/raid1/www/Hosts/bankrupt/TCR_Public/240502.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Thursday, May 2, 2024, Vol. 28, No. 122
Headlines
4TH VECTOR: Court OKs Interim Cash Collateral Access
AMERICAN PHYSICIAN: Trustee Hires Omni as Noticing Agent
AMERICAN TITANIUM: Case Summary & 20 Largest Unsecured Creditors
APPLIED PEDIATRICS: Seeks Cash Collateral Access
ARAX HOLDINGS: BF Borgers Raises Going Concern Doubt
ATKINS NUTRITIONALS: Moody's Affirms Ba3 CFR Amid OWYN Transaction
AVENUE THERAPEUTICS: Executes 1-for-75 Reverse Stock Split
B3 ELECTRIC: Hires Puryear Law Group PLLC as Co-Counsel
BARNES & NOBLE: Outerbridge Participates in $45MM Rights Offering
BARRETTS MINERALS: Completes Sale of Talc Assets to Riverspan
BENDED PAGE: Wins Cash Collateral Access Thru May 31
BEST HOME: Court OKs Cash Collateral Access Thru May 31
BNB BATTERY: Seeks Cash Collateral Access
BRENTWOOD NURSERY: Case Summary & Two Unsecured Creditors
CATHAY GENERAL: Fitch Affirms 'BB+' LongTerm IDR, Outlook Stable
CONTRACT PHARMACEUTICALS: Chapter 15 Case Summary
CRUZIN AUTO: Wins Interim Cash Collateral Access
DACO FIRE: Seeks to Use Cash Collateral
DARMARC LIMITED: Hires Signature Associates as Realtor
DODGE CONSTRUCTION: S&P Cuts ICR to 'CCC+' on Tightening Liquidity
DORCLAIR INVESTMENT: Case Summary & Five Unsecured Creditors
DRAIN SERVICES: Hires Ahlgren Law Office PLLC as Counsel
EIGER BIOPHARMACEUTICALS: Wins Cash Access on Final Basis
EQUALTOX LLC: Seeks Cash Collateral Access Thru Aug 10
FAITH USA: Files Emergency Bid to Use Cash Collateral
FESI HOLDINGS: Voluntary Chapter 11 Case Summary
GB2 HOLDINGS: Case Summary & Two Unsecured Creditors
GIRAFFE ENTERTAINMENT: Case Summary & One Unsecured Creditor
GORDON BROTHERS: Plan Agent Hires PPL Group as Auctioneer
HARVEST MIDSTREAM I: Fitch Assigns 'BB-' Rating on Unsec. Notes
HAWAIIAN HOLDINGS: Posts $137MM Net Loss in 2024 First Quarter
HAWKEYE ENTERTAINMENT: Court Keeps Chapter 11 Case
HEYCART INC: Court OKs Cash Collateral Access on Final Basis
HILLISTER FARMS: Case Summary & One Unsecured Creditor
IBF RETAIL: Voluntary Chapter 11 Case Summary
INTEGRATED BOTANICS: Case Summary & 20 Top Unsecured Creditors
J CABELLAS: Seeks Cash Collateral Access
J FRANKLIN: Seeks Cash Collateral Access
JSCO ENTERPRISES: Hires Chartered Capital as Expert Witness
JSCO ENTERPRISES: Hires Chicago Economics Corp. as Expert Witness
KALO CLINICAL: Court OKs Deal on Cash Collateral Access
KNOTTY NUFF: Has Deal on Cash Collateral Access
KOFC LTD: Court OKs Interim Cash Collateral Access
KOKOMO KEY: Case Summary & Two Unsecured Creditors
KOSMOS ENERGY: S&P Affirms 'B' Rating on Senior Unsecured Debt
LUMEN TECHNOLOGIES: To Cut Workforce, Expects Up to $100M in Costs
MCQUADE FOUNDATION: Voluntary Chapter 11 Case Summary
MIDWEST DOUGH: Case Summary & 20 Largest Unsecured Creditors
MOVING & STORAGE: Trustee Hires Wood & Jones as Counsel
MOVING & STORAGE: Trustee Seeks to Hire Financial Advisor
NEW HAVEN TRUCK: Wins Cash Collateral Access Thru May 31
NEW WAY MACHINE: Seeks Cash Collateral Access
OCEANWIDE PLAZA: Hires Bryan Cave Leighton as Counsel
OCEANWIDE PLAZA: Hires Development Specialists as CRO
OCEANWIDE PLAZA: Hires GlassRatner Advisory as Financial Advisor
PALOMAR HEALTH: Fitch Lowers Rating on Outstanding Bonds to 'BB+'
PRESIDIO LLC: S&P Affirms 'B' ICR, Outlook Stable
PUBLIC CRAFT: Voluntary Chapter 11 Case Summary
R.A.R.E. CORP: Court OKs Cash Collateral Access Thru May 23
RAPSYS INC: Court OKs Cash Collateral Access Thru May 31
REYNOLDS CONSUMER: Fitch Affirms 'BB+' LongTerm IDR, Outlook Stable
SEVENTEEN00 LLC: Case Summary & One Unsecured Creditor
SEVILLE FARMS: Case Summary & 20 Largest Unsecured Creditors
SIR TAJ: Trustee Hires Levene Neale Bender as Counsel
STAFFING 360: Delayed Report Prompts Nasdaq Non-Compliance Notice
SUNPOWER CORP: To Restate Financials Due to Misstatements
TIPPETT STUDIO: Case Summary & 20 Largest Unsecured Creditors
TURNING POINTS: Voluntary Chapter 11 Case Summary
VFX FOAM: Case Summary & 18 Unsecured Creditors
WEWORK COS: S&P Withdraws 'D' Issuer Credit Rating
WEWORK INC: Yardi Supports Proposed Reorganization Plan
WOFFORD ENTERPRISES: Wins Interim Cash Collateral Access
WOODBRIDGE PARTNERS: Case Summary & Nine Unsecured Creditors
ZAC PRUETT: Seeks Cash Collateral Access
[^] Recent Small-Dollar & Individual Chapter 11 Filings
*********
4TH VECTOR: Court OKs Interim Cash Collateral Access
----------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of North
Carolina, Raleigh Division, authorized 4th Vector Technologies, LLC
to use cash collateral on an interim basis, in accordance with the
budget, with a 10% variance.
The Debtor needs to use cash collateral to make payment of ordinary
operating expenses.
A review of the North Carolina Secretary of State's UCC filings
reveals the following financing statements which might perfect a
lien on cash collateral:
a. File # 20190055278M recorded May 23, 2019, in favor of NOW
ACCOUNT NETWORK CORPORATION, at 2300 Peachtree NW, Suite C-102,
Atlanta, GA, 30309.
b. File # 20200042096G recorded April 17, 2020, in favor of First
Horizon Bank, PO Box 132, Memphis, TN 38101.
c. File # 202100006769E recorded January 17, 2021, in favor of U.S.
Small Business Association, 2 North 20th Street, Suite 320,
Birmingham, AL, 35203.
d. File # 20210077982K recorded June 11, 2021, in favor of CHTD
Company, P.O. Box 2576, Springfield, IL, 62708.
e. File # 20230059828M recorded May 10, 2023, in favor of Bay First
National, a national banking association, 700 Central Avenue, St.
Petersburg, FL, 33701.
f. File # 20230115497F recorded September 15, 2023, in favor of Bay
First National, a national banking association, 700 Central Avenue,
St. Petersburg, FL, 33701.
As adequate protection, and to the extent that cash collateral is
used, the Potential Secured Creditors will receive a post-petition
lien on the Debtor's cash and inventory to the extent of the use
and to the extent that the pre-petition lien in the same type of
collateral was valid, perfected, enforceable, and non-avoidable as
of the petition date.
The Debtor's use of cash collateral will expire or terminate on the
earlier of: (i) the Debtor ceasing operations of its business; or
(ii) the non-compliance or default of the Debtor with any terms and
provisions of the Order.
A further hearing on the matter is set for May 7, 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=tXxWOw from PacerMonitor.com.
The Debtor projects $119,700 in revenue and $138,519 in total
expenses for the 30-day ending May 15, 2024.
About 4th Vector Technologies, LLC
4th Vector Technologies, LLC is an industrial equipment supplier in
Raleigh, North Carolina. The Company's current services include:
turnkey solutions, retrofits, field support & resource, industrial
research & engineering studies, traceability, data collection &
analytics, OEM open source development, and preventative
maintenance.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. N.C. Case No. 24-00021) on January 2,
2024. In the petition signed by Robert Couture, CTO/managing
member, the Debtor disclosed up to $10 million in both assets and
liabilities.
Judge Pamela W. McAfee oversees the case.
William P. Janvier, Esq., at STEVENS MARTIN VAUGHN & TADYCH, PLLC,
represents the Debtor as legal counsel.
AMERICAN PHYSICIAN: Trustee Hires Omni as Noticing Agent
--------------------------------------------------------
Pirinate Consulting Group, LLC, the liquidating trustee of American
Physician Partners, LLC, seeks approval from the U.S. Bankruptcy
Court for the District of Delaware to employ Omni Agent Solutions,
Inc. as noticing agent.
The firm's services include:
a. preparing and serving required notices;
b. maintaining copies of all proofs of claims, proofs of
interest, and the official claims register in these Chapter 11
Cases (the "Claims Register");
c. maintaining a current mailing list of all entities entitled
to notice of events in these Chapter 11 Cases (the "Mailing List");
d. overseeing the logistical aspects of the plan confirmation
process, including, among other duties, balloting, vote tabulation,
and service of notices;
e. assisting with reconciliation and resolution of claims;
and
f. maintaining a website from which anyone may download the
Claims Register.
The firm will be paid at these rates of $40 to $250 per hour.
Analyst $40 - $75 per hour
Consultants $75 - $195 per hour
Senior Consultants $200 - $240 per hour
Solicitation and Securities Consultant $200 - $225 per hour
Director of Solictation and Securities $250 per hour
Technology/Programming $85 - $155 per hour
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Paul H. Deutch, an executive vice president at Omni Agent
Solutions, Inc., disclosed in a court filing that the firm is a
"disinterested person" as the term is defined in Section 101(14) of
the Bankruptcy Code.
The firm can be reached at:
Paul H. Deutch
Omni Agent Solutions, Inc.
1120 Avenue of the Americas, 4th Floor
New York, NY 10036
Tel: (212) 302-3580
Fax: (212) 302-3820
Email: paul.web@omniagnt.com
About American Physician Partners
American Physician Partners, LLC, is an emergency medicine
management company in Brentwood, Tenn.
American Physician Partners and its affiliates sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case
No. 23-11469) on Sept. 18, 2023. In the petition signed by CRO John
DiDonato, American Physician Partners disclosed $100 million to
$500 million in assets and $500 million to $1 billion in
liabilities.
Judge Brendan L. Shannon oversees the cases.
Pachulski Stang Ziehl & Jones LLP, led by Laura Davis Jones, is the
Debtors' legal counsel. Huron Consulting Services LLC is the
Debtors' financial advisor. Epiq is the claims agent.
AMERICAN TITANIUM: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: American Titanium Works LLC
5315 N. Clark, Unit 329
Chicago, IL 60640
Chapter 11 Petition Date: May 1, 2024
Court: United States Bankruptcy Court
Northern District of Illinois
Case No.: 24-06559
Judge: Hon. Timothy A Barnes
Debtor's Counsel: Mark L. Radtke, Esq.
FOLEY & LARDNER LLP
321 N. Clark Street
Suite 3000
Chicago, IL 60654
Tel: 312-832-4500
Fax: 312-832-4700
Email: mradtke@foley.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Thomas F. Sax as CEO.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/FHOI3XQ/American_Titanium_Works_LLC__ilnbke-24-06559__0001.0.pdf?mcid=tGE4TAMA
APPLIED PEDIATRICS: Seeks Cash Collateral Access
------------------------------------------------
Applied Pediatrics Inc. asks the U.S. Bankruptcy Court for the
Northern District of Georgia, Atlanta Division, for authority to
use cash collateral in accordance with the budget, with a 15%
variance.
The Debtor requires the use of cash collateral to pay operating
expenses, including insurance, taxes and compensation for its work
force.
Corporation Service Company, as representative, CT Corporation
Systems, as representative, Payroll Funding Company LLC, Rapid
Financial Services, LLC, Forest Capital Management, LLC, Liquidibee
1, LLC d/b/a Liquidibee, Eminent Funding LLC, and the U.S. Small
Business Administration may assert a security interest in the
Debtor's cash.
Some of the Respondents assert their liens as perfected by the
filing of UCC-1 Financing Statements:
a. The SBA asserts a first priority lien upon the Debtor's assets
as more particularly described in the UCC Initial Filing Number
038-2020-027387 filed on June 22, 2020, in the records of the
Superior Court of Coweta County, Georgia, securing an asserted
outstanding indebtedness of approximately $31,112.
b. CSC, as representative, asserts a junior lien upon the Debtor's
assets as more particularly described in the UCC Initial Filing
Number 038-2022-018514 filed on May 23, 2022, in the records of the
Superior Court of Coweta County, Georgia. At this time, the Debtor
is unaware of who CSC is serving as representative of.
c. CSC, as representative, asserts a junior lien upon the Debtor's
assets as more particularly described in the UCC Initial Filing
Number 038-2022-024363 filed on July 25, 2022, in the records of
the Superior Court of Coweta County, Georgia. At this time, the
Debtor is unaware of who CSC is serving as representative of.
d. CT, as representative, asserts a junior lien upon the Debtor's
assets as more particularly described in the UCC Initial Filing
Number 007-2022-057102 filed on September 22, 2022, in the records
of the Superior Court of Barrow County, Georgia. At this time,
Debtor is unaware of who CT is serving as representative of.
e. Payroll Funding asserts a junior lien upon the Debtor's assets
as more particularly described in UCC Initial Filing Number
044-2023-004093 filed on July 12, 2023, in the records of the
Superior Court of Dekalb County, Georgia, securing an asserted
outstanding indebtedness of approximately $49,250.
f. CT, as representative, asserts a junior lien upon the Debtor's
assets as more particularly described in the UCC Initial Filing
Number 007-2023-059209 filed on December 4, 2023, in the records of
the Superior Court of Barrow County, Georgia. The Debtor believes
CSC is serving as representative of Forest Capital with an
estimated asserted claim of $15,195.
d. CSC, as representative, asserts a junior lien upon the Debtor's
assets as more particularly described in the UCC Initial Filing
Number 038-2024-001263 filed on January 17, 2024, in the records of
the Superior Court of Coweta County, Georgia. The Debtor believes
CSC is serving as representative of Liquidibee with an estimated
asserted claim of $11,349.
A copy of the motion is available at https://urlcurt.com/u?l=ydCitb
from PacerMonitor.com.
About Applied Pediatrics Inc.
Applied Pediatrics Inc. sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Ga. Case No. 24-54094-jwc) on
April 23, 2024. In the petition signed by George S. Rosero, chief
executive officer, the Debtor disclosed up to $50,000 in assets and
up to $500,000 in liabilities.
Cameron M. McCord, Esq., at Jones & Walden, LLC, represents the
Debtor as legal counsel.
ARAX HOLDINGS: BF Borgers Raises Going Concern Doubt
----------------------------------------------------
Lakewood, Colo.-based BF Borgers CPA PC, expressed that there is
substantial doubt about Arax Holdings Corp.'s ability to continue
as a going concern.
BF Borgers, the Company's auditor since 2021, issued a "going
concern" qualification in its report dated April 26, 2024, attached
to Arax's Form 10-K Report filed with the U.S. Securities and
Exchange Commission for the fiscal year ended October 31, 2023. BF
Borgers said the Company has suffered recurring losses from
operations and has a significant accumulated deficit. In addition,
the Company continues to experience negative cash flows from
operations. "These factors raise substantial doubt about the
Company's ability to continue as a going concern, the auditor
said.
The Company has incurred operating losses since its inception. For
the year ended October 31, 2023, the Company reported a net loss of
$18,543,578 on $909,176 of revenue, compared to a net loss of
$148,613 with no reported revenue for the year prior. As of October
31, 2023, the Company had working capital of $25,371,682 and an
accumulated deficit of $940,703.
The Company does not expect that existing operational cash flow
will be sufficient to fully fund presently anticipated operations
for fiscal year 2024. Therefore, the Company will need to raise
additional funds and is currently exploring alternative sources of
financing. If the Company is unable to raise additional cash, it
could have a material adverse effect on its financial position,
results of operations, and its ability to continue in existence.
Management believes that the Company's future success is dependent
upon its ability to achieve profitable operations, generate cash
from operating activities and obtain additional financing. There is
no assurance that the Company will be able to generate sufficient
cash from operations, sell additional shares of stock or borrow
additional funds. However, cash generated from software development
revenues is currently exceeding development costs, but is
insufficient to cover operating expenses.
A full-text copy of the Company's Form 10-K is available at
https://tinyurl.com/advcsfbw
About Arax Holdings
Tallahassee, Fla.-based ARAX is in the integration of blockchain
technology with enterprise solutions, dedicated to transforming
business practices with innovative, sustainable, and compliant
digital infrastructure.
As of October 31, 2023, the Company has $7,147,934 in total assets,
$258,134 in total liabilities, $6,889,800 in total stockholders'
equity.
ATKINS NUTRITIONALS: Moody's Affirms Ba3 CFR Amid OWYN Transaction
------------------------------------------------------------------
Moody's Ratings affirmed Atkins Nutritionals Holdings, Inc.'s
(Atkins) Ba3 Corporate Family rating and Ba3-PD Probability of
Default rating following the company's announced acquisition of
Only What You Need, Inc. (OWYN). Concurrently, Moody's affirmed the
Ba3 senior secured first lien bank credit facility ratings
(revolver and term loan B) that includes a proposed $250 million
term loan upsize to help fund the acquisition. The SGL-1
speculative grade liquidity rating is unchanged. The outlook is
stable. Atkins is a subsidiary of its publicly-traded parent
company, The Simply Good Foods Company (SMPL).
Atkins is upsizing its existing senior secured first lien term loan
by $250 million to fund the acquisition of OWYN, a provider of
protein ready to drink (RTD) beverages, powders and meal
replacement shakes in the United States. The upsize is expected to
be fungible with the existing $240 million outstanding term loan.
The proposed transaction, if successful, is credit negative because
it increases the company's funded debt and raises debt-to-EBITDA
leverage to 1.9x from 1.1x (on a Moody's adjusted basis) to
purchase a company that currently has limited earnings.
Moody's nevertheless affirmed Atkins' ratings and maintained a
stable outlook because the company's leverage remains low and
within expectations for the rating, and the purchase of OWYN will
expand the company's foothold in the fast growing RTD market and
further diversifys its owned brand portfolio beyond Atkins and
Quest. The proposed purchase price of $280 million represents a
purchase price multiple of approximately 2.3x estimated net sales
and 13.3x estimated management adjusted EBITDA, that consists
largely of the company's expected synergies. OWYN is growing
rapidly through distribution gains, marketing and by capitalizing
on consumer interest in plant-based protein products. Moody's
believes that execution risks to profitably grow OWYN are high
given the highly competitive industry with larger entrenched
brands. However, the acquisition is consistent with SMPL's growth
strategy to expand the portfolio in attractive categories, and the
OWYN business is complementary to SMPL's existing and is gaining
market share. The company follows a similar outsourced
manufacturing model as SMPL while realization of identified cost
synergies identified should improve OWYN's operating margin over
the next 18 months. Atkins' credit metrics remain strong for the
rating category. Moody's forecasts that the company's operating
cash flow will be comfortably sufficient to accommodate increased
interest costs resulting from the upsize. Moody's projects that the
company will generate good free cash flow of at least $150 million
annually. Voluntary debt repayment and cost management should lead
to Atkins reducing debt-to-EBITDA below 1.5x over the next 12
months. Moody's expects high single digit revenue growth, a healthy
EBITA margin and a return to pre-pandemic gross margins of
approximately 40% as the company benefits from lower ingredient and
packaging costs.
RATINGS RATIONALE
Atkins' Ba3 CFR reflects strong credit metrics and moderate scale
relative to other consumer goods companies, as well as its
concentration in the highly competitive healthy snack and meal
replacement industry. The company also has relatively concentrated
distribution channel with Walmart representing approximately 31% of
sales. The competition in the segment including from larger and
more diversified consumer packaged food and beverage companies
creates significant reinvestment needs necessary to maintain market
position as well as continuous innovation needed to appeal to
evolving consumer preferences. The company's acquisition of Quest
in November 2019 materially improved scale, expanded the product
portfolio and is a source of volume growth. The company benefits
from healthy free cash flow generation, solid operating performance
and very good liquidity. Atkins is actively expanding and investing
in other categories and the proposed OWYN acquisition will further
help it expand its presence in the rapidly growing protein RTD
market. The ratings also reflect event risk including Moody's
expectation of other potential debt-funded acquisitions to increase
product and customer diversity and enhance growth. SMPL has a
preferred net debt-to-EBITDA leverage range of around 3x (based on
the company's calculation) and the company will remain below this
level at around 1.5x following the OWYN acquisition. This indicates
the company's continued willingness to increase leverage as part of
its acquisition growth strategy. Strong free cash flow generation
exceeding $150 million annually benefits from low capital spending
under the outsourced manufacturing model and the absence of a
dividend. The free cash flow provide SMPL the flexibility to
reinvestment in growth initiatives and reduce leverage through debt
repayment. The company has demonstrated a disciplined approach to
acquisitions when considering high industry multiples and is
favorably keeping leverage low - providing capacity for future
transactions within the rating.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable outlook reflects Moody's expectation that Atkins will
continue to grow its revenue in the mid to high single digit range,
maintain a stable EBITDA margin and generate at least $150 million
of annual free cash flow. The outlook also reflects Moody's
expectation that Atkins will maintain very good liquidity and a
financial strategy that ensures maintenance of moderate leverage
and good interest coverage.
Ratings could be upgraded if debt-to-EBITDA is sustained around 2x
or lower, EBITA-to-interest is sustained around 8x or higher, and
the company maintains steady operating performance as evidenced by
stable market share, organic revenue growth, and a stable to higher
EBITA margin. The company would also need to generate strong free
cash flow. An additional factor would be maintaining financial
strategies consistent with these credit metrics, with meaningful
levels of predictability.
Ratings could be downgraded if operating performance weakens due to
market share erosion, loss of shelf space at key distribution
partners, or cost increases. Debt-funded acquisitions or
shareholder distributions, or a deterioration in liquidity could
also lead to a downgrade. Debt-to-EBITDA above 3x,
EBITA-to-interest below 6x, or free cash flow-to-debt sustained
below 12.5% could result in a downgrade.
The principal methodology used in these ratings was Consumer
Packaged Goods published in June 2022.
The Simply Good Foods Company, headquartered in Denver, Colorado,
is the parent of Atkins Nutritionals Holdings, Inc. and sells a
variety of convenient snacks and meal replacements. The product
portfolio consists of protein bars, ready-to-drink (RTD) shakes,
sweet and salty snacks, chips, and confectionary products marketed
under the Atkins, Atkins Endulge, Quest and Quest Hero brands. The
products are sold mostly in the United States (about 97% of
revenue) through mass merchants, club stores, grocery stores, and
drug retailers, with Walmart a key customer. Revenue for the last
12 months ended February 2024 was approximately $1.3 billion.
AVENUE THERAPEUTICS: Executes 1-for-75 Reverse Stock Split
----------------------------------------------------------
Avenue Therapeutics, Inc. disclosed on April 24, 2024, it would
effect a 1-for-75 reverse split of its issued and outstanding
common stock, and expected its common stock to begin trading on a
split-adjusted basis on the Nasdaq Capital Market as of the
commencement of trading on April 26 with a new CUSIP number of
05360L403. The ticker symbol for the Company's stock will remain
"ATXI."
The reverse stock split was approved on March 6 by Avenue's Board
of Directors and stockholders representing approximately 56% of the
voting power of Avenue's outstanding capital stock, with the
authorization to determine the final ratio (within a specified
range) having been granted to the Company's Board of Directors. The
reverse stock split was intended to bring the Company into
compliance with Nasdaq's $1.00 per share minimum bid price
requirement for continued listing.
After the effectiveness of the reverse stock split, the number of
outstanding shares of common stock would be reduced from
approximately 44.7 million to approximately 0.6 million, subject to
adjustment to give effect to the treatment of any fractional shares
that stockholders would have received in the reverse stock split.
No fractional shares will be issued in connection with the reverse
stock split, and stockholders who would otherwise be entitled to
receive a fractional share will be entitled to have such fractional
share rounded up to the next whole share. Proportional adjustments
will be made to the number of shares of the Company's common stock
issuable upon exercise or conversion of the Company's preferred
stock, warrants and equity awards, as well as the applicable
exercise or conversion prices, and the number of shares reserved
for issuance under the Company's equity compensation plan.
Avenue's transfer agent, VStock Transfer, LLC, is acting as the
exchange agent for the reverse stock split. VStock Transfer, LLC
will provide instructions to stockholders regarding the process for
exchanging physical share certificates. Avenue does not expect that
stockholders holding their shares in book-entry form or through a
bank, broker or other nominee need to take any action in connection
with the reverse stock split. Beneficial holders are encouraged to
contact their bank, broker or other nominee with any procedural
questions. Additional information concerning the reverse stock
split can be found in Avenue's definitive information statement on
Schedule 14C filed with the Securities and Exchange Commission on
March 18, 2024.
About Avenue Therapeutics, Inc.
Avenue Therapeutics, Inc. is a specialty pharmaceutical company
focused on the development and commercialization of therapies for
the treatment of neurologic diseases.
New York, N.Y.-based KPMG LLP, the Company's auditor since 2022,
issued a "going concern" qualification in its report dated March
18, 2024, citing that the Company has incurred substantial
operating losses since its inception and expects to continue to
incur significant operating losses for the foreseeable future that
raise substantial doubt about its ability to continue as a going
concern.
B3 ELECTRIC: Hires Puryear Law Group PLLC as Co-Counsel
-------------------------------------------------------
B3 Electric, LLC seeks approval from the U.S. Bankruptcy Court for
the Western District of Kentucky to employ Puryear Law Group, PLLC
as co-counsel.
The firm will provide these services:
a. give legal advice with respect to the Debtor's powers and
duties as debtor in possession in the continued operation of the
estate's business and management of its assets;
b. take all necessary action to protect and preserve the
Debtor's estate;
c. prepare on behalf of the Debtor all necessary motions,
answers, orders, reports, and other legal papers in connection with
the administration of the Debtor's estate herein; and
d. perform any and all other legal services for the Debtor in
connection with this Chapter 11 case and the formulation
implementation of the Debtor's Chapter 11 Plan.
The firm will be paid $450 per hour, plus reimbursements for
reasonable out-of-pocket expenses incurred.
Charles W. Cook III, a partner at Puryear Law Group, PLLC,
disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
Charles W. Cook III
Puryear Law Group, PLLC
Woodmont Centre
104 Woodmont Boulevard, Suite 201
Nashville, TN 37205
Telephone: (615) 630-6586
Email: ccook@puryearlawgroup.com
About B3 Electric LLC
B3 Electric is a commercial and industrial electrical contractor.
B3 Electric LLC filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Ky. Case No.
23-10766) on OCt. 12, 2023. The petition was signed by John Baker
as member. At the time of filing, the Debtor estimated $1 million
to $10 million in both assets and liabilities.
Judge Joan A Lloyd presides over the case.
Robert C. Chaudoin, Esq., at the HARLIN PARKER, is the Debtor's
legal counsel.
BARNES & NOBLE: Outerbridge Participates in $45MM Rights Offering
-----------------------------------------------------------------
Outerbridge Capital Management, LLC, disclosed in a Schedule 13D/A
Report filed with the U.S. Securities and Exchange Commission that
as of April 16, 2024, the firm and its affiliated entities --
Outerbridge Special Opportunities Fund, Outerbridge Special GP, and
Rory Wallace, their managing member -- beneficially owned 5,132,753
shares of Barnes & Noble Education, Inc.'s common stock
representing 9.7% of the shares outstanding.
Outerbridge Capital also disclosed that on April 16, 2024, the firm
entered into a standby, securities purchase and debt conversion
agreement with Barnes & Noble, Toro 18 Holdings LLC (Immersion),
Selz Family 2011 Trust, Vital Fundco, LLC and TopLids LendCo, LLC.
Outerbridge Capital, Immersion, and Selz Trust serve as standby
purchasers.
Pursuant to the terms and conditions of the Purchase Agreement:
(i) Barnes & Noble as Issuer will distribute to holders of its
Common Stock non-transferable subscription rights -- Rights
Offering -- to purchase up to an aggregate of 900,000,000 shares of
Common Stock at a subscription price of $0.05 per share of Common
Stock that, if exercised in full, will provide gross proceeds to
the Issuer of $45 million; and
(ii) the Standby Purchasers will collectively purchase, at the
Subscription Price, in a private placement exempt from the
registration requirements under the Securities Act of 1933, as
amended, and separate from the Rights Offering, up to $45 million
in shares of Common Stock not subscribed for by the Issuer's
stockholders at the expiration of the Rights Offering.
The Purchase Agreement also provides that, concurrently with the
consummation of the Rights Offering:
(i) Immersion and Vital will collectively purchase, at the
Subscription Price, in a private placement exempt from the
registration requirements under the Securities Act and separate
from the Rights Offering, an additional $50 million in shares of
Common Stock, and
(ii) Vital and TopLids will collectively convert all
outstanding principal and interest amounts owed to them under the
Issuer’s term credit agreement into shares of Common Stock at the
Subscription Price, resulting in the satisfaction of all amounts
owed by the Issuer thereunder.
The closing of the transactions contemplated by the Purchase
Agreement is subject to the satisfaction or waiver of customary
closing conditions, including, among other things:
(i) the accuracy of representations and warranties set forth
in the Purchase Agreement;
(ii) compliance with covenants;
(iii) the effectiveness of the Registration Statement as defined
in the Purchase Agreement on Form S-1 related to the Rights
Offering; and
(iv) consummation of the Rights Offering.
The closing of the Transactions contemplated by the Purchase
Agreement is also subject to the approval of the Issuer's
stockholders at a special meeting to be held by the Issuer. If the
issuance and sale of the Common Stock pursuant to the Rights
Offering and the Transactions are not approved at the special
meeting, then the Rights Offering will be cancelled.
Under the Purchase Agreement, notwithstanding anything to the
contrary in the Purchase Agreement, Outerbridge Capital and its
Representatives (as defined in the Purchase Agreement) shall be
permitted prior to 5:00 p.m. (Eastern Time) on May 3, 2024 to enter
into any agreement, discussion or negotiation with, or provide
information to, or solicit, encourage, facilitate or induce any
inquires or proposals from, any other person with respect to, and
related only to an Alternative Transaction as defined in the
Purchase Agreement, and participate in any Alternative Transaction,
provided that:
(i) any such actions taken by Outerbridge Capital or its
representatives shall not be deemed a violation of Section 8(e) of
the Purchase Agreement by the Issuer or its Representatives; and
(ii) unless the Purchase Agreement is terminated by the Issuer
under Section 12(a) to enter into a Superior Transaction as defined
in the Purchase Agreement, Outerbridge Capital (A) shall cause its
shares of Common Stock beneficially owned by it and its controlled
affiliates, if any, to continue to be held at least until and
through the record date of the Special Meeting as defined in the
Purchase Agreement and to be voted in favor of the Transaction
Proposals as defined in the Purchase Agreement pursuant to the
terms of the Purchase Agreement at the Special Meeting, and (B)
shall not make any public announcement with respect to the
Transactions contemplated by the Purchase Agreement that
discourages stockholders to approve the Transaction Proposals or
with respect to any Alternative Transaction.
A full-text copy of Outerbridge's SEC Report is available at
https://tinyurl.com/43ehcb2m
About Barnes & Noble Education
Basking Ridge, New Jersey-based Barnes & Noble Education, Inc.
("BNED") is one of the largest contract operators of physical and
virtual bookstores for college and university campuses and K-12
institutions across the United States. It is one of the largest
textbook wholesalers, inventory management hardware and software
providers that operates 1,289 physical, virtual, and custom
bookstores and serve more than 5.8 million students, delivering
essential educational content, tools and general merchandise within
dynamic omnichannel retail environment.
The Company disclosed in its Quarterly Report on Form 10-Q for the
quarterly period ended January 27, 2024, that its losses and
projected cash needs, combined with its current liquidity levels
and the maturity of its Credit Facility, which becomes due on
December 28, 2024, raise substantial doubt about its ability to
continue as a going concern.
BARRETTS MINERALS: Completes Sale of Talc Assets to Riverspan
-------------------------------------------------------------
Minerals Technologies Inc. on April 29 disclosed that its
subsidiary, Barretts Minerals Inc., has completed the sale of all
the talc assets to Riverspan Partners for $32 million. The
go-forward company will conduct business under the Barretts
Minerals brand.
The United States Bankruptcy Court for the Southern District of
Texas approved the sale, which includes an agreement to assume
certain Assumed Liabilities, on March 25, 2024, as part of the
ongoing Chapter 11 process of Barretts Minerals Inc. and Barretts
Ventures Texas LLC. Proceeds from the sale will be used to fund
BMI's ongoing Chapter 11 case including the repayment of its
debtor-in-possession funding and the anticipated creation of a
section 524(g) trust.
No other subsidiaries or business units of MTI are included in the
Chapter 11 filing or the sale and, as such, all are operating
business as usual and will continue to do so.
"This is an important step in MTI's exit from the talc business,
and represents forward progress in BMI's Chapter 11 process," said
Douglas T. Dietrich, Chairman and Chief Executive Officer of MTI.
"This sale not only delivers value and certainty to BMI's various
stakeholders, it also enables MTI to move forward with a clear
focus on achieving our long-term strategic objectives."
Riverspan Partners is a Chicago-based investment firm focused on
lower middle market companies in the industrials sector, including
engineered materials and advanced manufacturing. Leveraging its
deep domain expertise, Riverspan seeks to work with management
teams to accelerate growth and build durable, long-term success.
Dave Thomas, Partner and Co-Founder at Riverspan, said, "Riverspan
is committed to the long-term success of Barretts, and we are
excited to partner with the organization and its leaders in the
next phase of the company's growth. We are excited to acquire these
high-quality assets, which are bolstered by a very talented
employee base and a strong safety culture. We look forward to
providing financial support and operational expertise as the
business expands its product portfolio and continues to deliver
excellent service to its customers."
Riverspan is advised by Milbank LLP, McDermott Will & Emery LLP,
and Holland & Hart LLP.
About Minerals Technologies Inc.
Minerals Technologies Inc., headquartered in New York, New York, is
a specialty minerals company that develops, produces, and markets a
broad range of mineral and mineral-based products, related systems
and services. The company serves a wide range of consumer and
industrial markets, including household and personal care, paper
and packaging, food and pharmaceutical, automotive, construction,
steel and foundry, environmental, and infrastructure. The Consumer
& Specialties segment (54% of LTM revenue) serves consumer end
markets with mineral-to-market finished products and also provides
specialty mineral-based solutions and technologies that are an
essential component of finished products. The Engineered Solutions
segment (46% of LTM revenue) serves industrial end markets with
engineered systems, mineral blends, and technologies that are
designed to improve manufacturing processes and projects. The
principal methodology used in these ratings was Chemicals published
in October 2023.
About Barretts Minerals Inc.
Barretts Minerals Inc.'s current operations are focused on the
mining, beneficiating, processing, and sale of industrial talc. It
historically supplied a relatively minor percentage of its sales
into cosmetic applications. Barretts Minerals' talc is sold to
distributors and third-party manufacturers for use in such parties'
products, which are then incorporated into downstream products
eventually sold to consumers.
Barretts Minerals and its affiliates sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Texas Lead Case
No. 23-90794) on Oct. 2, 2023. In the petition signed by its chief
restructuring officer, David J. Gordon, Barretts Minerals disclosed
$50 million to $100 million in assets and $10 million to $50
million in liabilities.
Judge David R. Jones oversees the cases.
The Debtors tapped Porter Hedges, LLP and Latham& Watkins, LLP as
legal counsel; M3 Partners, LP as financial advisor; Jefferies, LLC
as investment banker; and DJG Services, LLC as restructuring
advisor. David J. Gordon of DJG Services serves as the Debtors'
chief restructuring officer. Stretto, Inc. is the claims, noticing
and solicitation agent and administrative advisor.
The U.S. Trustee for Region 7 appointed an official committee to
represent unsecured creditors in the Debtors' Chapter 11 cases.
Caplin & Drysdale, Chartered and Province, LLC serve as the
committee's legal counsel and financial advisor, respectively.
BENDED PAGE: Wins Cash Collateral Access Thru May 31
----------------------------------------------------
The U.S. Bankruptcy Court for the District of Colorado authorized
Bended Page, LLC to use cash collateral, on an inteirm basis, in
accordance with the budget, with a 15% variance, through May 31,
2024.
The Cash Collateral Creditors are Read Colorado LLC (post-petition
financing), Ingram Book Group LLC, and B.S.D. Capital, Inc., dba
Lendistry.
As adequate protection for the Cash Collateral Creditors, the Cash
Collateral Creditors are granted postpetition replacement liens on
the Debtor's post-petition assets, to the extent, but only to the
extent, of any identifiable diminution in value of their respective
interests in collateral that is property of the Debtor's estate, as
it existed on the Petition Date, all for the same validity, extent,
and priority of such Cash Collateral Creditor's prepetition lien.
A copy of the order is available at https://urlcurt.com/u?l=F23CdD
from PacerMonitor.com.
About Bended Page, LLC
Bended Page, LLC is a book store owner in Denver, Colorado.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Colo. Case No. 23-14679) on October 16,
2023. In the petition signed by Bradford Dempsey, chief executive
officer, the Debtor disclosed up to $10 million in both assets and
liabilities.
Judge Michael E. Romero oversees the case.
Andrew D. Johnson, Esq., at Onsager Fletcher Johnson Palmer LLC,
represents the Debtor as legal counsel.
BEST HOME: Court OKs Cash Collateral Access Thru May 31
-------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois,
Eastern Division, authorized Best Home Healthcare Network, Inc. to
use cash collateral, on an interim basis, in accordance with the
budget, with a 10% variance, through May 31, 2024.
As adequate protection to Bluevine Inc., Samson MCA LLC, Byzfunder
NY LLC DBA Byzfunder, Fundfi Merchant Funding, LLC, RBLX Funding,
American Choice Capital LLC for the use of its collateral or cash
collateral, pursuant to the terms of the Interim Cash Collateral
Order, the Lien Claimants are granted and will have postpetition
replacement liens, to the extent and with the same priority as held
pre-petition, in and to the cash collateral and all post-petition
property of the Debtor of the same type or kind substantially
equivalent to the pre-petition collateral.
A further hearing on the matter is set for May 29 a 10 a.m.
About Best Home Healthcare Network, Inc.
Best Home Healthcare Network, Inc. is an in-home health care
service provider in the State of Illinois.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ill. Case No. 24-05556) on April 16,
2024. In the petition signed by Iqbal Shariff, president, the
Debtor disclosed up to $500,000 in assets and up to $1 million in
liabilities.
Judge Timothy A. Barnes oversees the case.
Gregory K. Stern, Esq., at Gregory K. Stern, P.C., represents the
Debtor as legal counsel.
BNB BATTERY: Seeks Cash Collateral Access
-----------------------------------------
BNB Battery LLC asks the U.S. Bankruptcy Court for the Northern
District of Georgia, Atlanta Division, for authority to use cash
collateral and provide adequate protection.
The Debtor requires the use of cash collateral to pay the operating
expenses.
The Debtor experienced significant delays in the completion of a
buildout and the opening of its doors, which caused it to suffer
cash flow issues and fall behind on its rent. On the Petition Date,
the Debtor was facing demands from its landlord and filed for
Chapter 11 bankruptcy to reorganize its financial affairs.
As an essential part of the Business, the Debtor regularly
purchases food and beverages for its restaurant and bar.
Additionally, the Debtor utilizes various gaming platforms that
permit the arcade-component of the Business to operate.
Pinnacle Bank asserts a first priority lien upon the Debtor's
assets as more particularly described in the UCC Initial Filing
Number 0332023-01095 filed on March 27, 2023, with the Clerk of
Superior Court for Cobb County, Georgia, securing an asserted
outstanding indebtedness in the approximate amount of $2 million.
Corporation Service Company, as representative for Mulligan Funding
LLC, asserts a junior lien upon the Debtor's assets as more
particularly described in the UCC Initial Filing Number
038-2024-000418 filed on January 5, 2024, with the Coweta County
Clerk of Superior Court.
On the Petition Date, the Debtor had approximately $3,500 cash on
hand.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=IB02y4 from PacerMonitor.com.
The Debtor projects total operating expenses, on a weekly basis, as
follows:
$76,431 for the week ending May 5, 2024;
$36,984 for the week ending May 12, 2024;
$58,733 for the week ending May 19, 2024;
$53,433 for the week ending May 26, 2024.
About BNB Battery LLC
BNB Battery LLC is an operator of a bar & restaurant serving in
Atlanta, Georgia.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ga. Case No. 24-54144) on April 24,
2024. In the petition signed by Soel Tran, the Debtor disclosed up
to $1 million in assets and up to $10 million in liabilities.
Judge Sage M. Sigler oversees the case.
Mark D. Gensburg, Esq., at Jones & Walden, LLC, represents the
Debtor as legal counsel.
BRENTWOOD NURSERY: Case Summary & Two Unsecured Creditors
---------------------------------------------------------
Debtor: Brentwood Nursery, Inc.
8803 CR 612
Mansfield, TX 76061
Business Description: The Debtor is engaged in activities related
to real estate.
Chapter 11 Petition Date: May 1, 2024
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 24-41523
Debtor's Counsel: Katherine T. Hopkins, Esq.
KELLY HART & HALLMAN LLP
201 Main Street, Suite 2500
Fort Worth, TX 76102
Tel: (817) 332-2500
Fax: (817) 878-9280
Email: katherine.hopkins@kellyhart.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by William A. Brentlinger as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's two unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/KIEHG5Y/Brentwood_Nursery_Inc__txnbke-24-41523__0001.0.pdf?mcid=tGE4TAMA
CATHAY GENERAL: Fitch Affirms 'BB+' LongTerm IDR, Outlook Stable
----------------------------------------------------------------
Fitch Ratings has affirmed Cathay General Bancorp's (CATY) Long-
and Short-Term Issuer Default Ratings (IDR) at 'BB+' and 'B',
respectively. In addition, Fitch has affirmed Cathay Bank's Long-
and Short-Term IDRs at 'BBB-' and 'F3', respectively. The Rating
Outlook on the Long-Term IDRs is Stable.
KEY RATING DRIVERS
Affirmation Reflects Strengths: The affirmation and Outlook reflect
CATY's strong earnings power, higher-than-peer capital levels and a
management team experienced in restructuring and workouts. Despite
a deteriorating sector outlook, Fitch believes that strong asset
quality and above peer earnings warrant a Stable Outlook.
Solid Franchise in Niche Market: CATY has built a niche through its
Chinese-American ethnic affinity and relationship-focused banking,
primarily serving the Asian-American community in California. CATY
caters to the demographic's needs, such as providing
Chinese-language services.
Average Risk Appetite; Concentrations Mitigated: Fitch considers
CATY's risk appetite average compared with peers and neutral to the
rating. While the bank possesses significant concentration in
commercial real estate (CRE) lending, Fitch believes this should be
viewed in the context of its current and expected capital buffer,
healthy levels of internal capital generation and appropriate
growth levels.
Strong Asset Quality Despite Concentration: CATY has demonstrated
strong asset quality over the past decade. Net chargeoffs to
average loans remained low on both an absolute basis and in
comparison to peers. Additionally, the company has seen its
impaired loans to gross loans ratio trend downward and as of YE23
is now below peer average at 39 bps. CATY remains one of the most
CRE concentrated banks among the mid-tier regional peers with 2023
regulatory CRE/Risk-Based Capital of 279.45%. CRE concentration
remains a rating constraint.
Robust Earnings Power: CATY's earnings are a relative strength for
the company as it outperforms peers on Fitch's core and
complimentary metrics. CATY's operating profit / RWA declined to
2.1% in 2023, but still remained one of the best in the peer group.
CATY's asset sensitivity leaves earnings vulnerable to contraction
in a rapidly declining rate environment. Its lack of revenue
diversity, as the most spread-reliant bank in the peer group,
serves as a ratings constraint. Fitch expects CATY to outperform
peers from an earnings perspective over the near term but notes
that this outperformance would be hindered if rates are cut.
Capital Appropriate for Risk Appetite: Fitch expects CATY to manage
its common equity Tier1 (CET1) ratio well above regulatory minimums
and that of peers. As of 1Q24, CATY's CET1 ratio was 13.08%
representing a 66bp increase YoY. Fitch expects CATY to continue to
return capital to shareholders through repurchases, as it lacks
organic outlets to deploy capital. However, barring other factors,
the buyback impacts on CET1 will likely be immaterial to the
rating.
High Time Deposit Reliance: CATY's funding and liquidity is
constrained by high cost time deposit reliance. Time deposits
represented over half of the deposit book as of 1Q24. Additionally,
the company's loans-to-deposits ratio ended the year at 101%;
marking the first year above 100% since 2019. Total cost of funds
rose in 2023 but remained near the peer average despite the
company's higher time deposit reliance.
Holding Company Notched from Bank: CATY's Viability Rating (VR) and
Long-Term IDR are notched one level below those of its subsidiary,
Cathay Bank (BBB-/Stable/bbb-), based on the holding company's
liquidity management. CATY will continue to be reliant on dividend
capacity from Cathay Bank to cover the next 12 months of dividends
and other cash outflows. Fitch believes CATY's approach to holding
company liquidity management is not commensurate with an
investment-grade rating, and this remains an important constraint.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
A significant deterioration in asset quality could drive negative
rating action. Pressure could emerge if impaired loans to gross
loans were to meaningfully exceed 3% and remain above that
threshold for several quarters. Additionally, significant credit
losses, especially attributable to the bank's CRE portfolio, could
create negative ratings pressure for CATY.
Negative momentum could also occur if there were evidence of
outsized deterioration in the level or volatility of earnings
relative to peers. The bank's rating would also be at risk if CET1
were to approach or ultimately dip below 10% and remain there for
multiple quarters absent a credible plan to build levels back to
about this threshold. CATY's rating would also be sensitive to any
change in capital management that brought on a rapid decline in
capital levels, especially if CET1 were to fall near or below peer
medians.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
Positive ratings movement could occur if CATY were to improve its
revenue diversity through a reduction in its reliance on spread
income, there is further diversification in its loan portfolio away
from CRE concentrations and the holding company's liquidity becomes
in line with that of an investment-grade-rated institution. This
would be predicated on CATY maintaining its conservative capital
management and strong asset-quality performance.
OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS
Long- and Short-Term Deposit Ratings: Cathay Bank's long-term,
uninsured deposits are rated one notch higher than the bank's
Long-Term IDR, as U.S. uninsured deposits benefit from depositor
preference. U.S. depositor preference gives deposit liabilities
superior recovery prospects in the event of default. Fitch rates
Cathay Bank's short-term, uninsured deposits 'F3' in accordance
with its Bank Rating Criteria based on Cathay Bank's long-term
deposit rating and Fitch's assessment of Cathy Bank's funding and
liquidity profile.
CATY and Cathay Bank GSRs are rated 'No Support'. In Fitch's view,
the probability of support is unlikely.
OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES
The long-term deposit rating is sensitive to any negative change to
Cathay Bank's Long-Term IDR. Cathay Bank's short-term deposit
rating is sensitive to negative change in the company's long-term
deposit rating and Fitch's assessment of Cathay Bank's funding and
liquidity profile.
The GSRs would be sensitive to any change in U.S. sovereign
support, which Fitch believes is unlikely.
VR ADJUSTMENTS
- CATY's VR has been assigned at 'bb+', below the implied VR of
'bbb-', due to a negative adjustment for the 'weakest link'
financial profile key rating driver - Funding and Liquidity.
- The Asset Quality score has been assigned at 'bbb-', below the
implied score of 'aa', due to a negative adjustment for
Concentrations.
- The Earnings and Profitability score has assigned at 'bbb', below
the implied score of 'a', due to a negative adjustment for Revenue
Diversity.
- The Capitalization and Leverage score has been assigned at 'bbb',
below the implied score of 'a', due to a negative adjustment for
Capital Flexibility.
- The Funding and Liquidity score has been assigned at 'bb+', below
the implied score of 'a', due to a negative adjustment for
Liquidity Coverage.
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
----------- ------ -----
Cathay Bank LT IDR BBB- Affirmed BBB-
ST IDR F3 Affirmed F3
Viability bbb- Affirmed bbb-
Government Support ns Affirmed ns
long-term
deposits LT BBB Affirmed BBB
short-term
deposits ST F3 Affirmed F3
Cathay General
Bancorp LT IDR BB+ Affirmed BB+
ST IDR B Affirmed B
Viability bb+ Affirmed bb+
Government Support ns Affirmed ns
CONTRACT PHARMACEUTICALS: Chapter 15 Case Summary
-------------------------------------------------
Lead Debtor: Contract Pharmaceuticals Limited
7600 Danbro Crescent
Mississauga, ON L5N 6L6
Business Description: The Debtors are part of a group that
specializes in the development,
manufacturing, packaging, filing and testing
of non-sterile liquid and semi-solid
pharmaceutical and regulated over-the-
counter products, and also provides
laboratory services that include materials,
product release and stability testing.
Foreign Proceeding: Insolvency proceedings commenced under the
Companies' Creditors Arrangement Act, R.S.C.
1985, c. C-36, as amended, pending before
the Ontario Superior Court of Justice
(Commercial List), File No.
CV-23-00711401-00CL
Chapter 15 Petition Date: April 30, 2024
Court: United States Bankruptcy Court
District of Delaware
Five affiliates that concurrently filed voluntary petitions for
relief under Chapter 15 of the Bankruptcy Code:
Debtor Case No.
------ --------
Contract Pharmaceuticals Limited (Lead Case) 24-10915
CPL Canada Holdco Limited 24-10916
Contract Pharmaceuticals Limited Canada 24-10917
Glasshouse Pharmaceuticals Limited Canada 24-10918
Glasshouse Pharmaceuticals LLC 24-10919
Judge: Hon. Brendan Linehan Shannon
Foreign Representative: Contracts Pharmaceuticals Limited
Foreign
Representative's
Counsel: Joshua B. Brooks, Esq.
Matthew B. McGuire, Esq.
LANDIS RATH & COBB LLP
919 Market Street, Suite 1800
Wilmington, Delaware 19801
Tel: (302) 467-4400
Fax: (302) 467-4450
Email: mcguire@lrclaw.com
brooks@lrclaw.com
Estimated Assets: Unknown
Estimated Debt: Unknown
Full-text copies of the Chapter 15 petitions are now available for
download. Follow this link to get a copy today
https://www.pacermonitor.com.
CRUZIN AUTO: Wins Interim Cash Collateral Access
------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Texas,
Sherman Division, authorized Cruzin Auto, LLC to use cash
collateral, on an interim basis, in accordance with the budget,
with a 10% variance.
The Debtor's right to use cash collateral under the Interim Order
will commence on the date of entry of the Interim Order and expire
on the earlier of: (a) the entry of a subsequent interim cash
collateral order; or (b) the entry of a Final Order.
As adequate protection of Secured Lenders' interest, if any, in the
cash collateral pursuant to Sections 361 and 363(e) of the
Bankruptcy Code to the extent of any diminution in value from the
use of the Collateral the Court grants Secured Lenders replacement
security liens on and replacement liens on all of Debtor’s
Equipment, Inventory and Accounts, whether such property was
acquired before or after the Petition Date.
The Replacement Liens will be equal to the aggregate diminution in
value of the respective Collateral, if any, that occurs from and
after the Petition Date. 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), the
Subchapter V Trustee, and the Clerk of the Bankruptcy Court.
A final hearing on the matter is set for April 14, 2024 at 9:30
a.m.
About Cruzin Auto, LLC
About Cruzin Auto, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code(Bankr. E.D. Tex.Case No. 24-40884) on April
17, 2024.
Judge Brenda T Rhoades oversees the case.
Robert T DeMarco, Esq., at DEMARCO MITCHELL, PLLC, represents the
Debtor as legal counsel.
DACO FIRE: Seeks to Use Cash Collateral
---------------------------------------
DACO Fire Equipment, Inc. asks the U.S. Bankruptcy Court for the
Northern District of Texas, Lubbock Division, for authority to use
cash collateral and provide adequate protection.
The Debtor requires the use of cash collateral to pay its
post-petition expenses.
Its initial owner was Steve Davis. Mr. Davis sold the company
Garrett Dobmeier and Wesley Dobmeier in July 2020. In connection
with the sale, Mr. Davis failed to disclose that there were
substantial unpaid taxes. DACO sued Mr. Davis in state court for
fraud and other remedies.
Steve A. Davis and Lone Star State Bank of West Texas assert an
interest in the Debtor's cash collateral.
The Davis lien is for seller financing in the original amount of
$1.2 million.
Lone Star Bank of West Texas provided financing for the sale
transaction in the amount of $2.1 million.
The Debtor believes that there is a subordination agreement between
Lone Star Bank and Steve Davis.
In addition to these UCC liens, the IRS filed Notices of Tax Liens
in the amount of $318,769 and $2.222 million on March 7, 2024.
The Debtor proposes to provide adequate protection to the parties
with an interest in cash collateral in the following manner:
a. The Debtor will provide all creditors with an interest in cash
collateral with a replacement lien upon assets obtained
post-petition to the same extent, priority and validity as their
pre-petition liens.
b. The Debtor will maintain insurance upon its assets.
c. The Debtor will provide adequate protection payments as
negotiated.
A copy of the motion is available at https://urlcurt.com/u?l=SiBABp
from PacerMonitor.com.
About DACO Fire Equipment, Inc.
DACO Fire Equipment, Inc. manufactures and repairs fire trucks
throughout Texas and Oklahoma.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Tex. Case No. 24-50087) on April 24,
2024.
In the petition signed by Wesley Dobmeier, president, the Debtor
disclosed up to $10 million in both assets and liabilities.
Judge Robert L. Jones oversees the case.
DARMARC LIMITED: Hires Signature Associates as Realtor
------------------------------------------------------
Darmarc Limited Liability Company seeks approval from the U.S.
Bankruptcy Court for the Northern District of Ohio to employ
Signature Associates and Signature Associates as realtor.
The firm will market and sell the Debtor's real property located at
103 Industrial Drive, Edgerton, Ohio, Parcel No.
061-280-17-044.01.
The firm will be paid a $10,000.00 commission if the Real Estate
sells for $450,000 or less and a 5 percent commission on the total
purchase price paid for the Real Property if it sells for more than
$450,000.
Rob Keleghan, a partner at Signature Associates And Signature
Associates, disclosed in a court filing that the firm is a
"disinterested person" as the term is defined in Section 101(14) of
the Bankruptcy Code.
The firm can be reached at:
Rob Keleghan
Signature Associates and Signature Associates
One Towne Square, Suite 1200
Southfield, MI 48076
Telephone: (248) 948-9000
Email: info@signatureassociates.com
About Darmarc Limited Liability Company
Darmarc Limited Liability Company filed Chapter 11 petition (Bankr.
N.D. Ohio Case No. 24-30193) on Feb. 1, 2024, with as much as $1
million in both assets and liabilities. Marc Ferguson, authorized
representative, signed the petition.
Judge John P. Gustafson oversees the case.
Steven L. Diller, Esq., at Diller & Rice, LLC represents the Debtor
as legal counsel.
DODGE CONSTRUCTION: S&P Cuts ICR to 'CCC+' on Tightening Liquidity
------------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating by one notch to
'CCC+' on Dodge Construction Network LLC.
S&P said, "Additionally, we lowered our first-lien credit facility
issue-level rating by one notch to 'CCC+' and our second-lien term
loan issue-level rating by one notch to 'CCC-'.
"The negative outlook reflects the risk that we could lower our
ratings if further underperformance leads us to expect a payment
default or a distressed debt restructuring within the next 12
months.
"We forecast Dodge's liquidity position will worsen in 2024 and
remain very tight through 2025 amid an extended higher interest
rate environment that renders its debt capitalization
unsustainable. Under our updated base-case forecast, we expect
Dodge's total liquidity position will continue to decline from the
$20 million area in 2023 toward $5 million by year-end 2024, with
no improvement in 2025. This compares to our prior expectation
Dodge would rebuild its liquidity in 2025 with aid from a
substantial decline in base interest rates. Our updated forecast
reflects our expectation for fewer federal funds interest rate
decreases in 2024 and 2025, causing an extended period of cash flow
deficits and revolver draws. While we expect working capital
requirements to ease or potentially provide a source of cash with
strong collections against billings delayed in 2023, we do not
expect Dodge will generate positive cash flow after debt
amortization until 2026.
"We expect Dodge will maintain sufficient liquidity to meet debt
service costs in 2024; however, in 2025 we forecast the company
will be highly susceptible to a payment default if interest rates
do not drop because the company's floating-rate debt remains fully
unhedged. We forecast unadjusted free operating cash flow (FOCF)
deficits of about $10 million in 2024 and about breakeven in 2025.
"Dodge's ongoing cash flow deficits and tightening liquidity
increase the risk it will undertake a liability management
transaction that we could deem as a distressed exchange. We view a
distressed debt restructuring as increasingly likely. Given its
highly leveraged capital structure and the distressed trading
levels of its second-lien debt, we believe Dodge could undertake a
repurchase transaction to reduce leverage and improve its cash flow
prospects. We could deem such a transaction as a distressed
exchange and tantamount to a default if the transaction implies
investors will receive less value than initially promised when the
original debt was issued, and if we believe that a conventional
default is a realistic possibility absent the transaction.
"The negative outlook reflects the risk that we could lower our
ratings if further underperformance leads us to expect a payment
default or a distressed debt restructuring within the next 12
months.
"Governance is a moderately negative consideration, as is the case
for most rated entities owned by private-equity sponsors. We
believe Dodge's highly leveraged financial risk profile points to
corporate decision-making that prioritizes the interests of its
controlling owners. This also reflects private-equity owners'
generally finite holding periods and focus on maximizing
shareholder returns."
DORCLAIR INVESTMENT: Case Summary & Five Unsecured Creditors
------------------------------------------------------------
Debtor: Dorclair Investment, LLC
5111 Babcock Avenue
Valley Village CA 91607
Business Description: Dorclair Investment is a Single Asset Real
Estate debtor (as defined in 11 U.S.C.
Section 101(51B)). The Debtor is the owner
of a real property located at 2022 N. 22nd
Avenue Phoenix, AZ 85009-3007 having an
appraised value of $2.9 million.
Chapter 11 Petition Date: April 30, 2024
Court: United States Bankruptcy Court
District of Arizona
Case No.: 24-03387
Debtor's Counsel: Patrick Keery, Esq.
KEERY MCCUE, PLLC
6803 E. Main Street Suite 1116
Scottsdale AZ 85251
Tel: (480) 478-0709
Email: pfk@keerymccue.com
Total Assets: $3,021,089
Total Liabilities: $888,070
The petition was signed by Claire Barrett as owner.
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/7UBILEY/DORCLAIR_INVESTMENT_LLC__azbke-24-03387__0001.0.pdf?mcid=tGE4TAMA
DRAIN SERVICES: Hires Ahlgren Law Office PLLC as Counsel
--------------------------------------------------------
Drain Services, Inc. seeks approval from the U.S. Bankruptcy Court
for the District of North Dakota to employ Ahlgren Law Office, PLLC
as cCounsel.
The firm will render professional services to the Debtor in all
post-confirmation matters that may arise out of and in the course
of the administration of the Debtor's estate and for the benefit of
such estate, including representation in on-going adversary
proceedings and matters relating to claims and claim objections.
The firm will be paid at these rates:
Attorney $335 per hour
Attorney Sarah Duffy $275 per hour
Staff $75 per hour
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Erik A. Ahlgren, Esq., a partner at Ahlgren Law Office, PLLC,
disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
Erik A. Ahlgren, Esq.
Ahlgren Law Office PLLC
220 W. Washington Ave, Ste 105
Fergus Falls, MN 56537
Tel: (218) 998-2775
Email: erik@ahlgrenlawoffice.net
About Drain Services, Inc.
Drain Services Inc. offers residential, commercial, industrial, and
municipal pipe laying and lining to Minnesota, North Dakota, and
South Dakota customers. The company is based in West Fargo, N.D.
Drain Services filed Chapter 11 petition (Bankr. D.N.D. Case No.
23-30352) on Oct. 2, 2023, with up to $10 million in assets and up
to $1 million in liabilities. Kevin Cameron, vice president, signed
the petition.
Judge Shon Hastings oversees the case.
Maurice B. VerStandig, Esq., at The Dakota Bankruptcy Firm, serves
as the Debtor's counsel.
EIGER BIOPHARMACEUTICALS: Wins Cash Access on Final Basis
---------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida,
Jacksonville Division, authorized Wofford Enterprises, LLC, to use
cash collateral, on an interim basis, in accordance with the
budget.
The Debtor requires the use of cash collateral to fund all
necessary operating expenses of the Debtor's business.
The Debtor has 4 pre-petition merchant cash advances/lenders that
have a lien on the Debtor's cash and receivables. Those lenders are
U.S. Small Business Administration, JPMorgan Chase Bank, NA, Austin
Business Finance, and National Funding, Inc.
Apart from the Cash Collateral Lenders, the Debtor also has several
service providers which it struggles to remain current with, and
other unsecured debt which it unable to pay.
The Cash Collateral lenders will be granted a post-petition
replacement lien against the collateral to the same extent,
validity, and priority of any valid pre-petition lien.
The Debtor will tender monthly adequate protection payments of $750
to Creditor commencing May 1, 2024, and continuing on the first day
of each month thereafter until the earlier of: (1) confirmation of
the Debtor's Plan; (2) the Parties stipulate otherwise; (3) the
Court orders otherwise; (4) dismissal or conversion of the
Bankruptcy Case; or (5) termination of the automatic stay.
A copy of the order is available at https://urlcurt.com/u?l=2pNUXt
from PacerMonitor.com.
About Wofford Enterprises, LLC
Wofford Enterprises, LLC's primary business is a roofing company
and contractor based out of Duval County, Florida.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Fla. Case No. 3:24-bk-00657-BAJ) on
March 7, 2024. In the petition signed by Jerod Wofford, owner, the
Debtor disclosed up to $50,000 in assets and up to $500,000 in
liabilities.
Judge Jason A. Burgess oversees the case.
Thomas Adam, Esq. represents the Debtor as legal counsel.
EQUALTOX LLC: Seeks Cash Collateral Access Thru Aug 10
------------------------------------------------------
Equaltox, LLC asks the U.S. Bankruptcy Court for the Central
District of California, Santa Ana Division, to use cash collateral,
on a final basis, in accordance with the budget, through August 10,
2024.
The Debtor requires the use of cash collateral for operating
expenses and professional fees.
In the first 22 weeks of the case (ending March 30, 2024), the
Debtor exceeded its revenue projections, generated net cash flow of
478,508, and increased its cash on hand to $846,546.
The entities that assert, or may assert, an interest in all or a
portion of the Debtor's cash collateral are: (a) Blue Cross of
California d.b.a. Anthem Blue Cross and Anthem Blue Cross Life and
Health Insurance Company; (b) Sunwest Bank; (c) California
Statewide Certified Development Corporation; and (d) First Citizens
Bank & Trust.
For May 2024, through and including August 2024, the Debtor will
make monthly payments to Sunwest, CSCDC (one payment on each loan),
and First Citizens comprised of the full monthly payment of
principal and interest as set forth in their respective loan
documents.
If and to the extent that, as of the petition date, Anthem,
Sunwest, CSCDC, and/or First Citizens hold a duly perfected,
unavoidable, and valid lien in all, or a portion of, the Debtor's
cash, and such cash, as opposed to unencumbered cash, is actually
used by the Debtor post-petition, then such entity will receive a
replacement lien in the Debtor's post-petition cash, in the same
extent, validity, and priority up to the amount of the cash
collateral existing as of the petition date.
A hearing on the matter is set for May 15 at 1:30 p.m.
A copy of the motion is available at https://urlcurt.com/u?l=qDRrBh
from PacerMonitor.com.
About Equaltox, LLC
Equaltox, LLC is a full service reference laboratory that can
provide almost any type of blood testing.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Case No. 8:23-bk-12243) on
October 27, 2023. In the petition signed by Sulaiman Masood, member
and manager, the Debtor disclosed up to $10 million in both assets
and liabilities.
Judge Scott C. Clarkson oversees the case.
Robert S. Marticello, Esq., at Smiley Wang-Ekvall, LLP, represents
the Debtor as legal counsel.
FAITH USA: Files Emergency Bid to Use Cash Collateral
-----------------------------------------------------
Faith USA, LLC asks the U.S. Bankruptcy Court for the Southern
District of Texas, Houston Division, for authority to use cash
collateral and provide adequate protection.
The Debtor requires the use of cash collateral to pay its necessary
expenses of its business in the ordinary course.
Since date of filing, the Debtor's operations have been on a pause,
due to repairs needed to its trucks. RNDY Transport Inc. will pay
for the repairs and deduct the amounts spent from funds to be paid
to the Debtor as part of the Independent Contractor Agreements that
will be submitted to the Court for approval. The Debtor anticipates
that the trucks should be ready to operate very soon.
The creditors that purport to hold liens or security interests in
inventory and accounts are:
CFG Merchant Solutions, LLC, Luceo 124 Trust, Corporation Service
Company, as Representative, CHTD Company, EC Master Trust, First
Corporate Solutions, as Representative, RDM Capital Funding, LLC
a/ka/a Fintap, Ford Motor Credit, CAPYTAL.com, AMUR Equipment
Finance, Inc, Entegra Capital, OTR Solutions, and Summit Bank dba
Equipment Finance Group.
As adequate protection, the Debtor proposes to grant the Lenders
post-petition replacement liens in the same assets of the Debtor
that such entity had prior to the filing of the chapter 11
bankruptcy case.
In addition, the Debtor will provide the Lenders with information
relating to projected revenues and expenses, actual revenue and
expenses, and variances from the interim budget.
A copy of the motion is available at https://urlcurt.com/u?l=QQwlrI
from PacerMonitor.com.
About Faith USA
Faith USA, LLC filed a petition under Chapter 11, Subchapter V of
the Bankruptcy Code (Bankr. S.D. Texas Case No. 24-31010) on March
5, 2024, with $100,001 to $500,000 in assets and $500,001 to $1
million in liabilities.
Judge Eduardo V. Rodriguez presides over the case.
Reese W. Baker, Esq., at Baker & Associates represents the Debtor
as legal counsel.
FESI HOLDINGS: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: FESI Holdings, Inc.
81 Marmion Way
Rockport MA 01966
Chapter 11 Petition Date: May 1, 2024
Court: United States Bankruptcy Court
District of Massachusetts
Case No.: 24-10841
Debtor's Counsel: James L. O'Connor, Esq.
NICKLESS, PHILLIPS AND O'CONNOR
PO Box 7101 780 Main Street, Suite 401
Fitchburg, MA 01420
Tel: 978-342-4590
Email: joconnor@npolegal.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Timothy J. Fallon as president.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/QDCIMCA/FESI_Holdings_Inc__mabke-24-10841__0001.0.pdf?mcid=tGE4TAMA
GB2 HOLDINGS: Case Summary & Two Unsecured Creditors
----------------------------------------------------
Debtor: GB2 Holdings, LLC
8803 CR 612
Mansfield, TX 76061
Business Description: The Debtor is engaged in greenhouse,
nursery, and floriculture production.
Chapter 11 Petition Date: May 1, 2024
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 24-41529
Debtor's Counsel: Katherine T. Hopkins, Esq.
KELLY HART & HALLMAN LLP
201 Main Street, Suite 2500
Fort Worth, TX 76102
Tel: (817) 332-2500
Fax: (817) 878-9280
Email: katherine.hopkins@kellyhart.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $10 million to $50 million
The petition was signed by William A. Brentlinger as managing
member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's two unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/APIALIA/GB2_Holdings_LLC__txnbke-24-41529__0001.0.pdf?mcid=tGE4TAMA
GIRAFFE ENTERTAINMENT: Case Summary & One Unsecured Creditor
------------------------------------------------------------
Debtor: Giraffe Entertainment, Inc.
d/b/a 810 Billiards & Bowling
5609 Rogers Ave.
Suite F
Fort Smith, AR 72903
Business Description: The Debtor owns and operates 810 Billiards
& Bowling, which features 16 bowling lanes,
billiard tables, a sports simulator, axe
throwing lanes, and an arcade.
Chapter 11 Petition Date: April 30, 2024
Court: United States Bankruptcy Court
Western District of Arkansas
Case No.: 24-70714
Judge: Hon. Bianca M. Rucker
Debtor's Counsel: Stanley V. Bond, Esq.
BOND LAW OFFICE
525 S. School Ave.
Suite 100
Fayetteville, AR 72701
Tel: 479-444-0255
Fax: 479-235-2827
Email: attybond@me.com
Total Assets: $344,845
Total Liabilities: $2,369,810
The petition was signed by Erik Covitz as managing member.
The Debtor listed HomeTrust Bank located at PO Box 10 Asheville, NC
28802 as its sole unsecured creditor holding a claim of
$2,023,965.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/5NNXPVI/Giraffe_Entertainment_Inc__arwbke-24-70714__0001.0.pdf?mcid=tGE4TAMA
GORDON BROTHERS: Plan Agent Hires PPL Group as Auctioneer
---------------------------------------------------------
Eric J. Camm, the Plan Agent of Gordon Brothers Cellars, Inc. and
its affiliates, seeks approval from the U.S. Bankruptcy Court for
the Eastern District of Washington to employ PPL Group LLC and Onyx
Asset Advisors, LLC as auctioneers.
The firms will conduct an auction for the sale of substantially
all, or a portion of, the Debtors' Assets.
The firms will be paid based upon its normal and usual hourly
billing rates. The firms will also be reimbursed for reasonable
out-of-pocket expenses incurred.
As disclosed in a court filing that the firms are "disinterested
persons" as the term is defined in Section 101(14) of the
Bankruptcy Code.
The firms can be reached at:
PPL Group LLC
105 Revere Dr.
Northbrook, IL 60062
Tel: (224) 927-5300
- and -
Onyx Asset Advisors, LLC
50 California Street Suite 1500
San Francisco, CA 94111
Tel: (415) 799-3299
About Gordon Brothers Cellars, Inc.
Gordon Brothers Cellars, Inc., owns and operates a wine business.
Gordon Brothers Cellars sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D. Wash. Case No. 20-02003) on Nov.
6, 2020. In the petition signed by Jeffrey J. Gordon, president,
the Debtor disclosed $447,844 in assets and $2,148,304 in
liabilities.
Gordon Brothers Cellars' case is jointly administered with the
Chapter 11 case of Kamiak Vineyards Inc., which sought bankruptcy
protection (Bankr. E.D. Wash. Case No. 20-02038) on November 17,
2020. Gordon Brothers Cellars' is the lead case.
Judge Whitman L. Holt oversees the cases.
John W. O'Leary, Esq., at Gravis Law, PLLC, represents the Debtor.
Kevin O'Rourke is the Chapter 11 Subchapter V Trustee.
Jason Ayres, Esq., and Todd Reuter, Esq., at Foster Garvey P.C.,
represent Bank of Eastern Washington.
Michael Paukert, Esq., at Paukert & Troppmann, PLLC, represents
Equitable Financial Life Insurance Company.
HARVEST MIDSTREAM I: Fitch Assigns 'BB-' Rating on Unsec. Notes
---------------------------------------------------------------
Fitch Ratings has assigned a 'BB-'/'RR4' rating to Harvest
Midstream I, LP (HMI) proposed offering of senior unsecured notes
due in 2032.
The company will use the net proceeds from the proposed notes to
repay a portion of the existing Term Loan A due 2026, a portion of
its Revolving Credit Facility outstanding and general corporate
purpose. Total debt balance and EBITDA leverage are not affected by
this refinancing transaction. Concurrently with this offering,
HMI's Revolving Credit Facility will be upsized to $850 million
from $700 million. Fitch believes that the proposed notes issuance
will de-risk the upcoming maturity and improve Harvest's financial
flexibility.
KEY RATING DRIVERS
Acquisitions and Spending Increase Scale and Diversification:
Recent Paradigm and Alliance Terminal acquisitions bolstered the
run rate EBITDA and compensated for declining revenues from TAPS
and Four Corners. These acquisitions expanded HMI's presence in new
geographic regions and enhanced customer diversification.
HMI is also strategically deploying capital around the newly
acquired assets to fully leverage their potential. Fitch
anticipates the investments in Bakken, Texas and Louisiana and the
reduction of partnership's exposure to TAPS (Alaska) and Four
Corners to be positive given its expectation of continued revenue
decline in those regions. Fitch also views the increasing oil focus
as credit supportive in the near term given the volatility in
natural gas prices.
Moderate Leverage: HMI maintains low leverage and good interest
coverage relative to midstream peers. Management is committed to a
leverage target of 3.0x-3.5x and had been running at roughly 2.4x
for two years prior to making the Paradigm acquisition in May 2023.
Fitch has a neutral to slightly positive view on the transaction as
the higher initial leverage is offset by incremental scale and
stronger business mix with the addition of new customers and
expanded footprints.
Fitch believes that adherence to financial policy is critical to
HMI's credit profile due to the partnership's acquisitive strategy,
concentrated customer exposure and presence in mature conventional
basins. HMI has been FCF positive and has a credit supportive
financial policy. It essentially halted distributions in 2019 and
2020 when leverage exceeded the target level. Given the currently
higher leverage and capex needs, Fitch expects HMI to remain
committed to the leverage target and balance growth needs and
distributions with debt reduction until leverage declines to
approximately 3.5x in 2025.
Counterparty Exposure/Concentration Risk: HMI has a diverse
customer base of about 125 customers and the credit profile of its
counterparties have been improving in recent years. However,
counterparty risk continues to be a significant risk factor as
approximately three-fifths of its net revenues are from
non-investment-grade or unrated counterparties. Fitch views the
high-yield E&P companies as not having the same downside protection
to their cash flows as their investment-grade peers, and therefore
are exposed to greater risk in a volatile commodities price
environment.
HMI's broader risk remains aligned to its E&P affiliates and
largest counterparty, Hilcorp Energy I, L.P. (Hilcorp, NR), which
represented approximately 45% of HMI's 2023 net revenues,
considerably lower than 2021 when 70% of the revenues were derived
from Hilcorp. In general, the concentration risk is less of a
concern with the increasing scale and profitability, as well as the
generally improving credit profile, of upstream counterparties.
Volumetric Risk Prevails Within Portfolio: Despite the high
proportion of fee-based and regulated cost of service contracts,
the contractual framework exposes the Partnership to high
volumetric risk as there are limited contracts containing volume
assurance provisions. For 2023, approximately 90% of the net
revenues were from fixed-fee and cost of service contracts, with
substantial exposure to TAPS and Four Corners. Fitch anticipates
the decline in both regions will continue in the near term. Volumes
can be further pressured by diminishing fossil fuels demand and
domestic production in the long run, a risk Fitch expects to remain
over the rating horizon. Fitch anticipates that HMI will persist in
its acquisition strategy and increase marketing business to offset
the decline in volumes associated with existing assets.
Size and Scale: The partnership is geographically diversified, with
presence in five distinct areas spread across the U.S., although
much of the assets and operations concentration is limited to the
San Juan basin and Alaska, which are expected to contribute roughly
35% and 25% of expected EBITDA respectively.
Fitch believes this operational concentration and modest size makes
HMI vulnerable to an outsized event or pronounced slowdown in these
two core regions. Although currently relatively small, EBITDA
contributions from Eagle Ford (Texas), southern Louisiana and
Bakken are expected to double in the forecast years following a
series of acquisitions and continued investments in these regions,
which will offset risk associated with regional concentration.
Supportive Affiliate: Under common ownership, HMI supports Hilcorp
with midstream services, handling a significant portion of
Hilcorp's production. Of note, Hilcorp also transferred Harvest
Alaska to HMI in January 2020 at no cost. In Fitch's view, Hilcorp
directly benefits from the stable operations at HMI. While there is
limited strategic interaction between the two entities, at this
time Fitch expects HMI will continue to benefit from Hilcorp's
support in the near to intermediate term.
DERIVATION SUMMARY
HMI is a medium-sized midstream partnership. The partnership may be
distinguished from gathering and processing (G&P) companies with
similar levels of indebtedness by HMI's highly acquisitive strategy
and its presence in multiple operating regions. Many other
similarly sized G&P companies are heavily concentrated in only one
producing basin or focus on one commodity.
Given HMI's acquisition growth strategy and regional diversity,
Summit Midstream Partners, LP (Summit; B-/Stable) is a close peer.
Summit has a similar business strategy with a footprint in seven
distinctive regions including Williston, DJ, Permian, Utica,
Marcellus, Barnett, and Piceance. Similarly to Harvest, Summit is
exposed to high volumetric risks and a substantial percentage of
high-yield or non-rated producer customers.
Summit is smaller in size and its leverage is expected to sustain
in 4.0x-4.5x range over the forecast period. With a smaller sized
credit facility, and concentrated maturities in 2025 and 2026,
Summit has lower financial flexibility in the near term.
The smaller size, higher leverage, and lower near-term financial
flexibility account for the three-notch difference between Summit
and HMI.
KEY ASSUMPTIONS
Fitch's Key Assumptions in the Rating Case:
- Fitch price deck for West Texas Intermediate (WTI) oil price of
$75/bbl in 2024, $65/bbl in 2025, $60/bbl in 2026-2027, and $57/bbl
thereafter;
- Fitch Price Deck for Henry Hub prices of $2.50/Mcf in 2024,
$3.00/Mcf in 2025-2026, and $2.75/Mcf thereafter;
- Base interest rates applicable to the partnership's outstanding
variable rate debt obligations reflects the Fitch Global Economic
Outlook.
- Capex and distributions for 2024 in line with management
guidance;
- No asset acquisitions or disposals assumed;
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Material change to earnings stability profile in terms of greater
proportion of EBITDA derived from high growth basins and/or
decreased volumetric exposure;
- Meaningful improvement to counterparty credit profile and/or
increase in scale, with EBITDA leverage expected to be sustained
below 3.5x.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- EBITDA Leverage above 4.5x on a sustained basis;
- Increases in capital spending and/or funding for acquisitions
beyond Fitch's expectation that have negative consequences for the
credit profile (e.g. if not funded with a balance of debt and
equity);
- An event that has a material negative effect on Hilcorp's credit
profile or operations;
- Material change to contractual arrangement and operating
practices that negatively affect HMI's cash flow or earnings
profile.
- Impairments to liquidity.
LIQUIDITY AND DEBT STRUCTURE
Sufficient Liquidity: The partnership had a total liquidity of
approximately $252 million as of December 31, 2023. HMI had
approximately $12 million cash on its balance sheet and $240
million available on its $700 million first lien secured revolving
credit facility. The revolving facility includes an $80 million
sublimit for letters of credit (LC's). As of Dec. 31, 2023, there
were no outstanding LC's under the facility. The revolving credit
facility has a maturity date of Sept. 19, 2027. Concurrently with
this offering, the revolving credit facility will be upsized to
$850 million.
Covenants in the credit facility permit a maximum net secured
leverage ratio of 3.5x and total net leverage ratio of 5.25x. It
also requires the partnership to maintain a minimum interest
coverage ratio of 3.0x. As of Dec. 31, 2023, HMI was in compliance
with its covenants. Fitch expects HMI to generate FCF and maintain
compliance with its covenants in the forecast period.
Annual amortization of the $250 million term loan is $25 million.
The term loan matures on Sept. 19, 2026 and Fitch expects HMI to
roll the unpaid Term Loan balance into the revolving credit
facility at maturity. HMI also has an $800 million 7.5% senior
unsecured note maturing on Sept. 1, 2028.
ISSUER PROFILE
Harvest Midstream I, L.P. owns and holds interests in crude oil and
natural gas pipelines, gas processing and treating plants,
facilities and related equipment with a presence in Alaska, the San
Juan basin in Colorado and New Mexico, Louisiana, Texas, North
Dakota and Ohio.
DATE OF RELEVANT COMMITTEE
10 October 2023
ESG CONSIDERATIONS
Harvest Midstream I, L.P. has an ESG Relevance Score of '4' for
Governance Structure due to related party transactions with
affiliate companies, 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
----------- ------ --------
Harvest Midstream I,
L.P.
senior unsecured LT BB- New Rating RR4
HAWAIIAN HOLDINGS: Posts $137MM Net Loss in 2024 First Quarter
--------------------------------------------------------------
Hawaiian Holdings, Inc., the parent company of Hawaiian Airlines,
Inc., reported its financial results for the first quarter of
2024.
For the three months ended March 31, 2024, the Company reported a
net loss of $137.6 million, compared to a net loss of $98.3 million
for the three months ended March 31, 2023. As of March 31, 2024,
the Company has $3.79 billion in total assets, $3.83 billion in
total liabilities, and $40.2 million in total shareholders'
deficit.
"Mahalo to our team for remaining focused on delivering strong
operational performance and unparalleled guest experience," said
Hawaiian Airlines President and CEO Peter Ingram. "2024 is off to a
positive start as we work to start realizing the return on
significant investments we've made in our business, including
rolling out high-speed Starlink WIFI and taking delivery of our
first Boeing 787."
First Quarter 2024 Highlights:
Merger Update
-- The Company's stockholders voted in favor of the merger with
Alaska Air Group, Inc.
-- The Company and Alaska entered into a timing agreement with
the Department of Justice in which they agreed not to consummate
the merger before 90 days following the date on which both parties
have certified substantial compliance with the DOJ's second request
for additional information
Liquidity and Capital Resources
As of March 31, 2024, the Company had:
-- Unrestricted cash, cash equivalents and short-term investments
of $897 million
-- Liquidity of $1.15 billion, including an undrawn revolving
credit facility of $235 million
-- Outstanding debt and finance lease obligations of $1.75
billion
Routes and Network
-- Began Boeing 787-9 Dreamliner revenue service on April 15,
2024
-- Announced new flying from Salt Lake City (SLC) to Honolulu
(HNL) and Sacramento (SMF) to Lihu'e (LIH) and Kona (KOA)
-- Announced increased summer flights between HNL and Austin
(AUS), Boston (BOS), Las Vegas (LAS) and Pago Pago (PPG)
-- Hawaiian will also add a fourth daily flight between HNL and
Los Angeles (LAX) from May 24 through September 2
-- Hawaiian received its second A330-300 freighter from Amazon
which will operate between New York's JFK and San Bernardino (SBD)
Guest Experience
-- Starlink inflight connectivity is now available free of charge
on board all 18 A321neo aircraft
-- Expanded Premium Airport Service product in its Honolulu hub,
offering seamless curb-to-aircraft experience with access to new
airport private suite, Apt. 1929
-- Signed a multi-year distribution agreement with Sabre that
will provide Sabre-connected agencies with long-term access to the
carrier's HA Connect NDC and traditional EDIFACT content through
the Sabre travel marketplace.
Workforce Development
-- Partnered with Universal Technical Institute, the
transportation, skilled trades and energy education division of
UTI, Inc. to expand career opportunities for Universal Technical
Institute airframe and powerplant graduates who earn their FAA
certifications.
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/3uczj4f6
About Hawaiian Holdings
Headquartered in Honolulu, Hawaii, Hawaiian Holdings, Inc. provides
transportation services. As of September 30, 2023, Hawaiian
Holdings has $3,923,260 in total assets and $3,744,502 in total
liabilities.
* * *
On November 15, 2023, Egan-Jones Ratings Company retained its
'CCC-' foreign currency and local currency senior unsecured ratings
on debt issued by Hawaiian Holdings.
HAWKEYE ENTERTAINMENT: Court Keeps Chapter 11 Case
--------------------------------------------------
Judge Martin R. Barash of the United States Bankruptcy Court for
the Central District of California entered an order denying the
request of Smart Capital Investments I, LLC, Smart Capital
Investments II, LLC, Smart Capital Investments III, LLC, Smart
Capital Investments IV, LLC, and Smart Capital Investments V, LLC
to dismiss the chapter 11 case of Hawkeye Entertainment, LLC, and
for relief from the automatic stay to pursue an unlawful detainer
action against the Debtor in state court.
The Debtor is lessee under a lease of a portion of the commercial
property located at 618 South Spring Street, Los Angeles, which is
commonly known as the Pacific Stock Exchange Building. The Debtor
subleases the Premises to its subtenant, W.E.R.M. Investments, LLC,
which operates a popular dance club and event venue on the
Premises, commonly known as "Exchange LA". Smart Capital is the
current landlord of the property.
On September 30, 2013, the Debtor filed its first chapter 11
bankruptcy case. On June 20, 2016, the Court entered an order
confirming a chapter 11 plan for the Debtor, which order also
"confirmed" the assumption of the Lease. The Clerk of the Court
entered a final decree in, and closed, the Debtor's first
bankruptcy case on April 28, 2017.
However, on August 5, 2019, Smart Capital delivered a letter
asserting non-monetary defaults under the Lease. Despite the
Debtor's efforts to address and obtain more specific information on
the nature of the alleged defaults, Smart Capital thereafter issued
a three-day notice to quit the premises. Not long after, on August
21, 2019, the Debtor commenced its second chapter 11 case and moved
to assume the Lease pursuant to Bankruptcy Code section 365. Smart
Capital opposed. After a multi-day trial, the Court approved the
Debtor's assumption of the Lease. The Ninth Circuit Court of
Appeals later affirmed that decision. The Debtor confirmed a
chapter 11 plan in its second case, by order entered on August 6,
2021. That case has not yet been closed.
The conflict between the Debtor and Smart Capital has continued.
On September 20, 2021, the Debtor commenced an adversary proceeding
in its second bankruptcy case, alleging various breaches of the
Lease by Smart Capital, including efforts to interfere with the
Debtor and WERM's use and quiet enjoyment of the Premises. Judge
Maureen Tighe, however, dismissed that adversary proceeding on
jurisdictional grounds, concluding that the Court's
post-confirmation jurisdiction in the second case did not include
the disputes alleged in the Debtor's complaint. The dismissal
order was without prejudice to the Debtor re-filing its claims with
a court of competent jurisdiction. On August 29, 2022, the Debtor
and WERM filed a lawsuit in California Superior Court, which action
seeks a variety of relief for alleged breaches of the Lease by
Smart Capital. The State Court Action remains pending.
On October 16, 2023, Smart Capital served on the Debtor three
different notices under California Civil Procedure Code section
1161(4) purporting to terminate the Lease, declaring a forfeiture
of the leasehold, and giving the Debtor and its subtenant three
days to vacate the Premises. The Three-Day Notices allege the
Debtor and/or its subtenant breached the Lease by committing or
permitting to exist a nuisance on the Premises and using the
Premises for an illegal or unlawful purpose. The Debtor denies
these allegations. Rather than wait for the expiration of the
three-day period provided under the Three Day Notices and permit
Smart Capital to commence an unlawful detainer action in state
court, the Debtor commenced another Chapter 11 case on October 18,
2023.
Smart Capital has moved the Court: (i) to dismiss the third Chapter
11 case pursuant to Bankruptcy Code section 1112(b), and (ii) for
relief from the automatic stay pursuant to Bankruptcy Code section
362(d) to proceed with an unlawful detainer action against the
Debtor and to assert counterclaims against the Debtor, which is the
plaintiff in a civil action pending in the California Superior
Court against Smart Capital. The gravamen of both Motions is that
the Debtor filed this case in bad faith.
The Motions were filed on December 19, 2023, and set for hearing on
January 9, 2024. On January 9, the Court held an initial hearing
on the Motions, and thereafter continued the hearings to permit the
parties to cross-examine each other's declarants.
On March 29, 2024, the Court held a continued hearing to announce:
(i) its finding that the Debtor filed the case in good faith, (ii)
that the Court would deny the Dismissal Motion, (iii) that the
Court would deny Smart Capital's request for relief from stay to
pursue an unlawful detainer action against the Debtor, and (iv)
that the Court was inclined to grant Smart Capital limited relief
from the automatic stay to permit Smart Capital to file
counterclaims against the Debtor, provided the counterclaims were
limited to the liquidation of any damage claims Smart Capital might
have against the Debtor.
Smart Capital argues that the Debtor lacked good faith in filing
the Chapter 11 case and that the case should therefore be
dismissed. The Court disagrees, finding -- by a preponderance of
the evidence -- that the filing was done in good faith.
Smart Capital's first line of argument is that the Debtor has only
one asset, no ongoing business, few genuine creditors, and no
legitimate need for reorganization under chapter 11. Smart Capital
argues that this is particularly true because the Debtor availed
itself of chapter 11 twice before within the last 10 years.
However, the Court is persuaded that the Debtor filed this case for
the legitimate purposes of preserving its business as a going
concern and maximizing the value of its principal assets -- the
Lease and Sublease. The Court concludes the Debtor filed this case
to prevent the precipitous termination of the Lease under the
Three-Day Notices, avoid any resulting disruption to (i) the
Planning Department's consideration of the pending CUB renewal
application, (ii) WERM's ability to continue selling alcohol during
the consideration of that renewal, and (iii) the Debtor's ability
to satisfy its debts utilizing future rental payments from WERM.
The Debtor's schedules, filed under penalty of perjury, reveal a
secured claim of $150,200.34 and unsecured nonpriority claims of
$2,640,919.23. According to the Court, the Debtor's schedules and
statements of financial affairs, which are unrefuted, (i) show that
the Debtor does not have adequate liquidity to satisfy its debts
and (ii) support the Debtor's contention that it is relying on
future revenues from the Sublease (and, indirectly, from the
continued operations of its subtenant) to meet its obligations.
Smart Capital also argues that several of the Debtor's unsecured
claims are held by insiders and therefore are not legitimate. But
none of the evidence adduced by Smart Capital refutes the Debtor's
statements, under penalty of perjury, that these are genuine debt
obligations, the Court finds. The Court notes that even debts held
by insiders are debts for purposes of demonstrating good faith.
Smart Capital also asserts that the Debtor filed this chapter 11
case as an improper litigation tactic and an exercise in forum
shopping, in what is essentially a "two-party dispute." Smart
Capital contends the only problem facing the Debtor is a
run-of-the-mill lease dispute with its landlord, which can and
should be determined in Superior Court. The argument is unavailing
for numerous reasons, according to the Court, holding that the
argument ignores the fact that the Debtor has creditors holding
substantial secured and unsecured debts that the Debtor will be
unable to satisfy without the tools of Chapter 11. "In other
words, there are more than two parties in this case," the Court
says. Smart Capital insists this is not so because none of the
Debtor's creditors is currently pursuing or threatening legal
action against the Debtor. But this is not a prerequisite to
utilizing Chapter 11 and it is not what the cases mean when they
refer to a "two party" dispute, the Court holds.
Under the totality of the circumstances presented, litigating Smart
Capital's allegations regarding breaches of the Lease in the
context of lease assumption under Bankruptcy Code section 365 is a
reasonable and appropriate means of preserving the rights of all
involved (including Smart Capital), while maximizing the value of
the Debtor's assets for the benefit of its creditors. This is not
forum shopping, the Court finds. And it is not bad faith,
according to the Court. The Court states that this is the
legitimate use of Chapter 11 by a debtor seeking to preserve the
viability of its business.
The Court concludes that granting Smart Capital relief to proceed
with an unlawful detainer action would have potentially adverse
impacts on the Debtor and its creditors. On balance, this impact is
far more serious than the impact on Smart Capital. Denying the
relief requested by Smart Capital effectively would require Smart
Capital to litigate in Bankruptcy Court the breaches of the Lease
alleged in the Three-Day Notices, rather than in the Superior
Court. But Smart Capital would get its day in Court. If the Court
grants relief and permits Smart Capital to pursue an unlawful
detainer action in Superior Court, the Debtor (and its economic
stakeholders) may lose the value of its assets and its viability as
a going concern.
The Court reserves judgment on whether, and under what conditions,
it should grant relief from stay to permit Smart Capital to assert
counterclaims against the Debtor in the State Court Action.
A copy of the Court's decision is available at
https://tinyurl.com/y9nrj8ed
About Hawkeye Entertainment
Hawkeye Entertainment, LLC, sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No. 23-11501) on
Oct. 18, 2023. In the petition signed by Adi McAbian, president of
Saybian Gourmet, Inc., member of Hawkeye, the Debtor disclosed up
to $10 million in both assets and liabilities.
Judge Martin R. Barash oversees the case.
Sandford L. Frey, Esq., at Leech Tishman Fuscaldo & Lampl, LLC, is
the Debtor's legal counsel.
HEYCART INC: Court OKs Cash Collateral Access on Final Basis
------------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California,
Santa Ana Division, authorized Heycart, Inc. to use cash collateral
on a final basis, through February 8, 2025.
The Debtor scheduled Clearco as a nonpriority, unsecured creditor
with a claim in the amount of $787,166.
Amazon Capital Services, Inc., SellersFunding International
Portfolio Ltd., the Small Business Administration, and 8fig Inc.
are owed between approximately $2.740 million and $4.240 million.
The difference reflects the dispute between the Debtor and 8fig
over 8fig's claim amount -- the Debtor believes the principal
amount owed 8fig is less than $1.8 million, but has scheduled
8fig's disputed claim in the amount of $3.3 million. The Debtor is
informed that 8fig contends that it is owed a higher amount than
the scheduled claim amount.
The Debtor estimates that the total value of its assets is between
approximately $1.230 million and $3.130 million, depending on
whether inventory is valued at its appraised liquidation value
($632,750) or book value ($2,520,928).
To satisfy the claimed rights of (i) Amazon Capital, (ii)
SellersFunding International, (iii) the SBA, (iv) 8fig Inc., and
(v) CFT Clear Finance Technology Corporation d/b/a Clearco to
adequate protection of their claimed interests in the Debtor's cash
collateral, the Secured Creditors are granted, pursuant to 11
U.S.C. Sections 361, 363, and 552(b), a valid, attached, choate,
enforceable, perfected, post-petition security interests and liens
in and against all post-petition assets of the Debtor of the same
character and type, only to the same nature, extent, validity, and
priority that existed prepetition, and solely to the extent of any
diminution in value of the Secured Creditors' collateral caused by
the Debtor's use of cash collateral.
The Debtor will, as further adequate protection of the Secured
Creditors' interests in cash collateral, pay monthly adequate
protection payments as follows:
ACS - $22,887
SellersFunding - $11,444
SBA - $307
8fig - $41,197
Clearco - $9,000
In addition, the Secured Creditors will hold allowed administrative
claims under 11 U.S.C. Section 507(b) with respect to the adequate
protection obligations of the Debtor to the extent that the
replacement liens and post-petition collateral do not adequately
protect the diminution in value of the interests of Secured
Creditors in their prepetition collateral.
A copy of the order is available at https://urlcurt.com/u?l=iILLWk
from PacerMonitor.com.
About Heycart Inc.
Heycart Inc. is primarily engaged in selling utensils, ceramic
dishes, reusable labels and wine accessories.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Case No. 24-10483) on February
28, 2024. In the petition signed by Aiden Chien, chief operating
officer, the Debtor disclosed $1,231,380 in assets and $23,500,047
in liabilities.
Judge Theodor Albert oversees the case.
Zev Schechtman, Esq., at DANNING, GILL, ISRAEL & KRASNOFF, LLP,
represents the Debtor as legal counsel.
HILLISTER FARMS: Case Summary & One Unsecured Creditor
------------------------------------------------------
Debtor: Hillister Farms, L.L.C.
8803 CR 612
Mansfield, TX 76061
Business Description: Hillister Farms, L.L.C. is engaged in
greenhouse, nursery, and floriculture
production.
Chapter 11 Petition Date: May 1, 2024
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 24-41530
Debtor's Counsel: Katherine T. Hopkins, Esq.
Nancy Ribaudo, Esq.
Joseph Austin, Esq.
KELLY HART & HALLMAN LLP
201 Main Street, Suite 2500
Fort Worth, TX 76102
Tel: (817) 332-2500
Fax: (817) 878-9280
Email: katherine.hopkins@kellyhart.com
joseph.austin@kellyhart.com
nancy.ribaudo@gmail.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $10 million to $50 million
The petition was signed by William A. Brentlinger as manager.
The Debtor listed Iron Horse Credit LLC located at 6620 Southpoint
Drive South, Suite 230, Jacksonville, FL 32216 as its sole
unsecured creditor holding a claim of $1,139,103.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/AK65S2Y/Hillister_Farms_LLC__txnbke-24-41530__0001.0.pdf?mcid=tGE4TAMA
IBF RETAIL: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: IBF Retail Properties III LLC
420 Throckmorton St.
Suite 200
Fort Worth TX 76102
Business Description: IBF Retail Properties is a Single Asset Real
Estate debtor (as defined in 11 U.S.C.
Section 101(51B)).
Chapter 11 Petition Date: April 30, 2024
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 24-41497
Judge: Hon. Mark X. Mullin
Debtor's Counsel: Joyce W. Lindauer, Esq.
JOYCE W. LINDAUER ATTORNEY, PLLC
1412 Main Street, Suite 500
Dallas, TX 75202
Tel: (972) 503-4033
Email: joyce@joycelindauer.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Raheel Bhai as CEO.
A copy of the Debtor's list of 20 largest unsecured creditors is
now available for download. Follow this link to get a copy today
https://www.pacermonitor.com.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/WGM6M5Q/IBF_Retail_Properties_III_LLC__txnbke-24-41497__0001.0.pdf?mcid=tGE4TAMA
INTEGRATED BOTANICS: Case Summary & 20 Top Unsecured Creditors
--------------------------------------------------------------
Debtor: Integrated Botanics, L.P.
d/b/a IBOT
8803 CR 612
Mansfield, TX 76061
Business Description: The Debtor is engaged in greenhouse,
nursery, and floriculture production.
Chapter 11 Petition Date: May 1, 2024
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 24-41527
Debtor's Counsel: Katherine T. Hopkins, Esq.
KELLY HART & HALLMAN LLP
201 Main Street, Suite 2500
Fort Worth, TX 76102
Tel: (817) 332-2500
Fax: (817) 878-9280
Email: katherine.hopkins@kellyhart.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $10 million to $50 million
The petition was signed by William A. Brentlinger, president of
Sevile Farms, Inc., general partner.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/ZF3JFKA/Integrated_Botanics_LP__txnbke-24-41527__0001.0.pdf?mcid=tGE4TAMA
J CABELLAS: Seeks Cash Collateral Access
----------------------------------------
J. Cabellas, LLC 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 for food and
purchase of other perishable items that must be purchased multiple
times a week. The Debtor also has payroll coming up May 1, 2024
through payroll service.
The Debtor owns certain furniture, fixtures, equipment, signs,
paper products and perishable food that are used in the day to day
operations. This personal property has a value of approximately
$116,687.
The Debtor uses this Personal Property to generate cash income
which it uses to fund its operations. The Debtor does not generate
accounts receivable as all sales are point of sale purchases. As
such at the time of the filing of the bankruptcy case the Debtor
had $0 in accounts receivable and approximately $19,968 in its
checking account.
The Debtor believes that Cadence Bank, N.A. has a first priority
lien position as to the Personal Property and the Cash Collateral
based upon a Note and Security Agreement, with an applicable UCC-1
filed on April 29, 2021.
Cadence is owed approximately $250,000. As such, it appears that
Cadence is undersecured as to the Cash collateral.
The Debtor believes that Global Merchant Cash, LLC has a junior
lien position as to the Personal Property and the cash collateral
based upon a Note and Security Agreement, with an applicable UCC-1
filed on September 22, 2023.
Global is owed approximately $121,000. It appears that Global is
wholly unsecured.
As adequate protection, the creditors will be granted replacement
liens on post- petition cash collateral to the same extent,
validity, and priority as their pre-petition liens on the Petition
Date in all types and descriptions of collateral that were properly
secured and perfected under the applicable, valid, and enforceable
pre-petition loan documents, for any post-petition diminution in
the pre-petition cash collateral.
The Debtor also agrees that within 30 days of the petition date,
the Debtor will remit $1,000 to the Subchapter V trustee to be held
in trust pending the allowance of compensation and reimbursement of
expenses under 11 U.S.C. section 330.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=lKbCV1 from PacerMonitor.com.
The Debtor projects total expenses, on a monthly basis, as
follows:
$68,868 for Month 1;
$71,195 for Month 2;
$72,162 for Month 3;
$72,162 for Month 4;
$72,161 for Month 5; and
$72,161 for Month 6.
About J. Cabellas, LLC
J. Cabellas, LLC operates a Moe's Southwestern Grill under a
franchise agreement with Moe's Franchisor SPV, LLC, operating a
location at 917 Cabellas Drive, Suite 101, Fort Mill, SC.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. S.C. Case No. 24-01458-hb) on April 24,
2024. In the petition signed by Ronald B. Jennings, Jr., managing
member, the Debtor disclosed up to $500,000 in assets and up to $1
million in liabilities.
Kevin Campbell, Esq., at Campbell Law Firm, PA, represents the
Debtor as legal counsel.
J FRANKLIN: Seeks Cash Collateral Access
----------------------------------------
J Franklin, LLC asks the U.S. Bankruptcy Court for the District of
South Carolina for authority to use cash collateral and provide
adequate protection.
The Debtor owns certain furniture, fixtures, equipment, signs,
paper products and perishable food that are used in the day to day
operations. This personal property has a value of approximately
$140,276.
The Debtor uses this Personal Property to generate cash income
which it uses to fund its operations. The Debtor does not generate
accounts receivable as all sales are point of sale purchases. As
such at the time of the filing of this bankruptcy case the Debtor
had $0 in accounts receivable and approximately $2,456 in its bank
account.
North Mill Credit Trust has a first priority lien as to the
Personal Property and the cash collateral based upon a Note and
Security Agreement, with an applicable UCC-1 filed on February 23,
2023.
North Mill is owed approximately $178,743. It appears that North
Mill is undersecured as to the cash collateral.
North Mill Credit Trust has a junior lien position as to the
Personal Property and the accounts receivable and cash assets based
upon a Note and Security Agreement, with an applicable UCC-1 filed
on May 30, 2023.
The Debtor is informed and believes that North Mill is owed
approximately $195,479.
As such, it appears that North Mill is wholly unsecured.
Funding Circle has a junior priority lien position as to the
Receivables based upon a Note and Security, with an applicable
UCC-1 filed on September 15, 2023.
Funding Circle is owed approximately $ 179,918. As such, it appears
that Funding Circle is wholly unsecured.
Global Merchant Cash, Inc. has a junior priority lien position as
to the Receivables based upon a Note and Security Agreement, with
an applicable UCC-1 filed on September 22, 2023.
Global is owed approximately $125,000.
Superfast Capital, Inc. has a junior priority lien position as to
the Receivables based upon a Note and Security Agreement, with an
applicable UCC-1 filed on December 19, 2023.
Superfast is owed approximately $ 130,834. It appears that
Superfast is wholly unsecured.
As adequate protection, the Secured Creditors will be granted
replacement liens on post- petition cash collateral to the same
extent, validity, and priority as their pre-petition liens on the
Petition Date in all types and descriptions of collateral that were
properly secured and perfected under the applicable, valid, and
enforceable pre-petition loan documents, for any post-petition
diminution in the pre-petition cash collateral.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=ISxXNM from PacerMonitor.com.
The Debtor projects total expenses, on a weekly basis, as follows:
$90,238 for Month 1;
$91,117 for Month 2;
$92,436 for Month 3;
$92,436 for Month 4; and
$92,436 for Month 5.
About J Franklin, LLC
J Franklin, LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. S.C. Case No. 24-01457-hb) on April 24,
2024. In the petition signed by Ronald B. Jennings, Jr., managing
member, the Debtor disclosed up to $500,000 in assets and Ronald B.
Jennings, Jr. to $1 million in liabilities.
Kevin Campbell, Esq., at Campbell Law Firm, PA, represents the
Debtor as legal counsel.
JSCO ENTERPRISES: Hires Chartered Capital as Expert Witness
-----------------------------------------------------------
JSCO Enterprises, Inc. seeks approval from the U.S. Bankruptcy
Court for the Eastern District of Texas to employ Chartered Capital
Advisers, Ltd. as expert witness.
The firm will serve as an expert witness in relation to a pending
litigation at Superior Court of the State of Delaware, captioned as
BDO USA, P.C. v. JSCo Enterprises, Inc., C.A. No. N22C-12-063 KSM
CCLD.
The firm will be paid at the rates of $500 per hour.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Ronald G. Quintero, as testifying expert at Chartered Capital
Advisers, Ltd., disclosed in a court filing that the firm is a
"disinterested person" as the term is defined in Section 101(14) of
the Bankruptcy Code.
The firm can be reached at:
Ronald G. Quintero
Chartered Capital Advisers, Ltd.
100 Park Avenue, 16th Floor
New York, NY 10017
Tel: (212) 327-0200
About JSCO Enterprises, Inc.
JSCo Enterprises, Inc. filed its voluntary Chapter 11 petition
(Bankr. E.D. Texas Case No. 23-42151) on Nov. 9, 2023, with $1
million to $10 million in both assets and liabilities. Eric
Jia-Sobota, president, signed the petition.
Judge Brenda T. Rhoades oversees the case.
The Debtor tapped Howard Marc Spector, Esq., at Spector & Cox, PLLC
as bankruptcy counsel and the Law Offices of L.W. Cooper Jr. as
special counsel.
JSCO ENTERPRISES: Hires Chicago Economics Corp. as Expert Witness
-----------------------------------------------------------------
JSCO Enterprises, Inc. seeks approval from the U.S. Bankruptcy
Court for the Eastern District of Texas to employ Chicago Economics
Corp. as expert witness.
The firm will be a testifying expert witness in pending litigation
in the Superior Court of the State of Delaware captioned BDO USA,
P.C. v. JSCo Enterprises, Inc., C.A. No. N22C-12-063 KSM CCLD.
The firm will be paid at the rate of $1,275.00 per hour.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Jonathan Arnold, a partner at Chicago Economics Corp., disclosed in
a court filing that the firm is a "disinterested person" as the
term is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Jonathan Arnold
Chicago Economics Corp.,
30 North Gould Street
Suite 21993
Sheridan, Wyoming 82801
About JSCO Enterprises, Inc.,
JSCo Enterprises, Inc. filed its voluntary Chapter 11 petition
(Bankr. E.D. Texas Case No. 23-42151) on Nov. 9, 2023, with $1
million to $10 million in both assets and liabilities. Eric
Jia-Sobota, president, signed the petition.
Judge Brenda T. Rhoades oversees the case.
The Debtor tapped Howard Marc Spector, Esq., at Spector & Cox, PLLC
as bankruptcy counsel and the Law Offices of L.W. Cooper Jr. as
special counsel.
KALO CLINICAL: Court OKs Deal on Cash Collateral Access
-------------------------------------------------------
The U.S. Bankruptcy Court for the District of Utah authorized Kalo
Clinical Research, LLC to use cash collateral, on an interim basis,
in accordance with the budget and its stipulation with First
Community Bank, Division of Glacier Bank and the U.S. Small
Business Administration.
The Debtor requires funds to continue to manage and preserve its
business for the benefit of the Secured Lenders and other creditors
and to continue to operate as a going concern.
The Secured Lenders claim a lien and security interest in
substantially all the Debtor's assets, and assert that their liens
constitute a valid, properly perfected, and enforceable lien and
security interest in collateral as set forth in the Motion,
including a perfected secured lien on all products, proceeds, and
collections generated by that collateral. The Debtor has consented
to the validity and perfection of the Secured Lenders' asserted
liens in cash collateral.
The Debtor is permitted to use cash collateral to pay current
operating expenses including payroll, rent, retainers for
professionals, and other necessary pursuant to the Budget.
Provided, however, that the Debtor may exceed any individual line
item expenditure by a variance of up to 10%. In addition, any
unused amount for any given line item in the Budget for a
particular week shall carry forward and may be used in later weeks,
and any amounts budgeted for a given line item in a particular week
may be spent at an earlier time provided that the total amount for
such line item does not exceed the total amount budgeted for that
line item.
A copy of the order is available at https://urlcurt.com/u?l=RUfpnj
from PacerMonitor.com.
About Kalo Clinical Research, LLC
Kalo Clinical Research, LLC is a clinical research site local to
the greater Salt Lake area in Utah, providing people with the
opportunity to contribute to the development/advancement of
medicine that future generations will rely on.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Utah Case No. 24-21124) on March 18,
2024. In the petition signed by Isabella M. Johnson, member, chief
executive officer, the Debtor disclosed $634,599 om assets and
$1,059,526 in liabilities.
Judge Peggy Hunt oversees the case.
George B. Hofmann, Esq., at COHNE KINGHORN, P.C., represents the
Debtor as legal counsel.
KNOTTY NUFF: Has Deal on Cash Collateral Access
-----------------------------------------------
Knotty Nuff Wood, Inc. and the U.S. Small Business Administration
advised the U.S. Bankruptcy Court for the Central District of
California, Santa Ana Division, that they have reached an agreement
regarding the Debtor's use of cash collateral and now desire to
memorialize the terms of this agreement into an agreed order.
Pre-petition, on July 12, 2020. the Debtor executed a US Small
Business Administration Note, pursuant to which the Debtor obtained
a COVID Economic Injury Disaster Loan in the amount of $89,000. The
terms of the Note require the Debtor to pay principal and interest
payments of $434 every month beginning on July 12, 2021 and
continuing over the 30 year term of the Loan. The Loan has an
annual rate of interest of 3.75% and may be prepaid at any time
without notice or penalty.
The SBA consents to the Debtor's interim use of cash collateral,
existing on the Petition Date or collected thereafter, through and
including July 24, 2024 for payment of ordinary and necessary
expenses as set forth in the budget, with a 15% variance.
As adequate protection, retroactive to the Petition Date, the SBA
will receive a replacement lien(s) that is deemed valid, binding,
enforceable, non-avoidable, and automatically perfected, effective
as of the Petition Date, on all post-petition revenues of the
Debtor to the same extent, priority and validity that its lien
attached to the Collateral, including cash collateral.
The Debtor will continue to remit adequate protection payments to
the SBA in the amounts and terms as set forth in the applicable
Loan documents and continuing until further order of the Court
regarding interim and/or final use of cash collateral, or the entry
of an order confirming the Debtor's plan of reorganization,
whichever occurs first.
The SBA will be entitled to a super-priority claim over the life of
the Debtor's bankruptcy case, pursuant to 11 U.S.C. sections 503(b)
and 507(b), which claim will be limited to any diminution in the
value of the SBA's collateral, as a result of the Debtor's use of
cash collateral on a post-petition basis.
The Debtor agrees to maintain insurance on the Personal Property
Collateral and to designate SBA as a loss payee or additional
insured in accordance with the Loan and related documents and
agrees to provide proof of insurance within seven days upon written
request of the SBA.
A copy of the stipulation is available at
https://urlcurt.com/u?l=AXYNRg from PacerMonitor.com.
About Knotty Nuff Wood
Knotty Nuff Wood, Inc. sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. C.D. Calif. Case No. 23-12759) on
December 29, 2023, with $100,000 to $500,000 in assets and $1
million to $10 million in liabilities. Ryan Aguire, chief executive
officer, signed the petition.
Judge Theodor Albert oversees the case.
Misty Perry Isaacson, Esq., at Pagler and Perry Isaacson represents
the Debtor as legal counsel.
KOFC LTD: Court OKs Interim Cash Collateral Access
--------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Texas, San
Antonio Division, authorized KOFC, Ltd. to use the cash collateral
of the Texas Comptroller of Public Account, on an interim basis, in
accordance with the budget, with a 10% variance.
The Debtor requires the use of cash collateral to pay ordinary
post-petition operating expenses including taxes, rental/note
payments, insurance, payroll, payroll expenses, utility charges and
the costs of supplies used in the operation of the business as set
forth in the budget.
The court said the Texas sales tax trust funds are not a part of
the Debtor's cash, proceeds or accounts receivable, they do not
form a part of any other secured creditor's collateral, if any, and
they may not be used by the Debtor in its operations. The Debtor
will not utilize Texas sales tax trust funds for any purpose other
than remittance to the Comptroller.
Any Texas sales taxes collected by the Debtor post-petition are not
property of the estate, but instead remain property of the
Comptroller until paid. Payment of the post-petition taxes is
mandatory under 28 U.S.C. Section 959(b) and 960. The Comptroller
does not consent to the use of its post-petition sales tax trust
funds for any purpose other than remitting to the Comptroller.
As adequate protection, the Comptroller is granted replacement
liens on all the Debtor's property.
The Debtor will make monthly adequate protection payments to the
Comptroller in the amount of $3,000 due on the 15th day of each
month thereafter until the Court enters a final cash collateral
order. All payments will apply first to interest (at the statutory
rate of 9.5%) on the Comptroller's prepetition claims and then any
excess to the principal amount of the tax claims, starting with the
oldest period of liability first.
A final hearing on the matter is set for May 29 at 9:30 a.m.
A copy of the order is available at https://urlcurt.com/u?l=H22NvJ
from PacerMonitor.com.
About KOFC LTD
KOFC, LTD filed Chapter 11 petition (Bankr. W.D. Texas Case No.
23-51414) on Oct. 18, 2023, with $50,001 to $100,000 in assets and
$500,001 to $1 million in liabilities.
Judge Michael M. Parker oversees the case.
Morris Eugene White, III, Esq., at Villa & White, LLP represents
the Debtor as legal counsel.
KOKOMO KEY: Case Summary & Two Unsecured Creditors
--------------------------------------------------
Debtor: Kokomo Key Properties, Inc.
1325 NW 53rd Avenue
Suite E
Gainesville, FL 32609
Chapter 11 Petition Date: May 1, 2024
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 24-01268
Judge: Hon. Jacob A. Brown
Debtor's Counsel: Justin M. Luna, Esq.
LATHAM LUNA EDEN & BEAUDINE LLP
201 S. Orange Avenue
Suite 1400
Orlando, FL 32801
Tel: (407) 481-5800
Fax: (407) 481-5801
Email: jluna@lathamluna.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Larry H. Cheshire as shareholder.
A full-text copy of the petition containing, among other items, a
list of the Debtor's two unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/6YAYZ3Q/Kokomo_Key_Properties_Inc__flmbke-24-01268__0001.0.pdf?mcid=tGE4TAMA
KOSMOS ENERGY: S&P Affirms 'B' Rating on Senior Unsecured Debt
--------------------------------------------------------------
S&P Global Ratings affirmed its 'B' issue-level rating on Kosmos
Energy Ltd.'s senior unsecured notes and revised the recovery
rating to '4' from '3'. The '4' recovery rating indicates its
expectation for average (30%-50%; rounded estimate: 40%) recovery
of principal to creditors in the event of a payment default.
Dallas-based oil and gas exploration and production (E&P) company
Kosmos Energy Ltd. announced that it has successfully refinanced
its reserve-based lending (RBL) facility, extending the maturity by
approximately three years to December 2029, and increased its
facility size to $1.35 billion (from $1.25 billion), with current
commitments of approximately $1.2 billion (from $1.25 billion).
Around $800 million is currently drawn. As part of the process, the
company also downsized its revolving credit facility (RCF) to $164
million from $250 million (undrawn), maturing at the end of 2024.
As a result, S&P Global Ratings affirmed its 'B' issue-level rating
on Kosmos' senior unsecured notes and revised the recovery rating
to '4' from '3'. The '4' recovery rating indicates S&P's
expectation for average (30%-50%; rounded estimate: 40%) recovery
of principal to creditors in the event of a payment default.
The recovery rating reflects an updated year-end 2023 PV10 value of
proved reserves under our recovery price assumptions, the increase
in the company's outstanding debt following the issuance of $400
million convertible senior notes due 2030 (not rated) in March
2024, as well as the changes to its RBL commitments and RCF
facility.
The 'B' issuer credit rating and stable outlook on the company
remain unchanged.
ISSUE RATINGS--RECOVERY ANALYSIS
Key analytical factors
-- The existing unsecured notes and RCF are guaranteed on a senior
unsecured basis by Kosmos' U.S. operating subsidiary, which holds
the Gulf of Mexico assets and its working interests in the Jubilee
and Tweneboa, Enyenra, and Ntomme (TEN) fields located offshore
Ghana. In addition, Kosmos' senior unsecured notes are guaranteed
on a subordinated basis by certain operating subsidiaries that hold
the company's producing assets in Ghana and Equatorial Guinea. S&P
assumes the unsecured noteholders and the lenders of the unsecured
corporate revolving credit facility will benefit from residual
recovery values from both the Gulf of Mexico assets and,
separately, the West Africa assets (after the RBL facility is
repaid) via subsidiary guarantees.
-- S&P values the Gulf of Mexico reserves on a PV-10 basis at $306
million after 7% administrative expenses.
-- The PV-10 values incorporate S&P's recovery price deck
assumptions of $50/bbl for WTI crude and $2.50/mmBtu for Henry Hub
natural gas.
-- After the effect of the $1.2 billion RBL commitment and 7%
administrative fees, the residual PV10 value for the Ghana and
Equatorial Guinea assets is around $642 million.
-- S&P assumes the $164 million unsecured corporate revolver would
be 85% drawn at the time of a hypothetical default.
Simulated default assumptions
-- S&P's simulated default scenario assumes a payment default
occurring in 2027 stemming from sustained weakness in oil prices,
which reduces the company's cash flow below the break-even point
while it uses up its cash and liquidity.
-- Accordingly, S&P expects restructuring expenses would be
relatively high in a hypothetical Chapter 11 bankruptcy filing,
considering the various subsidiaries and the multiple jurisdictions
of the company's operations.
-- Specifically, S&P estimates administrative claims total 7% of
its gross enterprise value at emergence, which is higher than its
typical 5% assumption.
-- Kosmos Energy Ltd. is a U.S.-based issuer.
-- Jurisdiction/jurisdiction ranking assessment: U.S./Group A
Simplified waterfall
-- Total enterprise value: $2.2 billion
-- Ghana and Equatorial Guinea recovery value net of RBL: $642
million
-- Gulf of Mexico (GOM) recovery value: $306 million
-- Total value available to senior unsecured notes and $165
million revolving credit facility: $948 million
-- Total unsecured debt claims: $2.1 billion
--Recovery expectations: 30%-50% (rounded estimate: 40%)
Note: All debt amounts include six months of prepetition interest.
LUMEN TECHNOLOGIES: To Cut Workforce, Expects Up to $100M in Costs
------------------------------------------------------------------
Lumen Technologies, Inc. disclosed in a Form 8-K Report filed with
the U.S. Securities and Exchange Commission that on April 19, 2024,
the Company finalized plans to reduce its workforce by less than 7%
through a combination of involuntary and voluntary separations.
These reductions are a part of its efforts to change its workforce
composition to reflect its ongoing transformation and cost
reduction opportunities that align with the Company's shapeshifting
and focus on its strategic priorities. These initiatives are
expected to be substantially completed by the end of the second
quarter of 2024.
As a result of this plan, the Company expects to incur severance
and related costs in the range of approximately $90 million to $100
million, substantially all of which we expect to record in the
second quarter of 2024. Other than these costs, the Company does
not expect to incur any material impairment or exit costs related
to this plan.
About Lumen Technologies
Headquartered in Monroe, Louisiana, Lumen Technologies, Inc. is an
international facilities-based technology and communications
company focused on providing its business and mass markets
customers with a broad array of integrated products and services
necessary to fully participate in its ever-evolving digital world.
The Company's platform empowers its customers to swiftly adjust
digital programs to meet immediate demands, create efficiencies,
accelerate market access and reduce costs -- allowing customers to
rapidly evolve their IT programs to address dynamic changes.
* * *
As reported by the TCR on April 4, 2024, Fitch Ratings has
downgraded the Long-Term Issuer Default Ratings (IDR) of Lumen
Technologies and subsidiaries, Level 3 Parent, LLC and Level 3
Financing, Inc., to 'RD' from 'CCC-'. Fitch has also downgraded the
issue-level ratings assigned to Lumen and Level 3 Financing, Inc.,
as well as issue-level ratings at Qwest Capital Funding, Inc. In
addition, Fitch has removed the Rating Watch Negative on all
ratings, and has affirmed the Long-Term IDRs for Qwest Corporation,
Qwest Communications International Inc., and Qwest Services Corp.
at 'CCC+'.
Fitch has subsequently upgraded the ratings of Lumen Technologies,
Inc. and its key borrower subsidiaries to reflect the new capital
structure post its transaction support agreement (TSA) transaction
closed on March 22, 2024. Fitch has rated Lumen and various
subsidiaries 'CCC+'. The rating actions reflect Fitch's view that
the completed TSA involving a comprehensive debt restructuring
resulted in a distressed debt exchange (DDE) for the Lumen and
Level 3 entities. The transaction completed pursuant to the TSA was
one of the largest private debt restructurings completed in the
U.S. to date and encompassed participation from more than $15
billion of outstanding debt. The new 'CCC+' IDR ratings reflect an
improved debt maturity profile, offset by execution risks related
to the company's ability to strengthen its operating profile. Fitch
believes the combination of the large debt balance with weak
operating results calls into question the long-term sustainability
of the company's capital structure, even with extended maturities.
Moreover, as reported by the TCR on Apr 11, 2024, S&P Global
Ratings raised its issuer credit rating on Lumen Technologies to
'CCC+' from 'SD' (selective default). The TSA included $1.325
billion of new senior secured debt issued at wholly owned
subsidiary Level 3 Financing Inc. S&P assigned a 'B' issue-level
rating and '1' recovery rating to this debt and the new
super-priority debt at Lumen. S&P said, "We assigned a 'B-' rating
and '2' recovery rating to the new senior secured second-lien debt
at Level 3 (corrected from 'CCC+' and '3'; see editor's note
above). The '2' recovery rating indicates our expectation for
substantial (70%-90%; rounded estimate: 70%) recovery. S&P said,
"We also lowered the rating on the senior unsecured debt at wholly
owned subsidiary Qwest Corp. to 'B-' from 'B' and the rating on the
debt at Qwest Capital Funding Inc. to 'CCC-' from 'B-'. We removed
all the Qwest issue-level ratings from CreditWatch, where we placed
them with negative implications on Jan. 30, 2024." "The stable
outlook reflects our view that, over the next 12 months, Lumen will
maintain sufficient liquidity from cash and revolver availability
due to the maturity extensions despite lingering uncertainty over
the long-term sustainability of the capital structure."
The 'CCC+' rating reflects ongoing secular industry pressures in
Lumen's business and mass market segments. Lumen has made some
progress improving top-line trends by selling new products from its
digital platform, including network-as-a-service (Naas) and
ExaSwitch. It is also building some momentum in the public sector.
Nonetheless, the company derives about 79% of its revenue from
business customers, a segment in secular decline given the ongoing
migration to less expensive, newer technologies from higher-margin
legacy services. In addition, amid intense competition, it will
likely take several years to expand these newer products and
services at scale, in S&P's view. Moreover, Lumen still has
substantial exposure to legacy products and services, which will
take time to bottom out.
MCQUADE FOUNDATION: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: The McQuade Foundation
c/o St. Christopher's, Inc.
71 South Broadway
Dobbs Ferry, NY 10522
Chapter 11 Petition Date: April 29, 2024
Court: United States Bankruptcy Court
Southern District of New York
Case No.: 24-22374
Judge: Hon. Sean H. Lane
Debtor's Counsel: Janice Grubin, Esq.
BARCLAY DAMON LLP
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Dr. Sarah Ruback as chief executive
officer.
A full-text copy of the Amended Chapter 11 petition is now
available for download at
https://www.pacermonitor.com/view/ZR2FPJQ/The_McQuade_Foundation__nysbke-24-22374__0002.0.pdf?mcid=tGE4TAMA
MIDWEST DOUGH: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Midwest Dough Guys, LLC
d/b/a D.P. Dough
720 Pier 2
Lincoln NE 68528
Business Description: D.P. Dough is an American chain of calzone
restaurants.
Chapter 11 Petition Date: April 30, 2024
Court: United States Bankruptcy Court
District of Nebraska
Case No.: 24-40406
Judge: Hon. Thomas L Saladino
Debtor's Counsel: John A. Lentz, Esq.
LENTZ LAW, PC, LLO
650 J. St., Ste 215B
Lincoln, NE 68508
Tel: 402-421-9676
Email: john@johnlentz.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Nickolas T. Rowan as authorized signer.
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/CKUPYDA/Midwest_Dough_Guys_LLC__nebke-24-40406__0001.0.pdf?mcid=tGE4TAMA
MOVING & STORAGE: Trustee Hires Wood & Jones as Counsel
-------------------------------------------------------
Geoffrey Groshong, the Subchapter V Trustee of Moving & Storage
Solutions, Inc. seeks approval from the U.S. Bankruptcy Court for
the Western District of Washington to employ Wood & Jones, P.S. as
counsel.
The firm will provide these services:
a. locate and employ other professionals the Debtor may
require to properly administer its Subchapter V bankruptcy case,
such as a turnaround professional and a forensic accountant;
b. investigate the Debtor's assets, including but not limited
to bank accounts and undisclosed assets;
c. investigate the Debtor's potential fraudulent transfers of
assets;
d. assist the Trustee in motions practice, including motions
to sell the Debtor's business;
e. assist the Trustee with any adversary proceedings that may
be required to recover assets; and
f. otherwise provide services to the Trustee as may be
required to best protect the interests of creditors in this case.
The firm will be paid based upon its normal and usual hourly
billing rates. The firm will also be reimbursed for reasonable
out-of-pocket expenses incurred.
Denice W. Moewes, a partner at Wood & Jones, P.S., disclosed in a
court filing that the firm is a "disinterested person" as the term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Denice W. Moewes, Esq.
Wood & Jones, P.S.,
303 North 67th Street
Seattle, WA 98103
Tel: (206) 623-4382
Email: dmoewes@aol.com
About Moving & Storage Solutions, Inc.
Moving & Storage Solutions, Inc., was organized on May 12, 1997, as
a Washington for profit corporation by David Powell to provide
household moving and storage services to customers in the greater
Bellingham Washington area.
Moving & Storage Solutions sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. W.D. Wash. Case No. 24-10039-CMA)
on Jan. 9, 2024. In the petition signed by David Powell, president,
the Debtor disclosed up to $5000,000 in assets and up to $1 million
in liabilities.
Judge Christopher M. Alston oversees the case.
Thomas D. Neeleman, Esq., at Neeleman Law Group, P.C., is serving
as the Debtor's legal counsel.
MOVING & STORAGE: Trustee Seeks to Hire Financial Advisor
---------------------------------------------------------
Geoffrey Groshong, the Subchapter V Trustee of Moving & Storage
Solutions, Inc., seeks approval from the U.S. Bankruptcy Court for
the Western District of Washington to employ Dennis Haydon as
financial advisor.
The firm will provide these services:
a. analyze the Debtor's books and records;
b. assess the Debtor's business operations and advise the
Trustee with respect thereto;
c. assist the Trustee with fulfilling his duties, including
but not limited to the duty to operate the Debtor's business; and
d. provide services to the Trustee as may be required to best
protect the interests of creditors in this case.
Mr. Haydon will be paid at the hourly rate of $300.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
As disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached through:
Dennis Haydon
Haydon U.S., LLP
P.O. Box 5004
Bellevue, WA 98009
E-mail: dennis@haydon.us
About Moving & Storage Solutions, Inc.
Moving & Storage Solutions, Inc., was organized on May 12, 1997, as
a Washington for profit corporation by David Powell to provide
household moving and storage services to customers in the greater
Bellingham Washington area.
Moving & Storage Solutions sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. W.D. Wash. Case No. 24-10039-CMA)
on Jan. 9, 2024. In the petition signed by David Powell, president,
the Debtor disclosed up to $5000,000 in assets and up to $1 million
in liabilities.
Judge Christopher M. Alston oversees the case.
Thomas D. Neeleman, Esq., at Neeleman Law Group, P.C., is serving
as the Debtor's legal counsel.
NEW HAVEN TRUCK: Wins Cash Collateral Access Thru May 31
--------------------------------------------------------
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 May 31, 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 final hearing on the matter is set for May 29 at 10:30 a.m.
A copy of the court's order and the Debtor's budget is available at
https://urlcurt.com/u?l=NckHFf from PacerMonitor.com.
The Debtor projects $31,000 in gross profit and $28,021 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,
2023. 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.
NEW WAY MACHINE: Seeks Cash Collateral Access
---------------------------------------------
New Way Machine Components, Inc., t/a New Way Air Bearings, asks
the U.S. Bankruptcy Court for the Eastern District of Pennsylvania
for authority to use cash collateral.
The Debtor requires the use of cash collateral to pay expenses and
post-petition payroll obligations.
On April 19, 2023, PNC Bank, National Association extended credit
to the Debtor, as borrower, evidenced by an Amended and Restated
Loan Agreement dated April 19, 2023 and an Amended and Restated
Revolving Line of Credit Note in the principal amount of $2.750
million.
The Loan Agreement and the Line of Credit Note were amended and
restated various times over the years.
The Line of Credit Note evidences a revolving line of credit. The
Debtor was able to borrow, repay and reborrow under the Line of
Credit Note and PNC was able to advance and re-advance under the
Line of Credit Note from time to time.
The maturity date of the Line of Credit Note is April 30, 2024.
As of the Petition Date, the balance owed under the Line of Credit
Note was in the approximate amount of $2.6 million.
On March 20, 2024, PNC declared a default under the Line of Credit
Note due to inter alia (i) the Debtor allowing to exist $2.924
million of indebtedness for amounts owed by the Debtor to Nick
Hackett and (ii) the Debtor removing Nick Hackett as president. In
addition, PNC also decided to permanently suspend the Debtor's
ability to draw on the Line of Credit Note.
On December 28, 2021, PNC extended credit to the Debtor, as
borrower, evidenced by a term note in the in the original principal
amount of $181,716 [Loan No. 610695982].
The amounts outstanding under the First Term Note bear interest at
4.05% per annum.
Principal and interest under the First Term Note are due and
payable in monthly installments in the amount of $3,355. The
maturity date of the First Term Note is December 27, 2026.
As of the Petition Date, the balance owed under the First Term Note
was in the approximate amount of $104,529.65.
On March 20, 2024, PNC also declared a default under the First Term
Note.
On December 28, 2022, PNC extended credit to the Debtor, as
borrower, evidenced by a term note in the in the original principal
amount of $600,607. Principal and interest under the Second Term
Note are due and payable in monthly installments in the amount of
$11,835. As of the Petition Date, the balance owed under the Second
Term Note was in the approximate amount of $468,929.
As of the Petition Date, the Debtor's secured equipment financing
debt owed to PNC Equipment Finance, LLC was in the approximate
amount of $83,375.
On July 12, 2019, PNC Equipment Finance extended credit to the
Debtor, as borrower, evidenced by an amended and restated equipment
line of credit note in the original principal amount of $500,000.
As of the Petition Date, the balance owed under the First Equipment
Line of Credit Note was in the approximate amount of $41,281.
On November 16, 2020, PNC Equipment Finance extended credit to the
Debtor, as borrower, evidenced by an equipment line of credit note
in the original principal amount of $175,000, and together with the
First Equipment Line of Credit Note. As of the Petition Date, the
balance owed under the Second Equipment Line of Credit Note was in
the approximate amount of $42,094.
On March 20, 2024, PNC, in its own capacity and as successor to PNC
Equipment Finance, declared a default under the Equipment Line of
Credit Notes.
A copy of the motion is available at https://urlcurt.com/u?l=DVSVJf
from PacerMonitor.com.
About New Way Machine Components, Inc.
New Way Machine Components, Inc. is a manufacturer of air
bearings.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. Pa. Case No. 24-11362) on April 22,
2024. In the petition signed by Andrew J. Devitt, chairman/CEO, the
Debtor disclosed up to $10 million in both assets and liabilities.
Judge Ashely M. Chan oversees the case.
Aris J. Karalis, Esq., at KARALIS PC, represents the Debtor as
legal counsel.
OCEANWIDE PLAZA: Hires Bryan Cave Leighton as Counsel
-----------------------------------------------------
Oceanwide Plaza LLC seeks approval from the U.S. Bankruptcy Court
for the Central District of California to employ Bryan Cave
Leighton Paisner, LLP as counsel.
The firm's services include:
(a) advising the Debtor with respect to its powers and duties as
debtor-in-possession in the continued management and operation of
its business and properties;
(b) advising and consulting on the conduct of this Chapter 11
case, including all of the legal and administrative requirements of
operating in Chapter 11;
(c) attending meetings and negotiating with representatives of
the Debtor's creditors and other parties in interest;
(d) taking all necessary actions to protect and preserve the
Debtor's estate;
(e) preparing pleadings in connection with this Chapter 11 case,
including motions, applications, answers, orders, reports, and
papers necessary or otherwise beneficial to the administration of
the Debtor's estate;
(f) advising the Debtor in connection with a proposed sale of
its assets;
(g) appearing before the Court and any appellate courts to
represent the interests of the Debtor's estate;
(h) advising the Debtor regarding tax matters;
(i) advising the Debtor regarding insurance and regulatory
matters;
(j) taking any necessary action on behalf of the Debtor to
negotiate, prepare, and obtain approval of a disclosure statement
and confirmation of a Chapter 11 plan and all documents related
thereto; and
(k) performing all other necessary legal services for the Debtor
in connection with the prosecution of this Chapter 11 case,
including: (i) analyzing the Debtor's leases and contracts and the
assumption and assignment or rejection thereof; (ii) analyzing the
validity of liens against the Debtor; and (iii) advising the Debtor
on corporate and litigation matters.
The firm will be paid at these rates:
Partners & Counsel $832 to $1,185 per hour
Associates $495 to $690 per hour
Paraprofessionals $195 to $560 per hour
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
The following is provided in response to the request for additional
information set forth in Paragraph D.1. of the Revised UST
Guidelines:
Question: Did the firm agree to any variations from, or
alternatives to, its standard billing arrangements for this
engagement?
Answer: Yes. In light of the Debtor's capital constraints, the
firm agreed to provide the Debtor with a discount on each invoice
for this engagement.
Question: Do any of the firm's professionals in this engagement
vary their rate based on the geographic location of the Debtor's
Chapter 11 Case?
Answer: No.
Question: If the firm has represented the Debtor in the 12
months prepetition, disclose its billing rates and material
financial terms for the prepetition engagement, including any
adjustments during the 12 months prepetition. If BCLP's billing
rates and material financial terms have changed postpetition,
explain the difference and the reasons for the difference.
Answer: Not applicable.
Question: Has the Debtor approved the firm's budget and staffing
plan, and, if so, for what budget period?
Answer: Yes. The firm provided the Debtor with an estimated
budget for fees and expenses expected to be incurred in connection
with this Chapter 11 case.
Sharon Z. Weiss, Esq., a partner at Bryan Cave Leighton Paisner
LLP, disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
Sharon Z. Weiss, Esq.
Bryan Cave Leighton Paisner LLP
120 Broadway, Suite 300
Santa Monica, CA 90401-2386
Telephone: (310) 576-2100
Facsimile: (310) 576-2200
Email: sharon.weiss@bclplaw.com
About Oceanwide Plaza LLC
Involuntary bankruptcy petition against Oceanwide Plaza LLC in Los
Angeles CA, for Chapter 11 protection (Bankr. C.D. Cal. Case No.
24-11057) on February 13, 2024.
Judge Deborah J Saltzman oversees the case.
Bryan Cave Leighton Paisner, LLP as counsel to the Debtor. Bradley
D. Sharp as chief restructuring officer. GlassRatner Advisory &
Capital Group LLC, dba B. Riley Advisory Services as financial
advisor and expert witness.
OCEANWIDE PLAZA: Hires Development Specialists as CRO
-----------------------------------------------------
Oceanwide Plaza LLC seeks approval from the U.S. Bankruptcy Court
for the Central District of California to employ Development
Specialists, Inc. designating Bradley D. Sharp as chief
restructuring officer.
The firm will provide these services:
a. assist in addressing short-term liquidity requirements,
including but not limited to meeting with lenders, developing
presentations and providing management with financial and
analytical assistance necessary to facilitate such communications;
b. assist in evaluating/developing cash flow forecasting tools
and related methodologies to support (a) ongoing cash flow
management and (b) Debtor-in-Possession ("DIP") sizing/financing;
c. assist with general accounting/finance information
gathering and data production and provide general support
accounting / finance department;
d. assist with the preparation required for a timely and
effective Chapter 11 filing and ongoing case management;
e. assist with the development and distribution of information
required by the Company's various constituents, including
customers, vendors, lenders, investors, and prospective
purchasers/bidders;
f. assist in obtaining and presenting information required by
parties in interest in the Company's bankruptcy process including,
without limitation, official committees appointed by this Court and
the Court itself;
g. assist in other business and financial aspects of a Chapter
11 proceeding; and
h. assist with such other matters as may be requested that
fall within the firm's expertise and that are mutually agreeable.
The firm will be compensated at a rate of $50,000 per month.
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Bradley D. Sharp, a Sr. Managing Director at Development
Specialists, Inc., disclosed in a court filing that the firm is a
"disinterested person" as the term is defined in Section 101(14) of
the Bankruptcy Code.
The firm can be reached at:
Bradley D. Sharp
Development Specialists, Inc.,
Sr. Managing Director
DSI - Los Angeles
Telephone: (213) 617-2717
Email: bsharp@dsi.biz
About Oceanwide Plaza LLC
Involuntary bankruptcy petition against Oceanwide Plaza LLC in Los
Angeles CA, for Chapter 11 protection (Bankr. C.D. Cal. Case No.
24-11057) on February 13, 2024.
Judge Deborah J. Saltzman oversees the case.
Bryan Cave Leighton Paisner, LLP as counsel to the Debtor. Bradley
D. Sharp as chief restructuring officer. GlassRatner Advisory &
Capital Group LLC, dba B. Riley Advisory Services as financial
advisor and expert witness.
OCEANWIDE PLAZA: Hires GlassRatner Advisory as Financial Advisor
----------------------------------------------------------------
Oceanwide Plaza LLC seeks approval from the U.S. Bankruptcy Court
for the Central District of California to employ GlassRatner
Advisory & Capital Group LLC, dba B. Riley Advisory Services as
financial advisor and expert witness.
The firm will provide these services:
(a) assist the Debtor's management team and other professionals,
as necessary, with its liquidity, financial, operational, and
strategic planning including the development of a Chapter 11
strategy;
(b) review historical and projected financial information,
including operating results, capital structure and funding
mechanics, for the Debtor;
(c) assist the Debtor in communications and negotiations with
lenders and other stakeholders;
(d) assist the Debtor with financial reporting;
(e) assist the Debtor in preparation of the statutory reporting
requirements during the Chapter 11 proceedings. This would include
the statements of financial affairs and associated schedules and,
during the pendency of the case, the Monthly Operating Reports
("MORs");
(f) assist with the preparation of reports for, and
communications with, the Bankruptcy Court, creditors, and any other
relevant constituent;
(g) review, evaluate, and analyze the financial ramifications of
proposed transactions for which the Debtor may seek Bankruptcy
Court approval;
(h) provide financial advice and assistance to the Debtor in
connection with a sale transaction and conduct a section 363
auction to sell the assets of the Debtor;
(i) assist the Debtor in developing and supporting a proposed
Chapter 11 plan;
(j) negotiate terms of debtor-in-possession financing, if
necessary;
(k) any other duty or task which falls within the normal
responsibilities of a Financial Advisor at the direction of
Management and/or Board;
(l) assist in the negotiations with the various stakeholders,
including stockholders, creditors, employees, and other parties, as
necessary;
(m) assist in the development and negotiations of a plan
reorganization of the Debtor;
(n) if requested, prepare analyses related to potential third
party causes of action, if any;
(o) assist in the administration of the bankruptcy filings
including Schedules of Assets and Liabilities, Statement of
Financial Affairs, the Initial Monthly Operating Report and Monthly
Operating Reports;
(p) provide support in the development of a cash flow budget;
(q) work with an Unsecured Creditors' Committee if appointed to
facilitate the flow of information;
(r) render Bankruptcy Court testimony in connection with the
foregoing, as required, on behalf of the Debtor; and
(s) additional assistance as directed by the Debtor's
management, Board of Directors, and legal counsel.
The firm will be paid at these rates:
J. Michael Issa, Senior Managing Director $750 per hour
Wen Tan, Managing Directors $495 per hour
Other Staff $475-695 per hour
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Michael J. Issa, a senior managing director at GlassRatner Advisory
& Capital Group LLC, dba B. Riley Advisory Services, disclosed in a
court filing that the firm is a "disinterested person" as the term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Michael J. Issa
Senior Managing Director
GlassRatner Advisory & Capital Group LLC
d/b/a B. Riley Advisory Services
19800 MacArthur Blvd., Ste 820
Irvine, CA 92612
Tel: (949) 561-3750
About Oceanwide Plaza LLC
Involuntary bankruptcy petition against Oceanwide Plaza LLC in Los
Angeles CA, for Chapter 11 protection (Bankr. C.D. Cal. Case No.
24-11057) on February 13, 2024.
Judge Deborah J Saltzman oversees the case.
Bryan Cave Leighton Paisner, LLP as counsel to the Debtor. Bradley
D. Sharp as chief restructuring officer. GlassRatner Advisory &
Capital Group LLC, dba B. Riley Advisory Services as financial
advisor and expert witness.
PALOMAR HEALTH: Fitch Lowers Rating on Outstanding Bonds to 'BB+'
-----------------------------------------------------------------
Fitch Ratings has downgraded the following outstanding bonds issued
by Palomar Health, CA (Palomar) to 'BB+' from 'BBB-':
- Series 2016 and 2017 refunding revenue bonds;
- Series 2007A, 2009A 2010A general obligation (GO) bonds,
- Series 2017 and 2021 issued by California Municipal Finance
Authority on behalf of Palomar Health, and 2022 (taxable), 2022
COPs.
Fitch has also downgraded Palomar's Issuer Default Rating (IDR) to
'BB+' from 'BBB-' and its series 2016A & B unlimited tax GO (ULTGO)
bonds to 'A' from 'A+'.
The Rating Outlook is Negative for all series of debt.
Entity/Debt Rating Prior
----------- ------ -----
Palomar Health (CA) LT IDR BB+ Downgrade BBB-
Palomar Health
(CA) /General
Obligation –
Unlimited Tax –
Dedicated Tax/1 LT LT A Downgrade A+
Palomar Health
(CA) /General
Obligation –
Unlimited Tax/1 LT LT BB+ Downgrade BBB-
Palomar Health
(CA) /General
Revenues/1 LT LT BB+ Downgrade BBB-
The rating downgrade to 'BB+' reflects Palomar's challenged
financial performance over the past 18 months. This resulted in an
operating income loss of approximately $44.5 million (negative 4.2%
operating margin and 9.5% operating EBITDA margin) in fiscal 2023
(June 30; audited), which is inclusive of tax-supported revenues
and expenses. The weaker performance was driven by various factors,
including declining volumes, heightened labor and supplies expenses
that are primarily related to post-pandemic inflationary pressures,
and programmatic delays. The district's debt burden is very high,
which is characterized as weak with an 26.2% unrestricted cash to
adjusted debt position and 93.6% debt to capitalization ratio
(exclusive of the GO bonds).
The downgrade of Palomar's ULTGO bonds to 'A' reflects Fitch's
assessment that the pledged revenues for repayment of these bonds
meet the definition of "pledged special revenues" under the U.S.
Bankruptcy Code. As such, the bond's security protections warrant a
rating of up to five notches higher than the district's IDR.
The Negative Outlook incorporates the persistent operational
challenges Palomar confronts as management navigates through a
period of financial uncertainty. If management is able to succeed
on a number of strategic and operational priorities, which would
result in improved operating performance and improvements to
unrestricted balance sheet resources, a return to a Stable Outlook
would be considered.
Credit strengths include the district's sizable market position,
historical track-record of good cashflow generation, and diverse
tax base. The unlimited nature of the tax levy offsets potential
risk regarding tax base volatility.
SECURITY
The revenue bonds are secured by a gross revenue pledge (excludes
restricted property tax revenues) of the obligated group (OG). The
OG consists of PH's acute care facilities, Palomar Health Medical
Group (PHMG) and other healthcare-related entities. The GO bonds
are secured by unlimited ad valorem taxes (ULT) levied on all
taxable property within the district.
KEY RATING DRIVERS
Revenue Defensibility - 'bbb'
Sizeable Market Position in Competitive Service Area; Pressured
Volumes Impacting Performance
Palomar's midrange revenue defensibility reflects the
organization's sizeable market position, good breadth of services
in an expanding service area, and high but relatively manageable
exposure to Medi-Cal and self-pay, which accounted for more than
26% of gross revenues in fiscal 2023. The district maintains a
sizeable market position in its primary service area (approximately
42% as of 2021), which has been historically supported by strategic
partnerships with Rady Children's Hospital for pediatrics and
Kindred Healthcare for rehabilitation and behavioral health.
Palomar's primary competitors are Scripps Health, Sharp HealthCare,
Kaiser Permanente, and University of California - San Diego Health.
The district's market share has declined over the last several
years, while competitors' market positions have remained stable or
improved, which Fitch views as a potential credit risk. With the
intense competition for services, volumes have declined in
discharges, outpatient surgeries, and emergency department visits,
which have all negatively impacted overall financial performance.
Fitch still views Palomar's healthcare services as essential to
North San Diego County as the district maintains the only trauma
center, NICU and inpatient behavioral health unit within the county
boundaries. The district serves the communities within an
800-square-mile area, with its trauma center covering more than
2,200 square miles of South Riverside and North San Diego counties.
However, Fitch will continue to monitor the trajectory of the
organization's market presence and volume trends, as well as the
subsequent impact upon performance.
Ad valorem tax revenues do not improve Palomar's revenue
defensibility because of the limited contribution to operations and
the lack of an available taxing margin. As such, Fitch does not
view Palomar's taxing margin as a revenue enhancement. Total tax
revenues collected in fiscal 2023 totaled nearly $70 million, of
which $48 million was levied to support debt service payments of
the GO bonds.
Operating Risk - 'bbb'
Challenged Financial Performance; Satisfactory Investment in Plant
The midrange operating risk assessment reflects the organization's
weaker profitability and cash flow metrics, which resulted in a
9.5% operating EBITDA margin for fiscal 2023, and down from 13.3%
in fiscal 2022. Additionally, operational performance six-months
through fiscal 2024 (Dec. 31, 2023; unaudited) has continued to
trend weaker with Palomar recording a loss from operations of
approximately $46.3 million, which translated into a negative 9.0%
operating margin and 5.1% operating EBITDA margin. Fitch views the
weakened and declining operating performance as a primary credit
concern.
The operational challenges are due to various factors, including
pressured volume trends, heightened expenses primarily from labor
and supplies, and programmatic delays that have caused both expense
increases and failure to meet budgeted revenues. Management plans
to stabilize and improve operating performance, which if
successfully achieved would help bolster operational performance
and unrestricted balance sheet resources from current levels. Plans
include curtailing expenses through closing certain programs,
restructuring supply chain, and reducing some personnel positions.
Historically, Palomar was able to consistently maintain healthy
operating performance, demonstrated by stronger operating EBITDA
margins and EBITDA margins. From fiscal 2019-2022, it produced an
average operating EBITDA margin of approximately 10.5%, which Fitch
viewed favorably. Historical net capex has been satisfactory for
the rating level with the organization spending an average of
around 63% of annual depreciation expense from fiscal 2019-2022.
Fiscal 2023 marked a high of capex with the organization investing
approximately $82.8 million in plant (approximately 140% of
depreciation), which Fitch views as a credit positive. The
district's facilities are largely seismically compliant. Fitch
analysts have toured the main facility in Escondido and view the
campus as up-to-date.
Financial Profile - 'bb'
High Leverage Position; Declining Unrestricted Balance Sheet
Resources
Palomar's weaker financial profile reflects its high debt profile
and declining unrestricted balance sheet resources; however, the
risk is somewhat mitigated by unlimited ad valorem property taxes
to support debt service payments on the GO bonds, which constitute
approximately 50% of the district's long-term debt.
Palomar's weak financial profile assessment excludes the district's
GO debt. Included within total long-term debt are the
organization's lease obligations, which have increased over time.
Palomar only has a debt service coverage financial covenant, which
was in compliance in fiscal 2023.
In fiscal 2023, Palomar had approximately $203.1 million of
unrestricted cash and investments, which translated into 71.2 days'
cash on hand and 15.5% cash-to-adjusted debt, which includes the GO
debt. Exclusive of the GO debt, cash-to-adjusted debt is still weak
but slightly improved to 26.2% as of fiscal 2023. Through the
six-month interim period in fiscal 2024, unrestricted balance sheet
resources further declined to an absolute balance of approximately
$103.5 million, which has negatively impacted Palomar's liquidity
metrics.
Fitch's forward-looking analysis shows the district's financial
profile metrics being relatively stable to exhibiting slight
improvement if management is able to successfully implement its
various strategic initiatives and operational improvements.
Following the initial revenue and portfolio stress of Fitch's
scenario analysis, Fitch anticipates cash-to-adjusted debt
remaining consistent with a 'bb' assessment and remain weak for the
medium term.
Dedicated Tax Key Rating Drivers
The ULTGO bond rating is based on a dedicated tax analysis that
considers the strength and growth prospects of the tax base, as
well as the legal structure of the bonds. The bonds' structural
elements and security features are sufficiently strong to warrant a
rating up to five notches above the district's IDR.
Strong Tax Base: The economic resource base supporting the GO debt
is diverse, growing at a healthy pace and has been very stable
through the recent downturn related to the pandemic. The unlimited
nature of the tax levy offsets any concern about tax base
volatility.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- If operating performance continues to slide resulting in further
compressed margins, which negatively impacts the organization's
ability to adequately reinvest in its physical plant;
- If capital-related metrics (unrestricted cash to adjusted debt
and debt to capitalization) materially decline from current
levels;
- If the district experiences a significant and long-lasting
decline in the local economy and tax base resulting in material
deterioration of the hospital's payor mix and tax revenue support.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- If operating performance significantly improves and Palomar is
able to consistently generate operating EBITDA margins around
10%-11% for a sustained period, which would support unrestricted
balance sheet resource accretion;
- Material improvements in Palomar's liquidity levels resulting in
a consistent cash-to-adjusted debt metric of greater than 60%
(exclusive of GO debt).
PROFILE
Palomar Health is California's largest public healthcare district.
It is the largest trauma district in the state, covering 800 square
miles in northern San Diego County. The district owns and operates
two hospitals in northern San Diego County: the 286-bed Palomar
Medical Center Escondido (PMCE, opened in August 2012) and the
95-bed Palomar Medical Center Poway (PMCP, opened in 1977). Palomar
also owns and operates The Villas at Poway, a 129-bed skilled
nursing facility adjacent to PMCP. Other related entities include
PHMG, the largest health network in the region with 318 providers.
PHMG is comprised of a medical foundation whose physicians operate
in 19 clinics.
Fiscal 2023 (June 30 YE) total revenue was more than $1 billion,
which included approximately $22 million of unrestricted property
tax revenues to support operations and $48 million of restricted
property tax revenues for debt service payments on the GO bonds.
Sources of Information
In addition to the sources of information identified in Fitch's
applicable criteria specified below, this action was informed by
information from Lumesis.
ESG CONSIDERATIONS
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
PRESIDIO LLC: S&P Affirms 'B' ICR, Outlook Stable
-------------------------------------------------
S&P Global Ratings affirmed its 'B' issuer credit rating on New
York City-based information technology (IT) solutions provider
Presidio LLC.
S&P said, "We also assigned our 'B' issue-level rating and '3'
recovery rating to Presidio's proposed $2.103 billion first-lien
senior secured term loan B and $450 million revolving credit
facility (expected to be undrawn at close).
"The stable outlook on Presidio reflects our forecast that it will
increase its total organic gross profit by the low- to
mid-single-digit percentage area over the next 12 months, as anemic
hardware sales partially offset growth in cloud, stand-alone
software, and services. Our base case scenario assumes S&P Global
Ratings-adjusted debt to EBITDA in the high-5x area and free
operating cash flow (FOCF) to debt of about 3%-4% through fiscal
2025."
An affiliate of Clayton Dubilier & Rice LLC (CD&R), a private
equity sponsor, entered into a definitive agreement to acquire a
majority ownership position in Presidio LLC, partially funding the
transaction with $2.6 billion of debt.
S&P said, "The affirmation reflects our expectation that despite
the increase in debt, Presidio's credit metrics remain adequate for
the rating. With the incremental debt from the proposed
transaction, the company's S&P Global Ratings-adjusted debt
leverage increased to about 6.1x, from 4.1x as of Dec. 31, 2023. At
the same time, pro forma FOCF to debt declined to 3.5% from 11% on
Dec. 31, 2023, primarily due to the increase in interest expense.
While the change in leverage and cash flow ratios are significant,
the previous metrics were better than expected for the rating. Our
ratings already incorporated our expectation that the company would
increase leverage given its private equity ownership. Despite
constrained IT budgets, elongated sales cycles, and supply chain
challenges, the company has performed well, including increasing
its gross profit and EBITDA margin. We expect the company will
continue to execute well.
"The company benefits from industry tailwinds that will likely
support its gross profit and EBITDA expansion. We expect gross
profit within the IT channel market will grow at a compound annual
growth rate in the high-single-digits over the next five years,
driven by durable tailwinds in technology consumption, increasing
complexity of technology, and vendors increasingly relying on IT
solution providers to reach a highly fragmented group of customers
who often don't know what they need or have the necessary
capabilities. We believe the growing complexity of IT environments
requiring multi-vendor solutions and knowledge of customers has
enhanced competitive advantages for solution-agnostic IT solution
providers with strong customer relationships. It also reduces
reliance on any single original equipment manufacturer (OEM).
Presidio still has concentration in Cisco, its largest OEM partner
at about 45% of net revenue, but this concentration has come down
meaningfully in the past few years, and we expect the favorable
trend to continue. Although Presidio is an industry leader, we
believe the market is fragmented and very competitive. We expect
Presidio's growth will primarily come from services, stand-alone
software, and public cloud. While hardware could weigh down 2025,
we expect hardware will start to grow again in 2026. Further, we
expect a mix shift will limit revenue growth but lead to steady
gross margin improvement because revenue from software is
recognized net of costs. We expect software and Presidio's other
higher-margin solutions will continue to grow at a faster rate.
"Presidio LLC has a good history of integrating acquisitions. We
believe that IT solutions providers such as Presidio view
acquisitions as an important growth avenue because they generally
increase technological capabilities, talent availability, and
serviceable geographies. We believe that acquisitions add some risk
because they are often debt-funded and come with integration costs.
However, Presidio has a strong history of acquiring and integrating
tuck-in acquisitions, including eight acquisitions over the past
nine years. We expect the company to use future leverage capacity
to continue this acquisitive strategy, but we expect it will
prudently allocate capital such that leverage will remain below
6.5x and FOCF to debt will remain adequate. We modestly narrowed
our downgrade threshold on the company to 6.5x because, in a
higher-interest-rate environment, we believe leverage above 6.5x
would translate to FOCF to debt that is insufficient for Presidio
at the 'B' rating.
"The stable rating outlook on Presidio reflects our forecast that
it will increase its total organic gross profit by the low- to
mid-single-digit percentage area over the next 12 months, as anemic
hardware sales partially offset growth in cloud, stand-alone
software, and services. Our base-case scenario assumes S&P Global
Ratings-adjusted debt to EBITDA of high-5x and FOCF to debt of
about 3%-4% through fiscal 2025."
PUBLIC CRAFT: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: Public Craft Brewing Company LLC
628 58th St
Kenosha, WI 53140
On the Web: https://publiccraftbrewing.com/
Chapter 11 Petition Date: April 26, 2024
Court: United States Bankruptcy Court
Eastern District of Wisconsin
Case No.: 24-22169
Judge: Hon. Beth E. Hanan
Debtor's Counsel: Jerome R. Kerkman, Esq.
KERKMAN & DUNN
839 N. Jefferson Street
Milwaukee, WI 53202-3744
Tel: 414-277-8200
Fax: 414-277-0100
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $500,000 to $1 million
The petition was signed by Michael W. Wimmer, authorized
representative.
A full-text copy of Chapter 11 petition is now available for
download at
https://www.pacermonitor.com/view/NM2VC6Y/Public_Craft_Brewing_Company_LLC__wiebke-24-22169__0001.0.pdf?mcid=tGE4TAMA
R.A.R.E. CORP: Court OKs Cash Collateral Access Thru May 23
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois,
Eastern Division, authorized R.A.R.E. Corporation to use cash
collateral on an interim basis through May 23, 2024, in accordance
with the terms of the Order entered February 20, 2024.
As previously reported by the Troubled Company Reporter, there are
several entities who may claim an interest in the Debtor's cash
collateral. The potential claimants are:
i. Fundamental Capital, LLC d/b/a Nexi is a lender to the
Debtor and asserts a security interest in the Debtor's accounts
receivable, including amounts otherwise payable to the Debtor by
Hertz.
ii. Spartan Business Solutions LLC d/b/a Spartan Capital is
also a lender to the Debtor and asserts a security interest in the
Debtor's accounts receivable, including amounts otherwise payable
to the Debtor by Hertz.
iii. Everest Business Funding is a lender to the Debtor pursuant
to that certain Revenue Based Financing Agreement dated as of
September 9, 2023. Pursuant to the Everest Agreement, Everest may
hold a security interest in the Debtor's accounts receivable,
including amounts otherwise payable to the Debtor by Hertz.
iv. The LCF Group, Inc. is a lender to the Debtor. LCF may hold
a security interest in the Debtor's accounts receivable, including
amounts otherwise payable to the Debtor by Hertz.
v. U.S. Small Business Administration is a creditor of the
Debtor, and may hold a lien on some or all of the Debtor's assets.
As adequate protection, the Lenders were granted replacement liens
on the same form and type of collateral securing their claims as of
the Petition Date.
A further hearing on the matter is set for May 22 at 10:30 a.m.
A copy of the order is available at https://urlcurt.com/u?l=KCcFK6
from PacerMonitor.com.
About R.A.R.E. Corporation
R.A.R.E. Corporation sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ill. Case No. 24-02127) on February
15, 2024.
In the petition signed by Rocky Eastland, president, the Debtor
disclosed up to $500,000 in assets and $1 million in liabilities.
Judge David D. Cleary oversees the case.
William J. Factor, Esq., at FactorLaw, represents the Debtor as
legal counsel.
RAPSYS INC: Court OKs Cash Collateral Access Thru May 31
--------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois,
Eastern Division, authorized Rapsys, Inc. to use cash collateral to
pay post-petition expenses to third parties from April 28, 2024
through May 31 2024, in accordance with the budget, with a 10%
variance.
In return for the Debtor's continued interim use of cash
collateral, the Small Business Administration is granted the
following adequate protection for its purported secured interests
in cash collateral equivalents, including the Debtor's cash,
accounts receivable and inventory, among other collateral.
The Debtor will maintain and pay premiums for insurance to cover
the Collateral from fire, theft and water damage.
The SBA is granted replacement liens, attaching to the Collateral,
but only to the extent of their pre-petition liens, with any valid
liens attaching to the Collateral and its proceeds until further
Order of Court.
A further interim hearing on the matter is set for May 29 at 10:30
a.m.
A copy of the order is available at https://urlcurt.com/u?l=LNX7bQ
from PacerMonitor.com.
About Rapsys Inc.
Rapsys, Inc. sought protection under Chapter 11 of the U.S.
Bankruptcy Code Bankr. N.D. Ill. Case No. 24-03481) on March 11,
2024, with up to $50,000 in assets and up to $1 million in
liabilities.
Judge David D. Cleary oversees the case.
Scott R. Clar, Esq., at Crane, Simon, Clar & Goodman represents the
Debtor as legal counsel.
REYNOLDS CONSUMER: Fitch Affirms 'BB+' LongTerm IDR, Outlook Stable
-------------------------------------------------------------------
Fitch Ratings has affirmed Reynolds Consumer Products LLC
(Reynolds) and Reynolds Consumer Products Inc.'s Long-Term Issuer
Default Ratings (IDRs) at 'BB+'. Fitch has also affirmed the
'BBB-'/'RR1' ratings on Reynolds' first-lien secured revolving
credit facility and term loan. The Rating Outlook is Stable.
Reynolds' rating reflects its leading market position, supported by
innovation and conservative financial policies. EBITDA leverage is
expected to remain below 3x across the rating horizon. The ratings
also reflect the company's good liquidity, supported by FCF in the
$150 million-$200 million range annually, which could be used to
reinvest into the business or further reduce debt.
Reynolds' rating also reflects its relatively smaller scale and
lower degree of diversity compared to larger consumer goods
companies. The company also has exposure to raw material prices
that can lead to periods of earnings volatility.
KEY RATING DRIVERS
Leading U.S. Market Share: Reynolds holds a No. 1 or 2 U.S. market
share position in the majority of product categories in which it
participates. The company has the largest market share in the
consumer aluminum foil markets in both the U.S. and Canada. Over
65% of Reynolds' 2023 revenue was attributed to products where the
company held the leading market share position in the category.
The company leverages both branded and private label offerings,
allowing it to maintain a prominent and defensible shelf space
position with its retail partners. The company has three main
product groups: waste and storage at 41% of 2023 sales, cooking
products at around 34% and the remainder in tableware.
Deleveraging Capacity; Conservative Financial Policy: Reynolds'
EBITDA leverage could decline to around 2.6x in 2024 (on a Fitch
calculated basis), compared to around 2.8x in 2023 and a peak of
3.8x in 2022. Reynolds used FCF to repay over $400 million in debt
between 2021 and 2023, which combined with EBITDA expansion has
supported its deleveraging. The use of FCF to repay debt
demonstrates both willingness and capacity to delever toward its
net debt leverage target of 2.0x-2.5x, which is roughly in line
with Fitch-calculated EBITDA leverage less the impact of cash on
balance sheet.
Sales Decline in 2024; Growth Longer Term: Fitch's base case
assumes sales could be down in the mid-single digit range in 2024,
driven by factors such as declines in the low margin non-retail
sales, volume declines in tableware and increased promotional
activity. Innovation and increased focus on marketing and
advertising should support stable to modest growth in market share
in 2024, and a return to low single digit organic revenue growth
starting in 2025. Longer term, Fitch believes that Reynolds'
organic growth rate could be in the low single digit range,
supported by continued investments in the business and household
formation trends.
Potential for Profit Volatility: Reynolds' exposure to raw material
prices (aluminum and resin make up around 40% of raw material
costs) can meaningfully impact profitability. Considering the
potential lag in timing between input cost increases and the
company's ability to increase prices, this creates potential for
earnings volatility. Input cost increases combined with operational
issues led to Reynolds' EBITDA margins declining to the 14%-17%
range in 2021 through 2023 from around 22% in 2019.
Fitch expects margins to improve to the mid-18% range in 2024.
Considering the recent period of volatility, Fitch would need to
see a track record of stability in Reynolds' operations before
contemplating upward momentum on its rating.
Category Innovator: Reynolds has been an innovation leader within
the categories which it operates. Fitch believes this is
particularly important in mature markets with high levels of
competition. Innovations such as using recycled materials and the
introduction of value-added features to traditional products to
address consumer needs, have helped the company gain and sustain
market share. Reynolds has stated that over 20% of its sales in
2023 were from products that were introduced to the market over the
past three years.
Limited Diversification and Smaller Scale: Relative to larger
consumer goods companies, Reynolds' smaller scale (measured by
EBITDA) and lower degree of diversification results in reduced
ability to navigate macroeconomic or idiosyncratic challenges.
Reynolds performance is largely driven by two brands, Reynolds and
Hefty. The company lacks the size and breadth of portfolio of
larger consumer goods companies with more diversified portfolios
that may include cleaning agents, personal care, and health and
wellness segments. This lower degree of diversity is in part offset
by its conservative financial policies and strong market share in
many of the categories in which it operates.
Growing EBITDA: Reynolds' EBITDA could be around $670 million in
2024, which is modest growth compared to the $650 million generated
in 2023. The expansion in EBITDA is supported by a full year of
normalized operations in the Cooking and Baking segment, as well as
the impact of continued cost structure improvements. Reynolds'
EBITDA could continue to grow in 2025 and 2026, driven by a return
to low organic sales growth and continued focus on cost structure
improvements. However, Fitch's base case assumes that EBITDA
margins remain in the high teen range, below pre-pandemic levels in
the low 20% range.
Parent Subsidiary Linkage: Fitch's analysis includes a weak
parent/strong subsidiary approach between the parent and its
subsidiary Reynolds Consumer Products, LLC. Fitch assesses the
quality of the overall linkage as high, which results in an
equalization of IDRs across the corporate structure.
DERIVATION SUMMARY
Reynolds' 'BB+'/Stable rating reflects its leading market position
in the categories in which it participates, strong innovation
pipeline. The ratings also reflect Fitch's expectation that
Reynolds Fitch-calculated leverage (total debt/EBITDA) will decline
to around 2.6x in 2024 on EBITDA expansion and the use of FCF to
reduce debt. The company's exposure to raw material prices, as well
as weakness in the Cooking & Baking segment, resulted in recent
earnings volatility and a meaningful contraction in its margins
from 2021 through 2023 compare to pre-pandemic levels.
However, Fitch expects EBITDA margins to recover gradually to the
mid 18% range in 2024. The rating also considers Reynolds' limited
scale and diversification compared to larger, well-capitalized CPG
competitors.
Similarly rated credits in Fitch's consumer portfolio include
Mattel (BBB-/Stable), Hasbro (BBB-/Negative) and Tempur Sealy
International Inc. (TPX; BB+/Rating Watch Negative). Reynolds'
scale, measured by EBITDA, is smaller than Mattel, Hasbro, and TPX.
Reynolds' leverage could be similar to higher rated peer Mattel,
but is expected to be lower than its other consumer goods peers
across the ratings horizon (assuming TPX's proposed acquisition of
Mattress Firm closes).
KEY ASSUMPTIONS
- Sales decline around 5% to around $3.58 billion in 2024, driven
by factors such as a decline in non-retail sales, lower volumes in
tableware, and increased promotional activity. Growth could be in
the low single-digit range thereafter driven by new product
launches and volume normalization;
- EBITDA of around $670 million in 2024, driven by margins
improving to the mid 18% range. EBITDA margins could further
improve to the high 18% range between 2025 and 2026 supported by
Reynolds' focus on improving its cost structure and through top
line growth;
- FCF in the $150 million-$200 million range annually between
2024-2026, assuming capex of around 3% of sales and annual
dividends of around $200 million. Reynolds could deploy cash toward
debt repayment, reinvestment in business to support organic growth,
and bolt-on acquisitions;
- EBITDA leverage anticipated to be around 2.6x in 2024 (2.8x at YE
2023) and remain below 3x across the rating horizon assuming no
debt financed;
- Base interest rates in the 550bps-400bps range between 2024 and
2026, with annual interest expense partially offset by the
company's interest rate hedges.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
- An upgrade could be considered if the company exhibited low
single digit organic growth and EBITDA was sustained in the $700
million range, with gross EBITDA leverage sustained below 3.0x.
- Alternatively, should Reynolds undertake portfolio actions that
materially increased scale above $1 billion in EBITDA, Fitch could
upgrade Reynolds to 'BBB-' if EBITDA leverage is sustained under
3.5x.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade:
- EBITDA leverage sustained above 4.0x as a result of financial
performance below Fitch's expectations yielding EBITDA sustained in
the low $500 million range;
- A change in financial policy or a transformative debt-funded
acquisition absent a clear path to deleveraging to below 4.0x
within 24 months of acquisition close could also lead to negative
rating actions.
LIQUIDITY AND DEBT STRUCTURE
Good level of Liquidity: As of Dec. 31, 2023, Reynolds had total
liquidity of $293 million, including cash and cash equivalents of
$50 million and $244 million available under its $250 million
secured revolving credit facility due in February 2026 (net of $6
million of letters of credit outstanding). Liquidity is supported
by Fitch's expectation that the company will generate between $150
and $200 million in post-dividend FCF annually between 2024 and
2026. This good liquidity buffer should provide Reynolds with the
resources to continue investing in its business in order to drive
growth as well as navigate any operating challenges that may
occur.
In addition to the $250 million revolver, the company's debt
capital structure at the end of 2023 includes around $1.85 billion
in first-lien secured term loan debt maturing in February 2027.
During the year 2023, the company made voluntary payments of $250
million on the term loan facility, which were first applied to pay
the remaining balance of amortization payments in full, and the
balance applied to the outstanding principal.
Reynolds' term loan and revolver are guaranteed by wholly owned
domestic subsidiaries as well as Reynolds Consumer Products Inc.,
and secured by a first priority pledge of all equity interests held
by the borrower and guarantors, and priority security interest in
all other assets.
Fitch has assigned Recovery Ratings (RRs) to the various debt
tranches in accordance with Fitch criteria, which allows for the
assignment of RRs for issuers with IDRs in the 'BB' category. Given
the distance to default, RRs in the 'BB' category are not computed
by bespoke analysis. Instead, they serve as a label to reflect an
estimate of the risk of these instruments relative to other
instruments in the entity's capital structure. Fitch has assigned
the first-lien credit facilities (term loan and revolver) a
'BBB-'/'RR1' rating, indicating outstanding recovery prospects post
default.
ISSUER PROFILE
Reynolds produces and sells cooking products, waste and storage
products, and tableware under brands such as Reynolds and Hefty as
well as store brands. The product portfolio includes aluminum foil,
wraps, disposable bakeware, trash bags, food storage bags and
disposable tableware.
SUMMARY OF FINANCIAL ADJUSTMENTS
Historical and projected EBITDA is adjusted to add back non-cash
stock-based compensation and exclude non-recurring charges.
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
----------- ------ -------- -----
Reynolds Consumer
Products LLC LT IDR BB+ Affirmed BB+
senior secured LT BBB- Affirmed RR1 BBB-
Reynolds Consumer
Products Inc. LT IDR BB+ Affirmed BB+
SEVENTEEN00 LLC: Case Summary & One Unsecured Creditor
------------------------------------------------------
Debtor: Seventeen00 LLC
1700 Barlow Lane
Sebastopol, CA 95472
Chapter 11 Petition Date: May 1, 2024
Court: United States Bankruptcy Court
Northern District of California
Case No.: 24-10240
Judge: Hon. William J. Lafferty
Debtor's Counsel: E. Vincent Wood, Esq.
SHEPHERD & WOOD LLP
2950 Buskirk Ave., #300
Walnut Creek, CA 94597
Tel: (925) 278-6680
Fax: (925) 955-1655
Email: general@shepwoodlaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by John Loe as managing member.
The Debtor listed PG&E, P.O. Box 997300, Sacramento, CA 95899 as
its sole unsecured creditor holding a claim of $3,000.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/APJSH5Y/Seventeen00_LLC__canbke-24-10240__0001.0.pdf?mcid=tGE4TAMA
SEVILLE FARMS: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Seville Farms, Inc.
8803 CR 612
Mansfield, TX 76061
Business Description: Seville Farms is engaged in the business of
greenhouse, nursery, and floriculture
production.
Chapter 11 Petition Date: May 1, 2024
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 24-41526
Debtor's Counsel: Katherine T. Hopkins, Esq.
Nancy Ribaudo, Esq.
Joseph Austin, Esq.
KELLY HART & HALLMAN LLP
201 Main Street, Suite 2500
Fort Worth, TX 76102
Tel: (817) 332-2500
Fax: (817) 878-9280
E-mail: katherine.hopkins@kellyhart.com
nancy.ribaudo@gmail.com
joseph.austin@kellyhart.com
Estimated Assets: $50,000 to $100,000
Estimated Liabilities: $10 million to $50 million
The petition was signed by William A. Brentlinger as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/3GJGJQA/Seville_Farms_Inc__txnbke-24-41526__0001.0.pdf?mcid=tGE4TAMA
SIR TAJ: Trustee Hires Levene Neale Bender as Counsel
-----------------------------------------------------
John P. Pringle, the Trustee of Sir Taj LLC seeks approval from the
U.S. Bankruptcy Court for the Central District of California to
employ Levene, Neale, Bender, Yoo, and Golubchik L.L.P. as general
bankruptcy counsel.
The firm's services include:
a. advising the Debtor with regard to the requirements of the
Bankruptcy Court, Bankruptcy Code, Bankruptcy Rules and the Office
of the United States Trustee ("OUST") as they pertain to the
Debtor's estate;
b. advising the Debtor with regard to certain rights and
remedies of the Debtor's bankruptcy estate and the rights, claims
and interests of creditors;
c. representing the Debtor in any proceeding or hearing in the
Bankruptcy Court involving the Debtor's estate unless the Debtor is
represented in such proceeding or hearing by other special
counsel;
d. conducting examinations of witnesses, claimants or adverse
parties and representing the Debtor in any adversary proceeding
except to the extent that any such adversary proceeding is in an
area outside of LNBYG's expertise or which is beyond LNBYG's
staffing capabilities;
e. preparing and assisting the Debtor in the preparation of
reports, applications, pleadings and orders including, but not
limited to objections to claims, settlements and other matters
relating to the case;
f. investigating, evaluating, and prosecuting objections to
claims as may be appropriate; and
g. performing any other services which may be appropriate in
the firm's representation of theDebtor during the bankruptcy case.
The firm will be paid at these rates:
Attorneys $495 to $725 per hour
Paraprofessionals $300 per hour
David L. Neale $725 per hour
Ron Bender $725 per hour
Timothy J. Yoo $725 per hour
David B. Golubchik $725 per hour
Eve H. Karasik $725 per hour
Gary E. Klausner $725 per hour
Edward M. Wolkowitz $725 per hour
Beth Ann R. Young $725 per hour
Monica Y. Kim $700 per hour
Philip A. Gasteier $700 per hour
Daniel H. Reiss $695 per hour
Todd A. Frealy $695 per hour
Kurt Ramlo $695 per hour
Richard P. Steelman, Jr. $695 per hour
Zachary Page $695 per hour
Juliet Y. Oh $695 per hour
Todd M. Arnold $695 per hour
Krikor J. Meshefejian $695 per hour
John-Patrick M. Fritz $695 per hour
Joseph M. Rothberg $695 per hour
Carmela T. Pagay $680 per hour
Anthony A. Friedman $680 per hour
Jeffrey Kwong $665 per hour
Lindsey L. Smith $625 per hour
Robert Carrasco $495 per hour
Paraprofessionals $300 per hour
The firm will also be reimbursed for reasonable out-of-pocket
expenses incurred.
David B. Golubchik, Esq., a partner at Levene, Neale, Bender, Yoo,
and Golubchik L.L.P., disclosed in a court filing that the firm is
a "disinterested person" as the term is defined in Section 101(14)
of the Bankruptcy Code.
The firm can be reached at:
David B. Golubchik, Esq.
Levene, Neale, Bender, Yoo & Golubchik, LLP
2818 La Cienega Avenue
Los Angeles, CA 90034
Tel: (310) 229-1234
Fax: (310) 229-1244
Email: dbg@lnbyg.com
About Sir Taj LLC
Sir Taj, LLC in Beverly Hills CA, filed its voluntary petition for
Chapter 11 protection (Bankr. C.D. Cal. Case No. 24-10874) on Feb.
6, 2024, listing $10 million to $50 million in assets and $500,000
to $1 million in liabilities. Sergey Vershinin as manager, signed
the petition.
LAW OFFICES OF MICHAEL D. KWASIGROCH serve as the Debtor's legal
counsel.
STAFFING 360: Delayed Report Prompts Nasdaq Non-Compliance Notice
-----------------------------------------------------------------
Staffing 360 Solutions, Inc. disclosed in a Form 8-K Report filed
with the U.S. Securities and Exchange Commission that on April 17,
2024, the Company received a notice from the Listing Qualifications
Staff of the Nasdaq Stock Market LLC notifying the Company that as
it has not yet filed its Annual Report on Form 10-K for the year
ended December 30, 2023, the Company now no longer complies with
Listing Rule 5250(c)(1) for continued listing on Nasdaq. The
Company has 60 calendar days to submit to Nasdaq a plan to regain
compliance, and if such plan is accepted, Nasdaq may grant the
Company an exception of up to 180 calendar days from the prescribed
due date for filing the Form 10-K, or until October 14, 2024, to
regain compliance.
The Notice from Nasdaq has no immediate effect on the listing of
the Company's common stock. The Company is working diligently with
its independent registered public accounting firm to complete the
Form 10-K and expects to file the Form 10-K in the coming weeks to
regain compliance with Listing Rule 5250(c)(1). There can be no
assurance that the Company will regain compliance with the Nasdaq's
rules or maintain compliance with any of the other Nasdaq continued
listing requirements.
About Staffing 360 Solutions
New York, NY-based Staffing 360 Solutions, Inc. was incorporated in
the State of Nevada on December 22, 2009, as Golden Fork
Corporation, which changed its name to Staffing 360 Solutions,
Inc., ticker symbol "STAF," on March 16, 2012. STAF is a
high-growth international staffing company engaged in the
acquisition of U.S. and U.K. based staffing companies. As part of
its consolidation model, the Company pursues a broad spectrum of
staffing companies supporting primarily the Professional and
Commercial Business Streams. The model is based on finding and
acquiring suitable, mature, profitable, operating, domestic and
international staffing companies focused specifically on the
accounting and finance, information technology, engineering,
administration, and light industrial disciplines.
As of September 30, 2023, the Company had $80,555,000 in total
assets, $72,021,000 in total liabilities, and $8,534,000 in total
stockholders' equity.
In the quarterly report for the period ended September 30, 2023,
the Company disclosed that its negative working capital and
liquidity position combined with the uncertainty generated by the
economic reaction to COVID-19 and its ongoing effects contribute to
substantial doubt about the Company's ability to continue as a
going concern.
SUNPOWER CORP: To Restate Financials Due to Misstatements
---------------------------------------------------------
SunPower Corporation disclosed in a Form 8-K Report filed with the
U.S. Securities and Exchange Commission that on April 17, 2024, the
Audit Committee of the Board of Directors of the Company
determined, based on the recommendation of management, that the
Company's:
(i) audited financial statements included in the Company's
Annual Report on Form 10-K/A for the period ended January 1, 2023
filed with the U.S. Securities and Exchange Commission on December
18, 2023; and
(ii) unaudited financial statements included in the Company's
Quarterly Report on Form 10-Q/A for the quarterly period ended
April 2, 2023, the quarterly period ended July 2, 2023; and for the
quarterly period ended October 1, 2023, all subsequently filed with
the SEC on December 18, 2023, as well as the relevant portions of
any communication which describe or are based on such financial
statements,
should no longer be relied upon. The Company plans to restate, as
soon as practicable, the Affected Prior Period Financial
Statements.
In connection with the preparation of its financial statements for
the fiscal year ended December 31, 2023, the Company identified
misstatements in the audited financial statements for the fiscal
year ended January 1, 2023, included in the 2022 Form 10-K/A. These
misstatements primarily relate to:
(i) the capitalization of certain deferred costs that did not
qualify for capitalization;
(ii) the classification of certain sales commissions as cost of
revenue rather than sales, general and administrative expense; and
(iii) certain other individually immaterial adjustments.
The Company estimates that the impact of the aforementioned
adjustments is a decrease to income (loss) from continuing
operations before income taxes and equity in earnings (losses) of
unconsolidated investees for the fiscal year ended January 1, 2023,
in the range of approximately $15 million to $25 million.
At this time, the Company has not fully completed its review, and
the expected financial impact of the errors described above is
preliminary and subject to change. The Company cannot provide
assurance that other errors will not be identified.
The Company's management had previously concluded that the
Company's disclosure controls and procedures and internal control
over financial reporting were not effective as of January 1, 2023,
and the Company's disclosure controls and procedures were not
effective as of April 2, 2023, July 2, 2023, and October 1, 2023,
due to material weaknesses existed in the Company's internal
control over financial reporting. In light of the matters described
above, the Company's management has concluded that a new material
weakness exists in the Company's internal control over financial
reporting. The Company's remediation plan with respect to such
material weakness will be described in more detail in the Company's
amended 2022 Form 10-K/A.
In addition, Ernst & Young LLP, the Company's independent
registered public accounting firm, has determined that its reports
on the Company's financial statements and internal control over
financial reporting included in the 2022 Form 10-K/A should no
longer be relied upon.
About SunPower
Headquartered in Richmond, California, SunPower (NASDAQ: SPWR) --
https://www.sunpower.com/ -- is a residential solar, storage and
energy services provider in North America. SunPower offers solar +
storage solutions that give customers control over electricity
consumption and resiliency during power outages while providing
cost savings to homeowners.
SunPower Corporation said in its Form 10-Q Report filed with the
U.S. Securities and Exchange Commission for the quarterly period
ended October 1, 2023, that there is substantial doubt exists about
its ability to continue as a going concern. According to the
Company, for the three and nine months ended October 1, 2023, it
had recurring operating losses and, as of October 1, it breached a
financial covenant and a reporting covenant of its Credit
Agreement, dated as of September 12, 2022. The breaches created
events of default thereunder, which enables the requisite lenders
under the Credit Agreement to demand immediate payment or exercise
other remedies. Such events raise substantial doubt about the
Company's ability to continue as a going concern.
TIPPETT STUDIO: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Tippett Studio, Inc.
914 Grayson Street
Berkeley, CA 94710
Business Description: Tippett Studio is an established evergreen
Media Production house enabling film makers
and creative directors to realize their
vision through creation of high-end digital
effects for feature films, episodic content,
commercials and immersive experiences.
Chapter 11 Petition Date: May 1, 2024
Court: United States Bankruptcy Court
Northern District of California
Case No.: 24-40657
Debtor's Counsel: Chris Kuhner, Esq.
KORNFIELD, NYBERG, BENDES, KUHNER & LITTLE P.C.
1970 Broadway, Ste 600
Oakland, CA 94612
Tel: 510-763-1000
Fax: 510-273-8669
Total Assets: $5,362,065
Total Liabilities: $9,826,417
The petition was signed by Gary Mundell, president and chief
executive officer.
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/WVBH3MQ/Tippett_Studio_Inc__canbke-24-40657__0001.0.pdf?mcid=tGE4TAMA
TURNING POINTS: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Five affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Turning Points for Children 24-11479
1500 Market Street, Suite 1500E
Philadelphia, PA 19102
Turning Points CUA 3, LLC 24-11480
1500 Market Street, Suite 1500E
Philadelphia, PA 19102
Turning Points for Children CUA 5, LLC 24-11481
1500 Market Street, Suite 1500E
Philadelphia, PA 19102
Turning Points CUA 9, LLC 24-11482
1500 Market Street, Suite 1500E
Philadelphia, PA 19102
Turning Points for Children CUA 10, LLC 24-11483
1500 Market Street, Suite 1500E
Philadelphia, PA 19102
Business Description: Turning Points, a subsidiary of Public
Health Management Corporation, provides a
range of social and health services to
support children, caregivers, and families.
Its mission is to norture families with
children who are struggling against economic
and environmental odds.
Chapter 11 Petition Date: May 1, 2024
Court: United States Bankruptcy Court
Eastern District of Pennsylvania
Judge: Hon. Ashely M. Chan
Debtors' Counsel: Aris J. Karalis, Esq.
KARALIS PC
1900 Spruce Street
Philadelphia, PA 19103
Tel: (215) 546-4500
Email: akaralis@karalislaw.com
Consolidated Total Assets as of April 30, 2024: $34,373,426
Consolidated Total Liabilities as of April 30, 2024: $6,400,954
The petitions were signed by David R. Fair as executive director.
The Debtors failed to include in the petitions lists of their 20
largest unsecured creditors.
Full-text copies of the petitions are available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/E5IGIHI/Turning_Points_for_Children__paebke-24-11479__0001.0.pdf?mcid=tGE4TAMA
https://www.pacermonitor.com/view/FS5CI7A/Turning_Points_CUA_3_LLC__paebke-24-11480__0001.0.pdf?mcid=tGE4TAMA
https://www.pacermonitor.com/view/4KDXFQA/Turning_Points_for_Children_CUA__paebke-24-11481__0001.0.pdf?mcid=tGE4TAMA
https://www.pacermonitor.com/view/ZARHQ4Y/Turning_Points_CUA_9_LLC__paebke-24-11482__0001.0.pdf?mcid=tGE4TAMA
https://www.pacermonitor.com/view/7K5LTJY/Turning_Points_for_Children_CUA__paebke-24-11483__0001.0.pdf?mcid=tGE4TAMA
VFX FOAM: Case Summary & 18 Unsecured Creditors
-----------------------------------------------
Debtor: VFX Foam, LLC
d/b/a Themeland Studios
200 East Washington Ave., Suite 120
Burlington, WA 98233
Chapter 11 Petition Date: April 30, 2024
Court: United States Bankruptcy Court
Western District of Washington
Case No.: 24-11086
Judge: Hon. Christopher M Alston
Debtor's Counsel: Jennifer L. Neeleman, Esq.
NEELEMAN LAW GROUP, P.C.
1403 8th Street
Marysville, WA 98270
Tel: (425) 212-4800
Fax: (425) 212-4802
Email: courtmail@expresslaw.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Richard O'Connor, III as owner.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 18 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/TSXGHEI/VFX_Foam_LLC__wawbke-24-11086__0001.0.pdf?mcid=tGE4TAMA
WEWORK COS: S&P Withdraws 'D' Issuer Credit Rating
--------------------------------------------------
S&P Global Ratings withdrew its ratings on WeWork Cos. LLC,
including its 'D' issuer credit rating, at the issuer's request.
WeWork filed for Chapter 11 bankruptcy protection Nov. 6, 2023. At
the time of S&P's rating withdrawal, the company had yet to emerge
from bankruptcy.
WEWORK INC: Yardi Supports Proposed Reorganization Plan
-------------------------------------------------------
Yardi Systems, Inc. on April 30 commented on the proposed plan of
reorganization for WeWork, Inc. Under the proposed plan -- which is
subject to approval by WeWork creditors -- Yardi's wholly owned
subsidiary Cupar Grimmond, LLC would become a majority shareholder
of WeWork following the Company's successful emergence from the
Chapter 11 restructuring process. Existing significant investors
and other creditors of WeWork would hold the remainder of the
Company's equity.
Yardi stated:
"As a leading global provider of software and software services for
commercial and residential property owners, Yardi is committed to
supporting the long-term success of WeWork and the co-working
industry. We believe a hybrid workplace is the model of the future,
and that we have the experience and innovative technology to help
power this transition."
"We initially formed a technology partnership with WeWork in 2022
with the launch of the WeWork Workplace app, which enables
companies and employees to seamlessly work in traditional leased
and owned office buildings, flex and coworking spaces, or their
homes. Since then, we have been highly involved in scaling and
developing this software and additional WeWork technology services.
In 2023, we were approached to assist the Company by providing
capital through our investment arm, Cupar Grimmond, as part of
WeWork's restructuring transaction. Following our participation, we
have played a supportive role as a senior secured lender during the
Chapter 11 process.
"Yardi chose to invest in WeWork's latest fundraise by providing
debtor-in-possession and exit financing because we believe the
Company's fundamental value proposition remains intact and that it
can have a successful future. Under the plan, WeWork would emerge
from bankruptcy with no debt, adequate working capital and positive
free cash flow. We intend to help drive the revitalization of
WeWork in a manner that sustainably serves the best interests of
its stakeholders -- including the Company's landlords. Importantly,
post-bankruptcy WeWork would be operated as a separate entity
managed at arms-length from Yardi's core business.
"We look forward to continuing to be a supporter of WeWork
throughout the remainder of the bankruptcy process and to
communicating further with the Company's various constituencies at
the appropriate time."
About Yardi
Yardi(R) -- http://yardi.com-- develops industry-leading software
for all types and sizes of real estate companies across the world.
With over 9,200 employees, Yardi is working with our clients to
drive significant innovation in the real estate industry.
About WeWork Inc.
New York, NY-based WeWork Inc. is a global flexible workspace
provider, serving a membership base of businesses large and small
through its network of 779 Systemwide Locations, including 622
Consolidated Locations as of December 2022.
WeWork Inc. and its affiliates sought relief under Chapter 11 of
the Bankruptcy Code (Bankr. D.N.J. Case No. 23-19865) on Nov. 6,
2023. In its petition, WeWork Inc. reported $19 billion of
liabilities and $15 billion of assets.
The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis
International LLP, Cole Schotz PC, and Munger, Tolles & Olson LLP
as counsel; Alvarez & Marsal North America LLC and Province, LLC as
financial advisors; PJT Partners LP as investment banker; and
McManimon, Scotland & Baumann, LLC as local counsel. Softbank is
represented by Weil Gotshal & Manges LLP and Wollmuth Maher Deutsch
LLP as legal counsel and Houlihan Lokey Capital as financial
advisor.
The Ad Hoc Group of First Lien and Second Lien Lenders is
represented by Davis Polk & Wardwell LLP (Eli Vonnegut, Elliot
Moskowitz, Natasha Tsiouris, Jonah Peppiatt) and Greenberg Traurig
LLP (Alan Brody) as legal counsel and Ducera Partners LLC as
financial advisor.
WOFFORD ENTERPRISES: Wins Interim Cash Collateral Access
--------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida,
Jacksonville Division, authorized Wofford Enterprises, LLC, to use
cash collateral, on an interim basis, in accordance with the
budget.
The Debtor requires the use of cash collateral to fund all
necessary operating expenses of the Debtor's business.
The Debtor has 4 pre-petition merchant cash advances/lenders that
have a lien on the Debtor's cash and receivables. Those lenders are
U.S. Small Business Administration, JPMorgan Chase Bank, NA, Austin
Business Finance, and National Funding, Inc.
Apart from the Cash Collateral Lenders, the Debtor also has several
service providers which it struggles to remain current with, and
other unsecured debt which it unable to pay.
The Cash Collateral lenders will be granted a post-petition
replacement lien against the collateral to the same extent,
validity, and priority of any valid pre-petition lien.
The Debtor will tender monthly adequate protection payments of $750
to Creditor commencing May 1, 2024, and continuing on the first day
of each month thereafter until the earlier of: (1) confirmation of
the Debtor's Plan; (2) the Parties stipulate otherwise; (3) the
Court orders otherwise; (4) dismissal or conversion of the
Bankruptcy Case; or (5) termination of the automatic stay.
A copy of the order is available at https://urlcurt.com/u?l=2pNUXt
from PacerMonitor.com.
About Wofford Enterprises, LLC
Wofford Enterprises, LLC's primary business is a roofing company
and contractor based out of Duval County, Florida.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Fla. Case No. 3:24-bk-00657-BAJ) on
March 7, 2024. In the petition signed by Jerod Wofford, owner, the
Debtor disclosed up to $50,000 in assets and up to $500,000 in
liabilities.
Judge Jason A. Burgess oversees the case.
Thomas Adam, Esq. represents the Debtor as legal counsel.
WOODBRIDGE PARTNERS: Case Summary & Nine Unsecured Creditors
------------------------------------------------------------
Debtor: Woodbridge Partners, L.P.
8803 CR 612
Mansfield, TX 76061
Business Description: Woodbridge Partners is engaged in activities
relates to real estate.
Chapter 11 Petition Date: May 1, 2024
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 24-41520
Debtor's Counsel: Katherine Hopkins, Esq.
KELLY HART & HARTMAN LLP
201 Main Street, Suite 2500
Fort Worth, TX 76102
Tel: (817) 332-2500
Fax: (817) 878-9280
Email: katherine.hopkins@kellyhart.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by William Brentlinger, president of
Seville Farms, Inc., general partner.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/QSVUEYI/Woodbridge_Partners_LP__txnbke-24-41520__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's Nine Unsecured Creditors:
Entity Nature of Claim Claim Amount
1. Anthony "Tony" Yzaguirre, Jr. Taxes $36,820
Tax Asessor Cameron County
Tax Ofc.
P.O. Box 952
Brownsville, TX
78522-0952
2. Gary B. Barber Taxes $2,107
Smith County Tax-
Assessor Collect
P.O. Box 2011
Longview, TX 75602
3. Iron Horse Credit LLC Loan $1,139,103
6620 South Point Drive South
Ste. 230
Jacksonville, FL 32216
4. Richard Rozier Tax Taxes $29,855
Assessor Collector
P.O. Box 836
111 South Vail St.
La Grange, TX
78945-0836
5. Richard Rozier Tax Taxes $24,862
Assessor Collector
109 S. Jackson
Rm T125
Waxahachie, TX
75168
6. Scott Porter Taxes $547
Johnson County -
Scott Porter
#2 Mill Street, Suite B
PO Box 75
Cleburne, TX
76083-0075
7. Southland Property Trade Debt $1,838
Tax Consultants
Southland Property
Tax Consultants
421 W. 3rd St., Suite 920
Fort Worth, TX 76102
8. Wendy Burgess Taxes $6,430
Tax-Assessor-Collector
P.O. Box 961018
Fort Worth, TX
76161-0018
9. Whitley Penn LLP Professional $1,430
640 Taylor St., Ste. 2200 Services
Fort Worth, TX 76102
Justin Wetzler
Tel: 817-259-9786
Email: justin.wetzler@whitleypenn.com
ZAC PRUETT: Seeks Cash Collateral Access
----------------------------------------
Zac Pruett Inc. asks the U.S. Bankruptcy Court for the Central
District of Illinois for authority to use cash collateral and
provide adequate protection.
Bank of Springfield appears to hold valid and perfected first
position security interest against its "cash collateral".
The Debtor believes that BOS holds a first position, perfected
security interest in its deposit accounts and receivables,
equipment, inventory and other business assets, pursuant to
promissory notes, commercial security agreements, title and UCC-1
Financing Statements filed with the Illinois Secretary of State,
however, the Debtor and its proposed counsel will continue to
review the loan agreements and other loan documents for their
sufficiency as are they are received.
Certain assets, on which the Debtor believes that BOS holds a first
position lien, were also recently sold at auction, with the auction
settlements pending as of the date of the filing of the case.
The indebtedness to BOS on the date of the Chapter 11 filing was
estimated to be approximately $732,000.
The Debtor suggests that an interim lien on its post-petition
receivables and postpetition deposit accounts in favor of BOS, to
the extent of the diminution of value of BOS's pre-petition liens
against cash collateral, would be appropriate adequate protection
for cash collateral use pursuant to 11 U.S.C. Section 361.
The Debtor further suggests that a carveout from the Replacement
Liens in favor of the Subchapter V trustee in the case, in the
amount of $7,500 with compensation pursuant to future applications
and orders of the Court, would be appropriate and reasonable for
the anticipated trustee costs of the case.
A copy of the Debtor's motion and budget is available at
https://urlcurt.com/u?l=pJdrxs from PacerMonitor.com.
The Debtor projects total expenses, on a monthly basis, as
follows:
$74,750 for May 2024;
$74,750 for June 2024;
$78,350 for July 2024;
$78,350 for August 2024; and
$79,350 for September 2024.
About Zac Pruett Inc.
Zac Pruett Inc. sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Ill. Case No. 24-70282) on April 19,
2024. In the petition signed by Zachery K. Pruett, president, the
Debtor disclosed up to $10 million in both assets and liabilities.
Jeana K. Reinbold, Esq., at Sgro, Hanrahan, Durr, Rabin & Reinbold,
LLP, represents the Debtor as legal counsel.
[^] Recent Small-Dollar & Individual Chapter 11 Filings
-------------------------------------------------------
In re Applied Pediatrics Inc.
Bankr. N.D. Ga. Case No. 24-54094
Chapter 11 Petition filed April 23, 2024
See
https://www.pacermonitor.com/view/ESY5GFQ/Applied_Pediatrics_Inc__ganbke-24-54094__0001.0.pdf?mcid=tGE4TAMA
represented by: Cameron M. McCord, Esq.
JONES & WALDEN, LLC
E-mail: info@joneswalden.com
In re Kologik Capital, LLC
Bankr. M.D. La. Case No. 24-10312
Chapter 11 Petition filed April 23, 2024
See
https://www.pacermonitor.com/view/2P2JD2Y/Kologik_Capital_LLC__lambke-24-10312__0001.0.pdf?mcid=tGE4TAMA
represented by: Louis M. Phillips, Esq.
KELLY HART & PITRE
E-mail: louis.phillips@kellyhart.com
In re Kologik Capital II, LLC
Bankr. M.D. La. Case No. 24-10313
Chapter 11 Petition filed April 23, 2024
See
https://www.pacermonitor.com/view/3UWEDUY/Kologik_Capital_II_LLC__lambke-24-10313__0001.0.pdf?mcid=tGE4TAMA
represented by: Louis M. Phillips, Esq.
KELLY HART & PITRE
E-mail: louis.phillips@kellyhart.com
In re H2 Beverages, Inc.
Bankr. E.D. Tex. Case No. 24-40915
Chapter 11 Petition filed April 23, 2024
See
https://www.pacermonitor.com/view/3MSFJ6I/H2_Beverages_Inc__txebke-24-40915__0001.0.pdf?mcid=tGE4TAMA
represented by: Brandon Tittle, Esq.
TITTLE LAW GROUP, PLLC
E-mail: btittle@tittlelawgroup.com
In re Javier Garza
Bankr. S.D. Tex. Case No. 24-31788
Chapter 11 Petition filed April 23, 2024
represented by: Julie Koenig, Esq.
In re Gregorian Development & Design
Bankr. C.D. Cal. Case No. 24-10676
Chapter 11 Petition filed April 24, 2024
See
https://www.pacermonitor.com/view/TK34TCY/Gregorian_Development__Design__cacbke-24-10676__0001.0.pdf?mcid=tGE4TAMA
represented by: Matthew D. Resnik, Esq.
RHM LAW LLP
E-mail: matt@rhmfirm.com
In re Camarillo HHCA, Inc.
Bankr. C.D. Cal. Case No. 24-10677
Chapter 11 Petition filed April 24, 2024
See
https://www.pacermonitor.com/view/S5I4FZI/Camarillo_HHCA_Inc__cacbke-24-10677__0001.0.pdf?mcid=tGE4TAMA
represented by: Michael Jay Berger,
LAW OFFICES OF MICHAEL JAY BERGER
E-mail: michael.berger@bankruptcy
power.com
In re 4257-61 6th Street SE LLC
Bankr. D.C. Case No. 24-00139
Chapter 11 Petition filed April 24, 2024
See
https://www.pacermonitor.com/view/EVFMCBQ/4257-61_6th_Street_SE_LLC__dcbke-24-00139__0001.0.pdf?mcid=tGE4TAMA
represented by: Jeffery T. Martin,, Jr., Esq.
MARTIN LAW GROUP PC
E-mail: jeff@martinlawgroupva.com
In re 3205 D St SE LLC
Bankr. D.C. Case No. 24-00137
Chapter 11 Petition filed April 24, 2024
See
https://www.pacermonitor.com/view/EDUKALY/3205_D_ST_SE_LLC__dcbke-24-00137__0001.0.pdf?mcid=tGE4TAMA
represented by: Justin P. Fasano, Esq.
MCNAMEE HOSEA, P.A.
E-mail: jfasano@mhlawyers.com
In re Rush and Bee Management and Investment Group LLC
Bankr. M.D. Fla. Case No. 24-02247
Chapter 11 Petition filed April 24, 2024
See
https://www.pacermonitor.com/view/NEGD5NY/Rush_and_Bee_Management_and_Investment__flmbke-24-02247__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Padmajai, Inc.
Bankr. N.D. Fla. Case No. 24-40169
Chapter 11 Petition filed April 24, 2024
See
https://www.pacermonitor.com/view/WVPBTEQ/PADMAJAI_Inc__flnbke-24-40169__0001.0.pdf?mcid=tGE4TAMA
represented by: Byron W. Wright III, Esq.
BRUNER WRIGHT, P.A.
E-mail: twright@brunerwright.com
In re TGP Communications, LLC
Bankr. S.D. Fla. Case No. 24-13938
Chapter 11 Petition filed April 24, 2024
See
https://www.pacermonitor.com/view/RVGKJ3I/TGP_COMMUNICATIONS_LLC__flsbke-24-13938__0001.0.pdf?mcid=tGE4TAMA
represented by: Bart Houston, Esq.
HOUSTON RODERMAN PLLC
E-mail: bhouston@thehoustonfirm.com
In re Egamille Frederique
Bankr. N.D. Ga. Case No. 24-54164
Chapter 11 Petition filed April 24, 2024
represented by: William Rountree, Esq.
In re Kensington Realty Group Corp.
Bankr. E.D.N.Y. Case No. 24-41738
Chapter 11 Petition filed April 24, 2024
See
https://www.pacermonitor.com/view/EUKV7LQ/KENSINGTON_REALTY_GROUP_CORP__nyebke-24-41738__0001.0.pdf?mcid=tGE4TAMA
represented by: Karamvir Dahiya, Esq.
DAHIYA LAW OFFICES LLC
E-mail: karam@bankruptcypundit.com
In re Vigilancia Virtual Y Policia Privada, LLC
Bankr. D.P.R. Case No. 24-01678
Chapter 11 Petition filed April 24, 2024
See
https://www.pacermonitor.com/view/IT5OCLA/VIGILANCIA_VIRTUAL_Y_POLICIA_PRIVADA__prbke-24-01678__0001.0.pdf?mcid=tGE4TAMA
represented by: Noemi Landrau Rivera, Esq.
LANDRAU RIVERA & ASSOCIATES
E-mail: nlandrau@landraulaw.com
In re J Franklin, LLC
Bankr. D.S.C. Case No. 24-01457
Chapter 11 Petition filed April 24, 2024
See
https://www.pacermonitor.com/view/QNYFT6A/J_Franklin_LLC__scbke-24-01457__0001.0.pdf?mcid=tGE4TAMA
represented by: Kevin Campbell, Esq.
CAMPBELL LAW FIRM, PA
E-mail: kcampbell@campbell-law-firm.com
In re J Cabelas, LLC
Bankr. D.S.C. Case No. 24-01458
Chapter 11 Petition filed April 24, 2024
See
https://www.pacermonitor.com/view/QZME3GI/J_Cabelas_LLC__scbke-24-01458__0001.0.pdf?mcid=tGE4TAMA
represented by: Kevin Campbell, Esq.
CAMPBELL LAW FIRM, PA
E-mail: kcampbell@campbell-law-firm.com
In re Foobar, LLC
Bankr. D. Nev. Case No. 24-12012
Chapter 11 Petition filed April 25, 2024
See
https://www.pacermonitor.com/view/5IJ5F3Q/FOOBAR_LLC__nvbke-24-12012__0001.0.pdf?mcid=tGE4TAMA
represented by: Matthew C. Zirzow, Esq.
LARZON & ZIRZOW, LLC
E-mail: mzirzow@lzlawnv.com
In re Florida Investment Trust Enterprises, LLC
Bankr. E.D.N.Y. Case No. 24-41744
Chapter 11 Petition filed April 25, 2024
See
https://www.pacermonitor.com/view/HVDBPCY/Florida_Investment_Trust_Enterprises__nyebke-24-41744__0001.0.pdf?mcid=tGE4TAMA
represented by: Brian J. Hufnagel, Esq.
MORRISON TENENBAUM PLLC
E-mail: bjhufnagel@m-t-law.com
In re Frank M. Puskarich
Bankr. W.D. Pa. Case No. 24-21001
Chapter 11 Petition filed April 25, 2024
represented by: Michael Henny, Esq.
In re Hoodstock Ranch, LLC
Bankr. E.D. Wash. Case No. 24-00636
Chapter 11 Petition filed April 25, 2024
See
https://www.pacermonitor.com/view/YDN6NTA/Hoodstock_Ranch_LLC__waebke-24-00636__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re City Trust Investments LLC
Bankr. S.D. Fla. Case No. 24-14100
Chapter 11 Petition filed April 26, 2024
See
https://www.pacermonitor.com/view/PUFL2LY/CITY_TRUST_INVESTMENTS_LLC__flsbke-24-14100__0001.0.pdf?mcid=tGE4TAMA
represented by: Ariel Sagre, Esq.
SAGRE LAW FIRM, P.A.
E-mail: law@sagrelawfirm.com
In re Angelo Mauro
Bankr. D.N.J. Case No. 24-14295
Chapter 11 Petition filed April 26, 2024
represented by: Rasheedah Terry, Esq.
In re Everest Lending Group, LLC
Bankr. W.D. Pa. Case No. 24-21018
Chapter 11 Petition filed April 26, 2024
See
https://www.pacermonitor.com/view/24PUUPA/Everest_Lending_Group_LLC__pawbke-24-21018__0001.0.pdf?mcid=tGE4TAMA
represented by: Brian C. Thompson, Esq.
THOMPSON LAW GROUP, P.C.
E-mail: bthompson@thompsonattorney.com
In re William Romanowski and Julie Romanowski
Bankr. N.D. Cal. Case No. 24-40613
Chapter 11 Petition filed April 29, 2024
represented by: Miles Woodlief, Esq.
In re E&E Investment Group, LLC
Bankr. D. Md. Case No. 24-13564
Chapter 11 Petition filed April 29, 2024
See
https://www.pacermonitor.com/view/6DF5WEI/EE_Investment_Group_LLC__mdbke-24-13564__0001.0.pdf?mcid=tGE4TAMA
represented by: Richard B. Rosenblatt, Esq.
LAW OFFICES OF RICHARD B. ROSENBLATT, PC
E-mail: rrosenblatt@rosenblattlaw.com
In re The MT Distillery LLC
Bankr. D. Mont. Case No. 24-90081
Chapter 11 Petition filed April 29, 2024
See
https://www.pacermonitor.com/view/4FEJP2I/THE_MT_DISTILLERY_LLC__mtbke-24-90081__0001.0.pdf?mcid=tGE4TAMA
represented by: Matt Shimanek, Esq.
SHIMANEK LAW PLLC
E-mail: matt@shimaneklaw.com
In re Jayadeep Ramesh Deshmukh
Bankr. D.N.J. Case No. 24-14339
Chapter 11 Petition filed April 29, 2024
In re Aiman Abboud
Bankr. E.D.N.Y. Case No. 24-41797
Chapter 11 Petition filed April 29, 2024
represented by: Lawrence Morrison, Esq.
In re Rich Lucky Food Group LLC
Bankr. E.D.N.Y. Case No. 24-41818
Chapter 11 Petition filed April 29, 2024
See
https://www.pacermonitor.com/view/76TDCVI/Rich_Lucky_Food_Group_LLC__nyebke-24-41818__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re John T. Rossmiller
Bankr. W.D. Pa. Case No. 24-21033
Chapter 11 Petition filed April 29, 2024
represented by: David Valencik, Esq.
In re Ana Teresa Padilla Rivera
Bankr. D.P.R. Case No. 24-01755
Chapter 11 Petition filed April 29, 2024
represented by: Jesus Batista Sanchez, Esq.
*********
Monday's edition of the TCR delivers a list of indicative prices
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*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
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