority owner, have influences on many
aspects of the company's financial decision-making or longer-term
deleverage path, which constrains the rating to a higher notch."
Outlook
The stable outlook reflects S&P's expectation that Veeam will
continue its topline growth this year with EBITDA margins in the
23%-24% range, supporting modest deleveraging within the next 12
months.
Downside scenario
S&P could lower the rating if:
-- Competitive threats increase, the company fails to launch
compelling products, or weaker than-expected margin performance
leads to leverage sustained above 8x;
-- Cash generation deteriorates to break-even territory; or
-- Sources of cash are not sufficient to cover uses and S&P views
Veeam's liquidity as less than adequate.
Upside scenario
S&P would consider an upgrade if Veeam:
-- Sustains leverage below 5x, or
-- Generates FOCF to debt above 10%.
In addition, S&P would need to believe its ownership structure will
not preclude sustained deleveraging.
Company Description
Veeam provides software-based data protection solutions to small to
midsize businesses (SMBs) and enterprise customers. The company was
founded in 2006, and management is predominantly U.S. based.
Veeam's core product is backup and recovery, which is also sold as
part of the Veeam Availability Suite alongside monitoring and
analytics. The platform delivers visibility and control for a
customer's data in the cloud, virtual environments, and physical
servers. Veeam was acquired by Insight Partners in 2020.
ISSUE RATINGS – RECOVERY ANALYSIS
Key analytical factors
-- S&P values the company on a going-concern basis using a 7x
multiple of its projected emergence EBITDA.
-- S&P's simulated default scenario contemplates a default in
2027, because of a significant decline in revenue from increasing
competition in the backup and recovery market and a failure to
maintain technological leadership.
Simulated default assumptions
-- Year of default: 2027
-- Emergence EBITDA: about $165 million
-- EBITDA multiple: 7x
Simplified waterfall
-- Gross recovery value: $1.156 billion
-- Net enterprise value (after 5% administrative costs): about
$1.098 billion
-- Value available to senior secured claims: $1.098 billion
-- Estimated senior secured claims: about $2.088 billion
--Recovery expectation: 50%-70% (rounded estimate: 50%)
Note: All debt amounts include six months of prepetition interest.
WALLAROO'S FURNITURE: Seeks Cash Collateral Access Thru Aug 31
--------------------------------------------------------------
Wallaroo's Furniture and Mattresses, LLC and affiliates ask the
U.S. Bankruptcy Court for the District of Utah for authority to use
cash collateral and provide adequate protection, through August 31,
2024, or until the effective date of the Plan.
The Debtor seeks authorization to pay the April 4, 2024, payroll
for the period from March 21, 2024, through April 3, 2024 which
includes payment for the pre-petition period from the March 21,
2024 through March 29, 2024.
None of the proposed payments to each individual exceeds $15,150.
The pre-petition wage claims are based on compensation earned
within 180 days of the petition date under the statutory cap,
entitling them to priority status pursuant to 11 U.S.C. Section
507(a)(4). Pursuant to section 1129(a)(9), the wage claims would
normally be entitled to priority under any Chapter 11 plan,
therefore Debtor does not believe payment at this time would
prejudice other creditors. Payment of the prepetition wages is also
necessary to preserve the Debtor's business as a going concern.
As part of the foregoing relief, the Debtor also seeks
authorization to pay all federal and state withholding and
payroll-related taxes resulting from this pre-petition pay period.
The entities that assert an interest in the Debtor's cash
collateral are the U.S. Small Business Administration, UFS West,
Rowan Capital, Wynwood Capital, Bluevine Capital, and Backd.
As of the petition date, the Debtor's deposit accounts had a
balance of $3,148 and accounts receivables in the amount of
$379,651. On the date of the petition, the Debtor's cash collateral
was estimated to be valued at $382,799.
As adequate protection and for the Debtor's use of the cash
collateral, SBA, UFS West, Rowan Capital, Wynwood Capital, Bluevine
Capital Capital, Backd will be granted replacement liens in the
Debtor's post-petition cash, accounts receivables, and the proceeds
of each of the foregoing, to the same extent and priority as any
duly perfected and unavoidable liens in cash collateral held by the
Secured Creditor as of the Petition Date.
A copy of the motion is available at https://urlcurt.com/u?l=zWK1Hj
from PacerMonitor.com.
About Wallaroo's Furniture and Mattresses LLC
Wallaroo's Furniture and Mattresses LLC specializes in offering a
wide selection of high-end furniture and mattresses.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Utah Case No. 24-21395) on March 29,
2024. In the petition signed by Nathan Chetrit, managing member,
the Debtor disclosed up to $50,000 in assets and up to $10 million
in liabilities.
Judge Joel T. Marker oversees the case.
Geoffrey L. Chesnut, Esq., at RED ROCK LEGAL SERVICES, PLLC,
represents the Debtor as legal counsel.
WESTLAKE SURGICAL: No Decline in Patient Care, 4th PCO Report Says
------------------------------------------------------------------
Dr. Thomas Mackey, the court-appointed patient care ombudsman,
filed with the U.S. Bankruptcy Court for the Western District of
Texas his fourth report regarding the quality and safety of patient
care provided at The Hospital at Westlake Medical Center, a
boutique hospital in Westlake Hills operated by Westlake Surgical,
L.P.
The report contains the PCO's findings from his visit on March 22.
According to the report, Westlake has adequate clinical staff for
the number of patients being seen. An appropriate number of
physicians, staff nurses, pharmacists, and other critical staff are
employed to care for the number of active patients.
The PCO observed that there has been some turnover of staff,
including the CEO/CAO, DQCR, and Director of Radiology. He did not
find any deterioration of quality or safety of care issues.
Furthermore, personnel interviewed displayed a positive attitude of
change toward providing quality and safe care to patients.
The following are the salient points of the PCO visit on March 22:
* Westlake contracted with an Infection Control (IC)
specialist to address previously mentioned concerns. While there
are still areas needing attention, processes and qualified
infection control personnel are in place to discover and correct
patient safety and quality of care concerns. The PCO is satisfied
with the progress being made.
* The previously closed Emergency Department (ED) reopened as
of February 21, 2024, after receiving authorization from The Texas
Department of Health and Human Services Commission (HHSC).
* Westlake's various licenses (hospital, laboratory, pharmacy)
are current.
* Westlake has adequate clinical staff (physicians, nurses,
pharmacists, technicians, etc.) for the number of patients serviced
in the ED and hospital.
* There is a new Chief Administrative Officer (CAO) who is
very attentive and responsive to patient safety and quality of care
issues.
* The Director of Quality, Compliance & Risk (DQCR) is no
longer with the hospital. The CAO is actively seeking a
replacement.
A copy of the ombudsman report is available for free at
https://urlcurt.com/u?l=UXFmH2 from PacerMonitor.com.
About The Hospital at Westlake
Medical Center
The Hospital at Westlake Medical Center is a physician-owned
boutique hospital in Westlake Hills, Texas, a suburb of Austin.
Guided by an unwavering commitment to delivering quality healthcare
services in a comfortable setting, its core service areas include
surgical procedures, outpatient radiology, and a 24/7 emergency
room.
Westlake Surgical, L.P., doing business as The Hospital at Westlake
Medical Center, sought Chapter 11 protection (Bankr. W.D. Texas
Case No. 23-10747) on Sept. 8, 2023. The Honorable Shad Robinson is
the case judge.
The Debtor tapped Hayward, PLLC as bankruptcy counsel and Donlin,
Recano & Company, Inc. as claims agent. eCapital Healthcare Corp.,
the DIP lender, is represented by Foley & Lardner, LLP.
On Sept. 29, 2023, the U.S. Trustee for Region 7 appointed an
official committee to represent unsecured creditors in the Debtor's
Chapter 11 case. The committee is represented by White & Case,
LLP.
Dr. Thomas Mackey is the patient care ombudsman appointed in the
Debtor's case.
WHITTAKER CLARK: Denies Bid to Appoint Creditors' Committee
-----------------------------------------------------------
A U.S. bankruptcy judge denied the motion to appoint an official
committee of unsecured creditors in the Chapter 11 case of
Whittaker, Clark & Daniels, Inc.
Judge Michael Kaplan of the U.S. Bankruptcy Court for the District
of New Jersey held that the group, which filed the motion, can
address its interests through mediation without forming an official
creditors' committee.
The group on Feb. 17 sought the appointment of an official
committee, arguing the company's unsecured commercial creditors are
not adequately represented in its bankruptcy case unlike the
company's talc claimants who have their own official committee.
The group is composed of law firms and advisers that previously
worked for Whittaker. It holds more than $5.8 million in claims
against the company.
About Whittaker, Clark & Daniels
Whittaker, Clark & Daniels, Inc. and affiliates, Brilliant National
Services Inc., Soco West Inc. and L.A. Terminals Inc., were engaged
in nonmetallic mineral mining and quarrying.
The Debtors sought Chapter 11 protection (Bankr. D.N.J. Lead Case
No. 23-13575) on April 26, 2023. The Debtors estimated $100 million
to $500 million in assets against $1 billion to $10 billion in
liabilities as of the bankruptcy filing.
The Hon. Michael B. Kaplan is the case judge.
The Debtors tapped Kirkland & Ellis LLP as general bankruptcy
counsel; Cole Schotz P.C. as co-bankruptcy counsel; and M3 Partners
LLC as financial advisor. Stretto, Inc. is the claims agent.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee to represent talc claimants in the Debtors' Chapter 11
cases. The talc committee is represented by Cooley, LLP.
The Hon. Shelley Chapman was appointed as the future claimants'
representative (FCR) in these Chapter 11 cases. Willkie Farr &
Gallagher, LLP is the FCR's counsel.
WILSON BUILDING: Seeks Cash Collateral Access
---------------------------------------------
Wilson Building Maintenance, Inc. asks the U.S. Bankruptcy Court
for the District of Kansas for authority to use cash collateral and
provide adequate protection.
The Debtor requires the use of cash collateral for the maintenance
and preservation of the Debtor's property, its ongoing operations,
the payment of expenses attendant thereto, and the costs and
expenses of administering the case.
The Lenders with claimed liens in the Debtor's accounts receivable
are Samson MCA, LLC, ODK Capital, LLC, Capybara Capital, LLC, and
Rowan Advance, LLC.
The Debtor proposes as adequate protection to the Secured Lenders a
replacement lien in post-petition accounts receivable generated by
the Debtor to the extent of Debtor's use of the cash collateral.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=qc0rrd from PacerMonitor.com.
The Debtor projects total expenses, on a monthly basis, as
follows:
$477,084 for April 2024;
$482,496 for May 2024;
$454,484 for June 2024; and
$446,884 for July 2024.
About Wilson Building Maintenance, Inc.
Wilson Building Maintenance, Inc. owns and operates a commercial
maintenance business in Wichita, Kansas.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Kan. Case No. 24-10264) on April 5,
2024. In the petition signed by Anita L. Vara, president, the
Debtor disclosed up to $50,000 in both assets and liabilities.
Mark J Lazzo, Esq., at Mark J Lazzo PA, represents the Debtor as
legal counsel.
WOM SA: CEO Leaves Bankrupt Company, Criticizes Owner
-----------------------------------------------------
Vinícius Andrade and Maria Elena Vizcaino of Bloomberg News report
that the head of Chile's troubled telecom operator WOM was replaced
after less than six months on the job and said, after leaving, that
the company's owner failed to come through with promised cash in
the run-up to its bankruptcy.
Chris Bannister, who took over as CEO in October in a second stint
with WOM, was replaced Thursday by Martin Vaca Narvaja, according
to a statement.
About WOM SA
WOM is a Chilean telecommunications provider, focused on offering
mobile voice, data, and broadband services, along with a rapidly
expanding "Fiber to the Home" broadband offering, to consumers and
businesses in Chile. Since the acquisition of Nextel Chile in 2015
through Novator Partners LLP's investment vehicle NC Telecom AS,
WOM has expanded from having virtually no market share to
establishing itself as the second-largest mobile network operator
in Chile.
WOM sought relief under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. D. Del. Lead Case No. 24-10628) on April 1, 2024. In the
petition filed by Timothy O'Connoer, as independent director, the
Debtor reports estimated assets and liabilities between $1 billion
and $10 billion each.
The Honorable Bankruptcy Judge Karen B. Owens oversees the case.
The Debtors tapped WHITE & CASE LLP as general bankruptcy counsel,
RICHARDS, LAYTON & FINGER, P.A., as local bankruptcy counsel,
RIVERON CONSULTING LLC as financial advisor, and ROTHSCHILD & CO US
INC. as investment banker. KROLL RESTRUCTURING ADMINISTRATION LLC
is the claims agent.
WOMEN'S HEALTH: Seeks to Use Cash Collateral
--------------------------------------------
Women's Health Institute of Stockbridge, LLC asks the U.S.
Bankruptcy Court for the Middle District of Georgia for authority
to use cash collateral and provide adequate protection.
The Debtor requires the use of cash collateral to make payroll and
maintain its business.
U.S. Small Business Administration, Corporation Service Company as
representative, and Overnight Capital, LLC assert an interest in
the Debtor's cash collateral. The SBA appears to be in first
position.
As adequate protection, the Debtor proposes to grant Lenders a
post-petition security interest in post-petition inventory and
proceeds to the same extent and priority that it held a prepetition
security interest in such inventory and proceeds, and to provide
adequate protection payments to Respondents in exchange for the
Debtor's continued use of cash collateral post-petition.
A copy of the motion is available at https://urlcurt.com/u?l=rvzxl2
from PacerMonitor.com.
About Women's Health Institute of Stockbridge, LLC
Women's Health Institute of Stockbridge, LLC sought protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. M.D. Ga. Case
No. 24-50510) on April 3, 2024. In the petition signed by Nnameka
M. Umerah, managing member, the Debtor disclosed up to $50,000 in
assets and up to $1 million in liabilities.
Wesley J. Boyer, Esq., at Boyer Terry LLC, represents the Debtor as
legal counsel.
XTI AEROSPACE: Fails to Comply With Nasdaq's Director Requirements
------------------------------------------------------------------
XTI Aerospace, Inc. disclosed in a Form 8-K filed with the
Securities and Exchange Commission that Leonard Oppenheim resigned
from the Board of Directors of the Company, including all
committees thereof and any other positions held with the Company or
any of its subsidiaries, effective as of March 31, 2024. Mr.
Oppenheim's resignation was for personal reasons and not due to any
disagreement relating to the operations, policies or practices of
the Company.
As previously disclosed, and as contemplated by the terms of the
Agreement and Plan of Merger, dated July 23, 2024, by and between
the Company (then known as Inpixon), Superfly Merger Sub Inc.
("Merger Sub") and XTI Aircraft Company ("Legacy XTI"), as of the
effective time (the "Effective Time") of the merger of Merger Sub
with and into Legacy XTI, with Legacy XTI surviving the Merger as a
wholly-owned subsidiary of the Company, the Company determined that
the post-closing Board would consist of a total of five directors,
and therefore, two of the directors are required to have been
nominated by the Company, at least one of whom is an independent
director. Accordingly, the Board is currently comprised of two
directors nominated by the Company prior to the Effective Time
(Messrs. Kareem Irfan and Soumya Das) and two directors nominated
by Legacy XTI prior to the Effective Time (Mr. Scott Pomeroy, who
is also the Company's Chief Executive Officer, and Mr. David
Brody).
On April 3, 2024, the Company notified The Nasdaq Stock Market LLC
that the Company no longer complies with Nasdaq's independent
director and audit committee requirements as set forth in Listing
Rule 5605 as the Board is not comprised of a majority of
"independent directors" (as that term is defined in Nasdaq Listing
Rule 5605(a)(2)) as required by Nasdaq Listing Rule 5605(b)(1) and
the audit committee is not comprised of at least three independent
directors as required by Nasdaq Listing Rule 5605(c)(2)(A).
In response to the Company's notice, the Listing Qualifications
Department of Nasdaq issued a letter to the Company on April 4,
2024, stating that due to Mr. Oppenheim's resignation, the Company
no longer complies with Nasdaq's independent director and audit
committee requirements as set forth in Nasdaq Listing Rule 5605.
Consistent with Nasdaq Listing Rules 5605(b)(1)(A) and 5605(c)(4),
Nasdaq has provided the Company a cure period in order to regain
compliance (i) until the earlier of the Company's next annual
shareholders' meeting or March 31, 2025, or (ii) if the next annual
shareholders' meeting is held before Sept. 27, 2024, then the
Company must evidence compliance no later than Sept. 27, 2024. The
Company intends to appoint an additional independent director to
the Board and the audit committee prior to the end of the cure
period.
About XTI Aerospace
XTI Aerospace (formerly Inpixon), is an aviation company based near
Denver, Colorado. The Company has decades of experience, deep
expertise, and success bringing new aircraft to market, including
participating in teams that played a role in taking over 40
aircraft through FAA certification. Additionally, the Inpixon
business unit of XTI Aerospace (inpixon.com) is a recognized leader
in RTLS technology with customers around the world who use the
Company's location intelligence solutions in factories and other
industrial facilities to help optimize operations, increase
productivity, and enhance safety.
Inpixon reported a net loss of $66.3 million in 2022, a net loss of
$70.13 million in 2021, a net loss of $29.21 million in 2020, a net
loss of $33.98 million in 2019, and a net loss of $24.56 million in
2018.
YIELD10 BIOSCIENCE: Reports $14.5 Million Net Loss in 2023
----------------------------------------------------------
Yield10 Bioscience, Inc. filed with the U.S. Securities and
Exchange Commission its Annual Report on Form 10-K disclosing a net
loss of $14.5 million on $60,000 of total revenue for the year
ended December 31, 2023, compared to a net loss of $13.6 million on
$450,000 of total revenue for the year ended December 31, 2022.
As of December 31, 2023, the Company had $3.9 million in total
assets, $6.4 million in total liabilities, and $2.5 million in
total stockholders' deficit.
West Palm Beach, Florida-based Berkowitz Pollack Brant Advisors
+CPAs, the Company's auditor since 2024, issued a "going concern"
qualification in its report dated April 1, 2024, 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.
A full-text copy of the Company's Form 10-K is available at
https://tinyurl.com/46xraznn
About Yield10
Yield10 Bioscience, Inc. -- http://www.yield10bio.com-- is an
agricultural bioscience company focused on the large-scale
production of low carbon sustainable products from processing
Camelina seed using the oilseed Camelina sativa ("Camelina") as a
platform crop.
YWFM LLC: Daniel Etlinger Named Subchapter V Trustee
----------------------------------------------------
The U.S. Trustee for Region 21 appointed Daniel Etlinger of
Underwood Murray, P.A. as Subchapter V trustee for YWFM, LLC.
Mr. Etlinger 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. Etlinger declared that he is a disinterested person according
to Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Daniel E. Etlinger
Underwood Murray, P.A.
100 N. Tampa Street, Suite 2325
Tampa Florida 33602
(813) 540-8401
Email: detlinger@underwoodmurray.com
About YWFM LLC
YWFM, LLC, doing business as Brian's Tire and Service, sought
protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr.
N.D. Fla. Case No. 24-40141) on April 3, 2024, with $100,000 to
$500,000 in assets and $1 million to $10 million in liabilities.
Brian Lombardino, owner, signed the petition.
Byron W. Wright III, Esq., at Bruner Wright, P.A. represents the
Debtor as legal counsel.
[] BOOK REVIEW: Taking Charge
-----------------------------
Taking Charge: Management Guide to Troubled Companies and
Turnarounds
Author: John O. Whitney
Publisher: Beard Books
Softcover: 283 Pages
List Price: $34.95
Order a copy today at:
http://beardbooks.com/beardbooks/taking_charge.html
Review by Susan Pannell
Remember when Lee Iacocca was practically a national hero? He won
celebrity status by taking charge at a company so universally known
as troubled that humor columnists joked their kids grew up thinking
the corporate name was "Ayling Chrysler." Whatever else Iacocca may
have been, he was a leader, and leadership is crucial to a
successful turnaround, maintains the author.
Mediagenic names merit only passing references in Whitney's book,
however. The author's own considerable experience as a turnaround
pro has given him more than sufficient perspective and acumen to
guide managers through successful turnarounds without resorting to
name-dropping. While Whitney states that he "share[s] no personal
war stories" in this book, it was, nonetheless, written from inside
the "shoes, skin, and skull of a turnaround leader." That sense of
immediacy, of urgency and intensity, makes Taking Charge compelling
reading even for the executive who feels he or she has already
mastered the literature of turnarounds.
Whitney divides the work into two parts. Part I is succinctly
entitled "Survival," and sets out the rules for taking charge
within the crucial first 120 days. "The leader rarely succeeds who
is not clearly in charge by the end of his fourth month," Whitney
notes. Cash budgeting, the mainstay of a successful turnaround, is
given attention in almost every chapter. Woe to the inexperienced
manager who views accounts receivable management as "an arcane
activity 'handled over in accounting.'" Whitney sets out 50
questions concerning AR that the leader must deal with -- not
academic exercises, but requirements for survival.
Other internal sources for cash, including judiciously managed
accounts payable and inventory, asset restructuring, and expense
cuts, are discussed. External sources of cash, among them banks,
asset lenders, and venture capital funds; factoring receivables;
and the use of trust receipts and field warehousing, are handled in
detail. Although cash, cash, and more cash is the drumbeat of Part
I, Whitney does not slight other subjects requiring attention. Two
chapters, for example, help the turnaround manager assess how the
company got into the mess in the first place, and develop
strategies for getting out of it.
The critical subject of cash continues to resonate throughout Part
II, "Profit and Growth," although here the turnaround leader
consolidates his gains and looks ahead as the turnaround matures.
New financial, new organizational, and new marketing arrangements
are laid out in detail. Whitney also provides a checklist for the
leader to use in brainstorming strategic options for the future.
Whitney's underlying theme -- that a successful business requires
personal leadership as well as bricks and mortar, money and
machinery -- is summed up in a concluding chapter that analyzes the
qualities that make a leader. His advice is as relevant in this
1999 reprint edition as it was in 1987 when first published.
John O. Whitney had a long and distinguished career in academia and
industry. He served as the Lead Director of Church and Dwight Co.,
Inc. and on the Advisory Board of Newsbank Corp. He was Professor
of Management and Executive Director of the Deming Center for
Quality Management at Columbia Business School, which he joined in
1986. He died in 2013.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
TCR subscribers have free access to our on-line news archive.
Point your Web browser to http://TCRresources.bankrupt.com/and use
the e-mail address to which your TCR is delivered to login.
*********
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*** End of Transmission ***