/raid1/www/Hosts/bankrupt/TCR_Public/240926.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, September 26, 2024, Vol. 28, No. 269
Headlines
1908 BED AND BREAKFAST: Case Summary & Two Unsecured Creditors
345 SEVENTH: Secured Party Sets Public Auction
47-30 REALTY: Voluntary Chapter 11 Case Summary
AETHON UNITED: Moody's Rates New Unsec. Notes Due 2029 'B3'
ALPINE 4: Relocates Corporate Office to 4201 N. 24th Street Arizona
AMERICAN BUILDERS: S&P Upgrades ICR to 'BB+', Outlook Stable
ANASTASIA PARENT: $650MM Bank Debt Trades at 29% Discount
ARAX HOLDINGS: Incurs $433K Net Loss in Third Quarter
ARCH THERAPEUTICS: Amends SPA to Raise Amount of Notes Sold to $4MM
ARCON CONSTRUCTION: Seeks to Hire Eric Gravel as Legal Counsel
ARRAKIS LLC: To Seek Court's OK on Bid Rules
ASP BLADE: Blackstone Strat Marks $745,507 Loan at 24% Off
ASP LS ACQUISITION: Blackstone Strat Marks $1.5MM Loan at 15% Off
ASTRA ACQUISITION: RiverNorth Marks $529,837 Loan at 74% Off
ATLAS CC: Blackstone Strat Marks $4.2MM Loan at 26% Off
ATLAS CC: Blackstone Strat Marks $859,032 Loan at 26% Off
AVOCADO TREE: Case Summary & Two Unsecured Creditors
BAFFINLAND IRON: Moody's Cuts CFR & Senior Secured Notes to Caa3
BALLISTIC FABRICATION: Gets OK to Tap The Ruboyianes as Accountant
BEASLEY BROADCAST: Implements 1-for-20 Reverse Stock Split
BEBCO ENVIRONMENTAL: Taps Pendergraft & Simon as Bankruptcy Counsel
BENHAM ORTHODONTICS: Five Point et al. TRO Bid Denied in Part
BIOXCEL THERAPEUTICS: Receives 2 Noncompliance Notices From Nasdaq
BIOXCEL THERAPEUTICS: Reduces Workforce By 28%
BLINK CHARGING: Expects to Cut Global Workforce by 14%
CANNON CONSTRUCTORS: Seeks to Hire G&B Law as Bankruptcy Counsel
CARDIFF LEXINGTON: Hires GBQ Partners as New Auditor
CASPIAN TECHNOLOGY: Unsecureds to Get Share of Income for 3 Years
CASTLE US: $1.20BB Bank Debt Trades at 33% Discount
CASTLE US: $295MM Bank Debt Trades at 33% Discount
CEMTREX INC: Resolution to Pay Dividend on Preferred Shares OK'd
CLARITY LAB SOLUTIONS: Files for Chapter 11 Bankruptcy
COVETRUS INC: S&P Alters Outlook to Negative, Affirms 'B-' ICR
CRCI LONGHORN: S&P Withdraws 'B-' ICR Following KKR Buyout
CREAGER MERCANTILE: Amends Unsecured Claims Pay Details
DIGITAL MEDIA: In Chapter 11 With $300 Million in Debt
DMD CUSTOM: Seeks to Hire Leibowitz, Hiltz & Zanzig as Counsel
DPL INC: Fitch Puts 'BB' LongTerm IDR on Watch Positive
E.L. 27 REALTY: Seeks Chapter 11 Bankruptcy Protection
EDGIO INC: U.S. Trustee Appoints Creditors' Committee
EMPIRE LLC: Moody's Lowers CFR to 'Caa3', Outlook Remains Negative
EMPLOY SOURCE: Case Summary & 11 Unsecured Creditors
ENC PARENT: $450MM Bank Debt Trades at 16% Discount
ENVISION ORTHOPEDIC: Gets OK to Hire Independent Monitoring Agency
EPHPHATHA HOUSE: Seeks to Hire Haberbush as Bankruptcy Counsel
EXACTECH INC: Moody's Lowers CFR to Ca & Alters Outlook to Negative
EZEOBA LLC: Case Summary & Seven Unsecured Creditors
FINTHRIVE SOFTWARE: $1.44BB Bank Debt Trades at 27% Discount
FIREFLY NEUROSCIENCE: Christopher Finn Holds 5.5% Equity Stake
FIRSTBASE.IO INC: Voluntary Chapter 11 Case Summary
FRANCHISE GROUP: $1BB Bank Debt Trades at 35% Discount
FRIENDSHIP VILLAGE: Fitch Alters Outlook on 'BB+' IDR to Positive
FUSE GROUP: Effects 1-for-5 Reverse Common Stock Split
GALAXY US: Blackstone Senior Marks $983,131 Loan at 18% Off
GARDEN SPINCO: Moody's Affirms 'Ba3' CFR, Outlook Remains Stable
GENESIS HEALTHCARE: S&P Affirms 'BB+' Rating on 2013 Revenue Bonds
GIMEXTECH COMPANY: Voluntary Chapter 11 Case Summary
GRESHAM WORLDWIDE: Arena Seeks Chapter 11 Trustee Appointment
GROUP RESOURCES: Starts Subchapter V Bankruptcy
H-FOOD HOLDINGS: $1.15BB Bank Debt Trades at 25% Discount
H-FOOD HOLDINGS: $415MM Bank Debt Trades at 25% Discount
H-FOOD HOLDINGS: $515MM Bank Debt Trades at 25% Discount
HAWAIIAN HOLDINGS: Fitch Hikes LongTerm IDR to BB+, Outlook Stable
HERITAGE COLLEGIATE: Committee Gets OK to Hire Bankruptcy Counsel
HERITAGE COLLEGIATE: Committee Gets OK to Hire Financial Advisor
HERITAGE HOME: Sec. 341(a) Meeting of Creditors on Oct. 15
HILLCREST FUND: Seeks to Hire Kenneth Jacobi as Real Estate Broker
HOOTERS OF AMERICA: Reportedly Taps Debt Advisors
HTX WELLNESS: Seeks to Tap Pendergraft & Simon as Legal Counsel
HUDSON 888 OWNER: Wants Fast Chapter 11 Plan Confirmation
HYPERION UTS: Commences Subchapter V Bankruptcy Process
HYPERSCALE DATA: Declares Monthly Dividend of $0.2708333 Per Share
IHEARTCOMMUNICATIONS: $402MM Bank Debt Trades at 13% Discount
INGENOVIS HEALTH: $675MM Bank Debt Trades at 17% Discount
INOTIV INC: Amends Credit Agreement, Closes $22.6MM Notes Offering
IVANTI SOFTWARE: Blackstone Senior Marks $247,187 Loan at 21% Off
IVANTI SOFTWARE: Blackstone Senior Marks $537,313 Loan at 34% Off
IVANTI SOFTWARE: Blackstone Strat Marks $1.5MM Loan at 34% Off
IVANTI SOFTWARE: Blackstone Strat Marks $787,097 Loan at 21% Off
JDC RENTALS: Seeks to Hire Guidant Law as Bankruptcy Counsel
JDI DATA: Bid to Hire Counsel Moot Following Ch.7 Conversion
JOHAL BROTHERS: Hires Kroger Gardis & Regas as Bankruptcy Counsel
JONES COMMODITIES: Plan Filing Deadline Extended to Oct. 3
JPC LAND HOLDINGS: Case Summary & 12 Unsecured Creditors
KOLOGIK LLC: Creditors to Get Proceeds From Liquidation
LABL INC: S&P Rates New $950MM Senior Secured Notes 'B-'
LALA'S SANGRIA: Seeks Approval to Tap Terrence Oraha as Accountant
LEE INVESTMENT: Gets OK to Hire Upton Law as Bankruptcy Counsel
LEE INVESTMENT: Seeks to Tap Harry P. Long as Bankruptcy Counsel
LERETA LLC: $250MM Bank Debt Trades at 19% Discount
LERETA LLC: Blackstone Senior Marks $479,804 Loan at 25% Off
LERETA LLC: Blackstone Strat Marks $1.4MM Loan at 25% Off
LOYALTY VENTURES: Blackstone Strat Virtually Writes Off $1.3MM Loan
LOYALTY VENTURES: Blackstone Virtually Writes Off $409,425 Loan
LOYALTY VENTURES: Blackstone Virtually Writes Off $462,410 Loan
LUMEN TECHNOLOGIES: Blackstone Strat Marks $124,278 Loan at 17% Off
LYONS MAGNUS: $285MM Bank Debt Trades at 18% Discount
MAGENTA BUYER: Blackstone Senior Marks $1.6MM Loan at 44% Off
MAGENTA BUYER: Blackstone Strat Marks $5.08MM Loan at 44% Off
MAGENTA SECURITY: $1.07BB Bank Debt Trades at 36% Discount
MATADOR RESOURCES: Fitch Assigns BB- Rating on 2033 Unsec. Notes
MATADOR RESOURCES: Moody's Rates New $750MM Unsecured Notes 'B1'
MATIV HOLDINGS: Moody's Rates New Senior Unsecured Notes 'B3'
MATTHEWS INT'L: Fitch Assigns BB- Rating on 2nd Lien Secured Notes
MATTHEWS INT'L: Moody's Affirms B1 CFR & Rates New $300MM Notes B3
MAXIMUS SUPPLY: Seeks to Tap Boyer & Boyer as Bankruptcy Counsel
MEDICAL SOLUTIONS: Blackstone Senior Marks $1.1MM Loan at 26% Off
MEDICAL SOLUTIONS: Blackstone Strat Marks $3.5MM Loan at 24% Off
METRO MATTRESS: Seeks to Hire Barclay Damon as Bankruptcy Counsel
MICCARTAR LAND: Seeks to Tap McDowell Law as Bankruptcy Counsel
MKUL INC: Loses Summary Judgment Bid in Aura Smart Suit
MLN US HOLDCO: 91% Markdown for Blackstone Senior's $854,492 Loan
MLN US HOLDCO: 91% Markdown for Blackstone Strat's $2.3MM Loan
MOJ REALTY: Gets OK to Tap Marcus & Millichap as Real Estate Agent
MOORE MEDICAL: Case Summary & 11 Unsecured Creditors
MOUNTAIN SPORTS: U.S. Trustee Wants to Partly Unseal Bonuses
MP REORGANIZATION: Trustee Hires Ringstad & Sanders as Counsel
MRSC CO ASPEN: Seeks Chapter 11 Bankruptcy Protection
MULLEN AUTOMOTIVE: Effects 1-for-100 Reverse Stock Split
MURRAY ENERGY: Dinsmore, et al. Suit to Remain in Bankruptcy Court
NUO THERAPEUTICS: Raises $849,125 In Private Placement
ONE TABLE: Tocaya, Tender Greens on Track for Final Bid, DIP Okay
PACTIV EVERGREEN: Moody's Alters Outlook on 'B1' CFR to Positive
PAN AM INVESTMENTS: Kicks Off Subchapter V Bankruptcy Case
PATHWAY VET: Blackstone Senior Marks $1.4MM Loan at 21% Off
PECF USS: $2BB Bank Debt Trades at 29% Discount
PERICH AESTHETICS: Gets OK to Hire Ambryn Burdick as Accountant
PERICH AESTHETICS: Gets OK to Tap Roberts Speed & Co. as Accountant
PUERTO RICO: Court Okays PREPA's $188 Million Deal With Contractor
PURE BIOSCIENCE: Issues $500K Convertible Note to Lenders
QLESS INC: Unsecured Creditors to Recover 61.5% or 10.2% of Claims
QUEST BORROWER: Blackstone Senior Marks $1.7MM Loan at 25% Off
QUEST BORROWER: Blackstone Strat Marks $5.1MM Loan at 25% Off
RADIATE HOLDCO: Blackstone Senior Marks $1.2MM Loan at 19% Off
RADIATE HOLDCO: Blackstone Strat Marks $3. 9MM Loan at 19% Off
RATHER OUTDOORS: $365MM Bank Debt Trades at 19% Discount
RED CAT: Incurs $12.42 Million Net Loss in First Quarter
RESIDENTIAL ADVERSITIES: Property Sale Proceeds to Fund Plan
RESTORED TRUCKING: Case Summary & 15 Unsecured Creditors
RIVERBED TECHNOLOGY: RiverNorth Marks $141,052 Loan at 38% Off
RTA DENNIS: Seeks to Hire Geri Lyons Chase as Bankruptcy Counsel
SALT LIFE: Closes Jacksonville Beach Store Temporarily After Sale
SCILEX HOLDING: $10MM FSF Loan Satisfied With Endeavor Support
SITIO ROYALTIES: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable
SK MOHAWK: Fitch Lowers IDR to 'RD' on Distressed Debt Exchange
SPILLER PERSONAL: Seeks to Tap H. Brad Parker as Bankruptcy Counsel
SPOKANE INT'L: Moody's Affirms Ba2 Rating & Alters Outlook to Pos.
STAFFING 360: Inks Amendment With JIG to Extend Maturity of Notes
STANLEY OIL: Seeks Chapter 11 After Injunction
STRATEGIC MATERIALS: Blackstone Virtually Writes Off $2.6MM Loan
STRATEGIC MATERIALS: Blackstone Virtually Writes Off $553,333 Loan
STRATEGIC MATERIALS: Blackstone Virtually Writes Off $800,000 Loan
SYCAMORE BUYER: Moody's Alters Outlook on 'Ba3' CFR to Stable
T-SHACK INC: Gets OK to Sell Las Vegas Property for $140,000
TECHPRECISION CORP: Appoints New Chief Financial Officer
TEGNA INC: COO Lynn Beall to Depart Mid-2025
TEMPUR SEALY: Fitch Keeps 'BB+' LongTerm IDR on Watch Negative
TEMPUR SEALY: Moody's Rates New $1.6BB First Lien Term Loan 'Ba1'
THINK & LEARN: RiverNorth Marks $217,252 Loan at 77% Off
TIDAL WASTE:S&P Assigns 'B+' Issuer Credit Rating, Outlook Stable
TOSCA SERVICES: S&P Downgrades ICR to 'SD' on Debt Exchange
TREVENA INC: ICS Opportunities, 3 Others Disclose Equity Stakes
TRI-STATE SOLUTIONS: Unsecureds Will Get 4% in Subchapter V Plan
UNITED BELIEVERS: Voluntary Chapter 11 Case Summary
URBAN CHESTNUT: U.S. Trustee Appoints Creditors' Committee
VAPOTHERM INC: Stockholders OK Merger Deal With Veronica Holdings
VENUS CONCEPT: Saudi Economic Holds 7.3% Equity Stake
VENUS CONCEPT: Secures Additional $1MM Bridge Financing From Madryn
VIEWBIX INC: Capitalink Ltd., Lavi Krasney Hold 8.44% Equity Stake
VIEWBIX INC: M.R.M. Merhavit, Roni Menashe Hold 9.27% Equity Stake
VINTAGE WINE ESTATES: Sells Majority of Wineries
WAYFAIR INC: Fitch Assigns 'B' LongTerm IDR, Outlook Stable
WEST HARWICH: Court Orders Appointment of Chapter 11 Trustee
WIDELL RENOVATIONS: Seeks to Hire Brown Law Firm as Legal Counsel
WIDELL RENOVATIONS: Stephen Moriarty Named Subchapter V Trustee
WILDFIRE ENERGY I: Fitch Assigns 'B+' LongTerm IDR, Outlook Stable
WILLSCOT HOLDINGS: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable
WINDSTREAM SERVICES: Fitch Assigns BB- Rating on Sr. Secured Notes
WJA ASSET: Seeks to Hire Raines Feldman Littrell as Legal Counsel
WOB HOLDINGS: Gets OK to Hire Gulf Atlantic as Financial Advisor
XTI AEROSPACE: Appoints Tobin Arthur as Chief Strategy Officer
[^] Recent Small-Dollar & Individual Chapter 11 Filings
*********
1908 BED AND BREAKFAST: Case Summary & Two Unsecured Creditors
--------------------------------------------------------------
Debtor: 1908 Bed and Breakfast, Inc.
DBA 1908 Coastal Historic Bed and Breakfast
1012 Beach Blvd.
Biloxi, MS 39530
Chapter 11 Petition Date: September 25, 2024
Court: United States Bankruptcy Court
Southern District of Mississippi
Case No.: 24-51362
Judge: Hon. Katharine M Samson
Debtor's Counsel: Michael T. Ramsey, Esq.
SHEEHAN AND RAMSEY, PLLC
429 Porter Ave
Ocean Springs, MS 39564
Tel: 228-875-0572
Email: Mike@sheehanramsey.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $500,000 to $1 million
The petition was signed by Rebecca Center as president.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/OEV5U4I/1908_Bed_and_Breakfast_Inc__mssbke-24-51362__0001.0.pdf?mcid=tGE4TAMA
345 SEVENTH: Secured Party Sets Public Auction
----------------------------------------------
BSPODF TRS Holdco LLC ("secured party") offers for sale at public
auction all rights, title and interests of 345 Seventh Ave Holdings
LLC and Empire 345 Mezz LLC ("Debtor") in 100% of the limited
liability company membership in 7th City Realty LLC and Empire 345
Seventh LLC ("mortgage borrower"), which are owners of the property
located at 341, 343, and 345 Seventh Ave and 167 West 29th Street,
New York, New York 10001 ("premises"), and certain rights and
property related thereto pledged by the Debtor under that certain
pledge and security agreement made by the Debtor in favor of BSPODF
TRS Holdco LLC ("original lender") dated as of Sept. 2, 2001
("pledge agreement").
Original Lender was granted a security interests in the interests
to secure a loan to the Debtor ("mezzanine loan").
The public auction was slated to take place on Sept. 23, 2024.
All bids must be for cash, with a $500,000 deposit due two business
days prior to the auction, then with a deposit increase of 10% of
the winning bid within two business days after the auction, and
with the full amount due at closing.
The full terms and conditions of the sale, copies of the relevant
agreements, information for attending the auction, and other
information may be obtained by contacting Walker & Dunlop, Jordan
Casella; jcasella@walkerdunlop.com; 212-202-1805 or Christopher de
Raet; cderaet@walkerdunlop.com; 332-240-1658.
47-30 REALTY: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: 47-30 Realty Associates LLC
60 Madison Avenue
Suite 1012
New York, NY 10017
Business Description: 47-30 Realty is a Single Asset Real Estate
debtor (as defined in 11 U.S.C. Section
101(51B)).
Chapter 11 Petition Date: September 24, 2024
Court: United States Bankruptcy Court
Southern District of New York
Case No.: 24-11635
Judge: Hon. Judge David S. Jones
Debtor's Counsel: Joel M. Shafferman, Esq.
KUCKER MARINO WINIARSKY & BITTENS, LLP
747 Third Avenue
New York, NY 10017
Tel: 212-869-5030
Email: jshafferman@kuckermarino.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by David Monian as member.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/PR6Z5DI/47-30_Realty_Associates_LLC__nysbke-24-11635__0001.0.pdf?mcid=tGE4TAMA
AETHON UNITED: Moody's Rates New Unsec. Notes Due 2029 'B3'
-----------------------------------------------------------
Moody's Ratings assigned B3 rating to Aethon United BR LP's
proposed senior unsecured notes due in 2029. Proceeds from the
notes offering will be used to retire its senior notes due 2026 and
a portion of the borrowings outstanding under its revolving credit
facility. Aethon's existing ratings, including its B2 Corporate
Family Rating and B2-PD Probability of Default Rating are
unchanged. The outlook is stable.
"Aethon's proposed refinancing transaction and concurrently
announced revolver extension will improve its credit profile by
extending its maturity runway and solidifying its liquidity," said
Jake Leiby, Moody's Ratings Vice President.
RATINGS RATIONALE
Aethon's B2 CFR reflects the company's 100% exposure to natural
gas, geographic concentration in the Haynesville, and to some
extent its firm transportation commitments (FT). Aethon generates
strong margins relative to other natural gas focused peers owing in
part to its integrated midstream system, however, natural gas
production generates lower cash margins than similarly-sized oil
production. Aethon has meaningfully reduced its development
activity in 2024 in response to the low natural gas price
environment, resulting in expectations for minimal production
growth following significant growth generated over 2019-2023. These
constraints are counterbalanced by its robust portfolio of natural
gas hedges, uplift to cash margins from its integrated midstream
and marketing operations, and the scale of its production and
reserve base. Aethon's ownership of significant infrastructure
improves its asset coverage but its FT commitments present risks if
the company's production were to decline. Aethon is led by an
experienced management team with a good track record and one of its
sponsors, Ontario Teachers' Pension Plan Board (OTPPB), is a
long-term investor.
Moody's expect Aethon to maintain adequate liquidity through at
least 2025. Pro forma for the proposed transactions, the company is
expected to have a de minims cash balance and around $500 million
of available borrowing capacity under its RBL revolving credit
facility, after accounting for outstanding borrowings and letters
of credit. The RBL has a $1.15 billion borrowing base, $1.0 billion
of elected commitments, and matures in September 2029. Moody's
expect Aethon to fund its capital spending needs and debt service
through 2025 from its operating cash flow and for free cash flow to
be applied to reducing borrowings under the RBL. Aethon's RBL
covenants require the maintenance of net debt/EBIDTAX below 3.5x
and a current ratio above 1.0x. Moody's expect Aethon to remain in
compliance with its covenants through 2025.
Aethon's proposed and existing senior notes are rated B3, one notch
below the B2 CFR reflecting the priority ranking and size of the
company's senior secured RBL revolving credit facility relative to
the senior notes that will be outstanding. The RBL revolving credit
facility is secured by mortgages on at least 90% of Aethon's proved
oil and gas properties and by the equity interests in its
wholly-owned subsidiaries.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
An upgrade of Aethon's ratings could be considered if the company
generates positive free cash flow while growing its production and
maintaining retained cash flow to debt above 35% and a leveraged
full cycle ratio above 1.5x.
Aethon's ratings could be downgraded if its liquidity deteriorates
or its debt rises significantly. Retained cash flow to debt below
20% could also lead to a ratings downgrade.
Aethon is an independent exploration & production company focused
primarily on developing natural gas properties in North Louisiana
and East Texas. The company was formed in 2016 as an investment
vehicle to acquire North American onshore assets in partnership
with OTPPB and RedBird Capital Partners. The company's leasehold
acreage consists of 198,000 net acres in East Texas and North
Louisiana and 88,000 net acres in Wyoming, and 3.3 Tcfe of proved
reserves as of December 31, 2023. 39% of Aethon's reserves are
proved developed producing reserves and 99% of the production
consists of natural gas. The company's average daily production for
the full year of 2023 was about 900 MMcfe per day (~150,000 boe per
day).
The principal methodology used in this rating was Independent
Exploration and Production published in December 2022.
ALPINE 4: Relocates Corporate Office to 4201 N. 24th Street Arizona
-------------------------------------------------------------------
Alpine 4 Holdings, Inc. reported in a Form 8-K filed with the
Securities and Exchange Commission that on July 25, 2024, the
Company notified the public of its decision to relocate its
corporate office. This move was necessitated by the need for
enhanced security and a focus on cost-cutting measures, including a
reduced employee headcount.
"We are pleased to announce that we have found a new office space
that aligns with our current operational requirements while
offering increased security features," said the Company.
The Company executed a lease on September 23rd, 2024, and its
location will be at 4201 N. 24th Street, Suite 150, Phoenix, AZ
85016, conveniently near its previous office. The new lease will
begin on October 1st, 2024, and the Company plans to move into this
space over the next few weeks. The Company is enthusiastic about
this transition and the opportunities it presents for the Company.
About Alpine 4
Alpine 4 Holdings, Inc. (formerly Alpine 4 Technologies, Ltd) is a
publicly traded conglomerate that is acquiring businesses that fit
into its disruptive DSF business model of Drivers, Stabilizers, and
Facilitators. The Company's focus is on how the adaptation of new
technologies, even in brick-and-mortar businesses, can drive
innovation. The Company also believes that its holdings should
benefit synergistically from each other and that the ability to
have collaboration across varying industries can spawn new ideas
and create fertile ground for competitive advantages.
"[T]he Company has negative working capital and has continued to
experience operating losses, which causes doubt as to the ability
of the Company to continue. The Company's ability to raise
additional capital through the future issuances of common stock is
unknown. The obtainment of additional financing, the successful
development of the Company's plan of operations, and its ultimate
transition to profitable operations are necessary for the Company
to continue. The uncertainty that exists with these factors raises
substantial doubt about the Company's ability to continue as a
going concern," according to the Company's Quarterly Report for the
three months ended Sept. 30, 2023.
The Company has not yet filed its Annual Report on Form 10-K for
the year ended Dec. 31, 2023, and Quarterly Report for the quarter
ended March 31, 2024.
AMERICAN BUILDERS: S&P Upgrades ICR to 'BB+', Outlook Stable
------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on
Wisconsin-based building materials distributor, American Builders &
Contractors Supply Co. Inc. (ABC Supply) to 'BB+' from 'BB'. S&P
maintained its recovery rating of '2' (rounded estimate: 80%) with
issue-level rating of 'BBB-' on the term loan B and senior secured
notes.
S&P additionally maintained its recovery rating of '6' (rounded
estimate: 0%) with issue-level rating of 'BB-' on the company's
senior unsecured notes.
The stable outlook reflects S&P's view that the company can sustain
S&P Global Ratings-adjusted leverage of 1.5x-2.0x over the next 12
months, even amid less favorable business conditions.
S&P said, "We expect leverage will remain below 2x in 2024 and 2025
despite normalization of earnings. While market softness and
persistent inflationary commodity input costs are likely to persist
through 2025, we believe S&P Global Ratings-adjusted leverage will
remain below 2x as the company continues to maintain robust cash
flow and prudent debt balances. ABC Supply draws the majority of
its earnings from the repair and remodel market, which we
anticipate may experience low-single-digit percent decline this
year. This may be only somewhat offset by new construction demand,
which we forecast will increase by mid-single-digit percent in 2024
and 2025."
The company has grown a strong market leading position in roofing
distribution, though economic headwinds and industry fundamentals
could temper earnings growth. ABC Supply is the largest North
American roofing distributor. Earnings growth peaked in 2021 and
2022 through a combination of organic and inorganic expansion,
after which earnings have normalized. Despite moderately high
acquisition volume in recent years, the company has maintained S&P
Global Ratings-adjusted leverage below 2x since 2020. While EBITDA
margins remained elevated in recent years, we expect the company's
exposure to commodity volatility may pressure margins toward
historic levels of roughly 11%. Limited product diversity, exposure
to residential construction, and commodity costs continue to pose
volatility risk to the company's future earning potential.
S&P said, "We believe ABC Supply's financial policy actions and
commitment are key to the improved credit quality. Given recent
leverage performance and operating cash flow (OCF) generation, we
expect the company could maintain its S&P Global Ratings-adjusted
leverage under 2x through most market conditions. While the
company's maximum leverage target remains 3x for opportunistic
acquisition activity, it has generated sufficient cushion in
earnings to support regular acquisition activity even through a
weaker market environment. We expect ABC Supply could generate $20
billion-$21 billion in annual revenue and S&P Global
Ratings-adjusted earnings of $2.2 billion-$2.4 billion in 2024-2025
through a combination of organic and inorganic growth. The recent
conversion to a C-corp reduces operating cash flow to the extent of
operating tax flows which was previously paid out in the form of
dividends. However, we continue to expect sufficient OCF generation
to support acquisitions or shareholder-friendly actions using cash
to remain commensurate with the rating.
"The stable outlook on ABC Supply reflects our view that the
company can sustain S&P Global Ratings-adjusted leverage of
1.5x-2.0x over the next 12 months, even amid less favorable
business conditions."
S&P could take a negative rating action on ABC Supply over the next
12 months if:
-- Its S&P Global Ratings-adjusted earnings decline more than 30%
from S&P's base-case scenario, causing S&P Global Ratings-adjusted
leverage to exceed 3x. Such a scenario could materialize if
business conditions, including a slowdown in construction, are
steeper or longer than expected; or
-- The company undertakes an aggressive financial policy, such as
pursuing large, debt-financed acquisitions or shareholder actions,
resulting in S&P Global Ratings-adjusted leverage exceeding 3x.
Although unlikely, S&P could raise its rating over the next 12
months if:
-- The company were to further reduce its debt such that S&P
expects debt to EBITDA would remain below 1.5x through most
reasonable conditions; or
-- The company improves diversity to be more in line with
higher-rated peers while maintaining prudent leverage.
ANASTASIA PARENT: $650MM Bank Debt Trades at 29% Discount
---------------------------------------------------------
Participations in a syndicated loan under which Anastasia Parent
LLC is a borrower were trading in the secondary market around 71.4
cents-on-the-dollar during the week ended Friday, Sept. 20, 2024,
according to Bloomberg's Evaluated Pricing service data.
The $650 million Term loan facility is scheduled to mature on
August 11, 2025. The amount is fully drawn and outstanding.
Anastasia Parent, LLC is the parent company of Anastasia Beverly
Hills, Inc., a prestige cosmetics brand that focuses on eyebrow
shaping products.
ARAX HOLDINGS: Incurs $433K Net Loss in Third Quarter
-----------------------------------------------------
Arax Holdings Corp. filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q reporting a net loss
of $433,266 on $0 of revenue for the three months ended July 31,
2024, compared to a net loss of $2.27 million on $228,518 of
revenue for the three months ended July 31, 2023.
For the nine months ended July 31, 2024, the Company reported a net
loss of $905,932 on $528,636 of revenue, compared to a net loss of
$5.13 million on $682,290 of revenue for the nine months ended July
31, 2023.
As of July 31, 2024, the Company had $7.61 million in total assets,
$506,889 in total liabilities, and $7.11 million in total
stockholders' equity.
Arax stated, "The Company's management has evaluated whether there
is substantial doubt about the Company's ability to continue as a
going concern and has determined that substantial doubt existed as
of the date of the end of the period covered by this report. This
determination was based on the following factors: (i) the Company
used cash of approximately $470 thousand in operations during the
nine months ended July 31, 2024 and has a working capital of
approximately $261 thousand at July 31, 2024; (ii) the Company's
available cash as of the date of this filing will not be sufficient
to fund its anticipated level of operations for the next 12
months; (iii) the Company will require additional financing for
the fiscal year ending October 31, 2024, to continue at its
expected level of operations; and (iv) if the Company fails to
obtain the needed capital, it will be forced to delay, scale back,
or eliminate some or all of its development activities or perhaps
cease operations. In the opinion of management, these factors,
among others, raise substantial doubt about the ability of the
Company to continue as a going concern as of the date of the end of
the period covered by this report and for one year from the
issuance of these condensed consolidated financial statements.
"Management's plans to continue as a going concern include raising
additional capital through sales of equity securities and
borrowing. However, management cannot provide any assurances that
the Company will be successful in accomplishing any of its plans.
If the Company is not able to obtain the necessary additional
financing on a timely basis, the Company will be required to delay,
reduce the scope of, or eliminate one or more of the Company's
research and development activities or commercialization efforts or
perhaps even cease the operation of its business. These factors
raise substantial doubt about the Company's ability to continue as
a going concern for one year from the date the financials were
issued."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1566243/000175392624001616/g084438_10q.htm
About Arax Holdings
Tallahassee, Fla.-based ARAX ARAX Holdings Corp. operates
Blockchain as a Platform (BaaP), transforming enterprise data into
strategic assets with unmatched efficiency and integrity.
Leveraging Core Blockchain technology, the company integrates
Decentralized Physical Infrastructure Networks (DePIN) to boost
operational efficiency and ensure transparency across sectors such
as logistics, carbon accounting, smart building, and smart city
solutions, manufacturing,, and industry-specific secure
connectivity and communication solutions.
ARCH THERAPEUTICS: Amends SPA to Raise Amount of Notes Sold to $4MM
-------------------------------------------------------------------
As previously disclosed in the Current Report on Form 8-K filed by
Arch Therapeutics, Inc. with the Securities and Exchange Commission
on May 21, 2024, the Company entered into a Securities Purchase
Agreement, dated May 15, 2024 with certain institutional and
accredited individual investors providing for the issuance and
sale by the Company to the Investors certain Secured Promissory
Notes convertible into shares of common stock, par value $0.001 per
share. The 2024 First Notes were issued as part of a convertible
notes offering authorized by the Company's board of directors.
On September 15, 2024, the Company entered into Amendment No. 1 to
the SPA, with certain Investors representing the Consenting Buyers
to increase the Maximum Amount from US$2,775,000 to US$4,000,000.
Except as expressly stated in the First Amendment, all other terms
and provisions of the SPA shall remain in full force and effect.
Effective September 15, 2024, Arch Therapeutics, Inc. (the
"Company") entered into several amendments with the holders of its
outstanding Unsecured and Senior Secured Convertible Promissory
Notes:
(a) Amendment No. 19 to the First 2022 Notes: This amendment
applies to the Company's Senior Secured Convertible Promissory
Notes, previously amended on various dates from February 14, 2023,
to August 15, 2024, in connection with a private placement
completed on July 6, 2022.
(b) Amendment No. 19 to the Second 2022 Notes: This amendment
pertains to the Unsecured Convertible Promissory Notes, similarly
amended from February 14, 2023, to August 15, 2024, related to a
private placement completed on January 18, 2023.
(c) Amendment No. 14 to the Third 2022 Notes: This applies to
the Unsecured Convertible Promissory Notes, amended from June 15,
2023, to August 15, 2024, issued during a private placement on May
15, 2023.
(d) Amendment No. 5 to the Fourth 2022 Notes: This amendment
also concerns the Unsecured Convertible Promissory Notes, amended
from March 15, 2024, to August 15, 2024, issued in a private
placement on March 12, 2024.
(e) Amendment No. 3 to the First 2024 Notes: This amendment
relates to the Company's Senior Secured Convertible Promissory
Notes, amended on August 15, 2024, associated with a private
placement completed on May 15, 2024.
Under the Amendments to the Notes, the Notes were amended to extend
the date of the completion of an "Uplist" and to extend the
respective maturity date of each of the Notes from September 15,
2024 to September 30, 2024. In addition to the foregoing, Amendment
No. 3 to the First 2024 Notes also increased the outstanding
principal amount of the Additional Notes issued in connection with
the Fourth Closing, Fifth Closing, Sixth Closing and Seventh
Closing in connection with the SPA dated May 15, 2024, as amended
on September 15, 2024, by a factor of 1.03.
About Arch Therapeutics Inc.
Framingham, Mass.-based Arch Therapeutics, Inc. is a biotechnology
company focused on developing and marketing products based on its
innovative AC5 self-assembling technology platform.
Los Angeles, Calif.-based Weinberg & Company, P.A., the company's
auditor since 2024, issued a "going concern" qualification in its
report dated February 14, 2024. The report indicated that during
the year ended September 30, 2023, the company incurred a net loss
and utilized cash flows in operations, with recurring losses since
inception. These conditions raise substantial doubt about the
company's ability to continue as a going concern.
For the year ended September 30, 2023, Arch Therapeutics recorded a
net loss of $6,982,836. As of June 30, 2024, the company had
$1,397,644 in total assets, $13,958,210 in total current
liabilities, and $12,560,566 in total stockholders' deficit.
ARCON CONSTRUCTION: Seeks to Hire Eric Gravel as Legal Counsel
--------------------------------------------------------------
Arcon Construction Corporation seeks approval from the U.S.
Bankruptcy Court for the Northern District of California to employ
Law Offices of Eric J. Gravel as legal counsel.
The firm will render these services:
(a) prepare and file the Debtor's schedules, statement of
financial affairs and related documents occasioned by the filing of
a Chapter 11 case;
(b) appear with the Debtor at the first meeting of creditors;
(c) prepare such orders as may be required; and
(d) prepare a plan of reorganization and appearance at
proceedings related to the confirmation of a plan of
reorganization.
Eric Gravel, Esq., the primary attorney at this representation,
will be paid at his hourly rate of $450.
The Debtor has agreed to pay an initial retainer fee of $16,000.
Mr. Gravel 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:
Eric J. Gravel, Esq.
Law Offices of Eric J. Gravel
1390 market St., Suite 200
San Francisco, CA 94102
Telephone: (650) 931-6000
Email: ctnotices@gmail.com
About Arcon Construction
Arcon Construction Corporation sought protection under Chapter 11
of the U.S. Bankruptcy Code (Bankr. N.D. Cal. Case No. 24-30679) on
Sept. 13, 2024. In the petition signed by Andrey Libov, chief
operating officer, the Debtor disclosed up to $500,000 in assets
and up to $10 million in liabilities.
The Law Offices of Eric J. Gravel represents the Debtor as legal
counsel.
ARRAKIS LLC: To Seek Court's OK on Bid Rules
--------------------------------------------
Arrakis, LLC will ask the U.S. Bankruptcy Court for the Western
District of Pennsylvania at a hearing today to approve the bid
rules governing the sale of substantially all of its assets.
The assets up for sale include the company's 96-room hotel that
currently operates as the Comfort Inn & Suites
Pittsburgh-Northshore, and personal property used in the hotel's
operations.
The company is selling its assets to Hullett Properties, LLC or to
another buyer with a better offer.
Hullett Properties offered $8.5 million for the assets and agreed
to serve as the stalking horse bidder at a court-supervised auction
to be held no later than Nov. 22.
A stalking horse bidder sets the price floor for bidding in an
auction.
To participate in the auction, interested buyers must submit their
bids no later than Nov. 15. The initial bid must be at least $8.6
million and must be accompanied with an earnest money deposit of
$100,000, according to the proposed bid rules.
At the auction, interested buyers may submit a competing bid that
is at least $25,000 more than the initial bid. The minimum bid
increment is $25,000.
Arrakis will select the winning bidder at the conclusion of the
auction. Hullett will receive a break-up fee of $50,000 in the
event that another buyer is selected as the winning bidder.
The hearing to approve the sale to the winning bidder will be held
within 21 days after the auction (no later than Dec. 13).
Kirk Burkley, Esq., the company's attorney, said the company won't
have sufficient funds to operate the hotel beyond Dec. 31.
"Completing the sale process within that time period, or as
promptly thereafter as is practicable, thus is essential to avoid a
decline in the assets' value and a lesser recovery for creditors,"
Mr. Burkley said in court papers.
Pittsburgh Commercial Real Estate, Inc., a real estate broker, is
assisting the company with the sale.
About Arrakis LLC
Arrakis, LLC owns and operates the Comfort Inn & Suites
Pittsburgh-Northshore, a 96-room hotel located at 820 East Ohio
Street, Pittsburgh, Pa.
Arrakis filed Chapter 11 petition (Bankr. W.D. Pa. Case No.
24-22322) on Sept. 20, with $1 million to $10 million in assets and
$10 million to $50 million in liabilities.
Kirk B. Burkley, Esq., at Bernstein-Burkley, P.C. is the Debtor's
legal counsel.
ASP BLADE: Blackstone Strat Marks $745,507 Loan at 24% Off
----------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its $745,507
loan extended to Asp Blade Holdings, Inc to market at $570,126 or
76% of the outstanding amount, according to the Blackstone Strat's
Form N-CSRS for the semi-annual period ended June 30, 2024, filed
with the Securities and Exchange Commission.
Blackstone Strat is a participant in a First Lien Term Loan (3M CME
Term SOFR + 4%, 0.50% Floor) to Asp Blade Holdings, Inc. The loan
matures on October 13, 2028.
Blackstone Strat is a closed-end term fund that trades on the New
York Stock Exchange under the symbol. BGB's primary investment
objective is to seek high current income, with a secondary
objective to seek preservation of capital, consistent with its
primary goal of high current income.
Blackstone Strat is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
ASP LS Acquisition Corp. was formed to effectuate the acquisition
of Laser Ship, Inc. by the private equity firm American Securities
LLC.
ASP LS ACQUISITION: Blackstone Strat Marks $1.5MM Loan at 15% Off
-----------------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its
$1,543,845 loan extended to ASP LS Acquisition Corp to market at
$1,319,779 or 85% of the outstanding amount, according to the
Blackstone Strat's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone Strat is a participant in a First Lien Term Loan (3M CME
Term SOFR + 4.50%, 0.75% Floor) to Atlas CC Acquisition Corp. The
loan matures on May 7, 2028.
Blackstone Strategic Credit 2027 Term Fund is a closed-end term
fund that trades on the New York Stock Exchange under the symbol.
BGB's primary investment objective is to seek high current income,
with a secondary objective to seek preservation of capital,
consistent with its primary goal of high current income.
Blackstone Strat is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
ASP LS Acquisition Corp. was formed to effectuate the acquisition
of Laser Ship, Inc. by the private equity firm American Securities
LLC.
ASTRA ACQUISITION: RiverNorth Marks $529,837 Loan at 74% Off
------------------------------------------------------------
RiverNorth/DoubleLine Strategic Opportunity Fund, Inc has marked
its $529,837loan extended to Astra Acquisition Corp to market at
$139,581 or 26% of the outstanding amount, according to the
RiverNorth 's Form N-CSRS for the semi-annual period ended June 30,
2024, filed with the Securities and Exchange Commission.
RiverNorth is a participant in a Second Lien Initial Term Loan (3M
SOFR + 8.88%) to Astra Acquisition Corp. . The loan matures on
October 22, 2029.
RiverNorth/DoubleLine Strategic Opportunity Fund, Inc, is a
closed-end management investment company that was organized as a
Maryland corporation on June 22, 2016, and commenced investment
operations on September 28, 2016. The investment adviser to the
Fund is RiverNorth Capital Management, LLC. The Fund’s
sub-adviser is DoubleLine Capital, LP. RiverNorth is a diversified
investment company with an investment objective to seek current
income and overall total return.
RiverNorth is led by Patrick W. Galleyle, President and Chief
Executive Officer; and Jonathan M. Mohrhardt, Chief Financial
Officer and Treasurer. The Fund can be reached through:
Patrick W. Galleyle
RiverNorth/DoubleLine Strategic Opportunity Fund, Inc
360 South Rosemary Avenue, Suite 1420,
West Palm Beach, FL 33401
Telephone: (561) 484-7185
- and -
Marcus L. Collins, Esq.
RiverNorth Capital Management, LLC
360 South Rosemary Avenue, Suite 1420
West Palm Beach, FL 33401
Telephone: (561) 484-7185
Astra Acquisition Corp. is a provider of cloud-based software
solutions for higher educational institutions.
ATLAS CC: Blackstone Strat Marks $4.2MM Loan at 26% Off
-------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its
$4,234,458 loan extended to Atlas CC Acquisition Corp to market at
$3,141,142 or 74% of the outstanding amount, according to the
Blackstone Strat's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone Strat is a participant in a First Lien Term Loan B (3M
CME Term SOFR + 4.25%, 0.75% Floor) to Atlas CC Acquisition Corp.
The loan matures on May 25, 2028.
Blackstone Strat is a closed-end term fund that trades on the New
York Stock Exchange under the symbol. BGB's primary investment
objective is to seek high current income, with a secondary
objective to seek preservation of capital, consistent with its
primary goal of high current income.
Blackstone Strat is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Atlas CC Acquisition Corp serves transportation, defense command,
control, communication, computers, intelligence, surveillance and
reconnaissance (C4ISR), and defense training customers globally.
Cubic sells integrated payment and information systems,
expeditionary communications, cloud-based computing and
intelligence delivery, as well as training and readiness solutions.
ATLAS CC: Blackstone Strat Marks $859,032 Loan at 26% Off
---------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its $859,032
loan extended to Atlas CC Acquisition Corp to market at $637, 234
or 74% of the outstanding amount, according to the Blackstone
Strat's Form N-CSRS for the semi-annual period ended June 30, 2024,
filed with the Securities and Exchange Commission.
Blackstone Strat is a participant in a First Lien Term Loan C (3M
CME Term SOFR + 4.25%, 0.75% Floor) to Atlas CC Acquisition Corp.
The loan matures on May 25, 2028.
Blackstone Strategic Credit 2027 Term Fund is a closed-end term
fund that trades on the New York Stock Exchange under the symbol.
BGB's primary investment objective is to seek high current income,
with a secondary objective to seek preservation of capital,
consistent with its primary goal of high current income.
Blackstone Strat is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Atlas CC Acquisition Corp serves transportation, defense command,
control, communication, computers, intelligence, surveillance and
reconnaissance (C4ISR), and defense training customers globally.
Cubic sells integrated payment and information systems,
expeditionary communications, cloud-based computing and
intelligence delivery, as well as training and readiness solutions.
AVOCADO TREE: Case Summary & Two Unsecured Creditors
----------------------------------------------------
Debtor: Avocado Tree, LLC
5427 Beckford Ave.
Tarzana CA 91356
Business Description: The Debtor is primarily engaged in renting
and leasing real estate properties.
Chapter 11 Petition Date: September 24, 2024
Court: United States Bankruptcy Court
Central District of California
Case No.: 24-11606
Judge: Hon. Martin R Barash
Debtor's Counsel: David Brownstein, Esq.
LAW OFFICE OF DAVID BROWNSTEIN
1 Park Plaza, Suite 600 PMB 385
Irvine, CA 92614
Tel: (949) 486-4404
Email: david@brownsteinfirm.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Abraham Kordian 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/O3YIJ7Y/Avocado_Tree_LLC__cacbke-24-11606__0001.0.pdf?mcid=tGE4TAMA
BAFFINLAND IRON: Moody's Cuts CFR & Senior Secured Notes to Caa3
----------------------------------------------------------------
Moody's Ratings downgraded Baffinland Iron Mines Corporation's
corporate family rating to Caa3 from Caa1, probability of default
rating to Caa3-PD from Caa1-PD, senior secured bank credit facility
rating to B2 from B1 and senior secured notes rating to Caa3 from
Caa1. The outlook remains negative.
The downgrade of Baffinland reflects its weak liquidity driven by
the company's revolving credit facility and term loan both expiring
in May 2025.
RATINGS RATIONALE
Baffinland's Caa3 CFR is constrained by: 1) weak liquidity with
over $180 million of funded debt due within the next twelve
months; 2) a concentration of cash flow from one metal (iron ore),
which has volatile pricing; 3) a single mine (about 6 million wet
metric tonnes (wmt)) in a remote location above the Arctic Circle
(northern Baffin Island); 4) shipping constraints due to ice that
limit transporting iron ore between mid-July to October; 5) a high
cost structure that is sensitive to iron ore prices; and 6)
execution and financing risk related to its planned rail expansion
to Steensby Port. The company benefits from: 1) the high-grade ore
body of the mine; 2) low complexity of the mine operations; and 3)
the mine's location in a politically stable mining region (Canada's
Nunavut Territory).
Governance considerations were an important driver of the rating
actions, as the late timing in addressing the company's expiring
revolving credit facility and maturing term loan has weakened the
credit quality of Baffinland.
Baffinland has weak liquidity with about $20 million of sources
against about $285 million in uses. The company had $20 million of
cash as of Q2/2024. Uses include Moody's estimate of about $100
million of negative free cash flow to the end of June 2025, the
company's current drawings of about $110 million under its
revolving credit facility that expires May 2025 and a $75 million
term credit facility due May 2025. The company's $575 million notes
are due July 2026.
The B2 rating on the company's senior secured revolving credit
facility, four notches above the Caa3 CFR, reflects the structural
superiority of the revolving credit facility to the company's other
debt. The company's senior secured notes are rated Caa3, in-line
with the company's CFR, given that this debt makes up the
preponderance of the debt in the capital structure.
The negative outlook reflects Baffinland's weak liquidity that is
driven by approaching debt maturities that need to be refinanced.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if the company is able to address its
near-term maturities and have adequate liquidity in place.
The ratings could be lowered if the probability of a debt
restructuring or event of default increases for any reason, or
recovery prospects decline.
Baffinland is a privately held company that owns the Mary River
iron ore mine at the northern end of Baffin Island in the Nunavut
Territory, Canada. All its common shares are all owned by Nunavut
Iron Ore, Inc. (NIO). NIO is owned by the Energy & Minerals Group
and ArcelorMittal Canada Inc.
The principal methodology used in these ratings was Mining
published in October 2021.
BALLISTIC FABRICATION: Gets OK to Tap The Ruboyianes as Accountant
------------------------------------------------------------------
Ballistic Fabrication, LLC received approval from the U.S.
Bankruptcy Court for the District of Arizona to employ The
Ruboyianes Company, PLLC as its accountant.
The firm's services include:
(a) provide the Debtor with tax preparation services; and
(b) prepare and/or aid the Debtor in the filing of operating
reports.
The firm will be paid at its standard hourly rates.
Troy Ruboyianes, the principal at The Ruboyianes Company, 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:
Troy Ruboyianes
The Ruboyianes Company, PLLC
4007 E. Paradise Falls Dr., Suite 210
Tucson, AZ 85712
Telephone: (520) 577-1040
Email: info@rubycotax.com
About Ballistic Fabrication
Ballistic Fabrication, LLC, a company in Tucson, Ariz., filed a
petition under Chapter 11, Subchapter V of the Bankruptcy Code
(Bankr. D. Ariz. Case No. 24-06403) on August 4, 2024, with up to
$50,000 in assets and up to $1 million in liabilities.
Judge Brenda Moody Whinery oversees the case.
The Debtor tapped Charles R. Hyde, Esq., at the Law Offices of C.R.
Hyde, PLC as bankruptcy counsel and The Ruboyianes Company, PLLC as
accountant.
BEASLEY BROADCAST: Implements 1-for-20 Reverse Stock Split
----------------------------------------------------------
Beasley Broadcast Group Inc. announced that its Board of Directors
approved a reverse stock split of its Class A Common Stock and
Class B Common Stock at a ratio of 1-for-20. Stockholders
previously approved the reverse stock split on August 26, 2024 and
provided the Board with discretion to determine the final reverse
stock split ratio.
The reverse stock split is being conducted to regain compliance
with the $1.00 minimum bid price requirement for continued listing
on the Nasdaq Capital Market.
The reverse stock split became effective on September 23, 2024,
with shares of the Company's Class A Common Stock to begin trading
on a split-adjusted basis on Nasdaq on September 24, 2024. Shares
of the Class A Common Stock will continue to trade under the symbol
"BBGI" and the new CUSIP number will be 074014 200.
On the Effective Date, every 20 shares of the Company's Class A
Common Stock issued and outstanding will be automatically converted
into one share of Class A Common Stock, and every 20 shares of the
Company's Class B Common Stock issued and outstanding will be
automatically converted into one share of Class B Common Stock.
No fractional shares of Common Stock will be issued in connection
with the reverse stock split. Holders of Common Stock who would
otherwise receive a fractional share of Common Stock pursuant to
the reverse stock split will receive cash in lieu of the fractional
share equal to the closing sales price of the Class A Common Stock
on the Effective Date.
The reverse stock split has no effect on the par value of the
Company's Common Stock or authorized shares of any class of Common
Stock. Immediately after the reverse stock split, each
stockholder's percentage ownership interest in the Company and
proportional voting power will remain unchanged, except for minor
changes that will result from the treatment of fractional shares.
Equiniti Trust Company, LLC is acting as transfer and exchange
agent for the reverse stock split. Registered stockholders who hold
shares of Common Stock in book entry are not required to take any
action to receive split-adjusted shares. Stockholders who own
shares via a broker, bank, trust or other organization will have
their positions automatically adjusted to reflect the reverse stock
split, subject to such organization's particular processes, and
will not be required to take any action in connection with the
reverse stock split. Registered stockholders of certificate(s)
representing Common Stock prior to the Effective Date will receive
a Letter of Transmittal from the exchange agent to trade in their
certificate(s) for new certificate(s).
About Beasley
Naples, Florida-based Beasley Broadcast Group, Inc. was founded in
1961 and owns 61 AM and FM stations in 14 large- and mid-size
markets in the United States. Beasley reaches approximately 29
million unique consumers weekly over the air, online, and on
smartphones and tablets, and millions regularly engage with the
Company's brands and personalities through digital platforms such
as Facebook, Twitter, text, apps, and email.
* * *
In September 2024, S&P Global Ratings lowered its Company credit
rating on U.S.-based Beasley Broadcast Group Inc. to 'CC' from
'CCC+' and its issue-level rating on its senior secured notes to
'CC' from 'CCC+'.
Beasley has announced a debt restructuring under which it proposes
to extend the maturity of its senior secured notes to 2028 from
2026, offer to buy up to $68 million of its existing senior secured
notes due 2026 at a material discount to par, and issue $30 million
of new super-priority senior secured notes due 2028.
The negative outlook reflects that, upon the completion of the
transaction, S&P expects to lower its Company credit rating on the
company to 'SD' (selective default) and its issue-level rating on
its senior secured notes to 'D'.
S&P said, "We view the proposed restructuring as distressed and
tantamount to a default. In our view, the proposed debt
restructuring is distressed because Beasley's lenders will receive
less than they were originally promised. In addition, absent the
proposed transaction, the company's leverage is currently elevated
at about 10x and we have little visibility into its ability to
materially improve its leverage ahead of its 2026 debt maturity,
given the secular and cyclical challenges facing the broadcast
radio industry."
BEBCO ENVIRONMENTAL: Taps Pendergraft & Simon as Bankruptcy Counsel
-------------------------------------------------------------------
Bebco Environmental Controls Corporation seeks approval from the
U.S. Bankruptcy Court for the Southern District of Texas to employ
Pendergraft & Simon, LLP as bankruptcy counsel.
The firm's services include:
(a) analyze the financial situation, and render advice and
assist the Debtor in determining whether to file petitions under
Title 11, United States Code;
(b) advise the Debtor with respect to its powers and duties;
(c) conduct appropriate examinations of witnesses, claimants
and other persons;
(d) prepare and file all appropriate legal papers; and consult
with and advise the Debtor in connection with the operation of or
the termination of the operation of its business;
(e) represent the Debtor at the meeting of creditors and such
other services as may be required during the course of the
bankruptcy proceedings;
(f) represent the Debtor in all proceedings before the court
and in any other judicial or administrative proceeding where its
rights may be litigated or otherwise affected;
(g) prepare, file, negotiate and prosecute a disclosure
statement and plan of reorganization;
(h) advise and consult with the Debtor concerning questions
arising in the conduct of the administration of the estate and
concerning its rights and remedies with regard to the estate's
assets and the claims of secured, priority and unsecured
creditors;
(i) investigate pre-petition transactions and prosecution, if
appropriate, preference and other avoidance actions arising under
its avoidance powers or any other causes of action held by the
estates;
(j) defend, if necessary, any motions for relief from the
automatic stay, contested matters and/or adversary proceedings, and
analyze and prosecute any objections to claims;
(k) appear on behalf of the Debtor before this court;
(l) advise and assist the Debtor with real estate and business
organizations issues related to this case; and
(m) assist the Debtor in any matters relating to or arising
out of the above-styled and numbered case.
The hourly rates of the firm's counsel and staff are as follows:
Leonard Simon, Attorney $600
William Haddock, Attorney $600
Senior Paralegal/Senior Law Clerk $250
Junior Paralegal/Senior Law Clerk $125
In addition, the firm will seek reimbursement for expenses
incurred.
Mr. Simon 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:
Leonard H. Simon, Esq.
Pendergraft & Simon, LLP
2777 Allen Parkway, Suite 800
Houston, TX 77019
Telephone: (713) 528-8555
Facsimile: (713) 868-1267
About Bebco Environmental Controls
Bebco Environmental Controls Corporation offers a complete range of
industrial HVAC, pressurization & room air filtration solutions for
electrical enclosures, shelters & buildings in oil refineries,
chemical manufacturing plants, offshore rigs & other facilities
with hazardous electrical classified areas & corrosive
environments.
Bebco Environmental Controls filed a petition under Chapter 11,
Subchapter V of the Bankruptcy Code (Bankr. S.D. Tex. Case No.
24-80258) on Aug. 30, 2024. In the petition signed by Michael K.
Baucom, president & CEO, the Debtor disclosed up to $100,000 in
assets and up to $10 million in liabilities.
Leonard H. Simon, Esq., at Pendergraft & Simon, LLP represents the
Debtor as bankruptcy counsel.
BENHAM ORTHODONTICS: Five Point et al. TRO Bid Denied in Part
-------------------------------------------------------------
In the adversary proceeding captioned as FIVE POINT DENTAL
SPECIALISTS, INC., FPDS BENHAM SUB, LLC, and BENHAM ORTHODONTICS,
P.A., Plaintiffs v. ADAM BENHAM, DDS, MS, BENHAM PROPERTY OWNERS
ASSOCIATION, LLC, BENHAM ORTHODONTICS & ASSOCIATES, P.A.,
Defendants, Adv. No. 24-04068 (Bankr. N.D. Tex.), Judge Edward L.
Morris of the United States Bankruptcy Court for the Northern
District of Texas granted in part and denied in part the
plaintiffs' request for the entry of a temporary restraining order.
The Court granted the plaintiffs' request for issuance of a
preliminary and permanent injunction against all of the defendants.
This adversary proceeding involves a dispute between Five Point
Dental Specialists, Inc. and certain of its affiliates, on the one
hand, and Adam Benham, DDS, MS and certain of his affiliates, on
the other hand, arising out of the sale of Benham's orthodontic
practice to Five Point in 2020.
Prior to the August 7, 2024, the Five Point Parties and Benham
Parties were engaged in litigation in Texas state court under Cause
No. 471-02575-2024 in the 471st Judicial District Court of Collin
County, Texas. On the Petition Date, the Benham Debtor, a Texas
professional association organized by Benham on or about April 24,
2024:
(a) filed a petition for voluntary relief under chapter 11 of
the United States Bankruptcy Code, thereby initiating Case No.
24-42784 with this Court; and
(b) filed a Notice of Removal with the United States District
Court for the Eastern District of Texas to remove all of the claims
in the State Court Case to the EDTX District Court, thereby
initiating Civil Action No. 4:24-CV-00705 with the EDTX District
Court.
On August 13, 2024, the Benham Debtor then filed an unopposed
motion to transfer the EDTX Case to the Court.
Notwithstanding the issuance of certain pretrial injunctive relief
in favor of the Five Point Parties in the State Court Case, the
removal of all claims from the State Court Case to the EDTX
District Court, and the impending transfer of the EDTX Case to this
Court, on August 15, 2024, the Five Point Parties initiated the
adversary proceeding with the filing of their Original Complaint
and Emergency Application for Temporary Restraining Order,
Preliminary Injunction and Permanent Injunction against the Benham
Parties. Shortly thereafter, on August 20, 2024, the EDTX District
Court entered an order transferring the EDTX Case to this Court.
Pursuant to the Complaint, the Plaintiffs have asserted these
claims against the Defendants:
Count 1 - Trespass (against all of the Defendants)
Count 2 - Assault (against all of the Defendants)
Count 3 - Breach of the APA (against Benham)
Count 4 - Breach of the Employment Agreement (against
Benham)
Count 5 - Tortious Interference with Existing and Prospective
Contracts and Business Relationships (against Benham and the Benham
Debtor)
Count 6 - Tortious Interference with Existing Contracts
(against the Benham Debtor and
BPOA)
Count 7 - Violation of Delaware Uniform Trade Secrets Act
(against Benham and the
Benham Debtor)
Count 8 - Constructive Trust & Accounting (against all of the
Defendants)
Count 9 - Conversion (against Benham and the Benham Debtor)
Count 10 - Objection to Discharge 11 U.S.C. Sec. 523(a)(6)
(against the Benham Debtor)
On August 20, 2024, the Court commenced the evidentiary TRO
hearing. On August 22, the Court concluded the hearing.
Judge Morris says, "Numerous categories of relief sought pursuant
to the TRO Application have already been provided to the Plaintiffs
pursuant to the Amended Temporary Injunction. Thus, to such extent,
the Court declines to grant additional relief. Not only will this
protect against the possibility of having conflicting orders down
the road, but the Plaintiffs cannot satisfy their burden of proving
irreparable harm given the injunctive relief that is already in
place. That said, and for the avoidance of doubt, to the extent the
automatic stay of 11 U.S.C. Sec. 362 ostensibly impacts the
enforceability of the Amended Temporary Injunction against the
Benham Debtor, the Court will grant relief from the automatic stay
to ensure that the protections afforded by the Amended Temporary
Injunction are in full force and effect against the Benham
Debtor."
A copy of the Court's decision is available at
https://urlcurt.com/u?l=OIdzwi
About Benham Orthodontics & Associates
Benham Orthodontics & Associates, P.A. provides orthodontic care to
children and adults. It is based in Colleyville, Texas, and
conducts business under the name Benham Family Orthodontics.
Benham sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. N.D. Texas Case No. 24-42784) on August 7, 2024, with
up to $50,000 in assets and up to $10 million in liabilities. Adam
Benham, director, signed the petition.
Judge Edward L. Morris presides over the case.
Joyce W. Lindauer, Esq., at Joyce W. Lindauer Attorney, PLLC
represents the Debtor as bankruptcy counsel.
BIOXCEL THERAPEUTICS: Receives 2 Noncompliance Notices From Nasdaq
------------------------------------------------------------------
BioXcel Therapeutics, Inc., reported in a Form 8-K filed with the
Securities and Exchange Commission that on Sept. 16, 2024, it
received a letter from The Nasdaq Stock Market, LLC notifying the
Company that for the last 30 consecutive business days, the bid
price for the Company's common stock, par value $0.001 per share,
had closed below the $1.00 per share minimum bid price requirement
for continued listing on The Nasdaq Capital Market under Nasdaq
Listing Rule 5550(a)(2). The Bid Price Notice has no immediate
effect on the listing of the Company's common stock, which
continues to trade on The Nasdaq Capital Market under the symbol
"BTAI."
In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company
has a period of 180 calendar days, or until March 17, 2025, to
regain compliance. To regain compliance with the Nasdaq minimum
bid price requirement, the closing bid price of the Company's
common stock must be at least $1.00 per share for a minimum of 10
consecutive business days prior to the Bid Price Compliance Date.
The Company intends to monitor the bid price of its common stock
and consider available options if its common stock does not trade
at a level likely to result in the Company regaining compliance
with Nasdaq's minimum bid price rule by the Bid Price Compliance
Date.
If the Company does not regain compliance with Nasdaq's minimum bid
price requirement by the Bid Price Compliance Date, the Company
may be eligible for a second 180 calendar day compliance period.
To qualify, the Company would be required to meet the continued
listing requirement for market value of publicly held shares and
all other initial listing standards for The Nasdaq Capital Market,
with the exception of the bid price requirement, and would need to
provide written notice of its intention to cure the deficiency
during the second compliance period, for example, by effecting a
reverse stock split, if necessary. However, if it appears to the
Nasdaq staff that the Company will not be able to cure the
deficiency, or if the Company is otherwise not eligible, Nasdaq
would notify the Company that its securities would be subject to
delisting. In the event of such a notification, the Company may
appeal the Nasdaq staff's determination to delist its securities.
There can be no assurance that the Company will be eligible for the
additional 180 calendar day compliance period, if applicable, or
that the Nasdaq staff would grant the Company's request for
continued listing subsequent to any delisting notification.
In addition, on Sept. 20, 2024, the Company received a letter from
Nasdaq notifying the Company that for the last 30 consecutive
business days prior to the date of the letter, the Company's
minimum market value of listed securities was below the minimum of
$35 million required for continued listing on the Nasdaq Capital
Market pursuant to Nasdaq Listing Rule 5550(b)(2). The Market
Value Notice has no immediate effect on the listing of the
Company's common stock, which continues to trade on The Nasdaq
Capital Market under the symbol "BTAI."
In accordance with Nasdaq Listing Rule 5810(c)(3)(C), the Company
has a period of 180 calendar days, or until March 19, 2025, to
regain compliance. To regain compliance with the minimum market
value of listed securities requirement, the market value of the
Company's common stock must meet or exceed $35.0 million for a
minimum of 10 consecutive business days during the 180-day grace
period ending on the Market Value Compliance Date. If the Company
does not regain compliance with Nasdaq's minimum market value of
listed securities requirement by the Market Value Compliance Date,
the Company will receive written notification that its securities
are subject to delisting, at which point the Company may appeal the
delisting determination.
The Company said it is currently evaluating various alternative
courses of action, however, there can be no assurance that the
Company will be successful in regaining compliance with the Nasdaq
continued listing requirements or maintaining its listing of its
common stock on the Nasdaq Capital Market.
About BioXcel Therapeutics
Headquartered in New Haven, Conn., BioXcel Therapeutics, Inc., is a
biopharmaceutical company utilizing artificial intelligence to
develop transformative medicines in neuroscience and, through the
Company's wholly owned subsidiary, OnkosXcel Therapeutics LLC,
immuno-oncology. The Company is focused on utilizing cutting-edge
technology and innovative research to develop high-value
therapeutics aimed at transforming patients' lives. The Company
employ various AI platforms to reduce therapeutic development costs
and potentially accelerate development timelines.
Stamford, Conn.-based Ernst & Young LLP, the Company's auditor
since 2021, issued a "going concern" qualification in its report
dated March 22, 2024, citing that the Company has suffered
recurring losses from operations, has used significant cash in
operations, and has stated that substantial doubt exists about the
Company's ability to continue as a going concern.
BIOXCEL THERAPEUTICS: Reduces Workforce By 28%
----------------------------------------------
BioXcel Therapeutics, Inc. disclosed in a Form 8-K Report filed
with the U.S. Securities and Exchange Commission that on September
17, 2024, the Board of Directors approved a plan to reduce its
workforce by 15 employees, or approximately 28% of the Company's
headcount, in order to extend its cash runway and prioritize
investment on the clinical development of its lead neuroscience
asset, BXCL501.
The Company estimates that it will incur aggregate charges in
connection with the Clinical Prioritization of approximately $1.4
million, which relate primarily to severance payments, notice pay
and related continuation of benefits costs, all of which are
expected to be paid in cash and anticipated to result in future
cash expenditures, along with the payment of accrued benefits (such
as paid-time-off). The Company expects that the majority of these
costs will be incurred, and the Clinical Prioritization is expected
to be completed, during the quarter ending December 31, 2024. The
estimates of the charges and expenditures that the Company expects
to incur in connection with the Clinical Prioritization, and the
timing thereof, are subject to several assumptions and the actual
amounts incurred may differ materially from these estimates. The
Company may also incur other cash or non-cash charges or cash
expenditures not currently contemplated due to events that may
occur as a result of, or in association with, the Clinical
Prioritization.
On September 18, 2024, the Company notified Matt Wiley, the
Company's Chief Commercial Officer, that, in connection with the
Clinical Prioritization, his position was being eliminated. The
Company and Mr. Wiley agreed that he would cease his employment in
this role effective October 2 and would serve as a consultant for a
period of time thereafter.
About BioXcel Therapeutics
Headquartered in New Haven, Conn., BioXcel Therapeutics, Inc., is a
biopharmaceutical company utilizing artificial intelligence to
develop transformative medicines in neuroscience and, through the
Company's wholly owned subsidiary, OnkosXcel Therapeutics LLC,
immuno-oncology. The Company is focused on utilizing cutting-edge
technology and innovative research to develop high-value
therapeutics aimed at transforming patients' lives. The Company
employs various AI platforms to reduce therapeutic development
costs and potentially accelerate development timelines.
Stamford, Conn.-based Ernst & Young LLP, the Company's auditor
since 2021, issued a "going concern" qualification in its report
dated March 22, 2024, citing that the Company has suffered
recurring losses from operations, has used significant cash in
operations, and has stated that substantial doubt exists about the
Company's ability to continue as a going concern.
BioXcel Therapeutics reported net losses of $179,053,000 and
$165,757,000 for the years ended December 31, 2023 and 2022,
respectively. As of June 30, 2024, BioXcel Therapeutics had $65.4
million in total assets, $139.7 million in total liabilities, and
$74.3 million in total stockholders' deficit.
BLINK CHARGING: Expects to Cut Global Workforce by 14%
------------------------------------------------------
Blink Charging Co. announced Sept. 17, 2024, that it will implement
its planned operational cost reduction actions designed to position
the Company for short and long-term success within current economic
conditions.
The cost reduction plan anticipates reducing the global personnel
count by 14%, resulting in annualized savings of approximately $9
million. It will begin immediately and be completed in the first
quarter of 2025. The plan aims to improve operational efficiencies
by streamlining functions across the company.
Blink is focused on strengthening its financial position by
improving economic stability, profitability, and competitive
positioning. Blink plans to develop a more efficient and resilient
organization that supports long-term growth and strategic
advantage. These measures aim to strengthen the Company's financial
performance and growth potential, benefiting shareholders through
increased value and returns.
"The timing of these cost-cutting measures, as indicated in our
last earnings announcement, is a proactive step to adapt to current
market conditions while preserving our long-term strategy," said
President & CEO Brendan Jones. "We remain fully committed to our
mission to develop and deploy energy management services and pursue
operational excellence and superior customer experience. These
operational changes will make Blink Charging a more efficient and
effective organization that is better aligned with our strategic
priorities."
"We believe the current economic and market challenges facing the
EV industry are temporary," added Blink Chief Operating Officer and
CEO Elect Michael Battaglia. "We are very optimistic about the
future. The operational changes we are announcing today will help
us reduce costs and improve our financial performance right away.
At the same time, these changes will also help us make faster
progress in establishing Blink as a top provider of electric
transportation solutions and innovative technologies."
About Blink Charging
Based in Miami Beach, Florida, Blink Charging Co. (OTC: CCGID)
f/k/a Car Charging Group Inc. -- http://www.CarCharging.com/-- is
a manufacturer, owner, operator, and provider of electric vehicle
("EV") charging equipment and networked EV charging services in the
rapidly growing U.S. and international markets for EVs. Blink
offers residential and commercial EV charging equipment and
services, enabling EV drivers to recharge at various locations.
Blink's principal line of products and services is its Blink EV
charging networks and Blink EV charging equipment, also known as
electric vehicle supply equipment ("EVSE"), and other EV-related
services.
Blink Charging reported a net loss of $203.69 million in 2023, a
net loss of $91.56 million in 2022, a net loss of $55.12 million in
2021, a net loss of $17.85 million in 2020, a net loss of $9.65
million in 2019, and a net loss of $3.42 million in 2018. Blink
Charging reported a net loss of $37.23 million for the six months
ended June 30, 2024.
CANNON CONSTRUCTORS: Seeks to Hire G&B Law as Bankruptcy Counsel
----------------------------------------------------------------
Cannon Constructors North Inc. seeks approval from the U.S.
Bankruptcy Court for Northern District of California to employ G&B
Law, LLP as general bankruptcy counsel.
The firm's services include:
(a) advise the Debtor as to its duties, rights and powers;
(b) represent the Debtor, with respect to bankruptcy issues,
in the context of its pending Chapter 11 case and to represent it
in contested matters as would affect the administration of its
case, except to the extent that any such proceeding requires
expertise in areas of law outside of G&B's expertise;
(c) advise, assist, and represent the Debtor in negotiating
and seeking court approval of Chapter 11 plan;
(d) render services for the purpose of pursuing, litigating
and/or settling litigation as may be necessary and appropriate in
connection with this case;
(e) perform such other legal services as may be required and in
the interests of the Debtor and the estate; and
(f) provide such other services as may be required as
bankruptcy counsel.
The hourly rates of the firm's counsel and staff are as follows:
James Felton, Partner $695
Arthur Greenberg, Partner $695
Douglas Neistat, Of Counsel $695
Michael Conway, Associates $625
Jeremy Rothstein, Partner $575
Tania Ingman, Of Counsel $495
Marina Fineman, Of Counsel $450
Law Clerk $195 - $295
Paralegal/Legal Assistant $95 - $300
In addition, the firm will seek reimbursement for expenses
incurred.
The Debtor has agreed to pay the firm's post-petition retainer in
the amount of $35,000.
Mr. Rothstein 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:
Jeremy H. Rothstein, Esq.
G&B Law LLP
1600 Ventura Boulevard, Suite 1000
Encino, CA 91436
Telephone: (818) 382-6200
Facsimile: (818) 986-6534
Email: jrothsteing@gblawllp.com
About Cannon Constructors North
An involuntary petition for relief under Chapter 7 of the
Bankruptcy Code was filed against Cannon Constructors North, Inc.
on June 13, 2024.
Cannon Constructors North, Inc. filed a stipulation to convert case
to a case under Chapter 11, Subchapter V of the Bankruptcy Code
(Bankr. N.D. Cal. Case No. 24-30447) on Aug. 8, 2024.
On August 9, 2024, the Court entered the Order to convert case
under Chapter 11 of Title 11 of the United States Code.
Judge Hannah L. Blumenstiel oversees the case.
Jeremy H. Rothstein, Esq., at G&B Law LLP represents the Debtor as
bankruptcy counsel.
CARDIFF LEXINGTON: Hires GBQ Partners as New Auditor
----------------------------------------------------
Cardiff Lexington Corporation disclosed in a Form 8-K Report filed
with the U.S. Securities and Exchange Commission that Grassi & Co.,
CPAs, P.C. resigned as the independent registered public accounting
firm for the Company effective as of September 13, 2024.
The audit reports of Grassi on the financial statements of the
Company for the years ended December 31, 2023 and 2022 did not
contain an adverse opinion or a disclaimer of opinion and were not
qualified or modified as to uncertainty, audit scope or accounting
principles, except that Grassi's reports for such years included an
explanatory paragraph indicating that there was substantial doubt
about the Company's ability to continue as a going concern.
During the Company's two most recent fiscal years ended December
31, 2023 and 2022 and the subsequent interim period through
September 13, 2024, there were no (i) disagreements with Grassi on
any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure which, if not
resolved to Grassi's satisfaction, would have caused it to make
reference to the subject matter of the disagreement in connection
with its reports, or (ii) "reportable events," as defined in Item
304(a)(1)(v) of Regulation S-K.
Following Grassi & Co.'s resignation, the Company engaged GBQ
Partners LLC as the Company's independent registered public
accounting firm for the year ending December 31, 2024, which was
approved by the audit committee of the board of directors of the
Company.
During the Company's two most recent fiscal years ended December
31, 2023 and 2022 and the subsequent interim period through
September 13, 2024, neither the Company nor anyone on its behalf
has consulted with GBQ regarding either (i) the application of
accounting principles to a specified transaction, either completed
or proposed, or the type of audit opinion that might be rendered on
the Company's financial statements, and neither a written report
nor oral advice was provided to the Company that GBQ concluded was
an important factor considered by the Company in reaching a
decision as to any accounting, auditing or financial reporting
issue, or (ii) any matter that was either the subject of a
"disagreement" or a "reportable event," as such terms are defined
in Items 304(a)(1)(iv) and (v) of Regulation S-K, respectively.
About Cardiff Lexington
Headquartered in Las Vegas, Nevada, Cardiff Lexington Corporation
is an acquisition holding company focused on locating undervalued
and undercapitalized companies, primarily in the healthcare
industry, and providing them capitalization and leadership to
maximize the value and potential of their private enterprises while
also providing diversification and risk mitigation for its
stockholders.
Jericho, New York-based Grassi & Co., CPAs, PC, the Company's
auditor since 2022, issued a "going concern" qualification in its
report dated March 27, 2024, citing that the Company has sustained
an accumulated deficit and negative cash flows from operations,
which raise substantial doubt about its ability to continue as a
going concern.
Cardiff reported a net income of $3,028,394 for the year ended
December 31, 2023, as compared to a net loss of $5,429,521 for the
year ended December 31, 2022. As of June 30, 2024, Cardiff had
$24,659,020 in total assets, $14,196,608 in total liabilities,
$4,625,000 in total mezzanine equity, and $5,837,412 in total
stockholders' equity.
CASPIAN TECHNOLOGY: Unsecureds to Get Share of Income for 3 Years
-----------------------------------------------------------------
Caspian Technology Concepts LLC, submitted a Modified Plan of
Reorganization dated August 21, 2024.
The Debtor's Plan proposes to pay Secured Claims in full, assume
and reject certain of its contracts, and pay Unsecured Claims
pursuant to the Debtor's 3-year cash flow Projections.
Under the terms outlined in this Plan, the Debtor's Secured
Creditors, Administrative Claim Holders, and Creditors holding
priority Claims will be paid in full. Additionally, General
Unsecured Creditors will receive a Pro Rata distribution of the
Debtor's Disposable Income as set forth in the Projections, which
reflects more than parties would receive in a liquidation
scenario.
Class 4 consists of Allowed Unsecured Claims. Allowed Unsecured
Claims in Class 4 are impaired. Each Claim in Class 4 shall receive
a Pro Rata Share of the Reorganized Debtor's Disposable Income, to
be distributed by the Plan Proponent. The treatment afforded to
Class 4 Claims pursuant to this section shall fully discharge all
Class 4 Claims as of the Effective Date of the Plan, provided that
the Plan is confirmed under Section 1191(a) of the Bankruptcy
Code.
In the event the Plan is confirmed under Section 1191(b) of the
Bankruptcy Code, each Class 4 Claim shall only be discharged upon
payment in full of such Creditor's Pro Rata Share of the
Reorganized Debtor's Disposable Income. The Reorganized Debtor
shall make Pro-Rata payments to Creditors within Class 4 on (or
before) September 30th for each of the first three years following
the Effective Date, in such amounts consistent with the Disposable
Income in the Debtor's Projections.
Class 5 consists of Holders of Allowed Equity Interests. Members in
Class 5 that hold Allowed Equity Interests in the Debtor are
unimpaired by the Plan. Holders of Allowed Equity Interests shall
retain their interests.
Cash necessary to fund payments shall be from the Reorganization
Fund and the Debtor's normal business operations and cash on hand
as of the Effective Date.
The Debtor shall manage its financial and business affairs as a
Reorganized Debtor after the Effective Date. Except as altered by
this Plan, the existing equity holders of the Debtor shall continue
to be the equity holders of the Reorganized Debtor, in such level
and amount as consistent with the terms and provisions of the
Debtor's articles, bylaws, and other corporate documents. The
Debtor's existing Manager shall continue to hold his same positions
with regards to the Reorganized Debtor.
A full-text copy of the Modified Plan dated August 21, 2024 is
available at https://urlcurt.com/u?l=tpqKFT from PacerMonitor.com
at no charge.
Counsel to the Debtor
Justin M. Mertz, Esq.
Michael Best & Friedrich LLP
790 N. Water St., Ste. 2500
Milwaukee, WI 53202
Tel: (414) 271-6560
Fax: (414) 277-0656
Email: jmmertz@michaelbest.com
About Caspian Technology Concepts
Caspian Technology Concepts, LLC, is a global business technology
management firm in Waukesha Wis. It offers strategic advisory
services, managed infrastructure solutions, cybersecurity services,
and advanced communications services.
Caspian Technology Concepts filed its voluntary petition for
Chapter 11 protection (Bankr. E.D. Wis. Case No. 24-23280) on June
20, 2024, listing $100,000 to $500,000 in assets and $1 million to
$10 million in liabilities. Dale G. Boehm as member, signed the
petition.
Judge Katherine M Perhach oversees the case.
Michael Best & Friedrich, LLP serves as the Debtor's legal counsel.
CASTLE US: $1.20BB Bank Debt Trades at 33% Discount
---------------------------------------------------
Participations in a syndicated loan under which Castle US Holding
Corp is a borrower were trading in the secondary market around 67.1
cents-on-the-dollar during the week ended Friday, Sept. 20, 2024,
according to Bloomberg's Evaluated Pricing service data.
The $1.20 billion Term loan facility is scheduled to mature on
January 29, 2027. The amount is fully drawn and outstanding.
Castle US Holding Corporation provides database tools and software
to public relations and communications professionals.
CASTLE US: $295MM Bank Debt Trades at 33% Discount
--------------------------------------------------
Participations in a syndicated loan under which Castle US Holding
Corp is a borrower were trading in the secondary market around 66.6
cents-on-the-dollar during the week ended Friday, Sept. 20, 2024,
according to Bloomberg's Evaluated Pricing service data.
The $295 million Term loan facility is scheduled to mature on
January 29, 2027. The amount is fully drawn and outstanding.
Castle US Holding Corporation provides database tools and software
to public relations and communications professionals.
CEMTREX INC: Resolution to Pay Dividend on Preferred Shares OK'd
----------------------------------------------------------------
Cemtrex, Inc. disclosed in a Form 8-K Report filed with the U.S.
Securities and Exchange Commission that on September 18, 2024, the
Board of Directors passed a resolution that the company will pay
its dividend on Series 1 Preferred Stock in additional shares of
Series 1 Preferred Stock. to be issued on October 7, 2024, to the
holders of record on close of business on September 30, 2024. The
holders of the Series 1 Preferred Stock are entitled to receive
dividends at the rate of 10% annually, based on the $10.00 per
share Preference Amount, payable semiannually.
About Cemtrex
Cemtrex, Inc. was incorporated in 1998 in the state of Delaware and
has evolved through strategic acquisitions and internal growth into
a multi-industry company. During the first quarter of fiscal year
2023, the Company reorganized its reporting segments to be in line
with its current structure consisting of (i) Security, (ii)
Industrial Services, and (iii) Cemtrex Corporate.
As of June 30, 2024, Cemtrex had $43.8 million in total assets,
$43.5 million in total liabilities, $304,967 in non-controlling
interest and $47,956 in total Cemtrex shareholders' equity.
Jericho, New York-based Grassi & Co, CPAs, P.C., the Company's
auditor since 2021, issued a "going concern" qualification in its
report dated Dec. 28, 2023, citing that the Company has sustained
net losses and has significant short-term debt obligations, which
raise substantial doubt about its ability to continue as a going
concern.
CLARITY LAB SOLUTIONS: Files for Chapter 11 Bankruptcy
------------------------------------------------------
Clarity Lab Solutions LLC filed Chapter 11 protection in the
Southern District of Florida. According to court documents, the
Debtor reports between $10 million and $50 million in debt owed to
1 and 49 creditors. The petition states funds will be available to
unsecured creditors.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
Oct. 7, 2025 at 9:00 a.m. in Room Telephonically.
About Clarity Lab Solutions
Clarity Lab Solutions LLC is a high complexity clinical laboratory
located in Boca Raton, Florida that is focused on specialty
syndromic panel PCR + Culture testing.
Clarity Lab Solutions LLC sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. S.D. Fla. Case No. 24-19243) on
September 10, 2024. In the petition filed by Richard Simpson, as
president, the Debtor reports estimated assets between $1 million
and $10 million and estimated liabilities between $10 million and
$50 million.
Honorable Bankruptcy Judge Erik P. Kimball oversees the case.
The Debtor is represented by:
Bradley S. Shraiberg, Esq.
SHRAIBERG PAGE PA
2385 NW Executive Center Dr
Suite 300
Boca Raton, FL 33431
Tel: 561-443-0800
Email: bss@slp.law
COVETRUS INC: S&P Alters Outlook to Negative, Affirms 'B-' ICR
--------------------------------------------------------------
S&P Global Ratings revised our outlook on Portland, Maine-based
animal health distributor Covetrus Inc. to negative from stable and
affirmed its 'B-' issuer credit rating on the company. The 'B-'
issue-level rating and '3' recovery rating on the company's
first-lien credit facility are unchanged.
The negative outlook reflects elevated risk to S&P's base case due
to the extent of sustained margin improvement required to meet our
expectations and the difficulty predicting outcomes of the adoption
of Vetsuite in a period of macroeconomic and competitive
uncertainty.
S&P said, "We have lowered our expectations for profitability and
cash flow amid operational headwinds. We now expect S&P Global
Ratings-adjusted EBITDA margins to be in the low-3% area in 2024
before returning to the high-3% area in 2025. In addition, we
expect Covetrus to likely sustain reported cash flow deficits
through 2027. The veterinary industry has been faced with lowering
visit trends coming down from its highs in 2021, when there was a
significant increase in homes adding companion animals. As this
trend has continued to normalize, it has strained visit volumes.
The industry is also seeing some changes in consumer behavior
likely due to pet-related inflation and a generally weaker economic
environment across its primary geographic areas. Furthermore, this
has led to lower spending levels in terms of branded products and
some trade-down behavior to generally less expensive retail
channels. Ultimately, these industry pressures have created
elevated levels of competition from suppliers and customers, and
Covetrus has had to compete on price to maintain volumes because
most of its products are commodity-like.
"In addition to the pricing pressure, the company's margin profile
has also been affected by elevated restructuring costs as it
reaches the end of its major reorganization initiatives. While we
do not envision a significant near-term turnaround in the
veterinary space, we do expect the steps Covetrus is taking to
manage its cost profile should begin to offset some of the industry
headwinds in the second half of 2024 and into 2025. Furthermore, an
improving margin profile into 2025, and our expectation for a
lowering interest rate environment supports a positive cash flow
trend and a path to positive free cash flow. We believe the current
rating is supported by a relatively good liquidity position of $297
million as of the end of its second quarter, which should help the
company navigate through a challenged industry and macro
environment. In addition, the company does not have a significant
maturity until 2029, which provides some runway to improve its cash
flow profile supporting the current rating.
"The negative outlook reflects market uncertainties and execution
risks as it manages the business to a neutral cash flow position.
Covetrus had a cash balance of approximately $44 million as of June
30, 2024, as well as roughly $250 million available under its
revolving credit facility. We expect the company to use its
liquidity to support debt service and operations until cash flow
generation turns positive. If the company experiences a
deeper-than-expected cash flow deficit, possibly due to significant
unexpected working capital outflows; a prolonged compression of
margins related to continued macroeconomic effects (such as
inflationary pressures or reduced demand); or a delay in the
realization of its cost-out initiatives, its liquidity position
could deteriorate. While we believe its current liquidity position
provides sufficient cushion for cash flow to improve, a trend that
is below our forecast would further prolong negative cash flows and
likely support a view of a capital structure that is
unsustainable.
"The adoption of VetSuite could provide additional growth through
our forecast, but we do see some risks. Covetrus has had relative
success in the early adoption rates of its VetSuite offering. We
believe the economics and contractual nature of the offering could
provide potential upside to future growth. At this point, Covetrus
has been able to sign up just under 1,300 customers onto the
platform, with early adopters showing relatively solid growth
potential compared with non-adopters. That said, we feel these
sign-ups are likely customers who already had a high level of
utilization of Covetrus' services. As the company extends its
offering to a larger group, it could find some difficulty
maintaining the current rate of sign-ups. We think the margin
impact is uncertain as more customers sign up for Vetsuite due to
discounting. In addition, it is unclear how compliant its customers
will be for this new mode of purchasing. Lastly, it is uncertain
whether the adoption of Vetsuite will drive further adoption of
Covetrus' practice management software and pharmacy services, which
are much higher margin than distribution. In our view, Covetrus'
software and pharmacy offerings have underperformed expectations,
likely due to competing offerings with better user experience and
switching costs.
"The negative outlook reflects our expectation that cash flow
deficits could be extended beyond 2026 or result in a larger
liquidity drain then our current expectations as the company
navigates industry headwinds and weakening market dynamics. It also
reflects that Covetrus should continue to increase revenue in the
low- to mid-single-digit percent area and expand S&P Global
Ratings-adjusted EBITDA margins to about 4.1% as it benefits from
cost-cutting measures and as restructuring costs taper off.
"We could lower the rating if the company faced continued
operational and execution challenges such that it experienced
volume softness and margin improvement that were below our
expectations, resulting in less improvement in cash flow
generation. In this scenario, we would envision a deteriorating
liquidity position suggesting the capital structure is
unsustainable.
"We could revise the outlook to stable if we expected the company
to meet or exceed our expectations such that we expected positive
free cash flow. In this scenario, we would expect a positive trend
in EBITDA margins and cash flow as Covetrus sustains the benefits
from its cost-out initiatives, continues adoption of its VetSuite
platform with limited downside to profitability, and sees
stabilization of competitive dynamics.
"Governance factors are a moderately negative consideration in our
credit rating analysis of Covetrus. Our highly leveraged assessment
of the company's financial risk profile reflects its corporate
decision-making that prioritizes the interests of its controlling
owners, which is in line with our view of the majority of rated
entities owned by private-equity sponsors. Our assessment also
reflects private-equity sponsors' generally finite holding periods
and focus on maximizing shareholder returns."
CRCI LONGHORN: S&P Withdraws 'B-' ICR Following KKR Buyout
----------------------------------------------------------
S&P Global Ratings withdrew all of its ratings on CRCI Longhorn
Holdings Inc. (d/b/a CLEAResult), including the 'B-' issuer credit
rating, at the issuer's request. At the time of the withdrawal, our
outlook on the company was positive.
CLEAResult paid off its rated debt through a private-placement
transaction associated with its buyout by KKR.
CREAGER MERCANTILE: Amends Unsecured Claims Pay Details
-------------------------------------------------------
Creager Mercantile Co. ("CMC") submitted a Corrected Plan of
Reorganization.
The Debtor firmly believes that the Plan represents the best
alternative for providing the maximum value for creditors. The
Plan provides creditors with a distribution on their Claims in an
amount greater than any other potential known option available to
the Debtor.
Class 7 is comprised of the Allowed General Unsecured Claims
holding unsecured claims against the Debtor. Class 7 shall receive
a pro-rata distribution equal to an escalating percentage of the
Debtor's Gross Revenue calculated on annual basis for a five year
period beginning on the one year anniversary of the Effective Date
of the Plan ("Class 7 Plan Term") as follows:
* Year 1: 0.001%
* Year 2: 0.03%
* Year 3: 0.1%
* Year 4: 0.4%
* Year 5: 2.2%
Commencing on the first day of the second calendar year following
the commencement of the Class 7 Plan Term and continuing each year
thereafter, the Debtor shall distribute an amount equal to the
respective percentage of the prior year's Gross Revenue as set
forth above. By way of example, if the Plan is confirmed in
December 2024, the first distribution shall be made annually based
on the Gross Revenue generated from January 2025 through December
2025.
Based on the Debtors' projections, the Debtor estimates that Class
7 Claims will receive approximately $600,000 over a five-year
period, or approximately 24% on account of their claims totaling
approximately $2.47 million.
The Debtor shall be entitled to retire the entire obligations to
Class 7 Creditors at any time during the first two years of the
Class 7 Plan Term by making a single pro rata distribution of
$200,000, less amounts previously disbursed to unsecured creditors.
In addition to the amounts, Class 7 shall receive 50% of the
amounts recovered for claims arising under Chapter 7 after payment
of attorney fees, cost of litigation, and cost of recovery.
Class 8 consists of Interests in Creager Mercantile Co. held by
Interest Holders. Interest holders are unimpaired and shall retain
their interests.
On the Effective Date of the Plan, Donald "Chip" Creager shall be
appointed pursuant to Section 1142(b) of the Bankruptcy Code for
the purpose of carrying out the terms of the Plan, and taking all
actions deemed necessary or convenient to consummating the terms of
the Plan. Mr. Creager shall continue to receive an annual salary in
the amount of $71,775, subject to adjustment as the Debtor
determines is reasonable and appropriate.
In addition to the compensation, Mr. Creager may receive additional
compensation from the company, including a reduction of his
liabilities through payment of claims for which Mr. Creager has
issued a guaranty by the Debtor.
A full-text copy of the Corrected Plan dated August 21, 2024 is
available at https://urlcurt.com/u?l=O09BSX from PacerMonitor.com
at no charge.
Attorneys for the Debtor:
Jeffrey S. Brinen, Esq.
Jenny M.F. Fujii,
Kutner Brinen Dickey Riley, PC
1660 Lincoln Street, Suite 1720
Denver, CO 80264
Telephone: (303) 832-2400
E-mail: jsb@kutnerlaw.com
About Creager Mercantile Co.
Creager Mercantile Co. is a a wholesale grocery distributor.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Colo. Case No. 24-12652-KHT) on May 16,
2024. In the petition signed by Donald Creager, president, the
Debtor disclosed $10 million in both assets and liabilities.
Judge Kimberly H. Tyson oversees the case.
Jeffrey S. Brinen, Esq., at Kutner Brinen Dickey Riley PC,
represents the Debtor as legal counsel.
DIGITAL MEDIA: In Chapter 11 With $300 Million in Debt
------------------------------------------------------
Christina Georgacopoulos of the Tampa Bay Business Journal reports
that Digital Media Solutions filed for Chapter 11 bankruptcy and
will sell off some assets to its lenders, ending a nearly two-year
period of financial hardship.
The Clearwater-based digital advertising management and media
distribution company defaulted on its debt in April. Its board of
directors later initiated a strategic review to consider
alternative paths forward for the business, including a potential
sale. The announcement marked a second year of annual net losses.
As of last quarter, DMS had roughly $300 million in long-term
secured debt, including a $252.5 million term loan and $57 million
revolving credit facility, financial statements show. The company
listed $136 million in assets last quarter.
However, a group of existing lenders is providing DMS with $122
million in debtor-in-possession financing, which it expects to
support the business throughout the court-supervised sale process.
The Chapter 11 was filed in the Southern District of Texas
bankruptcy court.
DMS said it expects to continue paying employees, contractors,
vendors, and suppliers and continue its ordinary course of
business. DMS, a public company, was formerly listed on the New
York Stock Exchange under the ticker DMS but was delisted in
October 2023.
DMS previously restructured and laid off employees in early 2023
after rejecting a more than $330 million take-private buyout
offer.
DMS employed 337 employees at the end of 2023, down from 580 in
2021, but the company's total headcount is unknown. A spokesperson
for the company did not immediately return a request for comment.
"We are now moving forward with the support of highly sophisticated
investors, and we believe their commitments for new financing and
the [asset purchase agreement] underscore their conviction in our
business and the future of DMS," cofounder and CEO Joseph Marinucci
said in a statement.
"We are continuing our growth trajectory and are confident we will
be an even stronger partner for our clients and vendors," Marinucci
said.
Truist Bank and Fifth Third Bank, as joint lead arrangers, entered
a five-year $275 million senior secured credit facility with DMS in
early 2021. The banks waived penalties after the company breached
that agreement's net leverage ratio covenant in April and expanded
the facility by an additional $22 million in borrowing capacity.
DMS shareholders have also paid in nearly $80 million in additional
capital to keep the company afloat over the last two years,
financial statements show. Last quarter, DMS' shareholder deficit
was approximately $152 million.
About Digital Media Solutions
Digital Media Solutions, Inc., and 36 affiliates commenced
voluntary Chapter 11 proceedings (Bankr. N.D. Tex. Lead Case No.
24-90468) on Sept. 11, 2024.
Founded in 2012, DMS is a technology-enabled digital advertising
company that leverages its advanced technology and proprietary
customer data to efficiently and effectively connect its customers
with their target consumers. As of the Petition Date, the Debtors
operate in at least 15 countries and territories around the world
and employ approximately 247 individuals in the United States and
Canada.
Kirkland & Ellis LLP and Porter Hedges LLP are serving as legal
counsel to DMS, Portage Point Partners is serving as restructuring
advisor and Houlihan Lokey Capital, Inc., is serving as investment
banker. Omni Agent Solutions is the claims agent.
DMD CUSTOM: Seeks to Hire Leibowitz, Hiltz & Zanzig as Counsel
--------------------------------------------------------------
DMD Custom Critical, Inc. seeks approval from the U.S. Bankruptcy
Court for the Northern District of Illinois to employ Leibowitz,
Hiltz & Zanzig, LLC as legal counsel.
The firm will render the following services:
(a) advise the Debtor concerning its powers and duties;
(b) attend meetings with and negotiate with respective
creditors and other parties in interest.
(c) advise and consult on the conduct of the case;
(d) advise the Debtor concerning post-petition financing
arrangements and negotiate and draft necessary documents;
(e) provide advice to the Debtor on legal issues arising in or
relating to the its ordinary course of business;
(f) take all necessary actions to protect and preserve the
Debtor's estate;
(g) prepare on behalf of the Debtor all legal papers necessary
to the administration of the estate;
(h) prepare, on the Debtor's behalf, a plan of reorganization
or liquidation and all related agreements and documents and take
any necessary action on behalf of the Debtor to obtain confirmation
of such plan;
(i) attend meetings with third parties and participate in
negotiations concerning the above matters;
(j) appear before this bankruptcy court, other courts, and the
U.S. Trustee, and protect the interests of the Debtor's estate
before such courts and the U.S. Trustee; and
(k) perform all other necessary and appropriate legal services
and provide all necessary legal advice to the Debtor in connection
with this Chapter 11 case.
The hourly rates of the firm's counsel are as follows:
David P. Leibowitz, Attorney $800
Other Attorneys $550
In addition, the firm will seek reimbursement for expenses
incurred.
The firm also received a retainer in the amount of $14,218 from the
Debtor.
Mr. Leibowitz 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:
David P. Leibowitz, Esq.
Leibowitz, Hiltz & Zanzig, LLC
53 W. Jackson Blvd., Suite 1301
Chicago, IL 60604
Telephone: (312) 662-5750
Email: dleibowitz@lakelaw.com
About DMD Custom Critical
DMD Custom Critical Inc. is a trucking company that provides
expedited transportation services to all 48 states.
DMD Custom Critical sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ill. Case No. 24-10873) on July 26,
2024. In the petition filed by Damjan Dikanovic, president, the
Debtor disclosed total assets of $874,500 and total liabilities of
$1,885,742.
Judge Donald R. Cassling oversees the case.
David P. Leibowitz, Esq., at Leibowitz, Hiltz & Zanzig, LLC serves
as the Debtor's counsel.
DPL INC: Fitch Puts 'BB' LongTerm IDR on Watch Positive
-------------------------------------------------------
Fitch Ratings has placed DPL Inc. (DPL) on Rating Watch Positive.
At the same time, Fitch has affirmed the Long-Term Issuer Default
Ratings (IDRs) of Dayton Power and Light Company (d.b.a AES Ohio)
at 'BBB-'. The Rating Outlook for AES Ohio is Stable.
The placement of DPL on Positive Watch reflects Fitch's view that
the announced minority interest sale of AES Ohio to Caisse de
dépôt et placement du Québec (CDPQ) and DPL's plan to use the
majority of the proceeds from the transaction to reduce leverage at
the holding company level can lead to sustained financial and
credit metrics improvement. Fitch will resolve the Watch Positive
on DPL when the transaction closes.
Key Rating Drivers
Strategic Partnership with CDPQ is Credit Supportive: Fitch views
the announced sale of a 30% equity interest in AES Ohio to CDPQ for
$546 million as well as the company's plan to use majority of the
proceeds to reduce leverage at the DPL holding company level as
supportive of credit quality. As of June 30, 2024, DPL has about
$1.84 billion of long-term debt, including $830 million at the DPL
level with a $415 million debt maturity on July 1, 2025. The
transaction, if successfully executed, could result in meaningful
reduction in leverage at the DPL level. The transaction expects to
close in the first half of 2025 and requires approval from the
Public Utilities Commission of Ohio (PUCO), the Federal Energy
Regulatory Commission (FERC) and the Committee on Foreign
Investments in the United States.
Another benefit of this strategic partnership with CDPQ is that it
alleviates pressure on DPL and AES Corp. (BBB-/Stable), ultimate
parent of AES Ohio, as the sole source provider of equity to the
utility to support its large capital plan.
Credit Metrics Remain High in 2024, to Improve in 2025: In 2023,
DPL's FFO leverage was well-above its downgrade sensitivity, at
about 13.8x. Weak FFO leverage in 2023 was primarily due to the
rate freeze under its ESP1, materially higher capex and only few
months of cash flow contribution from ESP4 and new base rate
increases. In addition, AES Ohio lost the rate stabilization charge
of about $70 million-$75 million under ESP1. Furthermore, DPL is
executing a capex plan that is about 4x depreciation expense.
Together, Fitch expects DPL's FFO leverage to remain weak in 2024.
For 2025, with the expect closing of the minority sale transaction,
Fitch expects DPL's FFO leverage improve to about 7.1x and further
improve to about 5.6x-6.0x by 2026 due to the cumulative effects of
recovery from smart grid and distribution investment rider (DIR),
FERC investments and a constructive outcome for new distribution
rate case. Fitch forecasts AES Ohio's FFO leverage at about 6.8x in
2024 and then average at about 5.3x in 2025-2026.
ESP4 Approval Credit Supportive: Fitch views the recent approval of
the electric security plan (ESP4) as credit supportive.
Historically, AES Ohio's financial performance has been hampered by
successful intervenors challenges on approved rate plans and
regulatory lag. Implementation of the DIR in ESP4 should reduce
regulatory lag prospectively. With more than 90% of AES Ohio's
planned $1.3 billion in investments over the next three years
expected to be recovered through riders or formula rates, Fitch
expects DPL and AES Ohio's financial performance to improve.
On Aug. 9, 2023, the PUCO issued an order approving the three-year
ESP4 that includes a DIR to recover distribution investments
between rate cases during the ESP term. It also provides recovery
of $66 million related to past expenditures by AES Ohio, plus
future carrying costs and the recovery of incremental vegetation
management expenses up to annual limits over the term of the ESP.
2022 Rate Order: In December 2022 PUCO issued the last AES Ohio
rate order that allowed a $75.6 million base-rate increase, based
on a 10% ROE and 53.87% equity layer. The increase was about 62% of
AES Ohio's request and higher than the staff recommendation. The
PUCO-authorized ROE and equity ratio are above the industry
average. Rates went into effect on Sept. 1, 2023 with the approval
of ESP4. The base rates increase was delayed due to a rate freeze
precedent set in 2009 so long as ESP1 remained in effect.
Low Business Risk: DPL is a nearly 100% regulated electric
transmission and distribution (T&D) utility holding company. The
only generation exposure for AES Ohio is its 4.9% equity interest
in Ohio Valley Electric Corporation (OVEC; BBB-/Stable), a
wholesale power generator. AES Ohio can defer, recover or credit
the net of proceeds from selling energy and capacity received as
part of its investment in OVEC and its OVEC related costs,
effectively eliminating the risk associated with the power-price
fluctuation from the OVEC ownership.
Parent and Subsidiary Linkage: There is a parent subsidiary linkage
between AES Ohio and DPL. Fitch determines DPL's Standalone Credit
Profile (SCP) based on consolidated metrics. Fitch considers AES
Ohio's SCP to be stronger. As such, Fitch has followed the weaker
parent/stronger subsidiary path. As a regulated utility and holding
company, legal ring fencing for AES Ohio is porous, given the
general protections afforded by the regulatory capital structure
and other restrictions. Access and control are porous. AES Ohio is
fully owned by DPL but issues its own debt and does not guarantee
the debt at DPL. Due to these considerations, Fitch generally
limits the IDR notching difference to two.
Derivation Summary
DPL, Inc.
DPL is a nearly 100% regulated T&D utility holding company after
retiring, selling and closing its merchant operations. DPL operates
a single-state regulated utility, similar to Cleco Corporate
Holdings, LLC (BBB-/Stable) and IPALCO Enterprises (BBB-/Stable).
DPL's regulated T&D utility carries lower operating risks than
Cleco's and IPALCO's utilities, which are exposed to coal
generation.
Ohio regulation was constructive historically but has been
unpredictable in recent years. Fitch expects DPL's FFO leverage to
remain high in 2024 at around 10.5x and improve to about 5.6x by
2026. Fitch expects Cleco's FFO leverage to be 5.5x-5.8x from
2024-2026, while IPALCO's FFO leverage to be in the range of
5.1x-6.3x over the same period.
AES Ohio
As a regulated T&D operating in Ohio, AES Ohio is weakly positioned
compared with Ohio Power Company (A-/Negative), Ohio Edison Company
(OE; BBB+/Stable), The Toledo Edison Company (TE; BBB+/Stable), and
The Cleveland Electric Illuminating Company (CE; BBB+/Stable).
Similar to AES Ohio, OE's, TE's and CE's distribution modernization
riders (DMR) were removed in 2019. The effect of the DMR removal is
relatively more manageable for OE, TE and CE, as the DMR is a
relatively small portion of their revenue and that the removal
occurred near the end of the ESP period. However, OE, TE and CE
were negatively affected by the political scandal in Ohio involving
its parent FirstEnergy Corp. (FE; BBB-/Positive). OE's, CE's and
TE's IDRs and Stable Outlooks reflect solid underlying credit
metrics, constructive rate design in Ohio and anticipates a
balanced outcome in the utilities' base rate case applications with
the PUCO.
Fitch estimates average annual 2024-2026 FFO leverage of 2.9x-3.3x
for OE, 4.8x-5.6x for CE and 3.6x-4.3x for TE. Fitch estimates that
AES Ohio's FFO leverage will remain weak in 2024, at about 6.8x,
before improving to about 4.5x by 2026, incorporating a higher
capex program. AES Ohio's ratings are constrained by its parent,
DPL, whereas its Ohio peers benefit from being part of large and
diversified corporate families.
Key Assumptions
- Minority sale of AES Ohio will close as expected and use of
proceeds to reduce leverage at DPL hold-co level;
- Successful management of regulatory risks;
- Distribution rates and the DIR implemented as approved;
- Capex in-line with company's guidance.
RATING SENSITIVITIES
DPL Inc.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
- The minority interest sale of AES Ohio closed as expected, with
proceeds used to reduce holdco leverage to achieve FFO leverage
below 7.3x on a sustain basis.
Factors that Could, Individually or Collectively, Lead to
Stabilization of Rating:
- Inability to achieve FFO leverage below 7.3x on a sustained basis
due to the deal not closing as expected or lower than projected
reduction in leverage at the holdco level.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade:
- FFO leverage above 8.3x on a sustained basis;
- Deteriorating regulatory construct or successful challenges from
stakeholders such as the Ohio Consumer Council over approved future
rate plans.
AES Ohio
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
- If DPL is upgraded and if AES Ohio's FFO leverage sustains below
5.3x, as Fitch intends to maintain up to a two-notch IDR
differential between DPL and AES Ohio.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade:
- If AES Ohio's FFO leverage sustains above 6.3x;
- Signs of deterioration of regulatory construct or successful
challenges from intervenors against future rate orders;
- If DPL is downgraded, as Fitch intends to maintain a two-notch
IDR differential between DPL and AES Ohio.
Liquidity and Debt Structure
Adequate Liquidity: DPL and AES Ohio have adequate liquidity. On
Dec.22,2022, AES Ohio amended and restated its unsecured revolving
credit facility (RCF). The RCF has a $250 million borrowing limit,
with a maturity date of Dec. 22, 2027 and a provision that provides
AES Ohio with the option to request up to two one-year extensions
of the maturity date. On June 30, 2024, AES Ohio had about $22.2
million of cash and $115 million available under its RCF. The RCF
has one financial covenant that requires debt/total capitalization
below 67%. As of June 30, 2024, the company was compliant with all
covenants.
DPL and AES Ohio do not have large debt maturities until 2025, when
$415 million in senior unsecured notes are due at DPL. The vast
majority of DPL's and AES Ohio's negative FCF comes from AES Ohio,
as Fitch expects it to execute a big capex program that is eligible
to be recovered under smart grid programs, Federal Energy
Regulatory Commission projects and the DIR. The negative FCF is
expected to be funded by AES's equity investments and by AES Ohio
debt.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
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
----------- ------ -------- -----
The Dayton Power
& Light Company LT IDR BBB- Affirmed BBB-
senior secured LT BBB+ Affirmed BBB+
senior secured LT BBB+ Affirmed RR4 BBB+
DPL Inc. LT IDR BB Rating Watch On BB
senior
unsecured LT BB Rating Watch On RR4 BB
DPL Capital
Trust II
junior
subordinated LT BB- Rating Watch On RR5 BB-
E.L. 27 REALTY: Seeks Chapter 11 Bankruptcy Protection
------------------------------------------------------
E.L. 27 Realty LLC filed Chapter 11 protection in the Eastern
District of New York. According to court documents, the Debtor
reported between $1 million and $10 million in debt owed to 1 and
49 creditors. The petition states funds will be available to
unsecured creditors.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
October 21, 2024 at 2:00 p.m. in Room Telephonically on telephone
conference line: 1 (877) 953-2748. participant access code:
3415538#.
About E.L. 27 Realty LLC
E.L. 27 Realty LLC is engaged in activities related to real
estate.
E.L. 27 Realty LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D.N.Y. Case No. 24-43763) on September
11, 2024. In the petition filed by Elizabeth Lowe, as authorized
representative of the Debtor, the Debtor reports estimated assets
and liabilities between $1 million and $10 million each.
The Honorable Bankruptcy Judge Jil Mazer-Marino handles the case.
The Debtor is represented by:
Joshua R Bronstein, Esq.
JOSHUA BRONSTEIN
114 Soundview Drive
Port Washington, NY 11050
Tel: 516-698-0202
Email: Jbrons5@yahoo.com
EDGIO INC: U.S. Trustee Appoints Creditors' Committee
-----------------------------------------------------
The U.S. Trustee for Region 3 appointed an official committee to
represent unsecured creditors in the Chapter 11 cases of Edgio,
Inc. and its affiliates.
The committee members are:
1. Verizon Sourcing, LLC
Attn: William M. Vermette
22001 Loudoun County Parkway
Ashburn, VA 20147
Phone: 571-776-4522
Email: William.vermette@verizon.com
2. EdgeUno, Inc.
Attn: Mehmet Akcin
1200 Ponce de Leon, Unit 900
Miami, FL 33134
Phone: +57 317 5135543
Email: legal@edgeuno.com
3. Equinix, Inc.
Attn: Liz Vazquez
1133 Avenue of the Americas, 16th Floor
New York, NY 10036
Phone: 646-430-6847
Email: lvazquez@equinix.com
4. Tencent Cloud, LLC
Attn: Zhao Liu
2140 S, Dupont Hwy
Camden, DE 19934
Phone: 202-838-6486
Email: zlzhaoliu@global.rencent.com
5. Encore Technologies
Attn: Grant Leugers
4620 Wesley Avenue
Cincinnati, OH 45212
Phone: 866-990-3526
Fax: 513-946-5710
Email: legal@encore.tech
6. NTT America n/k/a NTT Data
Attn: Clifford Sonkin
One Penn Plaza, Suite 4920
1 Pennsylvania Plaza
New York, NY 10119
Phone: 212-613-1220
Email: am.legal.contracts@global.att
7. Computacenter United States, Inc.
Attn: Matt Girardot
6025 The Corners Parkway, Suite 100
Norcross, GA 30032
Phone: 412-562-1387
Email: matt.girardot@computacenter.co
Official creditors' committees serve as fiduciaries to the general
population of creditors they represent. They may investigate the
debtor's business and financial affairs. Committees have the right
to employ legal counsel, accountants and financial advisors at a
debtor's expense.
About Edgio Inc.
Edgio Inc. (NASDAQ: EGIO) Edgio, Inc., and its subsidiaries provide
technology services that support the delivery of video and other
content through the Internet. Among a broad suite of services,
Edgio runs global computer networks that support high-speed
delivery of websites, recorded video, and live-streaming for a
diverse and sophisticated base of blue-chip business and media
customers. Through its software applications, Edgio helps many of
those same customers enhance the security and performance of their
websites and e-commerce platforms.
Edgio and its affiliates sought Chapter 11 protection (Bankr. D.
Del. Lead Case No. 24-11985) on Sept. 9, 2024, with a deal to sell
their assets to lender Lynrock Lake Master Fund LP for a credit bid
of $110 million, absent higher and better offers.
Edgio disclosed $379,013,042 in total assets against $368,613,842
in total liabilities as of June 30, 2024.
Judge Karen B. Owens presides over the cases.
The Debtors tapped Milbank LLP as general bankruptcy counsel;
Richards, Layton & Finger, P.A., as local counsel; TD Securities
(USA) LLC (doing business as TD Cowen) as financial restructuring
advisor; and Riveron Consulting LLC as business advisor. C Street
Advisory Group serves as strategic communications advisor to the
Debtors. Omni Agent Solutions, Inc. is the claims agent.
EMPIRE LLC: Moody's Lowers CFR to 'Caa3', Outlook Remains Negative
------------------------------------------------------------------
Moody's Ratings downgraded Empire, LLC's corporate family rating to
Caa3 from Caa1, its probability of default rating to Caa3-PD from
Caa1-PD and its senior secured revolving credit facility and senior
secured term loan ratings to Caa3 from Caa1. The outlook remains
negative.
The downgrades reflect Empire's weaker than expected operating
performance and the resulting unsustainably high leverage and weak
interest coverage. The company has been negatively impacted by soft
demand due to a weak environment for discretionary spending and a
drop in home sale activity which is often the catalyst for floor
remodeling while facing a period of higher interest rates. As a
consequence, debt/EBITDA is unsustainably high at 13.6x and
EBITA/interest is very weak at 0.4x at 6/30/24. Free cash flow
(FCF) for the last twelve months ended June 30, 2024 was -$30
million. The company's liquidity is tight with about $0.8 million
of balance sheet cash and $23 million or 38% drawn on the $60
million revolver. However, the company's 9.15x leverage covenant
would spring if the revolver balance were to be greater than 40% of
availability at quarter-end. Moody's do not believe that the
company would be in compliance with the covenant if it were to be
tested.
The negative outlook reflects that credit metrics and liquidity
will likely remain very weak over the next 12-18 months as the
company navigates a challenging discretionary spending environment
and a situation where a number of competitors are chasing the few
consumer dollars available for floor remodeling.
RATINGS RATIONALE
Empire's Caa3 CFR credit profile reflects its unsustainably high
leverage, weak interest coverage and its small scale in a highly
competitive business environment with large and well capitalized
competitors. The credit profile also reflects the company's weak
liquidity reflected by negative FCF for the LTM June 30, 2024 and
deminimis balance sheet cash and availability on the revolver
absent an amendment or waiver on its 9.15x springing covenant. It
also reflects the discretionary nature of the company's products,
as well as its high susceptibility to macroeconomic factors.
Governance is a key rating factor, particularly Empire's financial
strategies under private equity ownership which has resulted in a
high debt load. The company's direct to consumer asset light
business model makes its cost structure quite flexible but a
reduction in the effectiveness of advertising spend caused by
market weakness and lower leads has negatively impacted revenue and
earnings. Because of the company's small scale, even small declines
in EBITDA can impact credit metrics significantly. Ratings are
supported by the market position Empire has established in the
highly fragmented direct to consumer floor covering market.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ratings could be upgraded if there is a sustained improvement in
operating performance and liquidity which lessens the overall
likelihood of default and the expected recovery rate improves.
The ratings could be downgraded if the company were to default on
its debt or if recovery expectations deteriorate further.
Headquartered in Northlake, IL, Empire, LLC is a specialty retailer
of carpet, hard floor, and window treatments. The company offers
shop-at-home sales in the largest metropolitan markets in the US.
Revenue is about $820 million for the LTM ended June 30, 2024.
The principal methodology used in these ratings was Retail and
Apparel published in November 2023.
EMPLOY SOURCE: Case Summary & 11 Unsecured Creditors
----------------------------------------------------
Debtor: Employ Source, Inc.
1770 Park St., #208
Naperville, IL 60563
Business Description: Employ Source is a boutique employment
solutions partner offering custom back-
office solutions. The Company's team of
employment specialists provides expertise in
Human Resources, Compliance, Benefits, Risk
Management, Payroll and Taxes, and Staffing.
Chapter 11 Petition Date: September 25, 2024
Court: United States Bankruptcy Court
Northern District of Illinois
Case No.: 24-14212
Judge: Hon. Janet S Baer
Debtor's Counsel: Scott R. Clar, Esq.
CRANE, SIMON, CLAR & GOODMAN
Suite 3950
135 South LaSalle Street
Chicago, IL 60603-4297
Tel: 312-641-6777
Fax: 312-641-7114
Email: sclar@cranesimon.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Joel S. Randazzo as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 11 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/ITDB5JA/Employ_Source_Inc__ilnbke-24-14212__0001.0.pdf?mcid=tGE4TAMA
ENC PARENT: $450MM Bank Debt Trades at 16% Discount
---------------------------------------------------
Participations in a syndicated loan under which ENC Parent Corp is
a borrower were trading in the secondary market around 83.8
cents-on-the-dollar during the week ended Friday, Sept. 20, 2024,
according to Bloomberg's Evaluated Pricing service data.
The $450 million Term loan facility is scheduled to mature on
August 21, 2028. About $437.6 million of the loan is withdrawn and
outstanding.
ENC Parent Corporation (“ENCâ€Â), (dba
Evans Network of Companies or Evans Delivery) is an asset-light
agent-based provider of services to operators in the intermodal
drayage, truckload, and freight brokerage markets of the logistics
industry. Services provided include national and regional sales
support to agents via a number of back-office support functions
including but not limited to accounts receivable management,
payment processing, insurance, and compliance. ENC will be owned by
PE firm Court Square Capital Partners.
ENVISION ORTHOPEDIC: Gets OK to Hire Independent Monitoring Agency
------------------------------------------------------------------
Envision Orthopedic & Spine, LLC and its affiliates received
approval from the U.S. Bankruptcy Court for the Northern District
of Georgia to employ Progressive Surgical Solutions as an
independent monitoring agency.
The firm's services include any and all matters reasonable and
necessary to effectuate the requirements of the independent
monitoring agency pursuant to the Settlement Agreement.
The hourly rates of the firm's counsel and staff are as follows:
Executive Consultant $428
Senior Consultant $360
Senior Consultant $340
In addition, the firm will seek reimbursement for expenses
incurred.
Dale Egan, a general counsel at Progressive Surgical Solutions,
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:
Dale Egan
Progressive Surgical Solutions
P.O. Box 664049
Telephone: (855) 777-4272
About Envision Orthopedics and Spine
Envision Orthopedics and Spine LLC is a full-service spine and
orthopedic care treatment center serving the Southeast.
Envision Orthopedics and Spine LLC and its affiliates sought relief
under the U.S. Bankruptcy Code (Bankr. N.D. Ga. Case No. 24-20846)
on July 14, 2024. In the petitions signed by James L. Chappuis MD,
CEO, Envision Orthopedics and Spine disclosed up to $50,000 in
assets and up to $10 million in liabilities.
Judge James R. Sacca oversees the cases.
The Debtors tapped William B. Geer, Esq., at Rountree, Leitman,
Klein & Geer, LLC as bankruptcy counsel and Lauren Warner, Esq., at
Chilivis, Grubman, Warner & Berry, LLP as special counsel.
EPHPHATHA HOUSE: Seeks to Hire Haberbush as Bankruptcy Counsel
--------------------------------------------------------------
Ephphatha House ofPrayer, Inc. seeks approval from the U.S.
Bankruptcy Court for the Central District of California to employ
Haberbush, LLP as general bankruptcy counsel.
The firm's services include:
(a) advise, consult, prosecute for, and defend the Debtor
concerning issues arising in regard to the conduct of the estate,
its rights and remedies with regard to the estate's assets, and the
claims of secured, priority and unsecured creditors;
(b) appear for and represent the Debtor's interest in
obtaining court approval for the hiring of professionals, and
assist and advise regarding the liquidation of the estate's
property;
(c) investigate and prosecute, if appropriate, preference,
fraudulent transfer, and other actions arising under the Debtor's
avoiding powers, should such causes of action exist;
(d) assist in the preparation of such pleadings, applications,
and orders as are required for the orderly administration of this
estate;
(e) advise, consult and represent Debtor in such legal actions
as are necessary concerning the use and disposition of property of
the estate;
(f) advise and consult with Debtor, prosecute for it, and
defend concerning claims made against the estate or claims made by
the estate;
(g) advise, consult and prosecute the approval of a plan of
reorganization; and
(h) advise, consult, and assist the Debtor with the Guidelines
of the United States Trustee, the Local Bankruptcy Rules of this
court, Title 11 of the United States Code, and the Federal Rules of
Bankruptcy Procedure.
The firm will be paid at these hourly rates:
David Haberbush, Attorney $550
Richard Brownstein, Attorney $550
Louis Altman, Attorney $485
Vanessa Haberbush, Attorney $350
Lane Bogard, Attorney $325
Alexander Haberbush, Attorney $250
In addition, the firm will seek reimbursement for expenses
incurred.
The firm received a retainer in the amount of $22,500 from the
Debtor.
Mr. Haberbush 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:
David R. Haberbush, Esq.
Haberbush LLP
444 West Ocean Boulevard, Suite 1400
Long Beach, CA 90802
Telephone: (562) 435-3456
Facsimile: (562) 435-6335
Email: dhaberbush@lbinsolvency.com
About Ephphatha House OfPrayer
Ephphatha House OfPrayer, Inc. is a nonprofit religious corporation
organized under the laws of the state of California. It is also
known as Living Flame Church and Ephphatha House of Prayer, Inc.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. C.D. Cal. Case No. 24-16940) on August 28,
2024, with $2,301,145 in assets and $2,181,599 in liabilities. Tae
H. Kim, chief executive officer, signed the petition.
Judge Sandra R. Klein oversees the case.
Haberbush, LLP represents the Debtor as legal counsel.
EXACTECH INC: Moody's Lowers CFR to Ca & Alters Outlook to Negative
-------------------------------------------------------------------
Moody's Ratings downgraded Exactech, Inc.'s Corporate Family Rating
to Ca from Caa2 and Probability of Default Rating to Ca-PD from
Caa2-PD. Moody's also downgraded the company's backed senior
secured first lien credit facility ratings to Ca from Caa2. The
outlook was revised to negative from stable.
The downgrade reflects the very high likelihood of a restructuring
of Exactech's capital structure due to a high debt burden relative
to the company's earnings capacity and the upcoming expiry of the
fully drawn revolver in November 2024 and term loan maturity in
February 2025. The company continues to be burdened by expenses
related to the company's polybag recall. Cash flow has been
consistently negative, in part because of high capital expenditures
relative to the company's internally generated free cash flow. The
company has minimal liquidity with no availability on its revolver
as of June 30, 2024. Given these factors, the rating action
reflects the high probability of a major restructuring or default.
RATINGS RATIONALE
Exactech's Ca CFR reflects the high likelihood of a default due to
weak liquidity, very high financial leverage and upcoming near-term
maturities. Liquidity continues to be pressured by polybag related
recall expenses, which remain difficult to forecast. Exactech
competes with other large investment-grade orthopedic companies
that are materially larger in scale. The company's overall credit
profile benefits from solid growth trends in its extremities
business, a fast-growing segment of the overall orthopedic market.
The negative outlook reflects the very high risk of a near term
debt restructuring and default with uncertainty around the
potential recovery.
Moody's expect liquidity to remain weak, with $10 million of cash
on balance sheet and no availability under the revolver as of June
30, 2024. The revolving credit facility is fully drawn and expires
in November 2024. Alternative sources of liquidity are limited as
substantially all assets are pledged.
Exactech's $50 million revolving credit facility and $270 million
term loan are secured by a first lien on substantially all of the
company's domestic assets. The revolving credit facility and term
loan are rated Ca, the same as the Ca Corporate Family Rating, as
they represent the preponderance of debt in the capital structure.
Exactech's CIS-5 score indicates that the rating is materially
lower than it would have been if ESG exposures did not exist, and
the negative impact is more pronounced than for issuers scored
CIS-4. The company has significant exposure to governance risk
considerations (G-5), reflecting an aggressive financial policy and
weak execution. The company has historically spent high amounts on
capital expenditure in relation to the company's scale. This
strategy has constrained the company's free cash flow. Social risks
considerations (S-4) mainly reflects risks associated with
responsible production. The company is facing a product recall
which has cost the company materially. The majority of the
company's products are subject to regulation. Many of the company's
orthopedic products are implanted inside the human body and are
exposed to severe regulatory actions or product liability
litigations. Moreover, the company's orthopedic business relies
heavily on the elderly population, insured by government payors,
which exposes the company to risks related demographic and social
trends.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Although unlikely in the near term, an upgrade would require a
reduction in the likelihood of default by addressing debt maturity
and sustained improvement in operating performance and liquidity.
The ratings could be downgraded if the company defaults or if the
prospects for recovery further decline.
Headquartered in Gainesville, Florida, Exactech, Inc. develops and
markets a range of orthopedic implant devices, related surgical
instruments and biologic materials and services. It operates in the
United States and more than 35 markets in the rest of the world.
Revenues were approximately $333 million as of the twelve month
period ending June 30, 2024. The company is privately held and is
owned by management and affiliates of TPG Capital, LLC.
The principal methodology used in these ratings was Medical
Products and Devices published in October 2023.
EZEOBA LLC: Case Summary & Seven Unsecured Creditors
----------------------------------------------------
Debtor: Ezeoba, LLC
44544 2nd Street E.
Lancaster, CA 93535
Chapter 11 Petition Date: September 24, 2024
Court: United States Bankruptcy Court
Central District of California
Case No.: 24-17764
Debtor's Counsel: Lane Bogard, Esq.
HABERBUSH, LLP
444 West Ocean Boulevard
Suite 1400
Long Beach, CA 90802
Tel: (562) 435-3456
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Bonaventure Ugonwa as managing member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's seven unsecured creditors is available for
free at PacerMonitor.com at:
https://www.pacermonitor.com/view/DNXBFZQ/Ezeoba_LLC__cacbke-24-17764__0001.0.pdf?mcid=tGE4TAMA
FINTHRIVE SOFTWARE: $1.44BB Bank Debt Trades at 27% Discount
------------------------------------------------------------
Participations in a syndicated loan under which FinThrive Software
Intermediate Holdings Inc is a borrower were trading in the
secondary market around 72.6 cents-on-the-dollar during the week
ended Friday, Sept. 20, 2024, according to Bloomberg's Evaluated
Pricing service data.
The $1.44 billion Term loan facility is scheduled to mature on
December 18, 2028. About $1.40 billion of the loan is withdrawn and
outstanding.
FinThrive is a provider of revenue cycle management software
solutions to the healthcare sector.
FIREFLY NEUROSCIENCE: Christopher Finn Holds 5.5% Equity Stake
--------------------------------------------------------------
Christopher Finn disclosed in a Schedule 13G Report filed with the
U.S. Securities and Exchange Commission that as of August 12, 2024,
Mr. Finn and its affiliates -- Eadwacer Holdings, LLC and Harleston
Capital LLC beneficially owned 499,369 shares of Firefly
Neuroscience, Inc.'s common stock.
Mr. Finn beneficially owned 435,207 shares of common stock,
representing 5.5% of the shares outstanding. Meanwhile Eadwacer
Holdings and Harleston Capital held 224,623 and 210,584 shares,
representing 2.9% and 2.7% of the shares outstanding,
respectively.
A full-text copy of Mr. Finn's SEC Report is available at:
https://tinyurl.com/5w3s8u5j
About Firefly Neuroscience
Firefly Neuroscience, Inc., formerly known as WaveDancer, Inc., is
in the business of developing and maintaining information
technology systems, modernizing client information systems, and
performing other IT-related professional services to government and
commercial organizations. WaveDancer, based in Fairfax, Va., has
been servicing federal and commercial customers since 1979.
Going Concern
In its most recent Quarterly Report, the Company reported that it
generated an operating loss from continuing operations of $1.06
million during the six months ended June 30, 2024. As of June 30,
2024, the Company had a net working capital deficit of $746,040
including cash and cash equivalents of $244,137. Under existing
operating conditions, the Company estimates that over the 12 months
from the issuance of the financial statements, its operating
activities may use as much as $1 million to $1.5 million of cash,
including the satisfaction of all existing liabilities. The
Company's line of credit balance as of June 30, 2024, was $300,000,
had no additional borrowing capacity, and expired on July 16, 2024.
These factors raise substantial doubt about the Company's ability
to continue as a going concern for at least the next 12 months from
the date of filing of the Quarterly Report.
As of June 30, 2024, Firefly Neuroscience had $3.31 million in
total assets, $1.93 million in total liabilities, and $1.38 million
in total stockholders' equity.
FIRSTBASE.IO INC: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: Firstbase.io, Inc.
26 Mercer, 3rd Floor
New York, NY 10013
Chapter 11 Petition Date: September 25, 2024
Court: United States Bankruptcy Court
Southern District of New York
Case No.: 24-11647
Debtor's Counsel: Dawn Kirby, Esq.
KIRBY AISNER & CURLEY LLP
700 Post Road
Suite 237
Scarsdale, NY 10583
Tel: (914) 401-9500
Email: dkirby@kacllp.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Mark Milastsivy as chief executive
officer.
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/ZDRK3HA/Firstbaseio_Inc__nysbke-24-11647__0001.0.pdf?mcid=tGE4TAMA
FRANCHISE GROUP: $1BB Bank Debt Trades at 35% Discount
------------------------------------------------------
Participations in a syndicated loan under which Franchise Group Inc
is a borrower were trading in the secondary market around 65.3
cents-on-the-dollar during the week ended Friday, Sept. 20, 2024,
according to Bloomberg's Evaluated Pricing service data.
The $1 billion Term loan facility is scheduled to mature on March
10, 2026. About $764.8 million of the loan is withdrawn and
outstanding.
Franchise Group, Inc., through its subsidiaries, operates
franchised and franchisable businesses including The Vitamin
Shoppe, Pet Supplies Plus, LLC, Badcock Home Furniture & More,
American Freight, Buddy’s Home
Furnishings and Sylvan Learning Systems, Inc.
FRIENDSHIP VILLAGE: Fitch Alters Outlook on 'BB+' IDR to Positive
-----------------------------------------------------------------
Fitch Ratings has affirmed the ratings on the outstanding revenue
bonds issued by The Industrial Development Authority of the County
of St. Louis Missouri on behalf of Friendship Village of St. Louis
(FVSTL) at 'BB+'. Fitch has also affirmed FVSTL's Issuer Default
Rating (IDR) at 'BB+'.
The Rating Outlook has been revised to Positive from Stable.
Entity/Debt Rating Prior
----------- ------ -----
Friendship Village
of St. Louis (MO) LT IDR BB+ Affirmed BB+
Friendship Village
of South County (MO)
/General Revenues/1 LT LT BB+ Affirmed BB+
Friendship Village of
St. Louis (MO) /General
Revenues/1 LT LT BB+ Affirmed BB+
FVSTL operates in two Missouri markets, Friendship Village of
Sunset Hills (FVSH) and Friendship Village of Chesterfield (FVC).
The rating primarily reflects its high debt burden and stressed
leverage metrics as a result of the borrowing to finance its
expansion project, coupled with a midrange operating risk profile
still impacted by the effects rising labor costs and other
inflationary pressures. However, a rating in the higher end of the
'BB' category is supported by FVSTL's robust demand and affordable
pricing characteristics as the only life care community in the
market.
FVSTL also has historically strong occupancy rates for independent
living units (ILUs), assisted living units (ALUs) and skilled
nursing facility (SNF) beds. While census levels softened due to
disruptions from the coronavirus pandemic and labor shortages,
FVSTL's strong demand indicators translated to improved census
levels over the two years, returning to historically strong
levels.
The positive outlook is a result of the expansion project
stabilization and return of census to strong levels. Although sales
and fill of the existing ILUs was slower than forecast due to the
pandemic, the new ILUs were fully sold prior to project completion,
and combined with increasing occupancy, supports improving
operating performance, which Fitch expects will continue.
SECURITY
The bonds are secured by a pledge of gross revenues of the
obligated group (OG), a mortgage on certain properties and
equipment, and a debt service reserve fund.
KEY RATING DRIVERS
Revenue Defensibility - a
Improving Demand Across Two Campuses
FVSTL's 'strong' revenue defensibility is supported by its
historically stable demand and pricing characteristics. Despite
being in a competitive market, FVSTL's demand for its services
remains 'midrange' across both of its campuses and all levels of
care with ILU occupancy improving to 92% in FY 2024 from 83% in FY
2022. The improvement is partially driven by its communities being
the only life care (Type-A) life plan community (LPC) in its
primary market area. The most recent expansion project entailed
repositioning its campuses so that facilities, amenities and
services strategically meet the needs of its residents, reinforcing
its appeal towards its targeted demographic.
Operating Risk - bbb
Improving Operating Risk Profile Challenged by Rising Costs
FVSTL's operating risk profile has improved driven by strong census
levels and expansion project stabilization, however is still
pressured by increased labor and other industry-wide inflationary
costs. FVSTL's large capital repositioning and expansion projects
at both of its campuses were completed in January 2021, ahead of
schedule and underbudget; however, fill of the expansions lagged
projected schedules as a result of the pandemic. The new ILUs have
been fully sold and Fitch believes this will help FVSTL support
continued improvement in operating performance and be accretive to
operations.
Strong census levels and regular rate increases have resulted in
improving operating performance. FVSTL's ended FY24 with 92% ILU
occupancy, 91% ALU occupancy, 100% occupancy in its memory care
units and 95% skilled nursing occupancy. Rate were increased on
average by 5.9% in fiscal 2024 and 4.8% for fiscal 2025. The
results for FVSTL's unaudited FY24 yielded a net operating margin
of 5%, a net operating margin adjusted (NOMA) of 25% and an
operating ratio of 111%, a significant improvement from fiscal 2022
levels or -2% net operating margin, 19% NOMA and 123% operating
ratio, respectively.
FVSTL's debt burden remains high. The series 2018 financing
increased its debt burden as evidenced by an average maximum annual
debt service (MADS) at a high 21% of revenues for unaudited fiscal
2024, which is weaker than Fitch's 'BIG' medians of 14.5%. Debt to
net available measured an elevated 11.1x during the same period.
Fitch expects both metrics to continue to improve following project
stabilization, which should meaningfully boost FVSTL's total
revenues and annual cash flow levels.
Financial Profile - bb
Elevated Debt Profile
Despite high capital spending that has stressed FVSTL's leverage
profile, Fitch expects FVSTL's liquidity position to remain stable
during Fitch's stress case scenario, and remains consistent with
the rating level in light of its strong revenue defensibility and
midrange operating profile. Unaudited FYE 2024 results (as of June
30, 2024) reported $137 million in unrestricted cash and
investments, which translates into 584 days cash on hand and 45%
cash to adjusted debt. FVSTL's MADS coverage has averaged about
1.0x over the last five fiscal years improving to 1.4x coverage in
unaudited FY 2024 from 0.3x in fiscal 2021, which is consistent
with the rating level. FVSTL has met its debt service coverage
covenant as they are tested on annual debt service and not MADS.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Unexpected deterioration in cash flow levels or unrestricted
reserves that result in cash to debt falling below 30%, or
stabilized MADS coverage levels below 1x;
- While FVSTL does not intend to issue more debt in the near term,
any additional borrowing would put pressure on the 'BB+' rating.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Demonstrated improved capital base measured by cash flow levels
or unrestricted reserves that result in cash to stabilized MADS
coverage levels of over 1.5x in line with Fitch's 'BBB' medians;
- Continued improvement in operating performance that leading key
financial metrics closer to Fitch's 'BBB' medians.
PROFILE
FVSTL operates in two Missouri markets, Friendship Village of
Sunset Hills (FVSH) and Friendship Village of Chesterfield (FVC).
FVSH and FVC historically operated as distinct entities. However,
in 2017, FVC joined FVSH's existing OG, which is now called FVSTL.
The FVSTL OG also includes FV Operations, LLC (FVO), which was
established to employ personnel working at FVC, FVSH, and other
affiliated entities.
All three OG entities are solely owned by FV Services, Inc., which
also wholly owns FV Management, a management service line of the
system, and FV at Home. FV at Home wholly owns two subsidiaries: FV
at Home - Supportive Service, which provides private duty services
to residents, and FV at Home - Home Health, which provides
Medicare-certified post-acute care services. The non-OG management
service line employs senior management of the system and allocates
costs commensurate with the level of services provided to each OG
member
FVSH owns and operates a life care (Type-A) LPC on 52 acres in
Sunset Hills, MO. As of January 2023, FVSH is comprised of 449 IL
units including 44 IL villas, 76 ALUs and SNF building with 144
beds. FVC owns and operates a life care LPC on 37 acres in
Chesterfield, MO. FVC is comprised of 334 IL units including 39 IL
villas, 60 ALUs, and 90 SNF beds. The updated unit mix for both
campuses of IL/AL/SNF units increased from 976 to 1,153 combined
from FVSTL's expansion project. FVC and FVSH are located
approximately 16 miles apart. Total operating revenues of FVSTL in
FY24 (FYE June 30 2024, unaudited) were $90.774 million.
Sources of Information
In addition to the sources of information identified in Fitch's
applicable criteria specified below, this action was informed by
data 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.
FUSE GROUP: Effects 1-for-5 Reverse Common Stock Split
------------------------------------------------------
Fuse Group Holding Inc. disclosed in a Form 8-K filed with the
Securities and Exchange Commission that on Sept. 19, 2024, it filed
a Certificate of Change with the State of Nevada to effect a
1-for-5 reverse stock split of the Company's authorized shares of
common stock, par value $0.001, accompanied by a corresponding
decrease in the Company's issued and outstanding shares of Common
Stock, effective upon filing. Following the Reverse Stock Split,
the number of authorized shares of Common Stock of the Company
shall be reduced from 375,000,000 to 75,000,000.
Pursuant to the Nevada Revised Statutes, the Reverse Stock Split
and Certificate of Change were approved by the Company's Board of
Directors on July 10, 2024, and no shareholder approval was
required. Fractional shares resulting from the Reverse Stock Split
shall be rounded up to the nearest whole share, and all shares of
Common Stock (including fractions thereof) issuable upon the
Reverse Stock Split to a given shareholder shall be aggregated for
the purpose of determining whether the Reverse Stock Split would
result in the issuance of a fractional share. Each shareholder's
percentage ownership interest in the Company and proportional
voting power remains unchanged immediately following the
effectiveness of the Certificate, except for minor changes and
adjustments that will result from the treatment of fractional
shares.
The market effective date for the Reverse Stock Split will be
Sept. 24, 2024, at which time the Company's Common Stock will begin
trading on the OTC Markets on a reverse split-adjusted basis. The
new CUSIP number for the Company's Common Stock following the
effectiveness of the Reverse Stock Split is 36116W 302.
About Fuse Group
Headquartered in Arcadia, CA, Fuse Group Holding Inc. currently
explores opportunities in mining, biotech and consulting
businesses. On Dec. 6, 2016, the Company incorporated Fuse
Processing, Inc. ("Processing") in the State of California.
Processing seeks business opportunities in mining and is currently
investigating potential mining targets in Asia and North America.
Fuse Group is the sole shareholder of Processing. In March 2017,
Processing acquired 100% ownership of Fuse Trading Limited.
"As reflected in the accompanying consolidated financial
statements, the Company had an accumulated deficit of $7,971,601 at
June 30, 2024, the Company incurred net loss of $62,582 for the
nine months ended June 30, 2024, and the Company had cash outflow
from operating activities of $85,769 for the nine months ended June
30, 2024. These raise substantial doubt about the Company's
ability to continue as a going concern," said the Company in its
Quarterly Report for the period ended June 30, 2024.
GALAXY US: Blackstone Senior Marks $983,131 Loan at 18% Off
-----------------------------------------------------------
Blackstone Senior Floating Rate 2027 Term Fund has marked its
$983,131 loan extended to Galaxy US Opco Inc to market at $802,072
or 82% of the outstanding amount, according to the Blackstone
Senior's Form N-CSRS for the semi-annual period ended June 30,
2024, filed with the Securities and Exchange Commission.
Blackstone Senior is a participant in a First Lien Term Loan B (3M
CME Term SOFR + 4.75%) to Galaxy US Opco Inc. The loan matures on
April 29, 2029.
Blackstone Senior, formerly known as Blackstone Senior Floating
Rate Term Fund, is a diversified, closed-end management investment
company. BSL was organized as a Delaware statutory trust on March
4, 2010. BSL was registered under the Investment Company Act of
1940, as amended on March 5, 2010.
Blackstone Senior is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Senior Floating Rate 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, New York 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, New York 10154
Telephone: (877) 876-1121
Galaxy US Opco Inc., a wholly owned subsidiary of CD&R Galaxy UK
Intermediate 3 Limited, operates as a consulting services company.
GARDEN SPINCO: Moody's Affirms 'Ba3' CFR, Outlook Remains Stable
----------------------------------------------------------------
Moody's Ratings affirmed the ratings of Garden SpinCo Corporation,
a subsidiary of Neogen Corporation (collectively referred to as
Neogen). The affirmed ratings include the Ba3 Corporate Family
Rating, the Ba3-PD Probability of Default Rating, the Ba2 senior
secured bank credit facilities rating and the B2 backed senior
unsecured notes rating. The Speculative Grade Liquidity Rating
remains unchanged at SGL-1 and the outlook remains stable.
The rating affirmation reflects ongoing progress at integrating the
former 3M Food Safety business, notwithstanding certain
inefficiencies and other challenges. Combined with challenging
macroeconomic conditions, these factors have delayed deleveraging.
However, as organic growth continues and one-time expenses decline,
Moody's anticipate deleveraging over the next 12 to 18 months such
that gross debt/EBITDA approaches 4x. Neogen has made considerable
progress implementing a new enterprise resource planning (ERP)
system, building its new manufacturing facility, transferring most
of the former 3M Food Safety manufacturing lines and exiting
certain transition and distribution agreements. Key remaining steps
include the transfer of Petrifilm manufacturing from an outside
supplier into the new production facility Neogen is in the process
of completing.
RATINGS RATIONALE
Neogen's Ba3 Corporate Family Rating reflects its leading global
market position in food and animal safety products. The company
benefits from a high proportion of consumable sales that are
recurring in nature and carry attractive margins. Neogen has a
highly diversified end-customer base, comprised primarily of food
processors, contract labs, and other adjacent end-markets. Rising
global emphasis on food safety will drive long-term demand for
Neogen's offerings.
The rating is constrained by ongoing integration challenges
following the 2022 acquisition of 3M Company's Food Safety segment
that will continue to constrain revenue growth and margin
improvement and keep gross debt/EBITDA somewhat elevated. In
addition, Neogen lacks diversification outside of its niche focus
on food and animal safety, which creates exposure to manufacturing
issues, product defects or increasing competition. Neogen does not
have long-term contracts with the majority of customers but
delivers goods on a per-order basis.
The Speculative Grade Liquidity Rating of SGL-1 reflects Moody's
expectation that Neogen's liquidity will remain very good over the
next 12 to 18 months. Moody's anticipate cash on hand of over $150
million, positive free cash flow as capital expenditures moderate,
and full availability under the $150 million revolving credit
agreement expiring in 2027. The credit agreement contains financial
maintenance covenants including maximum net leverage of 4.5x and
minimum interest coverage of 2.5x. Moody's anticipate that Neogen
will maintain good cushion under the covenants.
The outlook is stable, reflecting Moody's expectation for solid
organic growth, improving free cash flow as integration-related
outflows moderate, and debt reduction. Moody's anticipate that the
combination of these factors will result in gross debt/EBITDA
declining toward 4x over the next 12-18 months.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to an upgrade include successful completion
of the integration of the former 3M Food Safety business, strong
organic growth, and a reduction in debt stemming from solid free
cash flow. Quantitatively, the ratings could be upgraded if gross
debt/EBITDA is sustained below 3.0x.
Factors that could lead to a downgrade include an escalation of
integration challenges with the former 3M Food Safety business,
material customer attrition or weak end user market conditions, or
more aggressive financial policies. Quantitatively, the ratings
could be downgraded if gross debt to EBITDA is sustained above
4.0x.
Garden SpinCo Corporation is a subsidiary of publicly traded Neogen
Corporation. Headquartered in Lansing, Michigan, Neogen is a global
company that develops, manufactures and markets diagnostic tests
and other products and services dedicated to food safety, livestock
and pet health and wellness. Neogen has a presence in over 140
countries. Total revenue for the fiscal year ended May 31, 2024
totaled $924 million.
The principal methodology used in these ratings was Medical
Products and Devices published in October 2023.
GENESIS HEALTHCARE: S&P Affirms 'BB+' Rating on 2013 Revenue Bonds
------------------------------------------------------------------
S&P Global Ratings revised the outlook to positive from stable and
affirmed its 'BB+' long-term rating on Genesis HealthCare System,
Ohio's series 2013 fixed-rate revenue bonds, issued for Genesis
HealthCare System's Obligated Group (Genesis).
"The outlook revision reflects the trend of strengthening
operations with further improvement expected as well as general
balance sheet stability," said S&P Global Ratings credit analyst
Blake Fundingsland. "In addition, Genesis has improved its risk
profile by terminating the defined benefit pension plan and
successfully opening its new facility with limited capital needs,"
Mr. Fundingsland added.
A gross revenue pledge of the obligated group secures the bonds.
S&P said, "The rating reflects our view of the hospital's growing
volume trends with a healthy market share although in a somewhat
limited service area with a higher reliance on government payers.
The rating further reflects the solid debt profile with no
contingent liabilities and a recently fully terminated pension plan
that required a cash contribution, although management expects to
see further growth in days' cash on hand (DCOH) during the outlook
period, which was a factor in the positive outlook. Finally, a
positive one-notch holistic adjustment to the rating reflects a
recent trend of improvement in performance and unrestricted
reserves.
"The positive outlook reflects our view that Genesis will continue
to grow unrestricted reserves through a combination of improved
cash flow and one-time COVID-19-related funds to a level where
metrics will be more in line with those of higher-rated peers. In
addition, the positive outlook reflects the recent improvement in
operations, which is expected to continue and is likely to further
support solid MADS coverage. Finally, the outlook reflects our
expectation that the enterprise strengths will be maintained
including a stable market share."
GIMEXTECH COMPANY: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Debtor: Gimextech Company, Inc.
305 W Main Street
Alhambra CA 91801
Chapter 11 Petition Date: September 24, 2024
Court: United States Bankruptcy Court
Central District of California
Case No.: 24-17758
Judge: Hon. Julia W Brand
Debtor's Counsel: John Bauer, Esq.
FINANCIAL RELIEF LEGAL ADVOCATES, INC.
4501 Cerritos Ave, Suite 101
Cypress CA 90630
Tel: 714-319-3446
Email: johnbhud@aol.com
Total Assets as of Sept. 21, 2024: $4,425,000
Total Liabilities as of Sept. 21, 2024: $6,682,419
The petition was signed by Faye Y Liu as secretary.
The Debtor stated it has no creditors holding unsecured claims.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/X7P6HVY/Gemextech_Company_Inc__cacbke-24-17758__0001.0.pdf?mcid=tGE4TAMA
GRESHAM WORLDWIDE: Arena Seeks Chapter 11 Trustee Appointment
-------------------------------------------------------------
Arena Investors, LP, a secured noteholder, asked the U.S.
Bankruptcy Court for the District of Arizona to appoint a trustee
to take over the Chapter 11 case of Gresham Worldwide, Inc.
In a court filing, Arena raised the need to appoint an independent
trustee to manage the case, saying the company's board of directors
and management are "too conflicted to remain in control of the
estate."
"This case is not presently being run by [Gresham], or for the
benefit of [Gresham's] estate. It is being run by, and for, Ault,"
Arena's attorney, Anthony Pirraglia, Esq., said, referring to
Gresham's controlling shareholder and lender Ault Alliance, Inc.
and Ault Lending, LLC.
Mr. Pirraglia cited Ault Alliance's right to appoint and its
appointment of four of the seven members of Gresham's board of
directors, three of which also sit on Ault Alliance's own board.
"Because of its control over [Gresham], Ault has been intimately
involved in [Gresham's] bankruptcy process," the attorney said.
Mr. Pirraglia also claimed of "significant acrimony" between Arena
and Gresham, which warrants the appointment of an independent
trustee.
"[Gresham] has already shown it cannot be impartial," Mr. Pirraglia
said, adding that even the company's chief executive officer,
Jonathan Read, admitted that the acrimony between the company and
Arena has already had a detrimental impact on the case.
Attorneys for Arena Investors, LP:
Jason D. Curry, Esq.
Anthony F. Pusateri, Esq.
QUARLES & BRADY LLP
2 North Central Avenue, #3
Phoenix, Arizona 85004
Telephone: (602) 229-5200
Email: jason.curry@quarles.com
Jonathan Monaghan, Esq.
HOLLAND & KNIGHT LLP
10 St. James Avenue, 11th Floor
Boston, MA 02116
Telephone: (617) 573-5834
Email: john.monaghan@hklaw.com
Anthony F. Pirraglia, Esq.
HOLLAND & KNIGHT LLP
787 Seventh Avenue, 31st Floor
New York, NY 10019
Telephone: (212) 513-3887
Email: Anthony.Pirraglia@hklaw.com
About Gresham Worldwide
Gresham Worldwide, Inc. designs, manufactures, and distributes
purpose-built electronics equipment, automated test solutions,
power electronics, supply and distribution solutions, as well as
radio, microwave, and millimeter wave communication systems and
components for a variety of applications with a focus on the global
defense industry and the healthcare market.
Gresham Worldwide sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Ariz. Case No. 24-06732) on Aug. 14,
2024. In the petition filed by Lutz P. Henckels, chief financial
officer, the Debtor disclosed $32,859,000 in assets and $39,786,000
in liabilities as of June 30, 2024.
Judge Scott H. Gan oversees the case.
Patrick A. Clisham, Esq., at Engelman Berger, PC serves as the
Debtor's counsel.
The U.S. Trustee appointed an official committee of unsecured
creditors in this Chapter 11 case. The committee tapped Stinson LLP
as legal counsel.
GROUP RESOURCES: Starts Subchapter V Bankruptcy
-----------------------------------------------
Group Resources Acquisitions LLC in the Northern District of
Georgia. According to court documents, the Debtor reports up to
$50,000 in debt owed to 50 and 99 creditors. The petition states
funds will be available to unsecured creditors.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
October 16, 2024 at 10:00 a.m. in Room Telephonically on telephone
conference line: 888-902-9750. participant access code: 9635734.
About Group Resources Acquisitions
Group Resources Acquisitions LLC sought relief under Subchapter V
of Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Ga. Case No.
24-59671) on September 13, 2024. In the petition filed by Andy
Willoughby, as president & chief executive officer, the Debtor
reports total assets of $8,158,635.
The Honorable Bankruptcy Judge Sage M. Sigler handles the case.
The Debtor is represented by:
Michael D Robl, Esq.
ROBL LAW GROUP LLC
3754 LaVista Road
Suite 250
Tucker, GA 30084
Tel: 404-373-5153
Fax: 404-537-1761
E-mail: michael@roblgroup.com
H-FOOD HOLDINGS: $1.15BB Bank Debt Trades at 25% Discount
---------------------------------------------------------
Participations in a syndicated loan under which H-Food Holdings LLC
is a borrower were trading in the secondary market around 75.1
cents-on-the-dollar during the week ended Friday, Sept. 20, 2024,
according to Bloomberg's Evaluated Pricing service data.
The $1.15 billion Term loan facility is scheduled to mature on May
30, 2025. About $1.08 billion of the loan is withdrawn and
outstanding.
H-Food Holdings, LLC and Matterhorn Parent, LLC is a food contract
manufacturer.
H-FOOD HOLDINGS: $415MM Bank Debt Trades at 25% Discount
--------------------------------------------------------
Participations in a syndicated loan under which H-Food Holdings LLC
is a borrower were trading in the secondary market around 75.1
cents-on-the-dollar during the week ended Friday, Sept. 20, 2024,
according to Bloomberg's Evaluated Pricing service data.
The $415 million Term loan facility is scheduled to mature on May
30, 2025. About $404.6 million of the loan is withdrawn and
outstanding.
H-Food Holdings, LLC and Matterhorn Parent, LLC is a food contract
manufacturer.
H-FOOD HOLDINGS: $515MM Bank Debt Trades at 25% Discount
--------------------------------------------------------
Participations in a syndicated loan under which H-Food Holdings LLC
is a borrower were trading in the secondary market around 75.1
cents-on-the-dollar during the week ended Friday, Sept. 20, 2024,
according to Bloomberg's Evaluated Pricing service data.
The $515 million Term loan facility is scheduled to mature on May
30, 2025. About $486.7 million of the loan is withdrawn and
outstanding.
H-Food Holdings, LLC and Matterhorn Parent, LLC is a food contract
manufacturer.
HAWAIIAN HOLDINGS: Fitch Hikes LongTerm IDR to BB+, Outlook Stable
------------------------------------------------------------------
Fitch Ratings has removed the Rating Watch Positive and upgraded
the Long-Term Issuer Default Ratings (IDRs) of Hawaiian Holdings,
Inc. and Hawaiian Airlines, Inc. to 'BB+' from 'B-'. The Outlook is
stable. Additionally, Fitch has upgraded the notes of Hawaiian
Brand Intellectual Property, Ltd. and HawaiianMiles Loyalty, Ltd.
to 'BBB-'/'RR1' from 'B+'/'RR2' and the 2013-1 class A certificates
of Hawaiian Airlines to 'BBB' from 'BB-'.
The upgrades are driven by the closing of the Alaska-Hawaiian
merger. Fitch has equalized the IDRs of Hawaiian and Alaska,
deriving the rating through Fitch's parent-subsidiary rating
linkage criteria. Fitch believes Alaska has incentives to support
Hawaiian's credit profile based on Fitch's assessment of high
operational incentives and medium legal and strategic incentives.
Alaska's rating is supported by the company's solid operating
margin production and healthy financial flexibility. Alaska
maintains conservative financial policies, and Fitch expects debt
reduction to remain a priority following the purchase and
integration of Hawaiian.
Key Rating Drivers
Rating Equalization: Fitch rates Hawaiian based on the consolidated
credit profile of the combined companies and equalizes its IDR with
Alaska's, reflecting the parent's incentives to support the
subsidiary. Fitch believes operational incentives are high given
Alaska's intent to obtain a single air operator's certificate for
both airlines. This will make the two difficult to disentangle,
although the brands will remain separate for marketing purposes.
The planned integration of the two airline loyalty programs, back
office functions, and management decisions also provides
operational incentives for Alaska to support Hawaiian.
Alaska currently guarantees Hawaiian's 2013-1 EETC, which supports
the legal incentive assessment. However, this is moderated as the
EETC represents a limited portion of Hawaiian's debt. Fitch views
strategic incentives to be medium.
Merger Benefits: The complementary routes of Alaska and Hawaiian
should increase traffic within their network between Hawaii and the
U.S. domestic markets as well as U.S. and international markets.
The merger also solidifies Alaska's position in Hawaii, a premium,
yet competitive market where Alaska already holds a good market
share. Hawaiian's international operations also present Alaska with
growth opportunities beyond its currently constrained West Coast
hubs. However, Hawaiian's cash burn tempers its strategic
importance.
Stronger Combined Credit Profile: Hawaiian's credit profile will
benefit from its merger with Alaska given Alaska's healthier
operating margins and a stronger balance sheet. Fitch expects
post-closing leverage to be in the 5x area and then decline to the
mid-3x range, an improvement over Hawaiian's current negative
metrics.
As a standalone entity, Hawaiian faced challenges in turning a
profit due to a slow recovery in traffic from Japan, reduced
traffic to Maui, and domestic pricing pressures. A positive
development has been improvement in the interisland market, as
fares have significantly increased due to less competition from
Southwest. Hawaiian continues to incur expenses for hiring and
training in preparation for its Amazon contract and 787 operations
without material revenue offset until 2025. The company also
contends with increased costs from pilot wage hikes, heavy
maintenance events and higher airport fees.
HA 2013-1 Class A Certificates Upgrade: Alaska has guaranteed the
payments on Hawaiian's 2013 class A certificates. As such, Fitch
now rates the 2013-1 class A off of Alaska's ' BB+' IDR with
notching uplift based on Fitch's 'medium/high' assessment of the
affirmation factor (+1) and the presence of a liquidity facility
(+1). The affirmation notching has compressed to +1 from the
previous +2 for an airline in the 'BB' category, as stipulated in
Fitch's EETC criteria.
HA 2013-1 Affirmation Assessment: The medium/high affirmation
factor reflects Fitch's expectation that the A330s in the
collateral pool are likely to be affirmed during a hypothetical
Alaska bankruptcy due to their relatively young age profile
compared to other A330s in Alaska-Hawaiian fleet along with the
strategic importance of widebody aircraft which contributed to
Alaska's rationale for pursuing the acquisition. A significant
portion of the remaining A330s in the fleet are currently leased
(50%), which Fitch views as having a higher likelihood of rejection
compared to the owned aircraft in this transaction. The low coupon
rate of the EETC debt also contributes positively to the
affirmation of the collateral.
Fitch's affirmation assessment is tempered by the relatively small
portion of the combined Alaska/Hawaiian fleet represented by this
transaction, and by the low market value for the underlying assets.
The affirmation factor is also affected by Hawaiian's plan to
introduce 12 Boeing 787-9s with purchase rights for eight
additional aircraft, scheduled deliveries between 2024 to 2027.
These fuel-efficient and long-range aircraft, which also offer more
premium seats are strong substitutes to existing A330-200 aircraft
in the fleet.
Derivation Summary
Hawaiian's 'BB+' IDR is supported by its merger with Alaska
(BB+/Stable), which bolsters its credit profile. Alaska's 'BB+'
rating is one notch below Delta Air Lines (BBB-/Stable) and two
notches above United Airlines (BB-/Stable). Pro forma for the
Hawaiian acquisition, Fitch expects Alaska's leverage and coverage
metrics to be weaker than Delta's. Alaska will also face merger
integration risks, which are incorporated in the rating
differential. Fitch expects that leverage metrics for United and
Alaska may be similar over time, though United faces FCF pressure
from its fleet renewal efforts.
However, Fitch expects United's credit profile to improve over
time, potentially converging toward Alaska's. Alaska has a history
of outperforming peers in profitability, consistently generating
margins at or near the top of its peer group in the U.S. These
factors partly offset Alaska's smaller size, scale and regional
concentration relative to larger airlines.
HA 2013-1 class A certificates' 'BBB' rating is higher than several
class A of United Airlines, Air Canada and American Airlines's
Class A certificates that are rated bottom up. The rating
differential is largely driven by Hawaiian's IDR that is equalized
to Alaska Air and stronger than other peers.
Key Assumptions
Assumptions reflect the Alaska-Hawaiian combined entity
- Alaska experiences traffic growth in the low single digits in
2024, supported by stable demand;
- Yields flattish in 2024 and modestly positive thereafter;
- Brent crude prices average $85/barrel through the forecast;
- Capex is in line with company guidance.
EETC:
- Key assumptions within the rating case for the issuer include a
harsh downside scenario in which Hawaiian declares bankruptcy,
chooses to reject the collateral aircraft, and where the aircraft
are remarketed in the midst of a severe slump in aircraft values.
Hawaiian's bankruptcy is hypothetical, and is not Fitch's current
expectation;
- Fitch's analysis incorporates an 8% annual depreciation rate for
Tier 3 aircraft.
- Fitch's recovery analyses utilize Fitch's 'BB' level stress tests
and include a full draw on liquidity facilities and assumptions for
repossessions and remarketing costs.
Aircraft Value Stresses
- A330-200: A level stress at 45%, BBB level stress at 40%, and BB
level stress at 35%.
RATING SENSITIVITIES
Hawaiian's ratings are tied to Alaska's. The sensitivities reflect
Alaska's sensitivities:
Factors That Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Adjusted debt/EBITDAR sustained around or below 2.25x;
- FCF margins sustained in the mid-single digits;
- Execution of Alaska's fleet modernization plan while maintaining
or growing unencumbered assets and financial flexibility.
Factors That Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Acquisition related headwinds that drive a sustained reduction in
profitability and financial flexibility including;
- Gross adjusted leverage rising and remaining above 3.5x;
- FFO fixed-charge coverage toward 3x;
- Sustained EBIT margins in the single digits.
EETC:
Factors That Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Positive rating actions are unlikely at this time due to
depressed values for the A330-200s.
Factors That Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Due to the sharp decline in appraised values for the A330s, the
rating for the class A certificates are achieved via a bottom-up
approach that acts as a rating floor. Should Fitch downgrade
Hawaiian's IDR or change ots affirmation factor assessment, the
notes will be downgraded accordingly.
Liquidity and Debt Structure
Adequate Liquidity: As of June 30, 2024, Hawaiian's standalone
entity holds $1.5 billion liquidity consisting of $1.3 billion in
cash and short-term investments and a full availability on its $235
million revolver.
The company's revolver and its $163 million EETC mature in December
2025 and January 2026, respectively. Its next major maturity is the
$990 million brand IP and loyalty notes due 2029.
Issuer Profile
Hawaiian Holdings, Inc. is a subsidiary of Alaska Air Group Inc.
following their merger in September 2024. Hawaiian services
customers coming to and from Hawaii and traveling between the
islands of Hawaii.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
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
----------- ------ -------- -----
Hawaiian Holdings,
Inc. LT IDR BB+ Upgrade B-
Hawaiian Brand
Intellectual
Property, Ltd.
senior secured LT BBB- Upgrade RR1 B+
Hawaiian Airlines,
Inc. LT IDR BB+ Upgrade B-
HawaiianMiles
Loyalty, Ltd.
senior secured LT BBB- Upgrade RR1 B+
Hawaiian Airlines
2013-1 Pass
Through Trust
senior secured LT BBB Upgrade BB-
HERITAGE COLLEGIATE: Committee Gets OK to Hire Bankruptcy Counsel
-----------------------------------------------------------------
The official committee of unsecured creditors appointed in the
Chapter 11 case of Heritage Collegiate Apparel, Inc., formerly
known as M-Den, Inc., doing business as The M Den, received
approval from the U.S. Bankruptcy Court for the Eastern District of
Michigan to employ Wolfson Bolton Kochis PLLC as counsel.
The firm will provide these services:
(a) advise and consult with the committee, Debtor, and other
parties in interest concerning: (i) the proposed sale of Debtor's
assets; (ii) questions arising out of the administration of the
Debtor's bankruptcy estate; (iii) the rights and remedies of the
committee and its constituents; (iv) the formulation of plans of
reorganization; and (v) the claims and interests of secured and
unsecured creditors, equity holders, insiders, and other parties in
interest in this case;
(b) analyze, appear for, prosecute, defend, and represent the
committee in contested matters and adversary proceedings arising in
or related to this case; and
(c) generally represent the committee with respect to this
case and related proceedings, and to assist it as appropriate with
respect to the matters identified in 11 U.S.C. section 1103.
The firm will be paid at these hourly rates:
Scott Wolfson, Member $745
Peter Bolton, Member $695
Thomas Howlett, Member $640
Eric Zacks, Of Counsel $615
Lara Philips, Of Counsel $595
Anthony Kochis, Member $580
Michelle Bass, Member $475
Kelsey Postema, Associate $325
Logan Grizell, Associate $325
Stephanie Travis, Paralegal $260
In addition, the firm will seek reimbursement for expenses
incurred.
Mr. Wolfson 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:
Scott A. Wolfson, Esq.
3150 Livernois, Suite 275
Troy, MI 48083
Telephone: (248) 247-7105
Facsimile: (248) 247-7099
Email: akochis@wolfsonbolton.com
About Heritage Collegiate Apparel
Heritage Collegiate Apparel, Inc. serves as the official retailer
of the University of Michigan Athletic Department. For more than 20
years, the Debtor has provided a selection of clothing, merchandise
and gifts to the University of Michigan.
Heritage Collegiate Apparel filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Mich. Case No.
24-47922) on August 16, 2024, listing $1 million to $10 million in
assets and $10 million to $50 million in liabilities. The petition
was signed by Scott Hirth as president.
Judge Thomas J. Tucker presides over the case.
Kim K. Hillary, Esq., at Schafer and Weiner, PLLC represents the
Debtor as legal counsel.
On September 3, 2024, the United States Trustee appointed an
official committee of unsecured creditors in this Chapter 11 case.
The committee tapped Wolfson Bolton Kochis PLLC as counsel and
Capstone Partners as financial advisor.
HERITAGE COLLEGIATE: Committee Gets OK to Hire Financial Advisor
----------------------------------------------------------------
The official committee of unsecured creditors appointed in the
Chapter 11 case of Heritage Collegiate Apparel, Inc., formerly
known as M-Den, Inc., doing business as The M Den, received
approval from the U.S. Bankruptcy Court for the Eastern District of
Michigan to employ Capstone Partners as its financial advisor.
The firm will provide these services:
(a) analyze and review the Debtor's finances and cash flow
projections;
(b) advise the committee and its counsel with respect to the
Debtor's financing, reporting, sale of assets, and/or plan of
reorganization;
(c) prepare necessary analyses;
(d) appear in court and meetings to testify on behalf of the
committee; and
(e) generally represent the committee with respect to this
case and related proceedings, and assist the committee as
appropriate with respect to the matters identified in 11 U.S.C.
section 1103.
The firm's professionals will be paid at these hourly rates:
Sheldon Stone, Managing Director $650
David Rychalsky, Managing Director $650
Brian Phillips, Director $550
Erik Morandi, Associate $450
Sheldon Stone, a managing director at Capstone Partner, 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:
Sheldon Stone
Capstone Partners
Detroit, MI
Telephone: (313) 929-1526
Email: sstone@capstonepartners.com
About Heritage Collegiate Apparel
Heritage Collegiate Apparel, Inc. serves as the official retailer
of the University of Michigan Athletic Department. For more than 20
years, the Debtor has provided a selection of clothing, merchandise
and gifts to the University of Michigan.
Heritage Collegiate Apparel filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Mich. Case No.
24-47922) on August 16, 2024, listing $1 million to $10 million in
assets and $10 million to $50 million in liabilities. The petition
was signed by Scott Hirth as president.
Judge Thomas J. Tucker presides over the case.
Kim K. Hillary, Esq., at Schafer and Weiner, PLLC represents the
Debtor as legal counsel.
On September 3, 2024, the United States Trustee appointed an
official committee of unsecured creditors in this Chapter 11 case.
The committee tapped Wolfson Bolton Kochis PLLC as counsel and
Capstone Partners as financial advisor.
HERITAGE HOME: Sec. 341(a) Meeting of Creditors on Oct. 15
----------------------------------------------------------
Heritage Home Furnishings LLC filed Chapter 11 protection in the
Eastern District of California. According to court filings, the
Debtor reported between $1 million and $10 million in debt owed to
1 and 49 creditors. The petition states funds will be available to
unsecured creditors.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
Oct. 15, 2024 at 10:00 a.m. at 10:00 AM via Telephone Conference
number provided by the U. S. Trustees Office.
About Heritage Home Furnishings
Heritage Home Furnishings LLC, doing business as Minerva's Home
Furnishings, is a furniture and mattress store located in Turlock,
CA that provides furniture for the living room, dining room, home
office, and bedroom. In addition to furniture, the Company carries
mattress sets, innerspring, hybrid, and gel memory foam mattresses,
box springs, and adjustable foundations. It also has mattress
accessories such as pillows, mattress covers, and mattress
protectors.
Heritage Home Furnishings LLC sought relief under Subchapter V of
Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. Cal. Case No.
24-90528) on September 9, 2024. In the petition filed by Fabiola
Sanchez Sandoval, as managing member, the Debtor reports estimated
assets up to $50,000 and estimated liabilities between $1 million
and $10 million.
The Honorable Bankruptcy Judge Ronald H. Sargis handles the case.
The Debtor is represented by:
Brian S. Haddix, Esq.
HADDIX LAW FIRM
1224 I Street
Modesto, CA 95354-0912
Tel: (209) 338-1131
E-mail: bhaddix@modestobankruptcylaw.com
HILLCREST FUND: Seeks to Hire Kenneth Jacobi as Real Estate Broker
------------------------------------------------------------------
Hillcrest Fund, LLC seeks approval from the U.S. Bankruptcy Court
for the Central District of California to employ Kenneth Jacobi, a
real estate broker at South State Real Estate Management Inc.
The Debtor needs a broker to sell its property located at 1053 N.
Hillcrest, Beverly Hills, California.
The firm will receive a commission of 5 percent of the property's
listing price.
Mr. Jacobi 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:
Kenneth Jacobi
South State Real Estate Management Inc.
1201 North Pacific Ave., Ste. 202
Glendale, CA 91202
Telephone: (650) 773-4609
Email: kjjacobi@outlook.com
About Hillcrest Fund
Hillcrest Fund, LLC, filed a Chapter 11 bankruptcy petition (Bankr.
C.D. Cal. Case No. 24-15607) on July 16, 2024. At the time of
filing, the Debtor estimated up to $50,000 in both assets and
liabilities.
Judge Barry Russell presides over the case.
The Debtor hires Anyama Law Firm, A Professional Corporation as
bankruptcy counsel.
HOOTERS OF AMERICA: Reportedly Taps Debt Advisors
-------------------------------------------------
Eliza Ronalds-Hannon, Carmen Arroyo and Reshmi Basu of Bloomberg
News reported that Hooters of America is huddling with lenders and
advisers amid revenue declines that pushed the restaurant chain to
shutter several of its locations.
Hooters, famous for its chicken wings and skimpy server uniforms,
is getting guidance from Accordion Partners and law firm Ropes &
Gray on how to improve business and address its debt load as foot
traffic slows and its liquidity dwindles, said Bloomberg's sources,
who asked not to be named discussing confidential matters.
Some of Hooters' debtholders have tapped Houlihan Lokey Inc. for
advice, the people said. Representatives for Hooters and Accordion
Partners did not respond to requests for comment.
Ropes & Gray didn't provide a comment, while a Houlihan
representative declined to comment.
Hooters' troubles come as many casual dining establishments have
faced stress. Recently, TGI Friday's Inc.'s management had to turn
over control of some assets to an outside manager, after breaching
debt terms by failing to file documents to bondholders on time.
Red Lobster filed for bankruptcy in May.
Hooters, which was acquired by Nord Bay Capital and TriArtisan
Capital Advisors in 2019 from a consortium of other private equity
firms, recently closed several locations it said were
"underperforming" in statements to news outlets at the time.
In those statements, Hooters reportedly cited "pressure from
current market conditions," and said it would continue to open new
restaurants domestically and internationally. The chain has about
$300 million in asset-backed bonds to repay, according to data
compiled by Bloomberg. Kroll Bond Rating Agency recently downgraded
those securities after revenue supporting the debt dipped,
according to a notice posted to
KBRA's website.
Hooters' bonds are packaged as whole-business securitizations,
through which a company pledges most of its assets, including
franchise fees, as collateral. That type of structured debt is
popular among restaurant chains, fitness clubs and businesses with
large networks of franchised stores.
The securitizations are designed to allow businesses to pay down
the principal over time, rather than at once.
Other companies that have borrowed money using their assets as
collateral have either restructured or refinanced their debt over
the past 18 months. Coin-counting kiosk operator Coinstar
restructured about $1 billion of asset-backed debt last year after
facing a cash crunch that deepened in 2020. Centerline Logistics
Corp., a company that refuels ships and provides other marine
transport services, refinanced about $400 million of asset-backed
securities last year.
HTX WELLNESS: Seeks to Tap Pendergraft & Simon as Legal Counsel
---------------------------------------------------------------
HTX Wellness Group, LLC, seeks approval from the U.S. Bankruptcy
Court for the Southern District of Texas to employ Pendergraft &
Simon, LLP as legal counsel.
The firm's services include:
(a) analyze the financial situation, and render advice and
assist the Debtor in determining whether to file petitions under
Title 11, United States Code;
(b) advise the Debtor with respect to its powers and duties;
(c) conduct appropriate examinations of witnesses, claimants
and other persons;
(d) prepare and file all appropriate legal papers; and consult
with and advise the Debtor in connection with the operation of or
the termination of the operation of its business;
(e) represent the Debtor at the meeting of creditors and such
other services as may be required during the course of the
bankruptcy proceedings;
(f) represent the Debtor in all proceedings before the court
and in any other judicial or administrative proceeding where its
rights may be litigated or otherwise affected;
(g) prepare, file, negotiate and prosecute a disclosure
statement and plan of reorganization;
(h) advise and consult with the Debtor concerning questions
arising in the conduct of the administration of the estate and
concerning its rights and remedies with regard to the estate's
assets and the claims of secured, priority and unsecured
creditors;
(i) investigate pre-petition transactions and prosecution, if
appropriate, preference and other avoidance actions arising under
its avoidance powers or any other causes of action held by the
estates;
(j) defend, if necessary, any motions for relief from the
automatic stay, contested matters and/or adversary proceedings, and
analyze and prosecute any objections to claims;
(k) appear on behalf of the Debtor before this court;
(l) advise and assist the Debtor with real estate and business
organizations issues related to this case; and
(m) assist the Debtor in any matters relating to or arising
out of the above-styled and numbered case.
The hourly rates of the firm's counsel and staff are as follows:
Leonard Simon, Attorney $600
William Haddock, Attorney $600
Senior Paralegal/Senior Law Clerk $250
Junior Paralegal/Senior Law Clerk $125
In addition, the firm will seek reimbursement for expenses
incurred.
Mr. Simon 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:
Leonard H. Simon, Esq.
Pendergraft & Simon, LLP
2777 Allen Parkway, Suite 800
Houston, TX 77019
Telephone: (713) 528-8555
Facsimile: (713) 868-1267
About HTX Wellness Group
HTX Wellness Group, LLC, operates a business providing whole-body
and local cryotherapy, infusion services, compression therapy, and
red-light therapy under a franchise agreement with iCRYO.
HTX Wellness Group filed a petition under Chapter 11, Subchapter V
of the Bankruptcy Code (Bankr. S.D. Tex. Case No. 24-34239) on
Sept. 11, 2024, listing up to $500,000 in assets and up to $1
million in liabilities.
Judge Jeffrey P. Norman oversees the case.
Leonard H. Simon, Esq., at Pendergraft & Simon, LLP represents the
Debtor as bankruptcy counsel.
HUDSON 888 OWNER: Wants Fast Chapter 11 Plan Confirmation
---------------------------------------------------------
Emlyn Cameron of Law360 Bankruptcy Authority reports that bankrupt
New York City condominium complex Hudson 888 Owner LLC asked a New
York bankruptcy judge to put it on the fast track to a confirmation
hearing for its third proposed Chapter 11 plan, under which it
would hand over its real estate to its main lender to clear its
debts.
About Hudson 888 Owner
Hudson 888 Owner LLC is a Single Asset Real Estate debtor (as
defined in 11 U.S.C. Sec. 101(51B)).
The Debtor sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. S.D.N.Y. Case No. 24-10021) on Jan. 7, 2024. In the
petition signed by Sheng Zhang, chairman and CEO, the Debtor
disclosed up to $500 million in both assets and liabilities.
Judge Michael E. Wiles oversees the case.
Stephen B. Selbst, Esq., at Herrick Feinstein LLP, is the Debtor's
legal counsel.
HYPERION UTS: Commences Subchapter V Bankruptcy Process
-------------------------------------------------------
Hyperion UTS Inc. filed Chapter 11 protection in the Western
District of North Carolina. According to court filings, the Debtor
reported between $1 million and $10 million in debt owed to 1 and
49 creditors. The petition states funds will be available to
unsecured creditors.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
October 21, 2024 at 3:00 p.m. at 3-Charlotte First Meeting Room.
About Hyperion UTS Inc.
Hyperion UTS Inc., doing business as United Trucking Solutions, is
an active interstate freight carrier based out of Huntersville,
North Carolina.
Hyperion UTS Inc. sought relief under Subchapter V of Chapter 11 of
the U.S. Bankruptcy Code (Bankr. W.D.N.C. Case No. 24-30777) on
Sept. 10, 2024. In the petition filed by Yurii Stiahlii, as
officer, the Debtor reports estimated assets between $500,000 and
$1 million and estimated liabilities between $1 million and $10
million.
The Debtor is represented by:
John C. Woodman, Esq.
ESSEX RICHARDS PA
1701 South Boulevard
Charlotte, NC 28203
Tel: (704) 377-4300
Fax: (704) 372-1357
Email: jwoodman@essexrichards.com
HYPERSCALE DATA: Declares Monthly Dividend of $0.2708333 Per Share
------------------------------------------------------------------
Hyperscale Data, Inc., formerly known as Ault Alliance, Inc.,
announced on September 19, 2024, that its Board of Directors has
declared a monthly cash dividend of $0.2708333 per share of the
Company's outstanding 13.00% Series D Cumulative Redeemable
Perpetual Preferred Stock. The record date for this dividend is
September 30, 2024, and the payment date is Thursday, October 10,
2024.
Link to NYSE quote for the Company's 13.00% Series D Cumulative
Redeemable Perpetual Preferred Stock:
https://www.nyse.com/quote/XASE:GPUSpD
About Hyperscale Data
Hyperscale Data, Inc. formerly known as Ault Alliance, Inc. is a
diversified holding company pursuing growth by acquiring
undervalued businesses and disruptive technologies with a global
impact. Through its wholly and majority-owned subsidiaries and
strategic investments, Hyperscale Data owns and operates a data
center at which it mines Bitcoin and offers colocation and hosting
services for the emerging artificial intelligence ecosystems and
other industries. It also provides mission-critical products that
support a diverse range of industries, including a social gaming
platform, equipment rental services, defense/aerospace, industrial,
automotive, medical/biopharma, hotel operations and textiles. In
addition, Hyperscale Data is actively engaged in private credit and
structured finance through a licensed lending subsidiary.
Hyperscale Data's headquarters are located at 11411 Southern
Highlands Parkway, Suite 240, Las Vegas, NV 89141; Hyperscale Data,
Inc.
New York, New York-based Marcum LLP, the Company's auditor since
2016, issued a "going concern" qualification in its report dated
April 16, 2024, citing that the Company has a working capital
deficiency, has incurred net losses, and needs to raise additional
funds to meet its obligations and sustain its operations. These
conditions raise substantial doubt about the Company's ability to
continue as a going concern.
As of June 30, 2024, the Company had $270.78 million in total
assets, $243.70 million in total liabilities, $795,000 in
redeemable non-controlling interests in equity of subsidiaries, and
$26.28 million in total stockholders' equity.
IHEARTCOMMUNICATIONS: $402MM Bank Debt Trades at 13% Discount
-------------------------------------------------------------
Participations in a syndicated loan under which
iHeartCommunications Inc is a borrower were trading in the
secondary market around 87.1 cents-on-the-dollar during the week
ended Friday, Sept. 20, 2024, according to Bloomberg's Evaluated
Pricing service data.
The $402 million Term loan facility is scheduled to mature on May
1, 2026. About $401.2 million of the loan is withdrawn and
outstanding.
iHeartCommunications, Inc. operates as a media company. The Company
offers radio and television stations, outdoor advertising displays,
and live entertainment venues such as music, news, talk, sports,
and other stations.
INGENOVIS HEALTH: $675MM Bank Debt Trades at 17% Discount
---------------------------------------------------------
Participations in a syndicated loan under which Ingenovis Health
Inc is a borrower were trading in the secondary market around 83.5
cents-on-the-dollar during the week ended Friday, Sept. 20, 2024,
according to Bloomberg's Evaluated Pricing service data.
The $675 million Term loan facility is scheduled to mature on March
6, 2028. About $653.8 million of the loan is withdrawn and
outstanding.
Ingenovis Health is an Ohio based temporary healthcare staffing
agency providing nurses on assignments to hospitals and medical
centers, including both traditional and fast response staffing,
across the US. The company also supplies nurses during strikes and
provides interventional cardiologists for rural and remote
hospitals. Ingenovis is majority owned by Cornell and Trilantic
Capital Partners (the Investor Group).
INOTIV INC: Amends Credit Agreement, Closes $22.6MM Notes Offering
------------------------------------------------------------------
Inotiv, Inc. has amended certain terms of its Credit Agreement. In
addition, Inotiv has closed the sale of $22.6 million aggregate
principal amount of 15% Senior Secured Second Lien PIK Notes due
February 2027, and warrants to purchase common shares, to certain
investors in a private offering.
Robert Leasure Jr., President and Chief Executive Officer,
commented, "In order to increase our liquidity and to begin
strengthening Inotiv's balance sheet, the Company has amended its
Credit Agreement and has issued $22.6 million in Second Lien Notes
for $17.0 million in cash and the cancellation of approximately
$8.3 million of our existing convertible senior notes. Among other
items, the amendment to the Credit Agreement provides financial
covenant relief through the quarter ending June 30, 2025, and
establishes new financial covenant tests for the fiscal quarters
starting June 30, 2025 and thereafter. We believe this will give us
additional flexibility and time to see the results from our
recently completed site optimization plans, the recovery and
strengthening of the NHP market, and efforts to grow market share
and cashflow."
Mr. Leasure continued, "We have been building our business over the
last 5 years through acquisitions and initiating new services to
provide our biopharma customers with an end-to-end product and
services solution to help them discover and develop new medicines.
We have been focused on improving, integrating and optimizing the
acquisitions while at the same time transforming to an organization
to meet our customers' expectations and delivering solutions for
our customers who are focused on drug discovery and development."
"Inotiv will continue to focus on providing a superior customer
experience, in an effort to improve customer acquisition and
retention and organic revenue growth. We will also continue to
evaluate opportunities to improve our balance sheet as we work to
capture market share and improve cashflow going into 2025 as
outlined in prior updates."
Second Lien Note Offering
The Second Lien Notes accrue interest at a rate of 15% per annum
and are payable in kind, and are fully and unconditionally
guaranteed on a senior secured second lien basis by certain of
Inotiv's subsidiaries. As a part of this transaction, the investors
also received warrants to purchase 3,946,250 shares of the
Company's common stock. The warrants have an exercise price of
$1.57 per share and are exercisable at any time until September 13,
2034. The Second Lien Notes will mature on February 4, 2027, unless
earlier repurchased or redeemed. In addition to other related fees
and expenses, the Company is paying the structuring agent a 2.5%
fee in the form of $0.6 million of Second Lien Notes, which is
included in the $22.6 million aggregate principal amount of Second
Lien Notes discussed above, and warrants to purchase 200,000 common
shares, which are in addition to the warrants to purchase 3,946,250
common shares discussed above.
The Second Lien Notes were not registered under the Securities Act
of 1933, as amended or the securities laws of any state or other
jurisdictions, and the Second Lien Notes may not be offered or sold
in the United States absent registration under the Securities Act
or an applicable exemption from the registration requirements of
the Securities Act. This press release shall not constitute an
offer to sell or a solicitation of an offer to buy the Second Lien
Notes, nor shall there be any sale of these securities in any
jurisdiction in which such offer, solicitation or sale of these
securities would be unlawful prior to registration or qualification
under the securities laws of any such jurisdiction.
About Inotiv
West Lafayette, Ind.-based Inotiv, Inc. and its subsidiaries
comprise a leading contract research organization dedicated to
providing nonclinical and analytical drug discovery and development
services to the pharmaceutical and medical device industries and
selling a range of research-quality animals and diets to the same
industries as well as academia and government clients.
Going Concern
The Company cautioned in its quarterly report on Form 10-Q for the
period ended March 31, 2024, that there is substantial doubt about
the Company's ability to continue as a going concern and that
operating under these conditions may adversely affect the Company's
stock price, its ability to raise capital, its ability to comply
with its Credit Agreement, and its normal business operations,
among other implications.
As of June 30, 2024, Inotiv had $774.6 million in total assets,
$592.5 million in total liabilities, and $182.1 million in total
stockholders' equity and noncontrolling interest.
IVANTI SOFTWARE: Blackstone Senior Marks $247,187 Loan at 21% Off
-----------------------------------------------------------------
Blackstone Senior Floating Rate 2027 Term Fund has marked its
$247,187 loan extended to Ivanti Software, Inc to market at
$195,587 or 79% of the outstanding amount, according to the
Blackstone Senior's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone Senior is a participant in a First Lien First Amendment
Term Loan (3M CME Term SOFR + 4%, 0.75% Floor) to Ivanti Software,
Inc. The loan matures on December 1, 2027.
Blackstone Senior, formerly known as Blackstone Senior Floating
Rate Term Fund, is a diversified, closed-end management investment
company. BSL was organized as a Delaware statutory trust on March
4, 2010. BSL was registered under the Investment Company Act of
1940, as amended on March 5, 2010.
Blackstone Senior is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Senior Floating Rate 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Ivanti is an IT Software Company headquartered in South Jordan,
Utah. It produces software for IT Security, IT Service Management,
IT Asset Management, Unified Endpoint Management, Identity
Management and supply chain management.
IVANTI SOFTWARE: Blackstone Senior Marks $537,313 Loan at 34% Off
-----------------------------------------------------------------
Blackstone Senior Floating Rate 2027 Term Fund has marked its
$537,313 loan extended to Ivanti Software, Inc to market at
$353,619 or 66% of the outstanding amount, according to the
Blackstone Senior's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone Senior is a participant in a Second Lien First Amendment
Term Loan B (3M CME Term SOFR + 7.25%) to Ivanti Software, Inc. The
loan matures on December 1, 2028.
Blackstone Senior, formerly known as Blackstone Senior Floating
Rate Term Fund, is a diversified, closed-end management investment
company. BSL was organized as a Delaware statutory trust on March
4, 2010. BSL was registered under the Investment Company Act of
1940, as amended on March 5, 2010.
Blackstone Senior is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Senior Floating Rate 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Ivanti is an IT Software Company headquartered in South Jordan,
Utah. It produces software for IT Security, IT Service Management,
IT Asset Management, Unified Endpoint Management, Identity
Management and supply chain management.
IVANTI SOFTWARE: Blackstone Strat Marks $1.5MM Loan at 34% Off
--------------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its
$1,571,642 loan extended to Ivanti Software, Inc to market at
$1,034,337 or 66% of the outstanding amount, according to the
Blackstone Strat's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone Strat is a participant in a Second Lien First Amendment
Term Loan B (3M CME Term SOFR + 7.25%) to Ivanti Software, Inc. The
loan matures on December 1, 2028.
Blackstone Strat is a closed-end term fund that trades on the New
York Stock Exchange under the symbol. BGB's primary investment
objective is to seek high current income, with a secondary
objective to seek preservation of capital, consistent with its
primary goal of high current income.
Blackstone Strat is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Ivanti is an IT Software Company headquartered in South Jordan,
Utah. It produces software for IT Security, IT Service Management,
IT Asset Management, Unified Endpoint Management, Identity
Management and supply chain management.
IVANTI SOFTWARE: Blackstone Strat Marks $787,097 Loan at 21% Off
----------------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its $787,097
loan extended to Ivanti Software, Inc to market at $622,790 or 79%
of the outstanding amount, according to the Blackstone Strat's Form
N-CSRS for the semi-annual period ended June 30, 2024, filed with
the Securities and Exchange Commission.
Blackstone Strat is a participant in a First Lien First Amendment
Term Loan B (3M CME Term SOFR + 4%, 0.75% Floor) to Ivanti
Software, Inc. The loan matures on December 1, 2027.
Blackstone Strat is a closed-end term fund that trades on the New
York Stock Exchange under the symbol. BGB's primary investment
objective is to seek high current income, with a secondary
objective to seek preservation of capital, consistent with its
primary goal of high current income.
Blackstone Strat is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Ivanti is an IT Software Company headquartered in South Jordan,
Utah. It produces software for IT Security, IT Service Management,
IT Asset Management, Unified Endpoint Management, Identity
Management and supply chain management.
JDC RENTALS: Seeks to Hire Guidant Law as Bankruptcy Counsel
------------------------------------------------------------
JDC Rentals, LLC seeks approval from the U.S. Bankruptcy Court for
the District of Arizona to employ Guidant Law, PLC to handle its
Chapter 11 case.
The firm will be paid at these hourly rates:
Attorneys $375 - $490
Paralegals $120 - $175
Paralegal Assistants $80 - $125
The firm represents no interest adverse to the Debtor or to the
estate on the matters upon which it is to be engaged.
The firm can be reached through:
D. Lamar Hawkins, Esq.
Guidant Law PLC
402 E. Southern Ave.
Tempe, AZ 85282
Telephone: (602) 888-9229
Facsimile: (480) 725-0087
Email: lamar@guidant.law
About JDC Rentals
JDC Rentals, LLC sought relief under Subchapter V of Chapter 11 of
the U.S. Bankruptcy Code (Bankr. D. Ariz. Case No. 24-07708) on
Sept. 16, 2024. In the petition signed by Jordan Dale Call, sole
member, the Debtor disclosed up to $500,000 in assets and up to $10
million in liabilities.
Judge Daniel P. Collins oversees the case.
D. Lamar Hawkins, Esq., at Guidant Law PLC serves as the Debtor's
bankruptcy counsel.
JDI DATA: Bid to Hire Counsel Moot Following Ch.7 Conversion
------------------------------------------------------------
Judge David S. Leibowitz of the United States District Court for
the Southern District of Florida affirmed the order of the United
States Bankruptcy Court for the Southern District of Florida
denying JDi Data Corporation's application for employment of
professionals pursuant to 11 U.S.C. Sec. 327(a).
The case involves an alleged Ponzi scheme that ended in bankruptcy.
By way of background, on February 17, 2023, JDi sought Chapter 11
protection after one of its creditors filed suit against it in
federal district court. In that lawsuit, Plaintiff alleged that
JDi ran a Ponzi scheme whereby it raided trust accounts to pay
operating and other unauthorized expenses. At the commencement of
Chapter 11 proceedings, JDi served as a debtor-in-possession under
11 U.S.C. Sec. 1101(1).
As DIP, JDi applied for court permission to employ John Moffa,
Esq., and his law firm as legal counsel, John Heller as Chief
Reorganization Officer, and Marcum LLP as accountants for the
estate. On April 5, 2023, the Bankruptcy Court held a hearing on
JDi's retention applications. During the hearing, counsel for
creditor, Pultegroup, Inc., objected to Mr. Moffa's retention
specifically, citing ethical questions related to Mr. Moffa's
pre-bankruptcy representation of JDi. Counsel for Pulte complained
that, rather than withdraw from the representation as required by
Florida's ethics rules, Mr. Moffa continued to represent JDi after
he learned JDi was engaged in a Ponzi scheme.
After hearing from all of the parties, including Mr. Moffa at
length, the Bankruptcy Court denied JDi's applications and
appointed a Chapter 11 Trustee.
So, as a debtor out-of-possession, JDi subsequently moved for
reconsideration. The Court began the May 10 hearing by noting that
JDi failed to cite any applicable statute, case law or rule of
procedure for the relief requested in violation of Federal Rule of
Bankruptcy Procedure 9013, stating that failure alone required the
motions' denial. Nevertheless, the Court went on to analyze the
motion to reconsider the denial of JDi's retention applications and
the appointment of a Chapter 11 Trustee under the Rules and
concluded that the motions did not satisfy the requirements for
granting reconsideration.
The Bankruptcy Court thus denied reconsideration of its appointment
of the Chapter 11 Trustee, mooting the motion to reconsider the
denial of JDi's retention applications.
The issue on appeal is whether the Bankruptcy Court's denial of
JDi's retention applications was an abuse of discretion, arbitrary
and capricious, and/or a surprise. Before the District Court
reaches that question, it must first determine whether JDi's
conversion from Chapter 11 to Chapter 7 moots this appeal.
Under Article III, Sec. 2 of the U.S. Constitution, "a case is moot
when the issues presented are no longer live or the parties lack a
legally cognizable interest in the outcome."
The U.S. Trustee argues that JDi's appeal is moot because JDi lost
the power to retain professionals when the case was converted from
Chapter 11 to Chapter 7. Consequently, the relief JDi seeks in this
appeal -- the "overturning" of the Order denying the retention
applications -- is no longer available. Only the Chapter 7 Trustee
now has the power to retain professionals for the bankruptcy
estate. In other words, because JDi is not entitled to -- and
because the District Court cannot grant -- the relief JDi seeks,
the appeal is moot.
JDi counters the appeal is not moot because JDi had the power to
retain professionals at the time the Bankruptcy Court denied its
retention applications.
In this case, JDi is a debtor out-of-possession. Under section
327(a), only a "trustee" may apply to employ professionals to be
paid from the bankruptcy estate. When this case was converted to
Chapter 7, JDi lost trustee status. Thus, JDi's Chapter 7
conversion constitutes precisely the kind of event that makes the
relief sought from the Chapter 11 proceedings unavailable. As a
result, this appeal is moot. Accordingly, the District Court
dismisses this action.
Even if the Chapter 7 conversion did not moot this appeal, the
Bankruptcy Court did not abuse its discretion in denying JDi's
applications, the District Court finds.
In this case, after hearing from all the parties, especially Mr.
Moffa, the Bankruptcy Court determined that JDi failed to meet its
burden of demonstrating that Mr. Moffa was qualified to represent
the debtor. Because the Bankruptcy Court "could not find Mr. Moffa
was disinterested," it "could not approve his employment."
The District Court concludes that the Bankruptcy Court acted well
within its discretion in finding that Mr. Moffa was not
disinterested.
Judge Leibowitz says, "Given that JDi could not proceed without
legal counsel, the Bankruptcy Court did not err in appointing a
Chapter 11 Trustee, especially on these facts which 'cried out' for
an independent fiduciary. Once the Chapter 11 Trustee was
appointed, only the Chapter 11 Trustee had the power to seek court
approval to employ professionals. Accordingly, there is no clear
error of fact or law in this appeal."
A copy of the Court's decision is available at
https://urlcurt.com/u?l=JFz0lC
About JDi Data Corporation
JDi Data Corporation has developed innovative solutions for
professionals within the insurance, risk, and legal communities.
Its software solutions are designed to allow organizations to
invest in tools that truly transform their day-to-day processes.
The company is based in Fort Lauderdale, Fla.
JDi Data sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. S.D. Fla. Case No. 23-11322) on Feb. 17, 2023, with $1
million to $10 million in both assets and liabilities. John Heller,
chief restructuring officer, signed the petition.
Judge Scott M. Grossman presides over the case.
Moffa & Bierman represented the Debtor as legal counsel.
Scott N. Brown was appointed the Chapter 11 trustee in the Debtor's
bankruptcy case. The trustee tapped Bast Amron, LLP as bankruptcy
counsel; Bilzin Sumberg Baena Price & Axelrod, LLP as special
counsel; and KapilaMukamal, LLP as accountant.
The case was eventually converted to a Chapter 7 liquidation.
JOHAL BROTHERS: Hires Kroger Gardis & Regas as Bankruptcy Counsel
-----------------------------------------------------------------
Johal Brothers Inc. seeks approval from the U.S. Bankruptcy Court
for the Southern District of Indiana to employ the Kroger, Gardis &
Regas, LLP as its legal counsel.
The firm will render these services:
(a) prepare filings and applications and conduct examinations
necessary to the administration of this matter;
(b) advise regarding the Debtor's rights, duties, and
obligations;
(c) perform legal services associated with and necessary to
the day-today operations of the business;
(d) represent and assist the Debtor in complying with the
duties and obligations imposed by the Bankruptcy Code, the orders
of this court, and applicable law;
(e) represent the Debtor at hearings and other proceedings
before this court;
(f) negotiate, prepare, confirm and consummate a plan of
reorganization; and
(g) take any and all other necessary action incident to the
proper preservation and administration of the state in the conduct
of the Debtor's business.
The hourly rates of the firm's counsel and staff are as follows:
Harley Means, Partner $395
Weston Overturf, Partner $395
Anthony Carreri, Associate $325
Jason Mizzell, Associate $325
Kimberly Whigham, Paralegal $175
Mr. Means 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:
Harley K. Means, Esq.
Kroger Gardis & Regas, LLP
111 Monument Circle, Suite 900
Indianapolis, IN 46204
Telephone: (317) 777-7439
Email: hmeans@kgrlaw.com
About Johal Brothers
Johal Brothers Inc. is an Indianapolis-based company operating in
the general freight trucking industry.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. S.D. Ind. Case No. 24-04679) on August 28,
2024, with $581,500 in assets and $1,437,032 in liabilities.
Amritpaul S. Johal, president and chief executive officer, signed
the petition.
Judge James M. Carr presides over the case.
Harley K. Means, Esq., at Kroger, Gardis & Regas, LLP represents
the Debtor as legal counsel.
JONES COMMODITIES: Plan Filing Deadline Extended to Oct. 3
----------------------------------------------------------
Judge Benjamin P. Hursh of the U.S. Bankruptcy Court for the
District of Ohio extended Jones Commodities, LLC's period to file
its plan of reorganization to October 3, 2024.
In a court filing, two negotiations needed to be completed in order
to project and determine the parameters for both available funds
for a plan and what plan treatment could be offered to Debtor's
array of creditors.
The Debtor claims that negotiations with the Agricultural Products
Extension LLC ("APEX") have taken longer than anticipated,
involving extensive discussions involving APEX, the Debtor and the
Trustee with considerable back-and-forth.
The Debtor explains that APEX, the company and the Trustee were
able to agree on a Stipulation as to APEX Vehicles, Cash Collateral
and Plan Treatment which was filed with the Court on September 17.
This Stipulation, for which Court approval will be sought, resolves
the outstanding issues between those parties.
The Debtor asserts that the potential buyer for most of the
remainder of the Debtor's assets has been waiting until the APEX
issues were resolved and was re-engaged this week to finalize a
prospective deal. Such negotiation is anticipated to be completed
next week. After such is finalized, court approval of a sale will
be sought.
The Debtor believes that a short extension of 14 days will allow
the negotiations with the buyer to be finalized, allowing a plan of
reorganization be filed then that the Debtor believes can be
confirmed.
Jones Commodities, LLC, is represented by:
Steve Taggart, Esq.
Olsen Taggart PLLC
1449 E. 17th Street, Ste A
Idaho Falls, ID 83404
Tel: (208) 552-6442
Email: staggart@olsontaggart.com
About Jones Commodities
Jones Commodities, LLC, sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. D. Idaho Case No. 24-40345) on June
21, 2024, with up to $50,000 in assets and up to $10 million in
liabilities. Cameron Smith, manager, signed the petition. Steve
Taggart, Esq., at Olsen Taggart, PLLC, is the Debtor's legal
counsel.
JPC LAND HOLDINGS: Case Summary & 12 Unsecured Creditors
--------------------------------------------------------
Debtor: JPC Land Holdings LLC
210 Schuylerville Dr
Elgin, TX 78621-3275
Business Description: JPC Land is a Single Asset Real Estate
debtor (as defined in 11 U.S.C. Section
101(51B)). The Debtor owns a 338 acre
property known as Terra Escondido
Subdivision valued at $3.2 million.
Chapter 11 Petition Date: September 24, 2024
Court: United States Bankruptcy Court
Western District of Texas
Case No.: 24-11180
Judge: Hon. Shad Robinson
Debtor's Counsel: Stephen W Sather, Esq.
BARRON NEWBURGER, P.C.
7320 N. MoPac Expressway 400
Austin TX 78731
Tel: (512) 649-3243
Email: ssather@bn-lawyers.com
Total Assets: $3,200,000
Total Liabilities: $7,537,126
The petition was signed by Raif Castello as director and
president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 12 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/F6X7H4A/JPC_LAND_HOLDINGS_LLC__txwbke-24-11180__0001.0.pdf?mcid=tGE4TAMA
KOLOGIK LLC: Creditors to Get Proceeds From Liquidation
-------------------------------------------------------
Kologik, LLC and its affiliates filed with the U.S. Bankruptcy
Court for the Middle District of Louisiana a Disclosure Statement
for Liquidating Plan dated August 21, 2024.
Before the Asset Sale, the Debtors were headquartered in Baton
Rouge, Louisiana (operating as "Kologik"), and operated as a
software as service company that develops, acquires, and services
software that connects law enforcement departments to the
information they need to keep officers and communities safe by
making it possible for multiple sources of intelligence to
effectively speak to one another.
On March 14, 2024, the Kologik Board approved Kologik Software,
Inc. as the winning bidder and, along with Kelly Hart and Rock
Creek, began the negotiations of the Asset Purchase Agreement (the
"APA").
Pursuant to the APA, Kologik agreed to sell substantially all of
its assets to Kologik Software, Inc. (the "Purchaser"). Under the
APA, the Purchaser agreed to purchase and acquire from Kologik
"Purchased Assets" free and clear of liens to the extent
permissible under section 363(f) of the Bankruptcy Code where
Purchased Assets is defined to include substantially all assets of
Kologik including (without limitation) intellectual property, bank
accounts, customer contracts, and leases.
In return, Kologik was to receive a purchase price of $24 million,
subject to customary working capital adjustment and post-closing
true-up, plus cash over the "Required Cash" to be retained by the
Purchaser ($275,000). Excluded from the Purchased Assets are any
employee retention credits, which could have a value upwards of
$800,000. The APA further provided that the Employees would become
employees of the Purchaser and will continue to service the
Customer Contracts in substantially the same manner as before the
closing of the Proposed Sale.
The Purchaser also agreed to assume the Leases and that Kologik's
operations shall generally continue after the closing of the
Proposed Sale in a similar manner, under new ownership. In order to
consummate the APA, the Debtors commenced the Chapter 11 Cases.
On the Petition Date, the Debtors also filed that certain Motion
for Entry of an Order Authorizing and Approving (I) Sale Of
Debtors' Assets Free and Clear of All Claims, Liens, Encumbrances
and Interests Pursuant to Asset Purchase Agreement, (II) Assumption
and Assignment of Certain Executory Contracts and Unexpired Leases,
and (III) Granting Related Relief (the "Sale Motion"). The Sale
Motion was set for hearing on June 3, 2024 (the "Sale Hearing"),
along with the Cash Collateral Motion. The Cash Collateral Motion
also requested that pending the approval and closing of the APA,
the proceeds therefrom be used to satisfy the Senior Secured
Indebtedness (the Riva Note and MRB Notes).
The Bankruptcy Court granted the Cash Collateral Motion in a final
basis, including approving the payoff the Senior Secured
Indebtedness after closing of the APA. On June 7, 2024, the Debtors
closed the sale pursuant to the APA ("Sale").
Class 9 consists of General Unsecured Claims. Subject to the
Carve-Out and the Plan Expense Reserve and Professional Fee
Reserve, the Liquidating Debtors shall pay Holders of Allowed Class
9 Claims in cash a Pro Rata share of the Available Cash on the
Distribution Date, and a Pro Rata Share of the Remaining Amount on
the Residual Distribution Date, in full and final satisfaction,
settlement, release, and compromise of and in exchange for each
Allowed Class 9 Claim but no Class 9 Claim shall be paid in
priority over any Allowed Claim in a senior Class.
The Holders of Class 10 Membership/Equity Interests shall receive
no value under the Plan. The Membership/Equity Interests shall be
extinguished on the Membership Extinguishment Date. Pending the
Membership Extinguishment Date neither the Holders of Class 10
Interests nor the pre-Effective Date Board of managers shall have
any voting power or control, as the Plan Agent shall hold all
voting power and control over the Liquidating Debtors and shall be
the Entity representative of the Liquidating Debtors with full
corporate authority to act.
The Distributions and Residual Distributions shall be funded with
Available Cash and the proceeds from liquidation of any remaining
Assets of the Liquidating Debtors.
A full-text copy of the Disclosure Statement dated August 21, 2024
is available at https://urlcurt.com/u?l=GJLVyO from
PacerMonitor.com at no charge.
Counsel to the Debtor:
Louis M. Phillips, Esq.
One American Place
301 Main Street, Suite 1600
Baton Rouge, LA 70801-1916
Telephone: (225) 381-9643
Facsimile: (225) 336-9763
Email: louis.phillips@kellyhart.com
- and -
Erin K. Arnold, Esq.
Amelia L. Hurt, Esq.
400 Poydras Street, Suite 1812
New Orleans, LA 70130
Telephone: (504) 522-1812
Facsimile: (504) 522-1813
Email: erin.arnold@kellyhart.com
Email: amelia.hurt@kellyhart.com
About Kologik LLC
Kologik, LLC, a company in Baton Rouge, La., creates software that
connects small and medium-sized law enforcement departments to the
information they need to keep officers and communities safe.
Kologik and its affiliates filed Chapter 11 petitions (Bankr. M.D.
La. Case No. 24-10311) on April 23, 2024. At the time of the
filing, Kologik reported up to $50,000 in assets and up to $10
million in liabilities.
Judge Michael A. Crawford presides over the cases.
The Debtors tapped Louis M. Phillips, Esq., at Kelley Hart & Pitre
as bankruptcy counsel and Wright, Moore, DeHart, Dupuis &
Hutchinson, LLC as tax accountants.
LABL INC: S&P Rates New $950MM Senior Secured Notes 'B-'
--------------------------------------------------------
S&P Global Ratings assigned its 'B-' issue-level rating and '3'
recovery rating to LABL Inc.'s proposed $950 million senior secured
notes due in 2031. The '3' recovery rating indicates its
expectation of meaningful (50%-70%; rounded estimate: 55%) recovery
in the event of a payment default.
The company intends to use the proceeds to refinance its 6.75% $700
million senior secured notes due in 2026, fund near-term
acquisitions, and pay transaction-related fees and expenses. At the
same time, the company plans to extend the maturities of its
asset-based lending (ABL) facility and revolving credit facility to
October 2029 from October 2026. Both the new senior secured notes
and the extended credit facilities will be subject to springing
maturities if a portion of the 2027, 2028, or 2029 debt remains
outstanding prior to their respective due dates.
S&P's 'CCC+' issue-level and '5' recovery ratings on LABL's senior
unsecured notes are unchanged, as is its 'B-' issuer credit rating
and stable outlook.
S&P said, "LABL's volumes continued to decline through the first
half of 2024, as we expected. Revenue decreased 4.9% from the same
prior-year period due to ongoing customer inventory destocking and
lower consumer demand. However, destocking continues to decelerate,
and in the second quarter demand again improved sequentially. To
meet this higher demand, LABL has incurred incremental costs
related to expedited freight and higher labor costs. Although we
continue to believe volumes, earnings, and cash flow will improve
in the second half, we lowered our full-year S&P Global
Ratings-adjusted EBITDA expectation to between $585 million and
$610 million because of the transitory operating inefficiencies.
"Furthermore, interest rates have remained higher for longer than
we previously expected, and LABL anticipates a significant increase
in cash taxes for the year. As such, we also lowered our forecast
for S&P Global Ratings-adjusted free cash flow to a deficit of
between ($15) million and ($45) million. We now expect the company
to end 2024 with adjusted leverage of 9.25x-9.75x due to weaker
earnings and the proposed incremental debt to fund near-term
acquisitions.
"The proposed transaction reduces LABL's refinancing risk by
extending its 2026 maturities to at the soonest April 30, 2027,
under the earliest springing maturity. However, we also recognize
the proposed incremental debt will increase LABL's cash interest
expense and reduce cash flow from our previous forecast."
ISSUE RATINGS – RECOVERY ANALYSIS
Key analytical factors
-- Our simulated default scenario considers a default in 2026
stemming from very weak economic conditions and changes in customer
preferences that reduce the demand for LABL's key products for the
consumer packaged goods industry. We believe the reduction in its
demand would pressure its profit margins and cause its cash
generation to become insufficient to cover the fixed charges
related to its interest, working capital, and capital outlays.
Eventually, its liquidity and capital resources become so strained
that it cannot operate without filing for bankruptcy.
-- Given LABL's leading market positions, operational scale, and
diversity of label types, we believe it would be reorganized rather
than liquidated under our default scenario.
Simulated default assumptions
-- Simulated year of default: 2026
-- EBITDA multiple: 5.5x
-- EBITDA at emergence: $552 million
-- Jurisdiction: U.S.
Simplified waterfall
-- Net enterprise value at default (after 5% administrative
costs): $2.886 billion
-- Valuation split (obligors/nonobligors): 67%/33%
-- Priority claims: $360 million
-- Value available to secured debt (collateral/noncollateral):
$2.193 billion/$333 million
-- Secured debt claims: $4.203 billion
--Recovery expectations: 50%-70% (rounded estimate: 55%)
-- Value available to unsecured debt (collateral/noncollateral):
$0/$333 million
-- Pari passu secured first-lien deficiency claims: $2.010
billion
-- Senior unsecured debt claims: $1.205 billion
--Recovery expectations: 10%-30% (rounded estimate: 10%)
Note: Debt amounts include six months of accrued interest that S&P
assumes will be owed at default. Collateral value includes asset
pledges from obligors (after priority claims) plus equity pledges
in nonobligors. Noncollateral value is allocated to the pari passu
deficiency claims and unsecured debt claims on a pro rata basis.
S&P generally assumes usage of 85% for cash flow and 60% for ABL
revolvers at default.
LALA'S SANGRIA: Seeks Approval to Tap Terrence Oraha as Accountant
------------------------------------------------------------------
LaLa's Sangria Bar, LLC seeks approval from the U.S. Bankruptcy
Court for the Middle District of Florida to employ Terrence Oraha,
CPA PLLC as accountant.
The firm will assist the Debtor to prepare its 2023 federal tax
return and any estate tax returns that may come due during the
pendency of the Chapter 11 case.
The firm will be compensated at a flat rate of $2,000 to prepare
tax returns and an hourly rate of $500 to provide accounting
services.
Terrence Oraha, CPA, disclosed in a court filing that his firm is a
"disinterested person" as the term is defined in Section 101(14) of
the Bankruptcy Code.
The firm can be reached through:
Terrence Oraha, CPA
Terrence Oraha, CPA, PLLC
1208 E. Kennedy Blvd., Suite 226
Tampa, FL 33602
About LaLa's Sangria Bar LLC
LaLa's Sangria Bar LLC, a restaurant in Tampa Bay, Fla., sought
relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. M.D.
Fla. Case No. 24-03389) on June 14, 2024.
Judge Roberta A. Colton oversees the case.
The Debtor tapped Kathleen DiSanto, Esq., at Bush Ross, PA as
counsel and Terrence Oraha, CPA, PLLC as accountant.
LEE INVESTMENT: Gets OK to Hire Upton Law as Bankruptcy Counsel
---------------------------------------------------------------
Lee Investment Consultants, LLC, received approval from the U.S.
Bankruptcy Court for the Northern District of Alabama to employ
Upton Law, LLC as legal counsel.
The professional services to be rendered are as follows:
(a) advise the Debtor of its powers and duties;
(b) negotiate and formulate a plan of arrangement under
Chapter 11 which will be acceptable to its creditors and equity
security holders;
(c) deal with secured lien claimants regarding arrangements
for payment of its debts and if, appropriate, contest the validity
of same;
(d) prepare necessary legal papers; and
(e) perform all other services which may be necessary.
Stacy Upton, Esq., the primary attorney at this representation,
will be compensated at her hourly rate of $300.
Ms. Upton 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:
Stacy L. Upton, Esq.
Upton Law, LLC
914 Noble Street
Anniston, AL 36201
Telephone: (256) 237-3266
Email: stacy@uptonlawllc.com
About Lee Investment Consultants
Lee Investment Consultants, LLC sought protection for relief under
Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ala. Case No.
24-41078) on Sept. 11, 2024. In the petition signed by Scott Lee,
president, the Debtor disclosed up to $10 million in both assets
and liabilities.
Judge James J. Robinson oversees the case.
The Debtor tapped Stacy L. Upton, Esq., at Upton Law, LLC and the
Law Offices of Harry P. Long, LLC as counsel.
LEE INVESTMENT: Seeks to Tap Harry P. Long as Bankruptcy Counsel
----------------------------------------------------------------
Lee Investment Consultants, LLC seeks approval from the U.S.
Bankruptcy Court for the Northern District of Alabama to employ the
Law Offices of Harry P. Long, LLC as legal counsel.
The professional services to be rendered are as follows:
(a) advise the Debtor of its powers and duties;
(b) negotiate and formulate a plan of arrangement under
Chapter 11 which will be acceptable to its creditors and equity
security holders;
(c) deal with secured lien claimants regarding arrangements
for payment of its debts and if, appropriate, contest the validity
of same;
(d) prepare necessary legal papers; and
(e) perform all other services which may be necessary.
Harry Long, Esq., the primary attorney at this representation, will
be compensated at $420 per hour plus $11,738 retainer.
Mr. Long 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:
Harry P. Long, Esq.
Law Offices of Harry P. Long, LLC
P.O. Box 1468
Anniston, AL 36202
Telephone: (256) 237-3266
Email: hlonglegal8@gmail.com
About Lee Investment Consultants
Lee Investment Consultants, LLC sought protection for relief under
Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ala. Case No.
24-41078) on Sept. 11, 2024. In the petition signed by Scott Lee,
president, the Debtor disclosed up to $10 million in both assets
and liabilities.
Judge James J. Robinson oversees the case.
The Debtor tapped Stacy L. Upton, Esq., at Upton Law, LLC and the
Law Offices of Harry P. Long, LLC as counsel.
LERETA LLC: $250MM Bank Debt Trades at 19% Discount
---------------------------------------------------
Participations in a syndicated loan under which Lereta LLC is a
borrower were trading in the secondary market around 80.9
cents-on-the-dollar during the week ended Friday, Sept. 20, 2024,
according to Bloomberg's Evaluated Pricing service data.
The $250 million Term loan facility is scheduled to mature on
August 7, 2028. The amount is fully drawn and outstanding.
Headquartered in Pomona, California, Lereta LLC is a
technology-enabled property tax and flood determination service
provider to the financial services industry. The company provides
services in the areas of tax certification management and flood
determination to mortgage originators and servicers. Lereta is
owned by Flexpoint Ford and Vestar Capital Partners.
LERETA LLC: Blackstone Senior Marks $479,804 Loan at 25% Off
------------------------------------------------------------
Blackstone Senior Floating Rate 2027 Term Fund has marked its
$479,804 loan extended to Lereta, LLC to market at $361,851 or 75%
of the outstanding amount, according to the Blackstone Senior's
Form N-CSRS for the semi-annual period ended June 30, 2024, filed
with the Securities and Exchange Commission.
Blackstone Senior is a participant in a First Lien Term Loan B (1M
US SOFR + 5.25%) to Lereta, LLC. The loan matures on July 30,
2028.
Blackstone Senior, formerly known as Blackstone Senior Floating
Rate Term Fund, is a diversified, closed-end management investment
company. BSL was organized as a Delaware statutory trust on March
4, 2010. BSL was registered under the Investment Company Act of
1940, as amended on March 5, 2010.
Blackstone Senior is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Senior Floating Rate 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Headquartered in Pomona, California, Lereta LLC is a
technology-enabled property tax and flood determination service
provider to the financial services industry. The company provides
services in the areas of tax certification management and flood
determination to mortgage originators and servicers. Lereta is
owned by Flexpoint Ford and Vestar Capital Partners.
LERETA LLC: Blackstone Strat Marks $1.4MM Loan at 25% Off
---------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its
$1,403,427 loan extended to Lereta, LLC to market at $1,058,416 or
75% of the outstanding amount, according to the Blackstone Strat's
Form N-CSRS for the semi-annual period ended June 30, 2024, filed
with the Securities and Exchange Commission.
Blackstone Strat is a participant in a First Lien Term Loan B (1M
SOFR + 5.25%) to Lereta, LLC. The loan matures on July 30, 2028.
Blackstone Strat is a closed-end term fund that trades on the New
York Stock Exchange under the symbol. BGB's primary investment
objective is to seek high current income, with a secondary
objective to seek preservation of capital, consistent with its
primary goal of high current income.
Blackstone Strat is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Headquartered in Pomona, California, Lereta LLC is a
technology-enabled property tax and flood determination service
provider to the financial services industry. The company provides
services in the areas of tax certification management and flood
determination to mortgage originators and servicers. Lereta is
owned by Flexpoint Ford and Vestar Capital Partners.
LOYALTY VENTURES: Blackstone Strat Virtually Writes Off $1.3MM Loan
-------------------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its
$1,353.511 loan extended to Loyalty Ventures, Inc to market at
$13,535 or 1% of the outstanding amount, according to the
Blackstone Strat's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone Strat is a participant in a First Lien Term Loan B (3M
PRIME + 3.50%to Loyalty Ventures, Inc. The loan matures on November
3, 2027.
Blackstone Strat is a closed-end term fund that trades on the New
York Stock Exchange under the symbol. BGB's primary investment
objective is to seek high current income, with a secondary
objective to seek preservation of capital, consistent with its
primary goal of high current income.
Blackstone Strat is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Loyalty Ventures Inc. provides tech-enabled, data-driven consumer
loyalty solutions.
LOYALTY VENTURES: Blackstone Virtually Writes Off $409,425 Loan
---------------------------------------------------------------
Blackstone Long-Short Credit Income Fund has marked its $409,425
loan extended to Loyalty Ventures, Inc to market at $4,094 or 1% of
the outstanding amount, according to the Blackstone L & S's Form
N-CSRS for the semi-annual period ended June 30, 2024, filed with
the Securities and Exchange Commission.
Blackstone L & S is a participant in a First Lien Term Loan B (3M
PRIME + 3.50%to Loyalty Ventures, Inc. The loan matures on November
3, 2027.
Blackstone L & S is a diversified, closed-end management investment
company. BGX was organized as a Delaware statutory trust on October
22, 2010. BGX was registered under the 1940 Act on October 26,
2010. BGX commenced operations on January 27, 2011. Prior to that,
BGX had no operations other than matters relating to its
organization and the sale and issuance of 5,236 common shares of
beneficial interest in BGX to the Adviser at a price of $19.10 per
share.
Blackstone L & S is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Long-Short Credit Income Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Loyalty Ventures Inc. provides tech-enabled, data-driven consumer
loyalty solutions.
LOYALTY VENTURES: Blackstone Virtually Writes Off $462,410 Loan
---------------------------------------------------------------
Blackstone Senior Floating Rate 2027 Term Fund has marked its
$462,410 loan extended to Loyalty Ventures, Inc to market at $4,624
or 1% of the outstanding amount, according to the Blackstone
Senior's Form N-CSRS for the semi-annual period ended June 30,
2024, filed with the Securities and Exchange Commission.
Blackstone Senior is a participant in a First Lien Term Loan (3M
PRIME + 3.50%to Loyalty Ventures, Inc. The loan matures on November
3, 2027.
Blackstone Senior, formerly known as Blackstone Senior Floating
Rate Term Fund, is a diversified, closed-end management investment
company. BSL was organized as a Delaware statutory trust on March
4, 2010. BSL was registered under the Investment Company Act of
1940, as amended on March 5, 2010.
Blackstone Senior is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Senior Floating Rate 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telelephone: (877) 876-1121
Loyalty Ventures Inc. provides tech-enabled, data-driven consumer
loyalty solutions.
LUMEN TECHNOLOGIES: Blackstone Strat Marks $124,278 Loan at 17% Off
-------------------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its $124,278
loan extended to Lumen Technologies, Inc to market at $103,565,520
or 83% of the outstanding amount, according to the Blackstone
Strat's Form N-CSRS for the semi-annual period ended June 30, 2024,
filed with the Securities and Exchange Commission.
Blackstone Stratis a participant in a First Lien Term Loan (1M US
SOFR + 6%) to Lumen Technologies, Inc. The loan matures on June 1,
2028.
Blackstone Strat is a closed-end term fund that trades on the New
York Stock Exchange under the symbol. BGB's primary investment
objective is to seek high current income, with a secondary
objective to seek preservation of capital, consistent with its
primary goal of high current income.
Blackstone Strat is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Lumen Technologies, Inc., headquartered in Monroe, Louisiana, is an
integrated communications company that provides an array of
communications services to large enterprise, mid-market enterprise,
government and wholesale customers in its larger Business segment.
The company’s smaller Mass Markets segment primarily provides
broadband services to its residential and small business customer
base.
LYONS MAGNUS: $285MM Bank Debt Trades at 18% Discount
-----------------------------------------------------
Participations in a syndicated loan under which Lyons Magnus Inc is
a borrower were trading in the secondary market around 82.1
cents-on-the-dollar during the week ended Friday, Sept. 20, 2024,
according to Bloomberg's Evaluated Pricing service data.
The $285 million Term loan facility is scheduled to mature on
November 14, 2024. The amount is fully drawn and outstanding.
Lyons Magnus Inc produces and markets food products.
MAGENTA BUYER: Blackstone Senior Marks $1.6MM Loan at 44% Off
-------------------------------------------------------------
Blackstone Senior Floating Rate 2027 Term Fund has marked its
$1,677,104 loan extended to Magenta Buyer LLC to market at $940,266
or 56% of the outstanding amount, according to the Blackstone
Senior's Form N-CSRS for the semi-annual period ended June 30,
2024, filed with the Securities and Exchange Commission.
Blackstone Senior is a participant in a First Lien Term Loan B (3M
CME Term SOFR + 4.25%, 0.75% Floor) to Magenta Buyer LLC. The loan
matures on July 27, 2028.
Blackstone Senior, formerly known as Blackstone Senior Floating
Rate Term Fund, is a diversified, closed-end management investment
company. BSL was organized as a Delaware statutory trust on March
4, 2010. BSL was registered under the Investment Company Act of
1940, as amended on March 5, 2010.
Blackstone Senior is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Senior Floating Rate 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Magenta Buyer, LLC (McAfee) is a provider of cybersecurity software
that derives revenue from the sale of security products,
subscriptions, SaaS, support and maintenance, and professional
services.
MAGENTA BUYER: Blackstone Strat Marks $5.08MM Loan at 44% Off
-------------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its
$5,089,142 loan extended to Magenta Buyer LLC to market at
$2,853,100 or 56% of the outstanding amount, according to the
Blackstone Strat's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone Stratis a participant in a First Lien Term Loan B (3M
CME Term SOFR + 4.25%, 0.75% Floor) to Magenta Buyer LLC. The loan
matures on July 27, 2028.
Blackstone Strat is a closed-end term fund that trades on the New
York Stock Exchange under the symbol. BGB's primary investment
objective is to seek high current income, with a secondary
objective to seek preservation of capital, consistent with its
primary goal of high current income.
Blackstone Strat is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Magenta Buyer, LLC (McAfee) is a provider of cybersecurity software
that derives revenue from the sale of security products,
subscriptions, SaaS, support and maintenance, and professional
services.
MAGENTA SECURITY: $1.07BB Bank Debt Trades at 36% Discount
----------------------------------------------------------
Participations in a syndicated loan under which Magenta Security
Holdings LLC is a borrower were trading in the secondary market
around 63.7 cents-on-the-dollar during the week ended Friday, Sept.
20, 2024, according to Bloomberg's Evaluated Pricing service data.
The $1.07 billion Term loan facility is scheduled to mature on July
27, 2028. The amount is fully drawn and outstanding.
The Company's country of domicile is the United States.
MATADOR RESOURCES: Fitch Assigns BB- Rating on 2033 Unsec. Notes
----------------------------------------------------------------
Fitch Ratings has assigned a 'BB-'/'RR4' rating to Matador
Resources Company's (BB-/Positive) proposed senior unsecured notes
due 2033. The company intends to use the net proceeds from the
notes to repay borrowings under the reserve-based lending credit
facility (RBL) following close of the Ameredev II Parent, LLC
(Ameredev) acquisition and for general corporate purposes.
Matador's 'BB-' Issuer Default Rating and Positive Rating Outlook
reflects Fitch's expectation of increased size and scale following
close of the Ameredev transaction and reduction of RBL borrowings
post-close which will reduce leverage in 2025. Fitch will look to
resolve the Outlook following successful integration of the
transaction, progress toward RBL repayment and post-close
deleveraging.
Key Rating Drivers
Near-Term Leveraging Transaction: The Ameredev acquisition was
moderately leveraging to Matador in the near-term, given the large
debt component of the funding mix, and will temporarily reverse the
headroom Matador built up following the Advance transaction early
last year. Fitch recognizes that the management team does have a
track record of deleveraging post-acquisitions and the agency
believes this is further supported by the high-quality assets that
were acquired along with the company's historically strong FCF
generation.
High Quality, Accretive Assets: Fitch views the Ameredev assets
favorably as they are contiguous to existing Matador acreage,
largely held by production and will add high-margin, undeveloped,
oil-weighted inventory. The assets will add approximately 33,500
net acres in the Delaware basin, an estimated 25.5 Mboepd (65%) oil
and 371 net (431 gross) operated locations to Matador's existing
profile.
Management believes the multi-pay potential and cost savings
associated with longer laterals on multi-well pads will help
enhance the company's already strong Delaware basin portfolio. The
transaction also expands Matador's midstream footprint via a 19%
stake in Pinon Midstream, LLC, with assets located in southern Lea
County, New Mexico.
Nine-Rig Drilling Program: Management intends to operate a total of
nine drilling rigs in the near-term on the combined acreage base,
which should allow for total production above 180 Mboepd going
forward. The company continues to target its Wolfcamp A and lower
Bone Spring intervals, but has also seen strong well results in the
Avalon and upper Bone Spring across the acreage position. Fitch
believes the company's pro forma production size is in line with
'BB' category thresholds.
Strong FCF Generation, Measured Distributions: Fitch believes the
Ameredev assets will support continued strong FCF generation for
the company throughout the rating horizon. Fitch believes near-term
FCF generation will be aimed at reducing the post-close RBL
borrowings which will improve liquidity and reduce leverage.
Management intends to continue returning value to shareholders via
the fixed dividend, which Fitch expects measured increases through
the medium-term.
Manageable Leverage; Increased Hedging: Fitch forecasts Matador's
leverage will increase to 1.7x in 2024 and fall toward 1.5x in 2025
following repayment of RBL borrowings and post-close debt
reduction. Debt reduction will be further supported by the
company's increased hedging which will help lock in returns and
cash flow.
Derivation Summary
Matador's pro forma production of over 180 Mboepd will be similar
to SM Energy Company (SM; BB-/Rating Watch Positive) following the
announced XCL Resources, LLC acquisition. Matador remains smaller
than peers Civitas Resources, Inc. (Civitas; BB+/Stable; 343 Mboepd
in 2Q24) and Permian Resources Corporation (BB+/Stable; 339 Mboepd
in 2Q24).
The company's continued cost reduction efforts and high oil mix
have led to peer-leading Fitch-calculated unhedged netbacks of
$38.4/boe in 2Q24. This compares favorably to SM ($31.6/boe),
primarily driven by SM's lower oil cut, and is higher than Civitas
($26.5/boe) and Permian Resources ($27.5/boe) in 2Q24.
Key Assumptions
- West Texas Intermediate oil prices of $75/bbl in 2024, $65/bbl in
2025, $60/bbl in 2026 and $60/bbl in 2027 and $57/bbl in 2028;
- Henry Hub natural gas price of $2.50/mcf in 2024, $3/mcf in 2025
and 2026 and $2.75/mcf thereafter;
- 2025 pro forma production of over 180 Mboepd with modest growth
thereafter;
- Total capex of $1.5 billion in 2024 with acquisition-related
increases thereafter;
- Prioritization of FCF toward reduction of RBL;
- Measured increases in the fixed dividend.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Progress toward post-close debt reduction, including reduction of
RBL borrowings;
- Maintenance of economic inventory life and continued de-risking
of longer-term unit economics;
- Mid-cycle EBITDA leverage sustained below 2.0x.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Material reduction in liquidity including inability to reduce
post-close RBL borrowings;
- Inability to extend economic inventory life that leads to
expectations for weakened unit economics;
- Mid-cycle EBITDA leverage sustained above 2.5x.
Liquidity and Debt Structure
Adequate Liquidity: At 2Q24, Matador had $15 million of cash on
hand and $95 million of borrowings under its RBL credit facility.
Between June 30, 2024 and July 23, 2024, Matador repaid all $95
million of outstanding borrowing under the RBL. In connection with
the Ameredev acquisition, Matador's lenders elected to increase the
RBL elected commitments from $1.5 billion to $2.25 billion in June
and funded an incremental $250 million Term Loan A which provides
additional liquidity post-close. Fitch expect the liquidity profile
will further improve following the proposed note issuance and
reduction of RBL borrowings.
Issuer Profile
Matador Resources Company is an independent exploration and
production company primarily focused in the Delaware Basin in
Southwest New Mexico and West Texas.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
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
----------- ------ --------
Matador Resources
Company
senior unsecured LT BB- New Rating RR4
MATADOR RESOURCES: Moody's Rates New $750MM Unsecured Notes 'B1'
----------------------------------------------------------------
Moody's Ratings assigned a B1 rating to Matador Resources Company's
proposed $750 million senior unsecured notes due 2033. Matador's
other ratings, including its Ba3 Corporate Family Rating, and
stable outlook were unchanged.
Notes proceeds will be used to reduce borrowings under the
company's revolving facility and to fully repay the $250 million
term loan. On September 18, 2024, the company closed the $1.832
billion Ameredev acquisition with revolver and term loan
borrowings.
"This offering is in-line with Moody's expectations that Matador
would issue a mix of long term bonds and pre-payable bank debt in
acquiring Ameredev to facilitate quick deleveraging," said Sajjad
Alam, Moody's Ratings Vice President.
RATINGS RATIONALE
Matador's proposed notes will rank pari passu with the company's
existing senior unsecured notes and hence have the same B1 rating.
The unsecured notes are rated one notch below the Ba3 CFR
reflecting the substantial size of the secured revolving credit
facility, which was recently upsized to $2.25 billion. The new and
existing notes are subordinate in right of payment to Matador's
existing and future secured indebtedness including the increased
revolving credit facility, which is secured by substantially all of
Matador's oil and gas reserves. Given the increased credit facility
commitment, the B1 notes rating could come under pressure if the
company substantially increases revolver borrowings in the future
thereby increasing the proportion of secured debt relative to
unsecured debt in the capital structure.
Matador's Ba3 CFR is supported by the company's significant acreage
and reserves in the core areas of the prolific Delaware Basin;
track record of organic production and reserves growth; relatively
low break-even costs; and Moody's expectation of free cash flow
generation and improving leverage in 2025 following the Ameredev
acquisition. The company's competitive cost structure, enhanced
scale both through organic drilling and several sizeable
acquisitions, and continuous focus on maintaining a high level of
efficiency should continue to provide solid credit support. The
credit profile is restrained by Matador's scale relative to higher
rated E&P peers; high geographic concentration; sizeable
undeveloped reserves that will require significant future
investments, and meaningful exposure to federal land in New Mexico
that could face potential permitting and drilling restrictions in
the future. The credit profile also considers Matador's significant
midstream operations that provide cash flow and support its E&P
operations, but which also adds debt to its consolidated metrics
slightly weakening the company's consolidated leverage ratios.
The SGL-3 rating reflects Moody's expectation that the company will
generate free cash flow and maintain adequate liquidity through
2025. This notes offering will substantially reduce short term debt
by helping to redeem the $250 million term loan and reduce revolver
debt to about $1.1 billion leaving $1.15 billion in available
borrowing capacity. Moody's expect the company to apply the
majority of its near term free cash flow to further reduce revolver
debt through 2025.
The stable outlook balances the near term increase in financial
leverage from the Ameredev acquisition with management's plan to
delever and reduce the debt/EBITDA ratio below 1x in 2025.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Matador's ratings could be upgraded if the company can successfully
integrate the Ameredev assets, substantially reduce debt according
to its plans and consistently generate free cash flow. Moody's
could upgrade the CFR if the RCF/debt ratio remains above 40% on a
sustained basis. The CFR could be downgraded if RCF/debt declines
below 30%, the company makes more debt-funded acquisitions before
sufficiently reducing the incremental debt from the Ameredev
acquisition, or if the ability to drill and develop Matador's New
Mexico federal acreage becomes materially restrictive.
Matador Resources Company is a Dallas, Texas based publicly traded
independent exploration and production company with primary
operations in the Delaware Basin in New Mexico and West Texas.
The principal methodology used in this rating was Independent
Exploration and Production published in December 2022.
MATIV HOLDINGS: Moody's Rates New Senior Unsecured Notes 'B3'
-------------------------------------------------------------
Moody's Ratings assigned a B3 rating to the new senior unsecured
notes of Mativ Holdings, Inc. All other ratings for Mativ,
including the B1 corporate family rating, B1-PD probability of
default rating, as well as the Ba3 rating on the senior secured
debt and B3 rating on the existing senior unsecured notes are
unaffected at this time. The outlook is stable. The SGL-3
speculative grade liquidity rating is unchanged.
Moody's expect the transaction to be leverage neutral as proceeds
from the new $400 million unsecured notes maturing in 2029 will be
used primarily to refinance Mativ's existing $350 million senior
unsecured notes due 2026. The balance of the proceeds will be used
to repay $43 million on the rated term loan B, of which about $161
million remained drawn at June 30, 2024, and pay estimated
transaction expenses. Following the notes refinancing, Mativ will
have no near term debt maturities before its revolver and other
term loans come due in May 2027. Moody's will withdraw the B3
rating on the existing 2026 unsecured notes once this debt is
repaid.
RATINGS RATIONALE
Mativ's ratings reflect its high financial leverage with debt to
LTM EBITDA near 6x at June 30, 2024, and exposure to cyclical
markets facing macro-economic pressures that will continue to weigh
on earnings and delay significant improvement in credit metrics.
Additionally, the company's fine paper and printing business is in
secular decline. Mativ's sale of its cigarette paper business in
December 2023 has resulted in the loss of a high margin business
with solid cash flow that helped fund the growth of the company's
specialty materials industrial platform through acquisitions.
Acquisitive growth will remain core to the growth strategy and has
diluted margins and contributed to the high leverage. However,
Moody's believe the company will continue to prioritize
deleveraging to improve its financial flexibility.
Mativ's strategy to diversify away from tobacco reliant end markets
facing secular pressures and focus on specialty materials products
better positions the company for longer term growth. Moody's expect
the company to benefit from improved manufacturing efficiencies,
pricing actions and synergies realized from its 2022 merger with
Neenah, Inc. as volumes gradually improve. This should drive steady
margin growth and drive adjusted debt-to-EBITDA toward 5x over the
next year. Moody's anticipate the company will also benefit from
its less cyclical end markets, including filtration, healthcare and
sustainable packaging, and continue managing costs in the face of
near term top line pressures.
The B3 rating on the senior unsecured notes, two notches below the
B1 CFR, reflects their junior ranking behind the Ba3 rated senior
secured bank credit facility, which has a senior priority of claim
in the capital structure.
The stable outlook reflects Moody's expectation that credit metrics
will improve over the next 12-18 months, aided by cost-out actions,
continued focus on pricing discipline and moderate top line growth
as demand improves. Moody's also expect Mativ to maintain adequate
liquidity. The stable outlook does not assume any debt funded
acquisitions in the near term.
The SGL-3 speculative grade liquidity rating reflects adequate
liquidity, based on available cash, Moody's expectation of positive
free cash flow over the next year and ample revolver availability.
The $600 million senior secured revolving credit facility, expiring
in 2027, had approximately $300 million available at June 30, 2024
net of borrowings and letters of credit. Moody's anticipate the
company will pay down revolver borrowings periodically. However,
amounts drawn will fluctuate with working capital needs and depend
on the pace and magnitude of future acquisitions, though Mativ has
indicated acquisitions are on pause. The credit agreement includes
a maximum net leverage threshold of 4.5x and minimum interest
coverage covenant of 3.0x. Moody's expect Mativ to remain in
compliance with the covenants.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
The ratings could be downgraded with rising leverage or delays in
reducing leverage, including due to further declines in operating
results, or debt-to-EBITDA expected to remain above 5x. Inability
to improve the EBITDA margin could also result in a downgrade of
the ratings as could EBITA to interest coverage sustained at or
below 2x. Deteriorating liquidity, including sustained negative
free cash flow or increased reliance on the revolving credit
facility, could also result in a ratings downgrade. Debt funded
acquisitions or transactions that weaken the metrics or liquidity
would also pressure the ratings.
The ratings could be upgraded with improving organic growth and
material margin expansion such that Moody's expect EBITDA margin to
remain above 15%. Consistent solid free cash flow boosted by
accelerating growth in the company's specialty materials end
markets could also support a ratings upgrade. Free cash
flow-to-debt sustained above 5% and debt-to-EBITDA remaining below
4.5x while executing acquisitions would be important considerations
for an upgrade.
The principal methodology used in this rating was Manufacturing
published in September 2021.
Mativ Holdings, Inc. (fka Schweitzer-Mauduit International, Inc.),
based in Alpharetta, Georgia, is a producer of specialty materials.
The company manufactures filtration media, resin-based netting and
advanced films through its Filtration and Advanced Materials (FAM)
segment. The company also produces release liners, tapes,
healthcare materials and fine paper and packaging products through
its Sustainable and Adhesive Solutions (SAS) segment. Revenue
approximated $2 billion for the twelve months ended June 30, 2024.
MATTHEWS INT'L: Fitch Assigns BB- Rating on 2nd Lien Secured Notes
------------------------------------------------------------------
Fitch Ratings has assigned a 'BB-'/'RR4' rating to Matthews
International Corporation's (MATW) proposed issuance of second lien
secured notes. The proceeds are expected to be used to refinance
MATW's 5.25% senior unsecured notes due December 2025. Fitch
currently rates MATW's Long-Term Issuer Default Rating (IDR) 'BB-'.
The Rating Outlook is Stable.
MATW's rating reflects its diversified mix of relationship-oriented
and secular growth-linked businesses that support a relatively
resilient through-the-cycle consolidated cash flow profile. The
company's core stable Memorialization business is supported by
predictable demand, its advantaged distribution and point-of-sales
network, and comprehensive product mix.
Industrial Technologies is positioned to benefit from secular
trends in energy storage, warehouse automation and product
identification, while SGK Brand Solutions (SGK) has stabilized in
line with its long-term brand/packaging relationships following
regulatory-linked and geographic challenges. Fitch views MATW's
operational and cash flow risk profiles to be generally consistent
with 'BB' category characteristics. Fitch forecasts $40 million-$60
million annual FCF in fiscal years 2024 to 2025, including cost
savings and working capital unwinding, and EBITDA leverage below
4.0x, which is consistent with 'BB-' rating tolerances.
Key Rating Drivers
Stable Core Memorialization Business: MATW's credit profile is
underpinned by its leading market position and large operational
scale of its Memorialization segment. This segment accounts for 45%
of the company's revenue and 60% of its EBITDA as of FY23. As a
market leader in the death care industry, MATW offers a more
diversified product range than its closest scaled competitors. The
demand for this segment is stable, and Fitch believes that MATW is
well positioned as it continues expanding its cremation offerings
to capitalize on shifting market trends, while preserving its
pricing and growth opportunities.
Diversification Supports Cash Flows: MATW has had a strong track
record of resilient consolidated operating and cash flow
performance through economic cycles. Its revenues are supported by
its core, non-cyclical demand in the death care industry with
diversification from its Industrial Technologies and SGK segments.
The benefits of diversification are evident in the offsetting
financial impacts of the Industrial and SGK businesses, which
resulted in consolidated EBITDA remaining in the $200 million-$225
million range over the past four years.
Recent softness in demand for electric vehicles and warehouse
automation investment will pose low-single digit revenue declines
to MATW in the near-term, but Fitch believes secular trends to be
supportive of growth in energy storage, warehouse automation and
product identification sales through the cycle. The segment will
also benefit from integration and cost saving initiatives.
SGK's sales and EBITDA have stabilized following regulatory shifts
in tobacco packaging, COVID-19, and the Ukraine war, all of which
led to production curtailments. In response, MATW closed and
reduced costs at several European sites and is focusing on
strategic pricing and digital e-commerce initiatives to further
improve operations. Fitch views this segment as steady with modest
growth.
Customer Concentration in Industrial Technologies: The MATW
Engineering business, a part of the Industrial Technologies
segment, has significant customer concentration in the energy
storage solutions portion of this business, which poses potential
risk. Project delays have led to longer inventory days and an
increase in working capital outflows, pressuring free cash flow.
These risks are partially mitigated as significant interest from
prospective customers could diversify this concentration given
wider adoption of the company's dry battery electrode product.
Fitch also considers the risks in the reduction of revolver
availability as working capital needs grow, potentially hampering
financial flexibility. Fitch expects the current inventory buildup
to unwind by early FY25.
Steady Profitability, Positive FCF: Fitch forecasts EBITDA margins
to remain fairly stable between 11%-12.5%. Cost reductions from the
OLBRICH acquisition coupled with strategic price increases in
Memorialization and SGK are expected to be realized in FY24 and
FY25. Fitch also expects free cash flow generation to recover to
$40 million-$60 million annually (2.0%-3.5%) as drags on working
capital and excess cost subside.
Commitment to Deleveraging: Fitch believes the company will
continue to prioritize deleveraging towards its stated net leverage
target of 3.0x or lower. The company has a history of balancing
growth initiatives and shareholder friendly activities with debt
reduction. Fitch expects deleveraging will come from a combination
of EBITDA expansion and voluntary debt repayment as working capital
unwinds. EBITDA leverage will likely remain above company's
guidance in the medium-term but remain within Fitch's threshold of
'BB-' level ratings.
Derivation Summary
MATW's core Memorialization segment underpins the operating profile
due to its scaled market position, predictable demand, and cashflow
generation. The business profile is further bolstered by
diversification from its Industrial Technologies and SGK segments
with consideration of secular tailwinds in energy storage,
warehouse automation, and product identification. The company's
business profile and EBITDA leverage of around 4.0x are consistent
with 'BB-' rating tolerances.
MATW's credit profile is similar to other industrial companies in
the 'BB' category such as Hillman Solutions Corp. (BB-/Stable) and
WESCO International (BB+/Stable). Compared with more pureplay
industrial companies, MATW is operationally more diversified.
Key Assumptions
- Revenue experiences low single-digit declines in FY24 and FY25
due to weaker demand in warehouse automation and a cooling in the
electric vehicle market, followed by low single-digit growth in
subsequent years;
- EBITDA margins remain around 11.0%-12.5% over the medium term as
MATW realizes benefits from its cost saving initiatives and
increased pricing strategy;
- Capex estimated to be elevated through the forecast at 3.3% as
MATW continues its growth investments in the Industrial
Technologies segment;
- FCF margins between 2.0%-3.5% reflecting working capital
normalization as inventory build-up unwinds in early FY25;
- MATW focuses on deleveraging with EBITDA leverage around 4.0x in
FY24.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Continued commitment towards credit conscious financial policy
leading to EBITDA leverage below 3.5x;
- Retention of financial flexibility consistent with operational
and cash flow risk profile;
- Successful execution of its growth strategy in Industrial
Technologies leading to a larger more diversified install base.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Deviation from its publicly stated financial policy resulting in
EBITDA leverage sustained above 4.0x;
- A shift in financial flexibility leading to a material reduction
in credit facility availability;
- A deterioration in the operating profile or working capital
management leading to heightened variability or a sustained
contraction in FCF margin.
Liquidity and Debt Structure
Liquidity: Fitch considers MATW's liquidity as adequate. As of June
30, 2024, MATW International Corporation had sufficient liquidity
of $294 million comprised of $43 million in cash and $251 million
in availability on its $750 million revolving credit facility.
Debt Structure: As of June 30, 2024, MATW's debt structure largely
consists of a senior secured revolving credit facility, an
unsecured note, and off-balance-sheet factoring that Fitch treats
as debt. Total debt (including off-balance sheet factoring) is
approximately $925 million. The revolver and unsecured note mature
in 2029 and 2025, respectively.
After the 5.25% senior unsecured note refinancing, MATW's unsecured
debt will be repaid, and the capital structure will consist of
first lien and second lien debt.
Issuer Profile
Matthews International Corporation founded in 1850 and incorporated
in Pennsylvania in 1902, is a global provider of memorialization
products, industrial technologies, and brand solutions.
Date of Relevant Committee
19 September 2024
Public Ratings with Credit Linkage to other ratings
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.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
Entity/Debt Rating Recovery
----------- ------ --------
Matthews International
Corporation
Senior Secured
2nd Lien LT BB- New Rating RR4
MATTHEWS INT'L: Moody's Affirms B1 CFR & Rates New $300MM Notes B3
------------------------------------------------------------------
Moody's Ratings affirmed Matthews International Corporation's B1
corporate family rating and B1-PD probability of default rating. At
the same time, Moody's assigned B3 ratings to the proposed $300
million second lien senior secured notes due 2027. The current B3
ratings on Matthews' existing senior unsecured notes due 2025 were
also affirmed and will be withdrawn upon the close of the
transaction and the repayment of these notes. Moody's also
maintained Matthews' speculative grade liquidity ("SGL") rating at
SGL-2. The outlook remains stable. Matthews is a designer,
manufacturer and marketer of memorialization products, brand
solutions and industrial automation solutions.
The proceeds from the second lien senior secured notes, along with
a $10 million draw from the revolving credit facility (unrated),
will be used to repay the outstanding $300 million 5.25% senior
notes due December 2025, as well as to cover transaction-related
fees and expenses. The transaction will extend its debt maturity
profile until 2027 in essentially a leverage-neutral transaction,
reducing refinancing risk. However, Moody's anticipate an increase
in interest expense from higher coupon rates on the new notes,
which will be partly mitigated by a decrease in floating debt
costs.
RATINGS RATIONALE
Matthews' B1 CFR is constrained by recent declines in revenue and
profitability, primarily in its Industrial Technologies Segment,
and by the company's high financial leverage. Moody's expect
debt-to-EBITDA to be around 5x over the next 12 to 18 months.
Moody's anticipate lower sales in the company's Memorialization and
Industrial Technologies segments, along with relatively flat
top-line growth in its SGK Brand business, as price increase
initiatives will not fully offset diminishing demand. The credit
profile also incorporates risks to the company's operating
performance, especially due to a shift in product mix towards
lower-margin offerings like cremation and converting line products,
uncertainty in its energy storage business, and increased costs for
materials and labor. Delivery delays, attributed to the
installation readiness of Tesla, Inc. ("Tesla", Baa3 Stable), a
major client of its energy storage solutions business, have
pressured Matthews' working capital and cash flow generation.
Additionally, an ongoing dispute with Tesla, alleging that Matthews
has misappropriated Tesla's trade secrets, further increases
uncertainty and could limit Matthews' operational performance.
Nonetheless, Matthews maintains that these allegations have no
significant impact on its operations.
All financial metrics cited reflect Moody's standard adjustments.
Matthews' credit profile benefits from its leading position in the
memorialization segment, given the generally stable demand for its
caskets and other funeral products. The memorialization segment
accounted for 46% of the revenue for the 12-month period ending
June 30, 2024, contributing high margins and predictable cash flow
to support Matthews' growth. The company is well-positioned to
profit from the industry's gradual shift from traditional burials
to cremation. Moody's also consider the potential long-term growth
of the Industrial Technologies segment a credit positive, primarily
in the energy storage solutions business, amid rising demand for
energy solutions in electric vehicles and renewable energy
systems.
The B3 rating on the proposed $300 million second lien senior
secured notes due 2027 is two notches below the B1 CFR, reflecting
its junior position in the capital structure in relation to the
company's first lien secured debt, which includes a $750 million
revolving credit facility (unrated) due 2029.
Matthews' SGL-2 rating reflects Moody's expectation that the
company will maintain a good liquidity profile over the next 12 to
15 months. Liquidity is supported by $43 million of cash on hand as
of June 30, 2024, around $240 million pro forma of available
capacity under its $750 million revolving credit facility due 2029
(unrated), and Moody's expectation of free cash flow-to-debt in the
low single-digit percentage range over the same period. As of June
30, 2024, the company had a cash flow deficit, with a negative free
cash flow-to-debt of 3%, which Moody's expect will improve. The
company has a significant amount of working capital tied up in the
energy storage business, which could be released as more equipment
is delivered in the first half of fiscal 2025, thus improving the
company's operating cash flow. The company's revolving credit
facility is primarily employed for seasonal working capital needs
and discretionary purposes. Under the terms of the revolving credit
facility, Matthews is required to maintain a net leverage ratio (as
defined in the agreement) of less than or equal to 4.5x and an
interest coverage ratio of greater than or equal to 3.0x. Upon a
permitted acquisition, Matthews may elect a temporary leverage
increase on a one-time basis, subject to a net leverage ratio of up
to 5.0x and a secured net leverage of up to 4.0x for the subsequent
four quarters. Moody's expect the company to be in and maintain
compliance with all covenants. Matthews' senior secured second lien
notes mature in September 2027, before the revolving credit
facility expires. Consequently, due to a springing feature, the
maturity of the revolving credit facility will effectively advance
to 90 days prior to the notes' due date.
In addition, Matthews, through Matthews Receivables Funding
Corporation, LLC ("Matthews RFC"), regularly sells its trade
receivables up to $125 million to a financial institution for an
equivalent cash amount under a Receivables Purchase Agreement
(RPA), set to expire in March 2026. As of June 30, 2024, there was
approximately $19.9 million available under this agreement.
Furthermore, Matthews, through its U.K. subsidiary, utilizes
non-recourse receivable factoring arrangements with third-party
financial institutions to assist in managing working capital. As of
June 30, 2024, there was approximately $16 million available
through these arrangements.
The stable outlook reflects Moody's expectation of revenue declines
in the low single-digit percentage range and limited free cash flow
generation over the next 12 - 18 months, which could constrain the
company's capacity to repay debt or invest in growth opportunities.
Moody's anticipate that debt-to-EBITDA will remain high, around
5.0x, and free cash flow-to-debt will be in the low single-digit
percentage range. Moody's forecast an EBITDA margin of above 11%
and interest coverage, calculated as EBITA-to-interest expense, of
at least 2x over the same period.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if Matthews demonstrates sustained
revenue growth and profit margin expansion, while maintaining
debt-to-EBITDA below 4.75x. A ratings upgrade would also require
good liquidity and free cash flow-to-total-debt approaching the
high single-digit range or higher.
The ratings could be downgraded if Matthews experiences a material
contraction in revenue or profitability, free cash flow generation
weakens, or liquidity deteriorates. The ratings could also be
downgraded if the company adopts more aggressive financial policies
that lead to debt-to-EBITDA remaining above 5.5x.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
Matthews (NASDAQ: MATW), headquartered in Pittsburgh, PA, is a
designer, manufacturer and marketer of memorialization products,
brand solutions and industrial automation solutions. Moody's expect
Matthews to generate revenue of around $1.8 billion in 2025.
MAXIMUS SUPPLY: Seeks to Tap Boyer & Boyer as Bankruptcy Counsel
----------------------------------------------------------------
Maximus Supply Chain Holdings, LLC and its affiliates seek approval
from the U.S. Bankruptcy Court for the Northern District of Indiana
to employ Boyer & Boyer as its legal counsel.
The firm's services include:
(a) review and audit of the filed schedules and statements of
financial affairs and monthly operating reports;
(b) advise the Debtors with respect to (i) their powers and
duties, (ii) the management and operations of their property, and
(iii) recovery actions and other legal proceedings with they might
bring on behalf of the bankruptcy estate;
(c) apply authority to sell certain of the Debtors' assets at
one or more private sales and conduct negotiations with prospective
buyers and/or lease agreements and prepare any and all pleadings
and motions related to the same;
(d) conduct financial and other negotiations with advisors and
creditors of the Debtors and prepare and propose a disclosure
statement plan of reorganization or liquidation, then take the
steps necessary to confirm such plan;
(e) prepare on behalf of the Debtors necessary applications,
notices, complaints, answers, orders, reports, and other filings
and pleadings in these bankruptcy cases;
(f) advise the Debtors in connection with the use, sale and
lease of all property;
(g) advise the Debtors on matters relating to evaluation and
assumption, rejection or assignment of executory contracts and
unexpired leases;
(h) appear before this bankruptcy court to represent and
protect the interest of the bankruptcy estate; and
(i) perform all other legal services which may be necessary
and proper for an effective Chapter 11 reorganization.
R. David Boyer, Esq., the primary attorney at this representation,
will be compensated at his hourly rate of $300.
Prior to the petition date, the Debtor paid the firm a retainer in
amount of $15,000.
Mr. Boyer 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:
R. David Boyer, Esq.
Boyer & Boyer
46 N. Washington Blvd., Ste. 21
Sarasota, FL 34236
Telephone: (941) 365-2304
About Maximus Supply Chain Holdings
Maximus develops innovative solutions and products servicing a
variety of industries including automotive, commercial vehicle,
agricultural equipment, RVs, and power manufacturing industries.
Maximus Supply Chain Holdings, LLC and its affiliates filed their
voluntary petitions for Chapter 11 protection (Bankr. N.D. Ind.
Lead Case No. 24-40167) on June 25, 2024, listing as much as $0 in
both assets and liabilities. Sam Bazzi, president/CEO, signed the
petitions.
Judge Robert E. Grant oversees the cases.
Boyer & Boyer serves as the Debtors' legal counsel. Stretto, Inc.
is the Debtors' claims and noticing agent.
MEDICAL SOLUTIONS: Blackstone Senior Marks $1.1MM Loan at 26% Off
-----------------------------------------------------------------
Blackstone Senior Floating Rate 2027 Term Fund has marked its
$1,120,353 loan extended to Medical Solutions LLC to market at
$854,068 or 76% of the outstanding amount, according to the
Blackstone Senior's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone Senior is a participant in a First Lien Term Loan B (1M
US SOFR + 3.25%) to Medical Solutions LLC. The loan matures on
November 1, 2028.
Blackstone Senior, formerly known as Blackstone Senior Floating
Rate Term Fund, is a diversified, closed-end management investment
company. BSL was organized as a Delaware statutory trust on March
4, 2010. BSL was registered under the Investment Company Act of
1940, as amended on March 5, 2010.
Blackstone Senior is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Senior Floating Rate 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Medical Solutions L.L.C. operates as a travel nursing company. The
Company provides benefits such as personalized pay package, medical
and dental insurance, paid private housing, and loyalty programs,
as well as pet care, education and training, and friendly housing
services for travel nurses. Medical Solutions serves customers in
the United States.
MEDICAL SOLUTIONS: Blackstone Strat Marks $3.5MM Loan at 24% Off
----------------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its
$3,584,066 loan extended to Medical Solutions LLC to market at
$2,732,205 or 76% of the outstanding amount, according to the
Blackstone Strat's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone Stratis a participant in a First Lien Term Loan B (3M
CME Term SOFR + 4.25%, 0.75% Floor) to Medical Solutions LLC. The
loan matures on May 25, 2028.
Blackstone Strat is a closed-end term fund that trades on the New
York Stock Exchange under the symbol. BGB's primary investment
objective is to seek high current income, with a secondary
objective to seek preservation of capital, consistent with its
primary goal of high current income.
Blackstone Strat is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Medical Solutions L.L.C. operates as a travel nursing company. The
Company provides benefits such as personalized pay package, medical
and dental insurance, paid private housing, and loyalty programs,
as well as pet care, education and training, and friendly housing
services for travel nurses. Medical Solutions serves customers in
the United States.
METRO MATTRESS: Seeks to Hire Barclay Damon as Bankruptcy Counsel
-----------------------------------------------------------------
Metro Mattress Corp. seeks approval from the U.S. Bankruptcy Court
for the Northern District of New York to employ Barclay Damon LLP
as its bankruptcy counsel.
The firm will render these services:
(a) analyze the Debtor's financial situation, and render
advice regarding its obligations and responsibilities after filing
a petition in bankruptcy;
(b) prepare and file any petition, schedules, statements of
financial affairs, and plan which may be necessary or appropriate;
(c) represent the Debtor at any and all meetings;
(d) give the Debtor legal advice with respect to its powers
and duties in the continued operation of its business and
management of its property;
(e) advise the Debtor on the conduct of this Chapter 11 case;
(f) confer and negotiate with the United States Trustee,
representatives of the Debtor's creditors, landlords, and other
parties in interest on various issues as they arise;
(g) prepare, on behalf of the Debtor, pleadings in connection
with this Chapter 11 case;
(h) advise the Debtor in connection with sales or other
disposition of its assets;
(i) advise the Debtor in connection with any
debtor-in-possession financing;
(j) represent the Debtor in adversary proceedings and other
contested bankruptcy matters;
(k) appear before the court and any appellate court to
represent the interests of the Debtor's estates;
(l) take any necessary action on behalf of the Debtor to
negotiate, prepare, and obtain confirmation of a Chapter 11 plan
and all documents related thereto;
(m) analyze the Debtor's executory contracts and the
assumption, assumption and assignment, or rejection thereof;
(n) advise the Debtor on corporate, litigation, tax, employee,
and other matters; and
(o) perform all other legal services for the Debtor.
The firm will be paid at these hourly rates:
Partners $310 - $905
Counsel $290 - $740
Associates $225 - $515
Paraprofessionals $190 - $265
In addition, the firm will seek reimbursement for expenses
incurred.
The firm received payments totaling $102,399 during 90 days prior
to the petition date.
Jeffrey Dove, Esq., a partner at Barclay Damon, 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:
Jeffrey A. Dove, Esq.
Barclay Damon LLP
Barclay Damon Tower
125 East Jefferson Street
Syracuse, NY 13202
Telephone: (315) 413-7112
Email: jdove@barclaydamon.com
About Metro Mattress Corp.
Metro Mattress Corp. is specialty retailer of mattresses serving
New York, Connecticut, New Hampshire, Massachusetts, and Rhode
Island customers.
Metro Mattress Corp. sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D.N.Y. Case No. 24-30773) on September 4,
2024. In the petition filed by Dino Cifelli, chief executive
officer, the Debtor disclosed estimated assets between $1 million
and $10 million and estimated liabilities between $10 million and
$50 million.
Judge Wendy A. Kinsella oversees the case.
Barclay Damon LLP serves as the Debtor's counsel.
MICCARTAR LAND: Seeks to Tap McDowell Law as Bankruptcy Counsel
---------------------------------------------------------------
Miccartar Land Development, LLC seeks approval from the U.S.
Bankruptcy Court for the District of New Jersey to employ McDowell
Law, PC as counsel.
The firm's services include:
(a) provide all required advice concerning the Debtor's
operation; and
(b) assist in formulating and confirming a Plan of
Reorganization.
The firm's counsel and staff will be paid at these hourly rates:
Ellen McDowell, Attorney $450
Joseph Riga, Attorney $450
Robert Braveman, Attorney $450
Associates $275 - $300
The Debtor has agreed to pay the firm a retainer in the amount of
$10,000.
Ms. McDowell 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:
Ellen M. McDowell, Esq.
McDowell Law PC
46 West Main Street
Maple Shade, NJ 08052
About Miccartar Land Development
Miccartar Land Development, LLC is engaged in activities related to
real estate.
Miccartar Land Development sought relief under Subchapter V of
Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.N.J. Case No.
24-15717) on June 5, 2024, listing up to $10 million in both assets
and liabilities. Mark A. Vittese, manager, signed the petition.
Judge Jerrold N. Poslusny Jr. oversees the case.
McDowell Law, PC serves as the Debtor's counsel.
MKUL INC: Loses Summary Judgment Bid in Aura Smart Suit
-------------------------------------------------------
Chief Judge Erik P. Kimball of the United States Bankruptcy Court
for the Southern District of Florida denied the motions for summary
judgment filed by the parties in the case captioned as MKUL, INC.,
f/k/a MOLEKULE GROUP, INC., Plaintiff, v. AURA SMART AIR, LTD.,
Defendant, Adv. Proc. No. 24-01004-EP (Bankr. S.D. Fla.).
The parties' dispute centers around agreements they entered into in
February 2023. Among several contracts executed at that time, the
parties focus on two -- a Technology Collaboration Agreement and a
Merger Agreement.
Aura is an entity formed under the laws of Israel. Molekule is a
Florida corporation. Both companies have been in the business of
developing and marketing air filtration devices.
In late 2022, Molekule and Aura began negotiating a potential
acquisition of Aura by Molekule by way of merger. Aura would merge
with a newly created Israeli entity, a subsidiary of Molekule. Aura
would be the surviving entity in that merger, and would thereby
become a subsidiary of Molekule. The parties memorialized that
proposed transaction in the Merger Agreement.
At the same time, Molekule and Aura entered into other agreements
including the TCA. Aura had developed software to permit its
customers to access air filtration devices in the field by remote
means, to obtain data from and control those devices, and to allow
remote firmware updates. The parties refer to this as the Aura Air
Platform. Molekule wanted to obtain the ability to use the AAP for
remote access to its own customers' devices. In the TCA, the
parties agreed to integrate their systems in a way to permit
Molekule all of the benefits of the AAP, and to provide certain
rights to Molekule should Aura fail to perform.
Aura commenced a voluntary bankruptcy in Israel in August 2023 and
a trustee was appointed to manage its affairs. Molekule filed a
voluntary chapter 11 petition in October 2023.
The parties differ on why the merger failed but they agree that the
Merger Agreement was terminated before Molekule filed its chapter
11 case.
In the complaint, Molekule requests relief in two counts:
-- In count I, Molekule seeks specific performance of Aura's
obligations under the TCA. Citing section 2.04(ii) of the TCA.
Molekule asks the Court to order Aura to deliver the "tangible
embodiments" of Aura's Background IP.
-- In count II, Molekule seeks injunctive relief aligned with
the specific performance requested in count I. Molekule asks the
Court to enjoin Aura from deleting or modifying its Background IP,
including the AAP, that is stored with third parties including an
entity called Atlassian Corporation.
The parties' disputes fall into three general categories:
1. Aura argues that, in spite of assumption of the TCA and
termination and rejection of the Merger Agreement, the TCA and the
Merger Agreement must be treated as a single, integrated agreement.
Aura argues that the TCA terminated along with the Merger
Agreement. Aura argues that the result is that Molekule is not
entitled to any relief requested in the complaint. Molekule
responds that res judicata prohibits Aura's argument because the
TCA was assumed as a singular agreement and the Merger Agreement,
to the extent relevant after its termination, was rejected.
2. Aura argues that the text of the TCA does not support any
of the relief requested by Molekule. Among other things, Aura
argues that it did not grant a license in the AAP to Molekule and
so Molekule is not entitled to any data related to the AAP under
the TCA, and that Aura did not agree to specific performance in the
context of this dispute.
3. Aura argues that Molekule is asking the Court to enforce an
illegal contract. Aura states that the relief requested in this
adversary proceeding -- in particular to give Molekule access to
the source code for the AAP -- is contrary to the law of Israel and
would expose Aura to penalties including, potentially,
incarceration of representatives of Aura.
The Court notes the two motions for summary judgment are mirror
images of each other. Molekule seeks summary judgment in its favor
on all relief requested in the complaint. While Aura's motion is
labeled as one for partial summary judgment, it seeks judgment in
favor of Aura on all counts of the complaint.
Molekule met its burden on both counts of the complaint, the Court
finds. However, because the Court does not have sufficient data to
rule on Aura's affirmative defense of illegality, the Court is
unable to grant either motion for summary judgment. In light of the
Court's analysis of the relevant agreement between the parties and
the Court's own prior orders in the chapter 11 case of Molekule,
the only issue remaining for trial is Aura's affirmative defense of
illegality. The Court will limit presentation at trial to evidence
and legal argument relevant to that defense.
A copy of the Court's decision is available at
https://urlcurt.com/u?l=F63NjL
About Molekule Inc.
Molekule, Inc. and Molekule Group, Inc. manufacture air purifiers.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Fla. Lead Case No. 23-18094) on
October 3, 2023. In the petition signed by its chief financial
officer, Ryan Tyler, Molekule, Inc. disclosed $11,592,471 in total
assets and $46,952,909 in total liabilities.
The Hon. Erik P. Kimball is the case judge.
The Debtors tapped Bradley S. Shraiberg, Esq., at Shraiberg Page,
PA as bankruptcy counsel and the law firm of Ossentjuk & Botti and
The Marbury Law Group, PLLC as special counsel.
MLN US HOLDCO: 91% Markdown for Blackstone Senior's $854,492 Loan
-----------------------------------------------------------------
Blackstone Senior Floating Rate 2027 Term Fund has marked its
$854,492 loan extended to MLN US HoldCo LLC to market at $96,130 or
11% of the outstanding amount, according to the Blackstone Senior's
Form N-CSRS for the semi-annual period ended June 30, 2024, filed
with the Securities and Exchange Commission.
Blackstone Senior is a participant in a First Lien Term Loan B (3M
CME Term SOFR + 4.50%) to MLN US HoldCo LLC. The loan matures on
November 30, 2025.
Blackstone Senior, formerly known as Blackstone Senior Floating
Rate Term Fund, is a diversified, closed-end management investment
company. BSL was organized as a Delaware statutory trust on March
4, 2010. BSL was registered under the Investment Company Act of
1940, as amended on March 5, 2010.
Blackstone Senior is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Senior Floating Rate 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
MLN US Holdco LLC, dba Mitel, headquartered in Ottawa, Canada,
provides phone systems, collaboration applications (voice, video
calling, audio and web conferencing, instant messaging etc.) and
contact center solutions through on-site and cloud offerings. The
Company’s customer focus is on small and medium sized businesses.
Mitel is majority-owned by private equity firm Searchlight Capital
Partners.
MLN US HOLDCO: 91% Markdown for Blackstone Strat's $2.3MM Loan
--------------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its
$2,330,823 loan extended to MLN US HoldCo LLC to market at $262,174
or 11% of the outstanding amount, according to the Blackstone
Strat's Form N-CSRS for the semi-annual period ended June 30, 2024,
filed with the Securities and Exchange Commission.
Blackstone Strat is a participant in a First Lien Term Loan B (3M
CME Term SOFR + 4.50%) to MLN US HoldCo LLC. The loan matures on
November 30, 2025.
Blackstone Strat is a closed-end term fund that trades on the New
York Stock Exchange under the symbol. BGB's primary investment
objective is to seek high current income, with a secondary
objective to seek preservation of capital, consistent with its
primary goal of high current income.
Blackstone Stratis led by Robert Zable Principal Executive Officer,
President and Chief Executive Officer; and Gregory Roppa Principal
Financial Officer, Treasurer and Chief Financial Officer. The Fund
can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
MLN US Holdco LLC, dba Mitel, headquartered in Ottawa, Canada,
provides phone systems, collaboration applications (voice, video
calling, audio and web conferencing, instant messaging etc.) and
contact center solutions through on-site and cloud offerings. The
Company’s customer focus is on small and medium sized businesses.
Mitel is majority-owned by private equity firm Searchlight Capital
Partners.
MOJ REALTY: Gets OK to Tap Marcus & Millichap as Real Estate Agent
------------------------------------------------------------------
MOJ Realty, LLC received approval from the U.S. Bankruptcy Court
for the Middle District of Florida to employ Marcus & Millichap
Real Estate Investment Service of Florida, Inc. as commercial real
estate agent.
The Debtor needs a real estate agent to sell its property located
in Hillsborough County, Florida.
The firm will receive a commission of 6 percent of the property's
purchase price. If there is a separate broker, the firm will pay
that broker from the 6 percent paid by the Debtor.
Quint Schenck, a real estate agent at Marcus & Millichap Real
Estate Investment Service of Florida, 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:
Quint Schenck
Marcus & Millichap Real Estate Investment Service of Florida,
Inc.
300 S. Orange Avenue, Suite 700
Orlando, FL 32801
Telephone: (407) 557-3819
About MOJ Realty
MOJ Realty, LLC, a Single Asset Real Estate, operates a mobile home
park in Valrico, Florida.
MOJ Realty filed a Chapter 11 bankruptcy petition (Bankr. M.D. Fla.
Case No. 23-01259) on March 31, 2023. In the petition signed by
William A. Guzman, managing member, the Debtor disclosed $500,000
to $1 million in assets and $1 million to $10 million in
liabilities.
Judge Catherine Peek McEwen oversees the case.
The Law Office of Leon A. Williamson, Jr., PA serves as the
Debtor's counsel.
MOORE MEDICAL: Case Summary & 11 Unsecured Creditors
----------------------------------------------------
Debtor: Moore Medical Group, Inc.
1355 South International Parkway #1481
Lake Mary, FL 32746
Business Description: The Debtor is a general medical and surgical
hospital.
Chapter 11 Petition Date: September 24, 2024
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 24-05162
Judge: Hon. Grace E Robson
Debtor's Counsel: Katelyn M. Vinson, Esq.
DAVID JENNIS, PA
D/B/A JENNIS MORSE
606 East Madison Street
Tampa, FL 33602
Tel: (813) 229-2800
Email: ecf@JennisLaw.com
Total Assets as of Aug. 31, 2024: $481,336
Total Liabilities as of Aug. 31, 2024: $2,762,511
The petition was signed by Eric A. Moore as CEO.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 11 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/2X4AJPY/Moore_Medical_Group_Inc__flmbke-24-05162__0001.0.pdf?mcid=tGE4TAMA
MOUNTAIN SPORTS: U.S. Trustee Wants to Partly Unseal Bonuses
------------------------------------------------------------
Alex Wittenberg of Law360 Bankruptcy Authority reports that
the U.S. Trustee's Office urged a Delaware bankruptcy judge on
Wednesday, September 18, 2024, to deny sports retailer Mountain
Sports' bid to conceal details of bonuses it has proposed to pay
employees to help incentivize them to stay as it works to liquidate
all remaining stores.
About Mountain Sports
Mountain Sports LLC, doing business as Bob's Stores, Eastern
Mountain Sports, EMS, and Sport Chalet, is a sporting goods, hobby
and musical instrument retailer.
Mountain Sports LLC and its affiliates sought relief under Chapter
11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case No.
24-11385) on June 18, 2024. In the petitions filed by David Barton,
authorized representative, Mountain Sports disclosed between $10
million and $50 million in both assets and liabilities.
Judge Mary F. Walrath oversees the cases.
The Debtors tapped Goldstein & McClintock LLLP as counsel and
Silverman Consulting as financial advisor.
On July 3, 2024, the Office of the United States Trustee for the
District of Delaware appointed an official committee of unsecured
creditors in these Chapter 11 cases. The committee tapped
Lowenstein Sandler, LLP as bankruptcy counsel and Morris James LLP
as Delaware counsel.
MP REORGANIZATION: Trustee Hires Ringstad & Sanders as Counsel
--------------------------------------------------------------
Nathan Smith, the trustee appointed in the Chapter 11 case of MP
Reorganization, seeks approval from the U.S. Bankruptcy Court for
the District of Nevada to employ Ringstad & Sanders, LLP as his
general bankruptcy counsel.
The firm's services include:
(a) provide general legal advice, representation and counsel
on matters relating to administration of this Chapter 11
proceeding;
(b) undertake legal analysis, prepare and file any pleadings,
motions, notices, or orders which may be required for the orderly
administration of this estate;
(c) commence actions, wherever and whenever appropriate, and
provide legal advice regarding the marshalling and protection of
the assets of the Debtor for the benefit of creditors of the
estate;
(d) investigate and prosecute preference, turnover, or
fraudulent conveyance actions which may exist for the benefit of
creditors of the estate;
(e) object to claims, if any, after review by the trustee. In
the event objections are filed, counsel will be required to conduct
legal analysis, provide legal advice, prepare for, and attend any
hearing on objections, as well as to draft any and all pleadings
relevant thereto, and to engage in necessary discovery; and
(f) represent, assist, and advise the trustee in all matters
relating to his performance of his duties in this case.
The hourly rates of the firm's counsel and staff are as follows:
Todd Ringstad, Attorney $725
Nanette Sanders, Attorney $725
Karen Sue Naylor, Attorney $625
Becky Metzner, Paralegal $195
Arlene Martin, Paralegal $150
In addition, the firm will seek reimbursement for expenses
incurred.
Mr. Ringstad 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:
Todd C. Ringstad, Esq.
Ringstad & Sanders LLP
4910 Birch Street, Suite 120
Newport Beach, CA 92660
Telephone: (949) 851-7450
Facsimile: (949) 851-6926
Email: todd@ringstadlaw.com
About MP Reorganization
MP Reorganization sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Nev. Case No. 22-14422) on Dec. 15,
2022, listing up to $50 million in both assets and liabilities.
Judge Natalie M. Cox oversees the case.
Schwartz Law, PLLC is the Debtor's bankruptcy counsel.
Nathan F. Smith was appointed as trustee in this Chapter 11 case.
He tapped Todd C. Ringstad, Esq., at Ringstad & Sanders LLP as his
counsel.
MRSC CO ASPEN: Seeks Chapter 11 Bankruptcy Protection
-----------------------------------------------------
MRSC CO Aspen House LLC filed Chapter 11 protection in the District
of Colorado. According to court filings, the Debtor reported
between $1 million and $10 million in debt owed to 1 and 49
creditors. The petition states that funds will be available to
unsecured creditors.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
Oct. 16, 2024 at 9:00 a.m. in Room Telephonically on telephone
conference line: 888-497-4718. participant access code: 6026644#.
About MRSC CO Aspen House
MRSC CO Aspen House LLC, doing business as Aspen House Equity LLC
and Aspen House Assisted Living and Memory Care, offers assisted
living and memory care services.
MRSC CO Aspen House LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Col. Case No. 24-15323) on September 10,
2024. In the petition filed by Kenneth Mannina, Athan Antonopoulos,
and Richard E. Scott, a co-managers, the Debtor reports estimated
assets between $10 million and $50,000 and estimated lisbilities
between $1 million and $10 million.
The Honorable Bankruptcy Judge Joseph G. Rosania Jr. oversees the
case.
The Debtor is represented by:
Jeffrey A. Weinman, Esq.
ALLEN VELLONE WOLF HELFRICH & FACTOR, P.C.
1600 Stout Street
Denver, CO 80202
Tel: 303-534-4499
Email: jweinman@allen-vellone.com
MULLEN AUTOMOTIVE: Effects 1-for-100 Reverse Stock Split
--------------------------------------------------------
Mullen Automotive Inc. announced Sept. 13, 2024, that it will
effect a 1-for-100 reverse stock split of its common stock, par
value $0.001 per share, that became effective on Sept. 17, 2024, at
12:01 a.m. Eastern Time. The Common Stock continued to trade on
The Nasdaq Capital Market under the existing symbol MULN and will
begin trading on a split-adjusted basis when the market opened on
Sept. 17, 2024. The new CUSIP number for the Common Stock
following the Reverse Stock Split will be 62526P505.
The Reverse Stock Split is primarily intended to bring the Company
into compliance with the $1.00 minimum bid price requirement for
maintaining its listing on Nasdaq. There is no guarantee the
Company will meet the minimum bid price requirement.
At the Company's Special Meeting of Stockholders held on Sept. 9,
2024, the Company's stockholders approved a proposal to authorize a
reverse stock split of the Company's Common Stock, at a ratio
within the range of 1-for-2 to 1-for-100. The Company's board of
directors approved a 1-for-100 reverse split ratio, and the Company
will file a Certificate of Amendment to its Second Amended and
Restated Certificate of Incorporation to effect the Reverse Stock
Split effective Sept. 17, 2024.
The 1-for-100 Reverse Stock Split will automatically combine and
convert 100 current shares of the Company's Common Stock into one
issued and outstanding share of Common Stock. Proportional
adjustments also will be made to outstanding equity awards,
warrants and convertible notes, and certain existing agreements
pursuant to their terms; however, pursuant to the terms of the
Company's 2022 Equity Incentive Plan, as amended, the number of
shares then reserved for issuance under such plan will not be
adjusted based upon the Reverse Stock Split ratio. Proportionate
adjustments will also be made to the per share conversion price of
the Company's series of preferred stock, pursuant to their
respective terms. The Reverse Stock Split will not change the par
value of the Common Stock nor the authorized number of shares of
Common Stock, preferred stock or any series of preferred stock.
No fractional shares will be issued in connection with the Reverse
Stock Split. All fractional shares will be rounded up to the
nearest whole share. The Reverse Stock Split will affect all
stockholders uniformly and will not alter any stockholder's
percentage interest in the Company's equity (other than as a result
of the rounding of shares to the nearest whole share in lieu of
issuing fractional shares).
The Company's transfer agent, Continental Stock Transfer & Trust
Company, will serve as exchange agent for the Reverse Stock Split.
Registered stockholders holding pre-split shares of the Company's
Common Stock electronically in book-entry form are not required to
take any action to receive post-split shares. Stockholders owning
shares via a broker, bank, trust or other nominee will have their
positions automatically adjusted to reflect the Reverse Stock
Split, subject to such broker's particular processes, and will not
be required to take any action in connection with the Reverse Stock
Split.
About Mullen
Mullen Automotive Inc. (f/k/a Net Element Inc.) is a Southern
California-based automotive company building the next generation of
commercial electric vehicles ("EVs") with two United States-based
vehicle plants located in Tunica, Mississippi, (120,000 square
feet) and Mishawaka, Indiana (650,000 square feet). In August
2023, Mullen began commercial vehicle production in Tunica. In
September 2023, Mullen received IRS approval for federal EV tax
credits on its commercial vehicles with a Qualified Manufacturer
designation that offers eligible customers up to $7,500 per
vehicle. As of January 2024, both the Mullen ONE, a Class 1 EV
cargo van, and Mullen THREE, a Class 3 EV cab chassis truck, are
California Air Resource Board (CARB) and EPA certified and
available for sale in the U.S. Recently CARB issued HVIP approval
on the Mullen THREE, Class 3 EV truck, providing up to $45,000
cash voucher at time of vehicle purchase. The Company has also
recently expanded its
commercial dealer network with the addition of Pritchard EV and
National Auto Fleet Group, providing sales and service coverage in
key Midwest and West Coast markets. The Company also recently
announced Foreign Trade Zone ("FTZ") status approval for its
Tunica, Mississippi, commercial vehicle manufacturing center. FTZ
approval provides a number of benefits, including deferment of
duties owed and elimination of duties on exported vehicles.
Larkspur, California-based RBSM LLP, the Company's auditor since
2023, issued a "going concern" qualification in its report dated
Jan. 16, 2024, citing that the Company has an accumulated deficit,
recurring losses, and expects continuing future losses. These
conditions raise substantial doubt about the Company's ability to
continue as a going concern.
MURRAY ENERGY: Dinsmore, et al. Suit to Remain in Bankruptcy Court
------------------------------------------------------------------
In the adversary proceeding captioned as Brenda L. Murray, et al.,
Plaintiffs, v. Dinsmore & Shohl, LLP, et al., Defendants, Adv. Pro.
No. 24-2028 (Bankr. S.D. Ohio), Judge John E. Hoffman, Jr. of the
United States Bankruptcy Court for the Southern District of Ohio
denied the plaintiff's motion for remand.
The complaint in this adversary proceeding was initially filed in
the Belmont County, Ohio Court of Common Pleas. As in Murray v.
Willkie Farr & Gallagher LLP (In re Murray Energy Holdings Co.),
654 B.R. 469 (Bankr. S.D. Ohio 2023), the plaintiffs in this case
include Brenda L. Murray , the wife of the Debtors' founder, Robert
E. Murray, who died in October 2020. Mrs. Murray is a Plaintiff
both in her capacity as executrix of Mr. Murray's estate and in her
capacity as trustee of the Brenda L. Murray Trust. The other
Plaintiff is Michael J. Shaheen, in his capacity as trustee of the
Robert E. Murray Trust. The State Court complaint alleges
defendants Dinsmore & Shohl LLP and three of its present or former
partners, Jerrad T. Howard, J. Michael Cooney and Kim Martin Lewis
committed legal malpractice in negotiating and seeking confirmation
of the Chapter 11 Plan.
The Defendants removed the State Court complaint to the Bankruptcy
Court under 28 U.S.C. Sec. 1452(a), which provides for the removal
of actions over which there is jurisdiction under 28 U.S.C. Sec.
1334 (jurisdiction over bankruptcy cases and proceedings), and Rule
9027 of the Federal Rules of Bankruptcy Procedure.
The Plaintiffs filed a motion to remand, which the Defendants
opposed. The Plaintiffs replied and filed an amended complaint in
response to the Defendants' motion to dismiss.
In support of removal, the Defendants rely on a "Release" and an
"Exculpation Clause" in the Chapter 11 Plan.
The Defendants argue that the Plaintiffs' malpractice claim is
"barred by both the [Release] and the Exculpation Clause" in the
Debtors' Chapter 11 Plan.
The Plaintiffs contend that this adversary proceeding must be
remanded to the State Court because the Court lacks subject-matter
jurisdiction over their legal malpractice claim. For their part,
the Defendants argue that this proceeding should not be remanded
because the Bankruptcy Court has core, arising-in jurisdiction over
the Plaintiffs' claim.
The Bankruptcy Court notes remand would be required if it lacked
subject-matter jurisdiction. However, the Defendants have carried
their burden, the Bankruptcy Court finds. The Bankruptcy Court
concludes that it has core, arising-in jurisdiction over this
adversary proceeding.
Judge Hoffman says, "Again, '[a]rising in proceedings are those
that, by their very nature, could arise only in bankruptcy cases.'
The dispute between the parties fits the bill. Although the
Defendants represented the Murray Clients before the Debtors'
bankruptcy, the Defendants' alleged malpractice occurred entirely
during the Debtors' bankruptcy case."
He further explains, "True, 'the mere fact that conduct took place
during a bankruptcy case is not enough to provide 'arising in'
jurisdiction.' But the legal malpractice alleged in the Amended
Complaint has everything to do with the Debtors' bankruptcy case.
The Plaintiffs allege that the Defendants committed legal
malpractice by negotiating and obtaining approval of the Chapter 11
Plan in such a way that the Plaintiffs would be subject to ERISA
withdrawal liability. According to the Plaintiffs, the Defendants
should have taken steps that would have led to a different Chapter
11 plan being confirmed -- one in which, despite the Debtors'
withdrawal from the 1974 Plan, the Murray Clients would have had no
withdrawal liability. By its very nature, the claim that an
attorney committed malpractice in connection with the negotiation
and approval of a Chapter 11 plan could only arise in a bankruptcy
case."
The Bankruptcy Court will retain this adversary proceeding.
A copy of the Court's decision is available at
https://urlcurt.com/u?l=qXxW4x
About Murray Energy
Headquartered in St. Clairsville, Ohio, Murray Energy --
http://murrayenergycorp.com/-- is the largest privately owned coal
company in the United States, producing approximately 76 million
tons of high-quality bituminous coal each year, and employing
nearly 7,000 people in the United States, Colombia and South
America.
Murray Energy now operates 15 active mines in five regions in the
United States, plus two mines in Colombia, South America. It
operates 12 underground longwall mining systems, 42 continuous
mining units, 10 transloading facilities, and five mining
equipment factory and fabrication facilities.
Murray Energy and its affiliates sought protection under Chapter 11
of the Bankruptcy Code (Bankr. S.D. Ohio Lead Case No. 19-56885) on
Oct. 29, 2019. At the time of the filing, the Debtors disclosed
assets of between $1 billion and $10 billion and liabilities of the
same range.
The cases have been assigned to Judge John E. Hoffman Jr.
The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis
International LLP as general bankruptcy counsel; Dinsmore & Shohl
LLP as local counsel; Evercore Group L.L.C. as investment banker;
Alvarez and Marsal L.L.C. as financial advisor; and Prime Clerk LLC
as notice and claims agent.
The U.S. Trustee for Region 9 appointed creditors to serve on the
official committee of unsecured creditors on Nov. 7, 2019. The
committee tapped Morrison & Foerster LLP as legal counsel;
AlixPartners, LLP as financial advisor; and Vorys, Sater, Seymour
and Pease LLP as local counsel.
NUO THERAPEUTICS: Raises $849,125 In Private Placement
------------------------------------------------------
Nuo Therapeutics, Inc. disclosed in a Form 8-K Report filed with
the U.S. Securities and Exchange Commission that the Company
entered into a Securities Purchase Agreement, dated as of September
13, 2024, with certain accredited investors for the sale of
1,132,167 shares of the Company's common stock, par value $0.0001
per share at a price of $0.75 per share for gross proceeds of
$849,125. The closing of the Private Placement occurred on
September 19, 2024.
The investors in the Private Placement included Charles E. Sheedy,
a principal stockholder of the Company. Mr. Sheedy invested $93,750
in the Private Placement.
The proceeds of the Private Placement will be used for working
capital purposes.
As a result of the Private Placement, the number of shares of
Common Stock outstanding is 46,598,405.
About NUO Therapeutics
Headquartered in Houston, Texas, Nuo Therapeutics, Inc. is a
regenerative therapies company focused on developing and marketing
products for chronic wound care primarily within the U.S. The
Company commercializes innovative cell-based technologies that
harness the regenerative capacity of the human body to trigger
natural healing. The use of autologous (i.e., from self, the
patient's own) biological therapies for tissue repair and
regeneration is part of a clinical strategy designed to improve
long-term recovery in inherently complex chronic conditions with
significant unmet medical needs.
Houston, Texas-based Marcum LLP, the Company's auditor since 2017,
issued a "going concern" qualification in its report dated April
19, 2024, citing that the Company has incurred significant losses
and needs to raise additional funds to meet its obligations and
sustain its operations. These conditions raise substantial doubt
about the Company's ability to continue as a going concern.
For the years ended December 31, 2023 and 2022, the Company had a
net loss of approximately $3.2 million in each year. As of June 30,
2024, the Company had $1,420,472 in total assets, $821,959 in total
liabilities, and $598,513 in total stockholders' equity.
ONE TABLE: Tocaya, Tender Greens on Track for Final Bid, DIP Okay
-----------------------------------------------------------------
Emlyn Cameron of Law360 Bankruptcy Authority reports that a
Delaware bankruptcy judge said Thursday, September 19, 2024, she
anticipated being able to give the company that operates Tender
Greens and Tocaya restaurants final approval for $3.5 million in
debtor-in-possession financing and a stalking-horse bid once the
debtor submits proposed orders to that effect.
About One Table Restaurant Brands
One Table Restaurant Brands LLC is a next generation restaurant
platform of best-in-class emerging concepts.
One Table Restaurant Brands LLC sought relief under Chapter 11 of
the U.S. Bankruptcy Protection (Bankr. D. Del. Case No. 24-11553)
on July 18, 2024. In the petition filed by Harald Herrmann, as
authorized signatory, the Debtor reports estimated assets up to
$50,000 and estimated liabilities between $10 million and $50
million.
The Debtor is represented by:
Thomas Joseph Francella, Jr., Esq.
Raines Feldman Littrell LLP
1201 W. 5th Street
Suite T-400
Los Angeles, CA 90017
PACTIV EVERGREEN: Moody's Alters Outlook on 'B1' CFR to Positive
----------------------------------------------------------------
Moody's Ratings affirmed Pactiv Evergreen Inc.'s (Pactiv) B1
corporate family rating and B1-PD Probability of Default Rating.
Concurrently, Moody's affirmed Pactiv Evergreen Group Holdings
Inc.'s backed senior secured first lien term loan B and senior
secured revolving credit facility rating at B1. Pactiv Evergreen
Group Issuer Inc.'s backed senior secured notes ratings are also
affirmed at B1. Pactiv Evergreen Inc.'s Speculative Grade Liquidity
Rating remains unchanged at SGL-1. The rating outlooks for Pactiv
Evergreen Inc., Pactiv Evergreen Group Holdings Inc., and Pactiv
Evergreen Group Issuer Inc. have been changed to positive from
stable.
"The positive outlook reflects a clearer path and opportunity to
cross over to a Ba3 rating, as a result of management's continued
execution of portfolio rationalization and absolute debt reduction.
Moody's expect credit metrics to improve in 2025 and are looking
for evidence of consistency and sustainment," said Scott Manduca,
Vice President at Moody's Ratings.
RATINGS RATIONALE
The B1 ratings reflect that Moody's expect Pactiv's volumes to
remain flattish for the remainder of 2024, due to the lingering
effects of inflation on consumer spending. However, Pactiv has
remained focused on extracting benefits and maximizing the earnings
power of its portfolio through a value over volume strategy and
rationalization initiatives. Expected debt repayment using proceeds
from the recent sale of the company's Pine Bluff paper mill and
Waynesville extrusion facility is a prime example. Moody's expect
debt leverage (Moody's adjusted) to be just above 4.5x and interest
coverage of 3.4x in 2024, before improving to just under 4.5x and
4.0x, respectively, in 2025. Execution of continued portfolio
rationalization efficiencies, debt reduction, along with a modest
improvement in market fundamentals support Moody's view.
Pactiv's B1 ratings benefit from its scale (revenue) and a leading
market position in the fragmented North American food and beverage
packaging industry. The company produces upwards of 14,000 products
that range from food containers, plates and bowls, hot and cold
cups, and lids. Pactiv is also a one-stop-shop for foodservice
distributors, supermarkets, quick service restaurants, and food and
beverage retailers. The company's end markets are relatively stable
and its product mix differentiated with the inclusion of recyclable
material. Pactiv also maintains long tenured relationships with
Tier 1 customers in the food packaging industry.
Pactiv Evergreen Group Holdings Inc. and Pactiv Evergreen Group
Issuer Inc.'s B1 secured debt ratings are in line with Pactiv's B1
CFR, as secured debt represents the preponderance of debt in the
capital structure.
Pactiv's SGL-1 Speculative Grade Liquidity Rating reflects Moody's
expectation that the company will maintain very good liquidity over
the next twelve months, with positive free cash flow generation,
and good revolver availability.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if debt-to-EBITDA is sustained below
4.5x, EBITDA-to-interest expense is above 4x, and free cash
flow-to-debt is above 5%.
The ratings could be downgraded if debt-to-EBITDA is sustained
above 5.5x, EBITDA-to-interest expense is below 3.0x, and there is
deterioration in operating performance and liquidity.
Based in Lake Forest, IL, Pactiv Evergreen Inc. is a publicly
traded company on the NASDAQ with the symbol (PTVE), and is
controlled by financier Graeme Hart.
The principal methodology used in these ratings was Packaging
Manufacturers: Metal, Glass and Plastic Containers published in
December 2021.
PAN AM INVESTMENTS: Kicks Off Subchapter V Bankruptcy Case
----------------------------------------------------------
Pan Am Investments Inc. filed Chapter 11 protection in the Northern
District of California. According to court documents, the Debtor
reports between $1 million and $10 million in debt owed to 1 and 49
creditors. The petition states funds will be available to unsecured
creditors.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
Oct. 11, 2024 at 10:00 a.m. via UST Teleconference, Call in
number/URL: 1-877-991-8832 Passcode: 4101242.
About Pan Am Investments Inc.
Pan Am Investments Inc. is a real estate investment firm.
Pan Am Investments Inc. sought relief under Subchapter V of Chapter
11 of the U.S. Bankruptcy Code (Bankr. N.D. Cal. Case No. 24-41391)
on Sept. 11, 2024. In the petition signed by Qais Maqdoor, as CEO,
the Debtor estimated assets and liabilities between $1 million and
$10 million each.
The Honorable Bankruptcy Judge William J. Lafferty oversees the
case.
Christopher Hayes was appointed as Subchapter V trustee.
The Debtor is represented by:
Joyce Lau, Esq.
THE FULLER LAW FIRM PC
60 N Keeble Avenue
San Jose, CA 95126
E-mail: joyce@fullerlawfirm.ne
PATHWAY VET: Blackstone Senior Marks $1.4MM Loan at 21% Off
-----------------------------------------------------------
Blackstone Senior Floating Rate 2027 Term Fund has marked its
$1,499,697 loan extended to Pathway Vet Alliance LLC to market at
$1,185,323 or 79% of the outstanding amount, according to the
Blackstone Senior's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone Senior is a participant in a First Lien 2021 Replacement
Term Loan B (1M US SOFR + 3.75%, 0.75% Floor) to Pathway Vet
Alliance LLC. The loan matures on March 31, 2027.
Blackstone Senior, formerly known as Blackstone Senior Floating
Rate Term Fund, is a diversified, closed-end management investment
company. BSL was organized as a Delaware statutory trust on March
4, 2010. BSL was registered under the Investment Company Act of
1940, as amended on March 5, 2010.
Blackstone Senior is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Senior Floating Rate 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Headquartered in Austin, Texas, Pathway Vet Alliance, LLC is a
national veterinary hospital consolidator, offering a full range of
medical products and services, and operating over 280 general, and
emergency practice locations, 88 THRIVE Affordable Vet Care
locations, and the Management Services Organization, Veterinary
Growth Partners, which supports over 5,500 affiliated and
unaffiliated member hospitals, throughout the United Sates.
PECF USS: $2BB Bank Debt Trades at 29% Discount
-----------------------------------------------
Participations in a syndicated loan under which PECF USS
Intermediate Holding III Corp is a borrower were trading in the
secondary market around 70.9 cents-on-the-dollar during the week
ended Friday, Sept. 20, 2024, according to Bloomberg's Evaluated
Pricing service data.
The $2 billion Term loan facility is scheduled to mature on
December 15, 2028. About $206 million of the loan is withdrawn and
outstanding.
PECF USS Intermediate Holding III Corporation is the issuing entity
for a debt extended to United Site Services Inc., a provider of
portable sanitation and related site services.
PERICH AESTHETICS: Gets OK to Hire Ambryn Burdick as Accountant
---------------------------------------------------------------
Perich Aesthetics, LLC received approval from the U.S. Bankruptcy
Court for the Middle District of Florida to employ Ambryn Burdick
CPA, LLC as accountants.
The firm's services include:
(a) prepare monthly operating reports;
(b) prepare monthly financial reports and related services;
and
(c) perform such other services the Debtor may require.
The firm will be paid at its standard hourly rates ranging between
$75 and $95 plus reimbursement for expenses incurred.
Ambryn Burdick, CPA, 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:
Ambryn Burdick, CPA
Ambryn Burdick, CPA, LLC
20853 Broadwater Dr.,
Land O Lakes, FL 34638
Telephone: (727) 643-3660
About Perich Aesthetics
Perich Aesthetics, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No. 24-03812) on July
8, 2024, with $500,001 to $1 million in assets and liabilities.
Judge Catherine Peek McEwen presides over the case.
The Debtor tapped Daniel R. Fogarty, Esq., at Stichter, Riedel,
Blain & Postler, PA as counsel and Ambryn Burdick CPA, LLC and
Roberts, Speed & Company, PA as accountants.
PERICH AESTHETICS: Gets OK to Tap Roberts Speed & Co. as Accountant
-------------------------------------------------------------------
Perich Aesthetics, LLC received approval from the U.S. Bankruptcy
Court for the Middle District of Florida to employ Roberts, Speed &
Company, PA as accountant.
The firm will render these services:
(a) prepare annual federal and state corporate income tax
returns; and
(b) perform such other services the Debtor may require.
The firm will be compensated at its standard hourly rates ranging
between $150 and $300 plus reimbursement for expenses incurred.
Randall Speed, a certified public accountant at Roberts, Speed &
Company, 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:
Randall A. Speed, CPA
Roberts, Speed & Company P.A.
337 S. Plant Avenue
Tampa, FL 33606
Telephone: (813) 225-1040
Facsimile: (813) 50-1555
Email: info@rscpa.net
About Perich Aesthetics
Perich Aesthetics, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No. 24-03812) on July
8, 2024, with $500,001 to $1 million in assets and liabilities.
Judge Catherine Peek McEwen presides over the case.
The Debtor tapped Daniel R. Fogarty, Esq., at Stichter, Riedel,
Blain & Postler, PA as counsel and Ambryn Burdick CPA, LLC and
Roberts, Speed & Company, PA as accountants.
PUERTO RICO: Court Okays PREPA's $188 Million Deal With Contractor
------------------------------------------------------------------
Yun Park of Law360 Bankruptcy Authority reports that a New York
federal judge has approved a roughly $188 million settlement
between Puerto Rico's bankrupt public electricity provider and a
company whose multi-million-dollar contract to repair
hurricane-damaged power lines on the island had been under legal
scrutiny.
About Puerto Rico
Puerto Rico is a self-governing commonwealth in association with
the United States. The chief of state is the President of the
United States of America. The head of government is an elected
Governor. There are two legislative chambers: the House of
Representatives, 51 seats, and the Senate, 27 seats.
In 2016, the U.S. Congress passed PROMESA, which, among other
things, created the Financial Oversight and Management Board and
imposed an automatic stay on creditor lawsuits against the
government, which expired May 1, 2017.
The members of the oversight board are: (i) Andrew G. Biggs, (ii)
Jose B. Carrion III, (iii) Carlos M. Garcia, (iv) Arthur J.
Gonzalez, (v) Jose R. Gonzalez, (vi) Ana. J. Matosantos, and (vii)
David A. Skeel Jr.
On May 3, 2017, the Commonwealth of Puerto Rico filed a petition
for relief under Title III of the Puerto Rico Oversight,
Management, and Economic Stability Act ("PROMESA"). The case is
pending in the United States District Court for the District of
Puerto Rico under case number 17-cv-01578. A copy of Puerto Rico's
PROMESA petition is available at
http://bankrupt.com/misc/17-01578-00001.pdf
On May 5, 2017, the Puerto Rico Sales Tax Financing Corporation
(COFINA) commenced a case under Title III of PROMESA (D.P.R. Case
No. 17-01599). Joint administration has been sought for the Title
III cases.
On May 21, 2017, two more agencies -- Employees Retirement System
of the Government of the Commonwealth of Puerto Rico and Puerto
Rico Highways and Transportation Authority (Case Nos. 17-01685 and
17-01686) -- commenced Title III cases.
U.S. Chief Justice John Roberts named U.S. District Judge Laura
Taylor Swain to preside over the Title III cases.
The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets as municipal investment
banker, and Ernst & Young, as financial advisor.
Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose LLP; and Hermann D. Bauer, Esq.,
at O'Neill & Borges LLC are onboard as attorneys.
Prime Clerk LLC is the claims and noticing agent. Prime Clerk
maintains the case Website
https://cases.primeclerk.com/puertorico
Jones Day is serving as counsel to certain ERS bondholders.
Paul Weiss is counsel to the Ad Hoc Group of Puerto Rico General
Obligation Bondholders.
PURE BIOSCIENCE: Issues $500K Convertible Note to Lenders
---------------------------------------------------------
Pure Bioscience, Inc. disclosed in a Form 8-K filed with the
Securities and Exchange Commission that on Sept. 16, 2024, it
entered into a Note Purchase Agreement with certain accredited
investors pursuant to which the Company issued the Lenders
convertible promissory notes with an aggregate principal balance of
$500,000. The Notes Documents provide for subsequent closings for
an aggregate offering size of $3.0 million in principal balance.
The Notes Documents provided that the interest to the Lender shall
accrue at the rate of 7.88%, compounded annually. The Maturity
Date (as defined in the Notes) of the Notes is the third-year
anniversary of the date of issuance, or such earlier date as the
Notes provide.
Conversion. All or any portion of the principal amount of the
Note, plus accrued and unpaid interest, is convertible at any time,
in whole or in part, at a Lender's or the Company's option, into
shares of the Company's common stock at a conversion price equal to
the 30-day volume-weighted average price of the Company's common
stock as reported on the market or exchange on which the Company's
common stock is listed or quoted for trading ("VWAP") on the date
of conversion on the last trading day prior to the date of
conversion, provided that such conversion price is at least $0.095
per share and less than or equal to $0.175 per share, subject to
certain customary adjustments. Additionally, at any time following
Sept. 16, 2025, the holders of a majority of the outstanding
principal balance under the Notes may elect specified in writing to
convert all of the Notes at a conversion price equal to the VWAP,
provided that the conversion price is equal to at least $0.095 per
share, subject to certain customary adjustments.
Further, in the event of certain corporate transactions, all
outstanding principal and unpaid accrued interest due on such Notes
shall be automatically converted into conversion shares on the
trading day immediately prior to the closing date of such corporate
transaction. The number of shares to be issued upon such
conversion shall be based on the VWAP on the last trading day prior
to the public announcement of the execution of the definitive
documents with respect to such transaction.
Events of Default. The Notes Documents provide for certain events
of default that are typical for a transaction of this type,
including, among other things, default in the payment of principal
or interest for more than 30 days, the Company's making an
assignment for the benefit of creditors, within 15 days after the
commencement of bankruptcy proceedings against the Company, or
breach of certain covenants.
Covenants. The Company will be subject to certain customary
covenants regarding the current public information, reservation of
adequate share reserve, and maintenance of intellectual property
rights, among other customary matters.
Mr. Tom Y. Lee, a member of the Company's Board of Directors,
invested $500,000 in the Private Placement, through affiliates or
directly. The disinterested members of the Board approved the
Private Placement.
About PURE Bioscience Inc.
PURE Bioscience, Inc. -- http://www.purebio.com-- is focused on
developing and commercializing its proprietary antimicrobial
products primarily in the food safety arena. The Company provides
solutions to combat the health and environmental challenges of
pathogen and hygienic control. Its technology platform is based on
patented, stabilized ionic silver, and its initial products contain
silver dihydrogen citrate, better known as SDC. PURE is
headquartered in Rancho Cucamonga, California (San Bernardino
metropolitan area).
PURE Bioscience reported a net loss of $3.96 million for the year
ended July 31, 2023, compared to a net loss of $3.49 million for
the year ended July 31, 2022. As of April 30, 2024, PURE
Bioscience had $920,000 in total assets, $3.07 million in total
liabilities, and a total stockholders' deficiency of $2.15 million.
Los Angeles, California-based Weinberg and Company, P.A., the
Company's auditor since 2019, issued a "going concern"
qualification in its report dated Oct. 30, 2023, citing that the
Company has suffered recurring losses from operations and negative
cash flows from operating activities that raise substantial doubt
about its ability to continue as a going concern.
PURE Bioscience said in its Quarterly Report for the period ended
April 30, 2024, that "We have a history of recurring losses, and as
of April 30, 2024 we have a stockholders deficiency of $2,146,000.
During the nine months ended April 30, 2024, we recorded a net loss
of $2,594,000 on recorded net revenue of $1,489,000. In addition,
during the nine months ended April 30, 2024 we used $1,938,000 in
operating activities resulting in a cash balance of $442,000 as of
April 30, 2024. Our history of recurring operating losses, and
negative cash flows from operating activities give rise to
substantial doubt regarding our ability to continue as a going
concern."
QLESS INC: Unsecured Creditors to Recover 61.5% or 10.2% of Claims
------------------------------------------------------------------
QLess, Inc., submitted an Amended Chapter 11 Plan dated August 21,
2024.
This Plan provides for the financial reorganization of the Debtor,
through, among other things, an elimination of litigation that has
been burdening the Debtor's liquidity and profitability and a
conversion of debt the Debtor has incurred during this Case into
equity, so that the Debtor may continue growing its operations and
serving its existing and future customers.
As of the Effective Date, the composition of the Debtor's board of
directors will remain unchanged from the Petition Date. The
following individuals constitute the Debtor's board of directors as
of the Effective Date: (a) Anders Richardson; (b) Nathaniel
Hochman; (c) Mark Tapling; (d) James Harvey; and (e) M. Freddie
Reiss (who continues to receive a monthly fee of $25,000 per month
for service on the Board, and whose service on the Board is
expected to continue until Distributions are completed to all
holders of non-Disputed Claims, which the Debtor believes will
occur within 30 days of the Effective Date).
Mr. Harvey continues as the Debtor's chief executive officer from
and after the Effective Date with the same compensation package he
has received from the Debtor before and during this Case. Other
than Mr. Reiss, no member of the Board receives any compensation
for service on the Board from and after the Effective Date.
Class 4 contains all General Unsecured Claims, including the
Shareholder Lawsuit Claims, the Backer Arbitration Claim, all Non
Insured Indemnity Claims, and all Rejection Damages Claims. Class 4
is Impaired. Holders of Allowed Claims in Class 4 may Vote.
If Class 4 Votes to accept the Plan, then (i) the Palisades Claim
is waived, and (ii) on the Effective Date or the first feasible
date after that, each other holders of an Allowed General Unsecured
Claim in Class 4 receives, up to the full amount of its Claim, a
Pro Rata portion of the GUC Fund. If Class 4 Votes to reject the
Plan, then (i) the Palisades Claim is not waived, and (ii) on the
Effective Date or the first feasible date after that, each holder
of an Allowed General Unsecured Claim in Class 4 receives, up to
the full amount of its Claim, a Pro Rata portion of the Projected
Disposable Income.
The Debtor believes that all Allowed Claims in Class 4 total
approximately $738,000, comprising: (a) Claims of vendors and other
general unsecured creditors of approximately $338,000 (which
includes the approximately $50,000 in Non-Insured Indemnity
Claims); (b) the Palisades Claim; and (c) Rejection Damages Claims
of $150,000. The Backer Arbitration Claim and the Shareholder
Lawsuit Claims are Disputed. and the subject of objections the
Debtor Filed seeking an order disallowing all those Claims in their
entirety on the merits. The Debtor believes those Claims will be
Disallowed on their merits. If any of those Claims are Allowed,
then the total Allowed Claims in Class 4 will increase
significantly.
* If Class 4 Votes to accept the Plan and the Backer
Arbitration Claim and the Shareholder Lawsuit Claims are
Disallowed, the Debtor estimates that the Pro Rata Distribution of
the GUC Fund to each holder of a Class 4 Claim will equal
approximately 61.5% of the value of its Claim.
* If (i) Class 4 Votes to reject the Plan such that the DIP
Lender receives an Allowed Administrative Claim of $750,000 and the
Palisades Claim is not waived, and (ii) the Backer Arbitration
Claim and the Shareholder Lawsuit Claims are Disallowed, the Debtor
estimates that the Pro Rata Distribution of the Projected
Disposable Income to each holder of a Class 4 Claim will equal
approximately 10.2% of the value of its Claim.
Attachment 3 to the SOFA (non-insiders) reflects a total of
approximately $3.1 million in transfers to 32 different parties and
Attachment 4 to the SOFA (insiders) reflects a total of
approximately $1.3 million in transfers to four different parties
(collectively, the "Transfers"). The Plan waives all Avoidance
Actions, including any related to the Transfers.
Sherwood Partners, the Debtor's financial advisor, and Sherwood's
principal, Andrew De Camara, the Debtor's chief restructuring
officer, worked closely with the Debtor to analyze all Transfers
totaling more than $45,000 to a single transferee. There were a
total of 10 transferees whose Transfers totaled more than $45,000,
which were reviewed in detail. Sherwood and Mr. De Camara
determined that none of the Transfers constitutes an avoidable
preference because each Transfer was not made on account of an
antecedent debt, made on account of a secured debt, or falls within
the "ordinary course" defense of Bankruptcy Code Section 547(c)(2)
or another affirmative defense. Two Transfers made to certain of
the Debtor's lawyers are arguably avoidable but Sherwood and Mr. De
Camara believe that credible defenses (either or both of the
ordinary course defense or the subsequent new value defense under
Bankruptcy Code Section 547(c)(2) and (4)) may exist with respect
to those Transfers.
A full-text copy of the Amended Plan dated August 21, 2024 is
available at https://urlcurt.com/u?l=BMdx62 from PacerMonitor.com
at no charge.
Counsel to the Debtor:
Jeffrey N. Pomerantz, Esq.
PACHULSKI STANG ZIEHL & JONES LLP
10100 Santa Monica Blvd., 13th Floor
Los Angeles, CA 90067-4003
Tel: (310) 277-6910
Fax: (310) 201-0760
Email: jpomerantz@pszjlaw.com
About QLess Inc.
QLess, Inc., was founded in 2009, in Pasadena, Calif., as a
software startup operating from the cloud serving as a queue
management platform for customers to access over the internet, thus
eliminating customer time spent waiting in line for service.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 24-11395) on June 19,
2024, with $5,455,608 in assets and $13,504,290 in liabilities.
James Harvey, chief executive officer, signed the petition.
Judge Brendan Linehan Shannon presides over the case.
The Debtor tapped James E. O'Neil, Esq. at Pachulski Stang Ziehl &
Jones, LLP as the Debtor's counsel, and Kurtzman Carson
Consultants, LLC as claims, noticing and solicitation agent.
QUEST BORROWER: Blackstone Senior Marks $1.7MM Loan at 25% Off
--------------------------------------------------------------
Blackstone Senior Floating Rate 2027 Term Fund has marked its
$1,726,766 loan extended to Quest Borrower Ltd to market at
$1,286,924 or 75% of the outstanding amount, according to the
Blackstone Senior's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone Senior is a participant in a First Lien Term Loan (3M
CME Term SOFR + 4.25%) to Quest Borrower Ltd. The loan matures on
February 1, 2029.
Blackstone Senior, formerly known as Blackstone Senior Floating
Rate Term Fund, is a diversified, closed-end management investment
company. BSL was organized as a Delaware statutory trust on March
4, 2010. BSL was registered under the Investment Company Act of
1940, as amended on March 5, 2010.
Blackstone Senior is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Senior Floating Rate 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Quest Borrower Limited is part of the High Tech Industries.
QUEST BORROWER: Blackstone Strat Marks $5.1MM Loan at 25% Off
-------------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its
$5,193,023 loan extended to Quest Borrower Ltd to Atlas CC
Acquisition Corp market at $3,870,256 or 75% of the outstanding
amount, according to the Blackstone Strat's Form N-CSRS for the
semi-annual period ended June 30, 2024, filed with the Securities
and Exchange Commission.
Blackstone Strat is a participant in a First Lien Term Loan B (3M
CME Term SOFR + 4.25%, 0.75% Floor) to Quest Borrower Ltd. The loan
matures on February 1, 2029.
Blackstone Strat is a closed-end term fund that trades on the New
York Stock Exchange under the symbol. BGB's primary investment
objective is to seek high current income, with a secondary
objective to seek preservation of capital, consistent with its
primary goal of high current income.
Blackstone Strat is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Quest Borrower Limited is part of the High Tech Industries.
RADIATE HOLDCO: Blackstone Senior Marks $1.2MM Loan at 19% Off
--------------------------------------------------------------
Blackstone Senior Floating Rate 2027 Term Fund has marked its
$1,277,078 loan extended to Radiate Holdco, LLC to market at
$1,037, 894 or 81% of the outstanding amount, according to the
Blackstone Senior's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone Senior is a participant in a First Lien Term Loan (1M US
SOFR + 3.25%) to Radiate Holdco, LLC. The loan matures on September
25, 2026.
Blackstone Senior, formerly known as Blackstone Senior Floating
Rate Term Fund, is a diversified, closed-end management investment
company. BSL was organized as a Delaware statutory trust on March
4, 2010. BSL was registered under the Investment Company Act of
1940, as amended on March 5, 2010.
Blackstone Senior is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Senior Floating Rate 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Radiate Holdco LLC, also known as Astound Broadband, and backed by
Stonepeak, is a broadband communications services provider and
cable operator doing business via regional providers RCN, Grande
Communications, Wave Broadband and enTouch Systems.
RADIATE HOLDCO: Blackstone Strat Marks $3. 9MM Loan at 19% Off
--------------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its $3,92,471
loan extended to Radiate Holdco, LLC to market at $3,193,520 or 81%
of the outstanding amount, according to the Blackstone Strat's Form
N-CSRS for the semi-annual period ended June 30, 2024, filed with
the Securities and Exchange Commission.
Blackstone Stratis a participant in a First Lien Term Loan (1M US
SOFR + 3.25%) to Radiate Holdco, LLC. The loan matures on September
25, 2026.
Blackstone Strat is a closed-end term fund that trades on the New
York Stock Exchange under the symbol. BGB's primary investment
objective is to seek high current income, with a secondary
objective to seek preservation of capital, consistent with its
primary goal of high current income.
Blackstone Strat is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Radiate Holdco LLC, also known as Astound Broadband, and backed by
Stonepeak, is a broadband communications services provider and
cable operator doing business via regional providers RCN, Grande
Communications, Wave Broadband and enTouch Systems.
RATHER OUTDOORS: $365MM Bank Debt Trades at 19% Discount
--------------------------------------------------------
Participations in a syndicated loan under which Rather Outdoors
Corp is a borrower were trading in the secondary market around 81.1
cents-on-the-dollar during the week ended Friday, Sept. 20, 2024,
according to Bloomberg's Evaluated Pricing service data.
The $365 million Term loan facility is scheduled to mature on
February 11, 2028. The amount is fully drawn and outstanding.
Rather Outdoors Corporation operates as a holding company. The
Company, through its subsidiaries, provides fishing equipment, such
as casting, spinning, rods, tools, and accessories. Rather
Outdoors
Corp serves customers in the State of Missouri.
RED CAT: Incurs $12.42 Million Net Loss in First Quarter
--------------------------------------------------------
Red Cat Holdings, Inc., filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q reporting a net loss
of $12.42 million on $2.78 million of revenues for the three months
ended July 31, 2024, compared to a net loss of $5.84 million on
$1.75 million of revenues for the three months ended July 31,
2023.
As of July 31, 2024, the Company had $37.96 million in total
assets, $4.23 million in total current liabilities, $1.27 million
in total long-term liabilities, and $32.46 million in total
stockholders' equity.
Red Cat said, "The Company has never been profitable and has
incurred net losses related to acquisitions, as well as costs
incurred to pursue its long-term growth strategy. During the three
months ended July 31, 2024, the Company incurred a net loss of
approximately $12,000,000 and used cash in operating activities of
approximately $2,300,000. As of July 31, 2024, working capital
totaled approximately $17,200,000. These financial results and our
financial position at July 31, 2024 raise substantial doubt about
our ability to continue as a going concern. However, the Company
has recently taken actions to strengthen its liquidity. On
December 11, 2023, we completed a public offering of 18,400,000
shares of common stock which generated net proceeds of
approximately $8,400,000...In addition, the Company's operating
plan for the next twelve months has been updated to reflect recent
operating improvements. Revenues have accelerated and are expected
to continue growing. The Company's manufacturing facility is
scaling production and gross profits are projected to increase. If
necessary, the Company will seek to obtain additional debt
financing for which there can be no guarantee...[T]he Company sold
its equity method investment for $4,400,000 in July 2024....[T]he
Company closed a financing with proceeds of $8 million to be
received in late September 2024. Management has concluded that
these recent positive developments alleviate any substantial doubt
about the Company's ability to continue its operations, and meet
its financial obligations, for twelve months from the date these
consolidated financial statements are issued."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/748268/000155479524000238/rcat0923form10q.htm
About Red Cat Holdings Inc.
Red Cat (Nasdaq: RCAT) -- http://www.redcatholdings.com/-- is a
drone technology company integrating robotic hardware and software
for military, government, and commercial operations. Red Cat's
solutions are designed to "Dominate the Night" and include the Teal
2, a small unmanned system offering the highest-resolution thermal
imaging in its class.
Red Cat reported a net loss of $24.05 million for the year ended
April 30, 2024, a net loss of $28.11 million for the year ended
April 30, 2023, a net loss of $11.69 million for the year ended
April 30, 2022, a net loss of $13.24 million for the year ended
April 30, 2021, and a net loss of $1.60 million for the year ended
April 30, 2020.
RESIDENTIAL ADVERSITIES: Property Sale Proceeds to Fund Plan
------------------------------------------------------------
Residential Adversities, LLC, filed with the U.S. Bankruptcy Court
for the Northern District of Georgia a Plan of Reorganization.
The Debtor is a single-member Georgia LLC formed in October 2022 to
acquire, rehab, sell, rent, and lease properties acquired in the
state of Georgia.
Specifically, it is in the growing "Rooms for Rent" industry. Its
sole member and Manager is Lacey Murry-Bullock, who filed a chapter
13 bankruptcy petition the same day as this chapter 11 small
business case, which is also before this Court, Case No.
24-54370-SMS. The Debtor has no employees.
Currently, the Debtor owns one house that is being rented (5380
Somerlane) and another house (244 Eureka), which is not yet
rentable. Additionally, the Debtor leases two houses (728 Cascade
and 1592 Olympian Circle) and rents them out by the room for
amounts exceeding the lease payments. Both leases have expired and
are continuing on a month-to-month basis.
Each of the three secured creditors is in their own class. Class 1
is for federal and state taxes, though none are expected. Classes 2
to 4 are the three secured creditors, and Class 5 is for unsecured
creditors.
The Debtor's plan is to sell the property that is not being rented
and has the largest carrying cost, 244 Eureka. If that property is
sold, the largest creditor, Wilmington Trust, will be paid off
entirely, and the income from the other four properties remains the
same. Wilmington Trust's first mortgage matured prior to the
petition date in December 2023, and the current payoff amount is
approximately $862,661. The property is worth $1,300,000 and has
equity of $447,339, not counting the lien of BP Fast Lending. BP's
second mortgage of $220,000 now has a payoff of $320,000, still
leaving $100,000 of equity in the property when its entire lien is
included.
While there is not a huge equity cushion when BP's entire payoff is
included, the plan is to sell the property and use 100% of the
available proceeds to pay off the entire first mortgage of
Wilmington Trust and then to pay all of BP Fast Lending's current
payoff amount of $320,772, or as much of BP's secured claim as
possible.
The plan is to sell 244 Eureka and use 100% of the net proceeds to
pay off all of Wilmington and BP, or worst case, Wilmington and as
much of BP as possible, leaving them extremely oversecured by two
other properties. Last month, for example, the refinancing approval
discussed in Court involved BP agreeing to release their lien on
this property for a $20,000 payoff towards their lien.
If the property is sold for its as-is value, after closing costs
and selling expenses, the Debtor should be able to pay off
Wilmington and BP in full. But in any case, the Debtor should be
able to pay off Wilmington and a significant part or most of BP's
lien, and BP will be even more oversecured.
Class 5 consists of general unsecured claims. No unsecured creditor
has filed a proof of claim. The scheduled unsecured claims total
$15,062.
Before and upon the Confirmation Order becoming a Final Order (the
"Final Order Date") the Debtor will continue to market and sell the
Property for the best price available ("Sale Event").
Upon a Sale Event, the Debtor will pay or segregate sufficient
funds to pay (i) all reasonable and ordinary costs of sale,
including broker commissions, (ii) then all outstanding property
taxes not otherwise prorated between the Debtor and the purchaser
at closing, (iii) then the Class 3 Secured Claim of Wilmington
Trust, (iv) then the Class 4 Secured Claim of BP Fast Lending, (v)
then any unpaid professional fee claims, including post
confirmation professional fee claims, (v) then the balance owed the
holders of priority tax claims, and (vi) then any Class 5 Unsecured
Creditors with Allowed Claims, then to general business funds of
the Debtor.
The Debtor shall establish a trust account to be known and
designated as the Distribution Fund and shall deposit in said
account sufficient proceeds from operations to make the payments
provided for herein.
A full-text copy of the Plan of Reorganization dated August 21,
2024 is available at https://urlcurt.com/u?l=6IbIK2 from
PacerMonitor.com at no charge.
Attorney for the Debtor:
Brad Fallon, Esq.
Fallon Law PC
1201 W. Peachtree St. NW, Suite 2625
Atlanta, GA 30309
Telephone: (404) 849-2199
Facsimile: (470) 994-0579
Email: brad@fallonbusinesslaw.com
About Residential Adversities
Residential Adversities, LLC is primarily engaged in leasing
buildings, dwellings, or other real estate property to others. The
Debtor owns three properties, all located in Georgia, having a
total appraised value of $2.95 million.
Residential Adversities sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Ga. Case No. 24-54366) on April
30, 2024, with $2,980,000 in assets and $1,182,056 in liabilities.
Lacey Murry-Bullock, member, signed the petition.
Judge Sage M. Sigler oversees the case.
Brad Fallon, Esq., at Fallon Law, PC, is the Debtor's bankruptcy
counsel.
RESTORED TRUCKING: Case Summary & 15 Unsecured Creditors
--------------------------------------------------------
Debtor: Restored Trucking Company, Inc.
2800 County Road 8
Piedmont, AL 36272
Business Description: The Debtor is part of the general freight
trucking industry.
Chapter 11 Petition Date: September 24, 2024
Court: United States Bankruptcy Court
Northern District of Alabama
Case No.: 24-41134
Judge: Hon.James J Robinson
Debtor's Counsel: Robert D. McWhorter, Jr., Esq.
INZER, HANEY, MCWHORTER, HANEY & SKELTON
Post office Drawer 287
Gadsden, AL 35902
Tel: 256-546-1656
Email: rdmcwhorter@bellsouth.net
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Michael S. Jones as president.
A copy of the Debtor's list of 15 unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/2KHUKUQ/Restored_Trucking_Company_Inc__alnbke-24-41134__0008.0.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/VWSI42A/Restored_Trucking_Company_Inc__alnbke-24-41134__0001.0.pdf?mcid=tGE4TAMA
RIVERBED TECHNOLOGY: RiverNorth Marks $141,052 Loan at 38% Off
--------------------------------------------------------------
RiverNorth/DoubleLine Strategic Opportunity Fund, Inc has marked
its $141,052 loan extended to Riverbed Technology LLC to market at
$86,23 or 62% of the outstanding amount, according to the
RiverNorth 's Form N-CSRS for the semi-annual period ended June 30,
2024, filed with the Securities and Exchange Commission.
RiverNorth is a participant in a Term Loan (6M CME TERM SOFR +
2.50% ) to Riverbed Technology LLC. The loan matures on July 1,
2028.
RiverNorth/DoubleLine Strategic Opportunity Fund, Inc, is a
closed-end management investment company that was organized as a
Maryland corporation on June 22, 2016, and commenced investment
operations on September 28, 2016. The investment adviser to the
Fund is RiverNorth Capital Management, LLC. The Fund’s
sub-adviser is DoubleLine Capital, LP. RiverNorth is a diversified
investment company with an investment objective to seek current
income and overall total return.
RiverNorth is led by Patrick W. Galleyle, President and Chief
Executive Officer; and Jonathan M. Mohrhardt, Chief Financial
Officer and Treasurer. The Fund can be reached through:
Patrick W. Galleyle
RiverNorth/DoubleLine Strategic Opportunity Fund, Inc
360 South Rosemary Avenue, Suite 1420,
West Palm Beach, FL 33401
Telephone: (561) 484-7185
- and -
Marcus L. Collins, Esq.
RiverNorth Capital Management, LLC
360 South Rosemary Avenue, Suite 1420
West Palm Beach, FL 33401
Telephone: (561) 484-7185
Riverbed Technology, Inc. provides application performance
monitoring, cloud migration, network performance monitoring, and
security solutions. Riverbed Technology serves customers globally.
RTA DENNIS: Seeks to Hire Geri Lyons Chase as Bankruptcy Counsel
----------------------------------------------------------------
RTA Dennis Catherine Premier Furniture Maryland LLC seeks approval
from the U.S. Bankruptcy Court for the District of Maryland to
employ Geri Lyons Chase, Esq., an attorney practicing in Annapolis,
Maryland, as counsel.
The attorney's services include:
(a) give the Debtor legal advice with respect to its powers
and duties;
(b) prepare on behalf of the Debtor necessary legal papers;
(c) take the necessary steps to stay any action by creditors
seeking liens, attachments, or other advantages by legal process or
nonjudicial process;
(d) negotiate and prepare a Plan of Reorganization; and
(e) perform all other legal services for the Debtor as may be
necessary herein.
The attorney will be paid at his hourly rate of $375.
Mr. Chase received the sum of $2,500 plus filing fee of $1,736 from
the Debtor.
Mr. Chase disclosed in a court filing that he is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached through:
Geri Lyons Chase, Esq.
Law Office of Geri Lyons Chase
2007 Tidewater Colony Drive, Suite 2B
Annapolis, MD 21401
Telephone: (410) 573-9004
Email: gchase@glchaselaw.com
About RTA Dennis Catherine
Premier Furniture Maryland
RTA Dennis Catherine Premier Furniture Maryland LLC sought
protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.
Md., Case No. 24-17365) on Sept. 2, 2024, listing under $1 million
in both assets and liabilities.
Judge Lori S. Simpson oversees the case.
The Law Office of Geri Lyons Chase serves as the Debtor's counsel.
SALT LIFE: Closes Jacksonville Beach Store Temporarily After Sale
-----------------------------------------------------------------
Mark Basch of Jacksonville Daily Record reports that after the
bankruptcy sale, Jacksonville Beach Salt Life apparel store is
'temporarily closed.'
A sign on the door of Salt Life's flagship apparel store in
Jacksonville Beach said Sept. 19 it is "temporarily closed," three
days after a U.S. Bankruptcy Court judge approved the sale of the
retail chain to two brand management firms.
Iconix International Inc. and Hilco Merchant Resources Inc. are
buying the brand and have not said anything publicly about their
plans for the chain of 28 apparel stores.
However, court documents filed with their bid include procedures
for store closing sales and the order signed Sept. 16 by U.S.
Bankruptcy Judge Laurie Selber Silverstein said Hilco is authorized
to hold closing sales.
Representatives of Northbrook, Illinois-based Hilco did not respond
to email and voice messages seeking information about its plans for
Salt Life.
The Salt Life Food Shack restaurants have separate ownership from
the apparel business and are not impacted by the bankruptcy court
proceedings.
Salt Life's parent company, Delta Apparel Inc., filed a Chapter 11
reorganization petition June 30 in U.S. Bankruptcy Court for the
District of Delaware.
The company said when it filed for Chapter 11 that it would sell
the Salt Life chain to the highest bidder at a court auction.
Hilco and Iconix submitted the top bid of $38.74 million at an Aug.
27 court auction.
Duluth, Georgia-based Delta acquired Salt Life for $37 million in
2013.
The company expanded the apparel business which, it said in news
releases, was "founded in 2003 by four avid watermen from
Jacksonville Beach."
Salt Life had sales of $25.9 million in the six months ended March
31, 2024 according to Delta's most recent financial report.
The company which also sold merchandise under Delta and Soffe
brands had total sales of $158.9 million in the six-month period
but recorded an adjusted net loss of $24.2 million.
Delta said in court filings "a combination of reduced demand and
difficulties obtaining raw materials have resulted in declining
liquidity that Delta's Board has been unable to counteract, despite
their best efforts," leading to the Chapter 11 filings.
When Delta filed for Chapter 11, it also filed notices under the
Worker Adjustment Retraining and Notification Act saying its 15
Florida stores could close if no buyer was found.
The notice for Salt Life’s store at 240 S. Third St. in
Jacksonville Beach said it has eight employees.
About Delta Apparel
Headquartered in Duluth, Georgia, Delta Apparel, Inc., is a
vertically integrated, international apparel company with 6,800
employees worldwide. The Company designs, manufactures, sources,
and markets a diverse portfolio of core activewear and lifestyle
apparel products under its primary brands of Salt Life, Soffe, and
Delta. The Company specializes in selling casual and athletic
products through a variety of distribution channels and tiers,
including outdoor and sporting goods retailers, independent and
specialty stores, better department stores and mid-tier retailers,
mass merchants, eRetailers, the U.S. military, and through its
business-to business digital platform.
Delta Apparel Inc. and six affiliates filed for Chapter 11
protection in Wilmington, Del., on June 30, 2024, with a deal in
hand to sell its Salt Life brand. The lead case is In re Salt Life
Beverage, LLC (Bankr. D. Del. Lead Case No. 24-11468).
Delta Apparel's assets as of June 1, 2024, total $337,801,000 and
debt total $244,564,000. The petitions were signed by Mr. Pruban.
The Hon. Judge Laurie Selber Silverstein presides over the cases.
Lawyers at Polsinelli PC serve as counsel to the Debtors. Tim
Pruban at Focus Management Group is serving as the Debtors' chief
restructuring officer. MMG Advisors, Inc., serves as investment
banker. Epiq is the claims and noticing agent and administrative
advisor.
SCILEX HOLDING: $10MM FSF Loan Satisfied With Endeavor Support
--------------------------------------------------------------
Scilex Holding Company announced on September 18, 2024, the
continuing support from Endeavor Distribution LLC on Scilex's
commercial products and the satisfaction of the FSF 33433 LLC $10
million loan under the Commitment Side Letter dated June 11, 2024.
As previously announced by Scilex, FSF provided Scilex a
non-refundable deposit in the aggregate amount of $10 million
pursuant to the Commitment Side Letter. On September 17, 2024, FSF,
Endeavor and Scilex entered into an agreement, pursuant to which
the remaining obligations in respect of the FSF Deposit shall be
satisfied in full, and the Commitment Side Letter terminated, by
Scilex's delivery of certain amounts of ZTlido product.
Scilex and Endeavor entered into a multi-year distribution
agreement in June 2024, and since then, Scilex has shipped $14
million of commercial products to Endeavor, with another pending
order of $10 million to be shipped in the fourth quarter of 2024.
With the ongoing support from Endeavor, Scilex's products will be
distributed to a wide range of healthcare services outlets across
the United States, including many locations not previously
accessible to Scilex. Scilex expects to initially target the
utilization of ZTlido® to thousands of pharmacies and extended
care outlets nationally, which would be prioritized based upon
growing need for non-opioid products.
"I am very excited that this agreement with one of the premier
healthcare and distribution services providers in the U.S. will
expand access to ZTlido, ELYXYB, and GLOPERBA for thousands of
patients suffering from acute and chronic pain. This partnership
strengthens the progress we've achieved with key customers and
point of care facilities over the past few months," says Scilex's
Chief Executive Officer, Jaisim Shah, "Scilex remains committed to
our goal of ensuring broad access to ZTlido® and our other
important non-opioid products."
About Scilex Holding
Headquartered in Palo Alto, Calif., Scilex Holding Company is
focused on acquiring, developing, and commercializing non-opioid
pain management products for the treatment of acute and chronic
pain. Scilex targets indications with high unmet needs and large
market opportunities with non-opioid therapies for the treatment of
patients with acute and chronic pain and is dedicated to advancing
and improving patient outcomes. Scilex's commercial products
include: (i) ZTlido (lidocaine topical system) 1.8%, a prescription
lidocaine topical product approved by the U.S. Food and Drug
Administration for the relief of neuropathic pain associated with
postherpetic neuralgia, which is a form of post-shingles nerve
pain; (ii) ELYXYB, a potential first-line treatment and the only
FDA-approved, ready-to-use oral solution for the acute treatment of
migraine, with or without aura, in adults; and (iii) Gloperba, the
first and only liquid oral version of the anti-gout medicine
colchicine indicated for the prophylaxis of painful gout flares in
adults, expected to launch in the first half of 2024.
San Diego, California-based Ernst & Young LLP, the Company's
auditor since 2020, issued a "going concern" qualification in its
report dated March 11, 2024, citing that the Company has negative
working capital, has suffered losses from operations, has recurring
negative cash flows from operations, and has stated that
substantial doubt exists about the Company's ability to continue as
a going concern.
Scilex incurred net losses of $114.3 million, $23.4 million, and
$88.4 million for the years ended December 31, 2023, 2022, and
2021, respectively. As of June 30, 2024, Scilex had $104.5 million
in total assets, $319.2 million in total liabilities, and $214.7
million in total stockholders' deficit.
SITIO ROYALTIES: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable
----------------------------------------------------------------
Fitch Ratings has affirmed Sitio Royalties Operating Partnership,
LP 's (Sitio) Long-Term Issuer Default Rating at 'B+'. The Rating
Outlook is Stable. Fitch has also affirmed Sitio's senior unsecured
notes due 2028 co-issued with Sitio Finance Corp. at 'BB-'/'RR3'.
Sitio's rating reflects Sitio's limited scale of cash flows
relative to oil and gas peers, lack of control over future reserves
development on its oil and gas properties, possible M&A
transactions, limited proved developed reserve life, and generous
dividend policy. Its credit profile is supported by very low
operating expenditure and no capex, stronger resilience during
commodity price downswings than that of upstream producers, and
Fitch-projected midcycle leverage of around 1.5x.
Key Rating Drivers
M&A-Driven Growth: Sitio has been growing continuously through
acquisitions. The company spent $177 million on cash-funded bolt-on
acquisitions of DJ and Permian basin acreage in 1H24. It completed
a major all-stock merger with Brigham Minerals, Inc. in 2022. Sitio
often partially covers acquisition cost with its stock. It targets
net debt reduction post-transaction. Fitch expects the company's
EBITDA leverage will be 1.7x in 2024-2025, below the 3.0x negative
rating sensitivity. Sitio will need to buy acreage to replenish its
depleting inventory, although it is not necessary in the short to
medium term.
Small Scale, Permian Focus: Sitio's net production increased to
39.2 thousand barrels of oil equivalent per day (kboe/d; 50% oil)
in 2Q24, up from 34.7 kboe/d in 2Q23. This is below the typical
level for upstream companies rated 'B+' but is not directly
comparable because mineral interest companies generate much higher
pre-dividend FCF per barrel. Sitio's gross well portfolio is very
diverse, as it typically has a small share in each well. Most of
Sitio's production comes from the Permian basin, while the rest is
produced at the DJ basin, Eagle Ford and Williston basins. Fitch
projects Sitio's organic production growth to be positive in 2024
followed by production decline thereafter, driven by its decreasing
oil and gas price assumptions.
Low-Cost Structure, Strong FCF: Sitio acquires and manages mineral
and royalty interests in oil and gas acreage. It does not have
working interest in oil and gas properties, which exempts it from
the majority of costs associated with hydrocarbons production. It
does not incur development or abandonment costs, and its operating
costs include only production taxes, some gathering and
transportation, and G&A. Fitch estimates operating costs were just
$5.5 per barrel of oil equivalent (boe) in 2Q24, compared to
Sitio's average realized price of $46.7/boe. Sitio's income tax
rate is also modest.
Sitio generates far superior pre-dividend FCF margins than most
working interest oil and gas producers. Fitch forecasts Sitio's
pre-dividend FCF margin to average 75% in 2024-2028. The low cost
base makes the company less vulnerable to sharply lower prices.
However, it has no control over the upstream development activity
of its lessees and can only revoke the right to exploit its mineral
interests after several years of limited use. Sitio tries to buy
the most promising acreage with the lowest breakeven prices, which
upstream companies are more likely to develop.
Limited Reserve Life: Fitch estimates Sitio's YE2023 proved
developed reserve life ratio at five years, below the average for
North American oil and gas peers. Sitio's proved reserve life is
seven years. The lower-than-average proved reserve life is
partially explained by its conservative proved undeveloped reserve
booking policy, which only includes spud wells in proved
undeveloped reserves. Sitio may apply FCF toward the acquisition of
additional acreage, or it may target new stock-based M&A. It
currently has 267,351 net royalty acres and 85 million boe of net
proved reserves.
Projected Debt Reduction: Sitio's management aims to pay out at
least 65% of its EBITDA less accrued debt interest and taxes as
shareholder distributions. Its targeted minimum dividend is 35% of
discretionary FCF and approximately 30% more can be allocated
between share buybacks and dividends. The rest is designated for
debt repayment, liquidity improvement and acquisitions.
Fitch projects its post-dividend FCF to average roughly $140
million annually in 2024-2025 based on its current oil and gas
price deck. Fitch assumes the company will use most of its FCF to
reduce debt and keep leverage below 1.5x. According to management,
Sitio can reduce its dividend payout ratio if necessary, although
this is not currently planned.
Selective Hedging Program: The company only hedges a few years of
volumes of newly acquired assets if cash consideration was used and
prices were above the company's estimates for midcycle levels.
Sitio uses swaps and costless collars. It does not routinely hedge
its volumes outside of M&A deals, which impedes visibility over its
financial profile, given the volatility of oil and gas prices.
Sitio's share of hedged Fitch-expected production was low compared
with peers, at 14% in 2H24, 7% in 2025 and no hedges for 2026.
Financials Published by Parent: Fitch adjusts financial statements
published by Sitio Royalties Corp., Sitio's parent, to calculate
Sitio's metrics. Sitio does not plan to publish audited financials;
however, its parent's only asset is Sitio, of which it holds only
52% of economic interest. The remaining 48% economic interest is
owned by Class C shareholders of Sitio Royalties Corp. Fitch
reclassified dividends paid to Class C shareholders from
noncontrolling interest dividends to common dividends to estimate
Sitio's credit metrics based on its parent's audited financials.
Derivation Summary
Sitio's business model is the same as Viper Energy, Inc's
(BB/Stable; bb- Standalone Credit Profile). Both companies are pure
non-working interest mineral rights holders with high margins and
no capex. Sitio has lower production scale (40 kboe/d) than Viper
(48kboe/d in 2Q24) and lower reserves. It is concentrated in the
Permian Basin, like Viper, but has substantial exposure to other
U.S. basins. Sitio has lower operating netbacks before interest, at
$41/boe in 2Q24, than Viper, at $45/boe, due to lower oil exposure
and higher G&A expense. Its interest costs are also higher than
Viper's.
Viper's relationship with Diamondback Energy, Inc. (BBB+/Stable)
reduces counterparty risk through visibility into development plans
and prioritization of Viper acreage, as Diamondback operates the
majority of Viper's net royalty acreage. Sitio is not dependent on
any single exploration and production (E&P) operator, unlike Viper.
Viper's leverage is slightly below Sitio's at midcycle prices,
while Fitch expects both to remain within a range of 1.0x-1.5x.
Northern Oil & Gas (NOG; B+/Positive), a non-operator working
interest E&P company, is more exposed to fluctuations in operating
and capital costs. NOG acquires working interests in leaseholds and
contributes capital to the development and drilling activity of
wells and bears additional operating costs. Therefore, NOG's
margins are materially lower than Sitio's, althout its production
size is substantially larger. Like Sitio, NOG does not have control
over production decisions, although it may opt out of wells in
which it does not wish to participate.
Key Assumptions
- WTI oil price of $75/bbl in 2024, $65/bbl in 2025, $60/bbl in
2026-2027, and $57/bbl in 2028 and midcycle;
- Henry Hub natural gas price of $2.25/mcf in 2024, $3.00/mcf in
2025-2026 and $2.75/mcf in 2027-2028 and midcycle;
- Oil and gas production at 38 kboe/d in 2024, declining to 37
kboe/d by 2028;
- Shareholder distributions at 65% of pre-dividend FCF;
- $200 million of discretionary cash outflows in 2026-2028
combined.
Recovery Analysis
The recovery analysis assumes Sitio would be reorganized as a
going-concern (GC) in bankruptcy rather than liquidated. Fitch has
assumed a 10% administrative claim.
Going-Concern Approach
Sitio's GC EBITDA estimate of $240 million reflects Fitch's view of
a sustainable, post-reorganization EBITDA level upon which Fitch
bases the enterprise valuation (EV). This value is based on stress
case oil and gas prices as well as expectations for reduced
production volumes. GC EBITDA was raised from the last rating
review to reflect net acquisitions over the last 12 months.
An EV multiple of 5.5x was applied to the GC EBITDA to calculate a
post-reorganization EV of $1.2 billion. The multiple is above the
median 5.3x exit multiple for energy in Fitch's Energy, Power and
Commodities Bankruptcy Enterprise Values and Creditor Recoveries
(2023 Fitch Case Studies). The 5.5x multiple is also significantly
higher than multiples normally used for U.S. working interest oil
and gas producers, such as NOG with 3.5x EV multiple, as Sitio does
not have to incur capex or production costs.
Liquidation Approach
The liquidation estimate reflects Fitch's view of the value of
balance sheet assets that can be realized in sale or liquidation
processes conducted during a bankruptcy or insolvency proceeding
and distributed to creditors. For liquidation value, Fitch applied
an 80% advance rate to the company's receivables and added an
approximation of the PV10 value of Sitio's reserves based on
Fitch's current stress case oil and gas prices.
The maximum of these two approaches was the GC approach.
Fitch assumed Sitio's $850 million borrowing base RBL to be 90%
drawn upon default. Sitio also has $600 million of senior unsecured
notes subordinated to the RBL facility. The allocation of value in
the liability waterfall results in recovery corresponding to 'RR3'
for the unsecured notes.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Increased scale, with midcycle EBITDA above $500 million;
- Midcycle EBITDA leverage below 2.0x.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Weakening liquidity;
- Material deterioration of reserve life or production volumes;
- Midcycle EBITDA leverage above 3.0x.
Liquidity and Debt Structure
Healthy Liquidity: Sitio's nearest debt maturity will be in 2027,
when its $850 million RBL facility expires. The company currently
had $460 million drawn under the facility at June 30, 2024. The
other piece of debt is the $600 million unsecured bond due in 2028.
The company maintains a small amount of cash. Fitch expects Sitio
to generate significant FCF in 2024-2028, which further supports
its liquidity.
Issuer Profile
Sitio acquires and manages mineral and royalty interests in oil and
natural gas properties in the U.S. Most of Sitio's acreage is in
the Permian basin.
Summary of Financial Adjustments
Fitch estimates Sitio's financials using Sitio Royalty Corp.'s
public financial statements. Fitch treats Sitio Royalty Corp.'s
dividends paid to non-controlling interests as dividends paid to
common shareholders.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
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
----------- ------ -------- -----
Sitio Royalties
Operating
Partnership, LP LT IDR B+ Affirmed B+
senior unsecured LT BB- Affirmed RR3 BB-
Sitio Finance Corp.
senior unsecured LT BB- Affirmed RR3 BB-
SK MOHAWK: Fitch Lowers IDR to 'RD' on Distressed Debt Exchange
---------------------------------------------------------------
Fitch Ratings has downgraded the Long-Term Issuer Default Ratings
(IDRs) of SK Mohawk Holdings, SARL and Polar US Borrower, LLC
(collectively, SI Group) to 'RD' (Restricted Default) from 'CCC'
and additionally downgraded its senior secured ratings to
'CC'/'RR3' from 'CCC+'/'RR3'. Fitch has also downgraded SI Group's
unsecured notes to 'C'/'RR6' from 'CC'/'RR6'. These actions follow
the company's execution of an exchange offering on September 18,
2024 which meets the conditions for a Distressed Debt Exchange
(DDE) as per Fitch's corporates rating criteria.
Fitch has subsequently reassessed and upgraded the IDRs to 'CCC-'
and placed them on Rating Watch Negative (RWN). Fitch has also
subsequently downgraded the senior secured ratings to 'C'/'RR6' and
affirmed the unsecured ratings at 'C'/'RR6'. These rating actions
reflect SI Group's announcement of a follow-on public exchange
offering on its remaining senior debt, which have the same terms as
the executed offering and also meets the conditions for a DDE.
Fitch continues to evaluate SI Group on its existing capital
structure, but including the new senior secured debt introduced in
September 2024. The public exchange is expected to close in October
2024. Once the DDE is executed, Fitch expects to downgrade the IDR
to 'RD' (Restricted Default) and reassess the rating based on the
revised capital structure, future business prospects and liquidity
position.
Key Rating Drivers
Exchange Offer, DDE: On Sept. 18, 2024, SI Group announced a public
exchange offering, whereby participating holders of the existing
revolver, term loan, and notes can exchange for holdings in a newly
created first lien first out $218 million revolver (FLFO RCF)
maturing in 2028 and/or a first lien second out term loan (FLSO
TL). Participating revolver lenders are being offered to receive
80c of FLFO RCF and 20c of FLSO TL, and participating TL holders
are being offered to receive a combination of cash and 88c-92.5c of
FLSO TL (with the amounts to be confirmed upon final participation
levels).
Participating holders of the unsecured notes are being offered 65c
of FLSO TL. Additionally, SI Group's sponsor, SK Capital Partners,
provided a $100 million new money first lien third out (FLTO TL)
financing to fund a paydown of participating TL. A private exchange
on the same terms, which are detailed below, has been closed with a
majority of the issuer's creditors. Fitch views the transaction as
a DDE.
Material Reduction in Terms: Fitch views the proposed transaction
as a DDE given a material reduction in terms. Participating holders
of the unsecured notes are being offered 65c of FLSO TL, which
constitutes a reduction in principal. Additionally, security and
claim priority is weakened for existing loan and noteholders, as
any existing debtholders that do not participate in the transaction
will be junior in right of payment and lien priority to the
newly-created debt tranches. Existing creditor protections will
also be stripped/revised.
Avoidance of a Probable Default: Fitch also views the transaction
as a DDE given it having the effect of allowing the issuer to avoid
an eventual probable default. There was high probability of default
absent the exchange offer, with SI Group entering this process with
sustained weak operating performance, an untenable pre-transaction
liquidity profile, and unsustainable pre-transaction
Fitch-calculated EBITDA leverage of around 19x.
At the end of 2Q24 and in early July 2024, SI Group received loans
totaling $50 million from its sponsor to maintain adequate
liquidity in light of deepening negative FCF and minimal
availability under the previous revolver. Fitch believes the
confluence of these factors left the company unable to complete an
orderly refinancing, leaving no other option other than to engage
with existing lenders in a debt restructuring.
Elevated Leverage, Tight Coverage: Pro forma for the transactions,
Fitch expects EBITDA leverage to remain above 10.0x through the
forecast horizon, largely driven by continued sluggish EBITDA
generation and the debt load remaining elevated. Fitch's forecast
also shows revolver utilization steadily increasing over the next
several years as FCF remains consistently negative. Further
reducing SI Group's financial flexibility is EBITDA interest
coverage remaining below 1.5x through the forecast horizon.
While solid sponsor support is demonstrated by the new
sponsor-funded loans made at the end of 2Q24 and during the
exchange process, these loans still ultimately add to the issuer's
debt load and will increase with high rates of paid-in-kind
interest. Additionally, SI Group could still be exposed to high
refinancing risk in the event that participation from existing TL
holders is below-expectations and a substantial portion of term
loan debt maturing in 2025 remains after close of the exchange
process.
Sustained Weak Performance: SI Group's performance further
deteriorated in 2Q24, with YTD sales and Fitch-defined EBITDA each
down 5% YoY. Poor recent performance stems from sustained weak end
market demand, combined with industry destocking through most of
2023, and a surge of new capacity in China leading to structural
market oversupply and heightened competition. Given the oversupply
and lack of meaningful demand improvements since the deterioration
began in 3Q22, Fitch expects sales volumes to remain at similarly
low levels through the forecast horizon.
Management has responded to the adverse environment with cost
cutting measures and reducing capex spending to maintenance levels.
The company also is ceasing production within its smallest Pharma
segment. Still, Fitch expects continued negative FCF through the
forecast horizon, as the recovery in EBITDA remains slow and
interest costs remain high.
Product and End-Market Diversity: SI Group's rating is supported by
a diverse product portfolio that is utilized by companies across a
wide range of industries, providing ballast against volatility in
any one sector. The company offers multiple applications including
adhesives, lubricants, coatings and packaging applications, while
serving a diverse set of end-markets across aerospace, automotive,
building and construction, consumer goods and oil and gas. This
diversity across application and industry helps smooth some of the
cyclical exposure.
Middling Core Additives Position: Backward integration into
intermediate chemistry provides an advantaged cost structure for
the company's additive products. SI Group also has the ability to
switch capacity to other products within its portfolio in response
to tightness or weakness across markets, however its mix of volumes
has shifted towards lower-margin products in recent periods. In
conjunction with the company's increasing centralization of its
facilities, Fitch believes that utilization rates will rise over
the medium term.
Derivation Summary
Compared to most speculative-grade chemical peers, SI Group has
very high EBITDA leverage of above 10x. Typically, the greater
degree to which a chemical manufacturer's products are specialized
or otherwise defensible, the greater amount of debt the firm can
support at the same rating level. ASP Unifrax (CCC-) operates with
similar leverage and scale, but also benefits from a somewhat more
specialized product portfolio that generates higher EBITDA margins.
SI Group operates with similar scale to Vantage Specialty
Chemicals, Inc. (B/Negative) but with relatively higher EBITDA
leverage.
Advancion Holdings LLC's (B-/Stable) leverage profile trends around
8.0x and operates with smaller scale, but its position as the only
global commercial producer of nitroalkanes allows the company to
enjoy outsized EBITDA margins. SK Mohawk's business and cash flow
risk profiles are towards the middle of these peers in normal
environments, with diverse offerings in the additives space,
fragmented competition, and a modest cost advantage.
Key Assumptions
- Revenue growth is modest in 2024, with sales volumes remaining at
below-average levels. Growth in volumes and prices remains slow
thereafter, driven by gradually improving demand, partially offset
by continued market oversupply;
- Fitch-defined EBITDA margins modestly recover to 10% by 2025 and
trend towards 11% thereafter, as product mix shift towards
lower-margin products is partially offset by slightly improved
operating leverage and cost reduction measures;
- Capex spending remains at around maintenance levels of $50
million annually through the forecast.
Recovery Analysis
Key Recovery Rating Assumptions
The recovery analysis assumes that SI Group would be reorganized as
a going-concern (GC) in bankruptcy rather than liquidated. Fitch
has assumed a 10% administrative claim and that the company's new
$218 million revolver and existing $100 million A/R Securitization
are both fully drawn. The recovery analysis currently reflects the
closed exchange transactions completed on September 18, but not the
public exchange offering, as final participation is presently
unknown.
GC Approach
Fitch projects SI Group's GC EBITDA of $150 million, which assumes
a rebound from an assumed trough EBITDA of around $100 million,
reflecting an improvement in the underlying economic conditions
that would have likely precipitated the default, as well as
corrective actions taken during restructuring (or actions that
would be priced in by potential bidders).
The GC EBITDA estimate reflects Fitch's view of a sustainable,
post-reorganization EBITDA level upon which it bases the enterprise
valuation. Specifically, the GC EBITDA depicts a sustained economic
contraction in EMEA and North America, resulting in severe volume
headwinds in both the Polymer Solutions and Industrial Solutions
segments, which leads to a material decline in EBITDA and cash
generation.
Fitch assumes that upon default, SI Group would be unable to
improve EBITDA as economic and industry headwinds would likely
limit the benefits of cost reductions. However, Fitch also assumes
that the underlying business fundamentals would improve over time
as the cycle corrects, leading to the assumed GC EBITDA.
An enterprise value multiple of 6x EBITDA is applied to the GC
EBITDA to calculate a post-reorganization enterprise value. The
choice of this multiple considered historical bankruptcy case study
exit multiples for peer companies. Fitch used a multiple of 6x to
estimate a value for SI Group because of its slightly lower margins
relative to public comps.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- A positive rating action is unlikely until after the conclusion
of the second exchange offering process.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Successful conclusion of the exchange offering as proposed would
be expected to result in a downgrade of ratings followed by a
reassessment of the issuer's credit profile under the revised
capital structure;
- Enactment of a formal bankruptcy procedure.
Liquidity and Debt Structure
Adequate Pro Forma Liquidity: SK Mohawk's liquidity profile is
expected to improve pro forma for the exchange transactions, with
an adequate cash balance of around $30 million and around $100
million in availability under the new $218 million revolver.
However, Fitch's forecast for consistently negative FCF leads to
steadily increasing revolver utilization, leading to declining
forecasted liquidity over the next several years.
Issuer Profile
SI Group (SK Mohawk Holdings, SARL) provides polymers, fuel,
lubricant and industrial additives and chemical intermediates for
use in a number of end-markets, including plastics, fuels, tires,
oilfield chemicals, food packaging and surfactants.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
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
----------- ------ -------- -----
Polar US Borrower LLC LT IDR RD Downgrade CCC
LT IDR CCC- Upgrade RD
senior unsecured LT C Downgrade RR6 CC
senior unsecured LT C Affirmed RR6 C
senior secured LT CC Downgrade RR3 CCC+
senior secured LT C Downgrade RR6 CC
SK Mohawk Holdings,
SARL LT IDR RD Downgrade CCC
LT IDR CCC- Upgrade RD
SPILLER PERSONAL: Seeks to Tap H. Brad Parker as Bankruptcy Counsel
-------------------------------------------------------------------
Spiller Personal Care Home seeks approval from the U.S. Bankruptcy
Court for the Southern District of Texas to employ the law firm of
H. Brad Parker, PC as legal counsel.
The firm's services include:
(a) assist the Debtor in the counseling and professional
advice regarding continued operation of its business and management
of its property and duties and responsibilities;
(b) assist the Debtor in preparing all necessary legal
papers;
(c) assist the Debtor in negotiation of a Plan satisfactory to
parties-in-interest, and prepare a disclosure statement which will
be submitted to parties-in-interest; and
(d) assist the Debtor in performing all other legal services
which may be necessary and appropriate.
The firm will be compensated at its normal hourly rates, plus
reimbursement for expenses incurred.
H. Brad Parker, Esq., an attorney at H. Brad Parker, 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:
H. Brad Parker, Esq.
H. Brad Parker, P.C.
700 Louisiana, Suite 3950
Houston, TX 77002
Telephone: (832) 390-2690
Email: bparker@parkerlawpc.com
About Spiller Personal Care Home
Spiller Personal Care Home, doing business as Spiller Care Home,
owns and operates an assisted living facility in Houston, Texas.
Spiller Personal Care Home sought relief under Subchapter V of
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No.
24-33614) on August 5, 2024. In the petition filed by Terry N.
Spiller, executive director, the Debtor disclosed estimated assets
between $1 million and $10 million and estimated liabilities
between $500,000 and $1 million.
Judge Eduardo V. Rodriguez oversees the case.
H. Brad Parker, PC serves as the Debtor's counsel.
SPOKANE INT'L: Moody's Affirms Ba2 Rating & Alters Outlook to Pos.
------------------------------------------------------------------
Moody's Ratings has affirmed Spokane International Academy, WA's
Ba2 revenue backed rating. The outlook has been revised to positive
from stable. The charter school has approximately $18 million of
debt outstanding, all rated by us. The outlook revision to positive
from stable reflects the completion of the high school, achievement
of full enrollment, and the expectation that financial performance
will remain a credit positive.
RATINGS RATIONALE
The Ba2 rating reflects Spokane International Academy's relatively
small size as a single site school serving a midsized city, though
enrollment has been grown to reach roughly 860 students and the
school has a significant waitlist equal to about one third of
enrollment. The rating is supported by the school's growing
financial reserves supported by its recently established high
school operation. Negatively, the school's leverage is elevated due
to the recent facility expansion, though debt service coverage is
quite good at over twice maximum annual debt service and will
remain so as the school's maintains its good financial margins over
the next several years.
RATING OUTLOOK
The positive outlook reflects Moody's expectation that the school's
finances will continue to improve as its recently established high
school continues to generate revenue and that leverage will
gradually decline as the school grows liquidity and pays down
debt.
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATING
-- Continued growth in both revenues and available liquidity,
particularly if reserves reach 150 days cash on hand
-- Continued maintenance of debt service coverage in excess of two
times annual debt service payments
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATING
-- Significant decline in liquidity, particularly if reserves fall
below 100 days cash on hand
-- Additional debt that significantly dilutes either current or
projected debt service coverage
LEGAL SECURITY
The Series 2021A and 2021B bonds are special, limited obligations
of the Washington State Housing Finance Commission secured solely
by revenues derived from a loan agreement with Spokane
International Academy. Under the loan agreement, the academy has
pledged to make payments derived from revenues received from the
operation of the financed facility. The academy has also executed a
deed of trust covering its real and personal property interests
associated with the financed facility as security for the debt.
Additionally, a debt service reserve fund was funded with bond
proceeds at the maximum annual debt service.
PROFILE
Spokane International Academy (SIA) is a K-12 charter school that
serves Spokane, WA (Aa2 stable), within Spokane County School
District 81 (Spokane) (Aa3 stable), and the surrounding area. The
school had an enrollment of about 860 students, essentially at its
full capacity, and operates out of a single facility. It is
authorized by a five year charter granted by the Washington State
Charter School Commission, set to expire in the 2025-26 school
year.
METHODOLOGY
The principal methodology used in this rating was US Charter
Schools published in April 2024.
STAFFING 360: Inks Amendment With JIG to Extend Maturity of Notes
-----------------------------------------------------------------
Staffing 360 Solutions, Inc. disclosed in a Form 8-K Report filed
with the U.S. Securities and Exchange Commission that the Company
entered into that certain Second Omnibus Amendment and
Reaffirmation Agreement to the Note Documents with Jackson
Investment Group, LLC and the guarantors party thereto, which such
Amendment Agreement, among other things:
(i) extends the maturity date of that certain Third Amended
and Restated Note and Warrant Purchase Agreement, by and between
the Company and Jackson, dated as of October 27, 2022, as amended
by the First Omnibus Amendment and Reaffirmation Agreement to the
Note Documents, dated as of August 30, 2023, to the earlier of (a)
January 13, 2025, or (b) the date of the acceleration of the
maturity of any of the Notes; and
(ii) extends the maturity date of that certain (a) Third
Amended and Restated 12% Senior Secured Note due October 14, 2024,
dated as of October 27, 2022, and (b) 12% Senior Secured Promissory
Note due October 14, 2024, dated as of August 30, 2023, to January
13, 2025.
In connection with the Amendment Agreement, the Company entered
into Amendment No. 30 to Credit and Security Agreement and Limited
Waiver, effective as of September 18, 2024, by and among the
Company, as Parent, Monroe Staffing Services, LLC, a Delaware
limited liability company, Faro Recruitment America, Inc., a New
York corporation, Lighthouse Placement Services, Inc., a
Massachusetts corporation, Key Resources, Inc., a North Carolina
Corporation, Headway Workforce Solutions, Inc., a Delaware
corporation, Headway Employer Services LLC, a Delaware limited
liability company, Headway Payroll Solutions, LLC, a Delaware
limited liability company, Headway HR Solutions, Inc., a New York
corporation, and NC PEO Holdings, LLC, a Delaware limited liability
company, collectively, as borrowers, and MidCap Funding IV Trust,
as agent for the lenders (as successor by assignment to MidCap
Funding X Trust, "MidCap") and the lenders party thereto from time
to time, which such Amendment No. 30 amends that certain Credit and
Security Agreement, dated as of April 8, 2015, by and among, the
Borrowers, the Agent and the Lenders. Pursuant to Amendment No. 30,
the Commitment Expiry Date is extended to December 5, 2024.
In addition, pursuant to Amendment No. 30, in consideration for
MidCap's agreement to enter into Amendment No. 30, the Borrowers
have agreed to pay to MidCap a modification fee of $200,000, which
such Modification Fee shall be non-refundable and fully earned as
of September 5, 2024. The Modification Fee shall constitute a
portion of the Borrowers obligations pursuant to the Credit and
Security Agreement and shall be secured by all Collateral. If the
Borrowers satisfy the outstanding obligations pursuant to the
Credit and Security Agreement in full prior to December 5, 2024,
the Modification Fee shall be waived by MidCap.
Amendment No. 30 was held in escrow until the execution of the
Amendment Agreement on September 18, 2024, and both the Amendment
No. 30 and the Amendment Agreements became effective as of
September 18, 2024.
About Staffing 360
Headquartered in New York, Staffing 360 Solutions, Inc. is engaged
in the execution of a buy-integrate-build strategy through the
acquisition of domestic and international staffing organizations in
the United States. The Company believes that the staffing industry
offers opportunities for accretive acquisitions and, as part of its
targeted consolidation model, is pursuing acquisition targets in
the finance and accounting, administrative, engineering, IT, and
light industrial staffing space.
New York, NY-based RBSM LLP, the Company's auditor since 2024,
issued a "going concern" qualification in its report dated June 11,
2024, citing that the Company has incurred substantial operating
losses and will require additional capital to continue as a going
concern. This raises substantial doubt about the Company's ability
to continue as a going concern.
Staffing 360 Solutions reported a net loss of $26.04 million for
the fiscal year ended Dec. 30, 2023, compared to a net loss of
$16.99 million for the fiscal year ended Dec. 31, 2022. As of June
29, 2024, the Company had $63.44 million in total assets, $75.42
million in total liabilities, and $11.97 million in total
stockholders' deficit.
STANLEY OIL: Seeks Chapter 11 After Injunction
----------------------------------------------
Kirk O'Neil of The Street reports that Stanley Oil & Lubricants
filed its bankruptcy petition after U.S. District Judge Nina R.
Morrison on Sept. 11 granted a preliminary injunction in the U.S.
District Court for the Eastern District of New York to Frankfurt am
Main, Germany-based General Petroleum GmbH, a manufacturer of
automotive, industrial, and marine lubricants.
The preliminary injunction enjoined Stanley Oil from manufacturing,
importing, distributing, and selling any products using General
Petroleum's trademarks, or any confusingly similar marks and froze
the debtor's assets related to the alleged selling of its goods
with counterfeit marks or other illegal activities.
Stanley Oil in August 2019 began doing business with General
Petroleum, purchasing petroleum products from the company in
Sharjah, UAE, to sell in the United States, court papers said. The
agreement led to a five-year dispute over trademarks, copyrights,
and other business dealings.
General Petroleum on March 28, 2024, filed a lawsuit against
Stanley in the Eastern District of New York alleging trademark
infringement, copyright infringement, unfair competition, deceptive
trade practices, breach of contract, cybersquatting, cancellation
of fraudulently obtained trademark registration, and that the
defendant was trafficking goods bearing counterfeit marks.
The parties subsequently held productive settlement discussions for
several weeks and agreed to basic terms, according to court papers.
The discussions ended around June 12, 2024 after the debtor
replaced its counsel. On June 14, 2024, General Petroleum filed for
a preliminary injunction.
Morrison found in favor of General Petroleum's request for a
preliminary injunction on all of the issues since the company
demonstrated a likelihood that it would succeed on the merits of
its trademark infringement, unfair competition, trafficking in
counterfeit goods, copyright infringement, cybersquatting, and
irreparable harm claims, the judgment said.
Stanley Oil's Chapter 11 bankruptcy filing places an automatic stay
on any pending litigation while its case proceeds.
The debtor's bankruptcy attorney did not immediately respond to a
request for comment
Stanley Oil markets automobile, industrial, and marine lubricants;
automotive grease; additives and chemicals; brake fluid and
coolant; and base oil, under the Stanley, Syntrol, Prime, and
Hexagen brands, according to its website.
About Stanley Oil & Lubricants
Stanley Oil & Lubricants is a merchant wholesaler of petroleum and
petroleum products.
Stanley Oil & Lubricants sought relief under Chapter 11 of the
Bankruptcy Code (Bankr. E.D.N.Y. Case No. 24-73597) on Sept. 17,
2024. In the petition filed by Syed Hasnain, as president, the
Debtor estimated assets up to $50,000 and estimated liabilities
between $1 million and $10 million.
The Honorable Bankruptcy Judge Louis A. Scarcella handles the
case.
The Debtor is represented by:
Ronald D. Weiss, Esq.
RONALD D. WEISS, P.C.
445 Broadhollow Road
Suite CL-10
Melville, NY 11747
Tel: (631) 271-3737
Fax: (631) 271-3784
E-mail: weiss@ny-bankruptcy.com
STRATEGIC MATERIALS: Blackstone Virtually Writes Off $2.6MM Loan
----------------------------------------------------------------
Blackstone Strategic Credit 2027 Term Fund has marked its
$2,666,667 loan extended to Strategic Materials Holding Corp to
market at $53,333 or 2% of the outstanding amount, according to the
Blackstone Strat's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone Strat is a participant in a Second Lien Initial Term
Loan (3M CME Term SOFR + 7.75%, 1% Floor) to Strategic Materials
Holding Corp. The loan matures on October 31, 2025.
Blackstone Strat is a closed-end term fund that trades on the New
York Stock Exchange under the symbol. BGB's primary investment
objective is to seek high current income, with a secondary
objective to seek preservation of capital, consistent with its
primary goal of high current income.
Blackstone Strat led by Robert Zable Principal Executive Officer,
President and Chief Executive Officer; and Gregory Roppa Principal
Financial Officer, Treasurer and Chief Financial Officer. The Fund
can be reached through:
Robert Zable
Blackstone Strategic Credit 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Strategic Materials processes recycled glass and plastic for use in
a wide array of products.
STRATEGIC MATERIALS: Blackstone Virtually Writes Off $553,333 Loan
------------------------------------------------------------------
Blackstone Long-Short Credit Income Fund has marked its $553,333
loan extended to Strategic Materials Holding Corp to market at
$10,667 or 2% of the outstanding amount, according to the
Blackstone L & S's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone L & S is a participant in a Second Lien Initial Term
Loan (3M CME Term SOFR + 7.75%, 1% Floor) to Strategic Materials
Holding Corp. The loan matures on October 31, 2025.
Blackstone L & S is a diversified, closed-end management investment
company. BGX was organized as a Delaware statutory trust on October
22, 2010. BGX was registered under the 1940 Act on October 26,
2010. BGX commenced operations on January 27, 2011. Prior to that,
BGX had no operations other than matters relating to its
organization and the sale and issuance of 5,236 common shares of
beneficial interest in BGX to the Adviser at a price of $19.10 per
share.
Blackstone L & S is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Long-Short Credit Income Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Strategic Materials processes recycled glass and plastic for use in
a wide array of products.
STRATEGIC MATERIALS: Blackstone Virtually Writes Off $800,000 Loan
------------------------------------------------------------------
Blackstone Senior Floating Rate 2027 Term Fund has marked its
$800,000 loan extended to Strategic Materials Holding Corp to
market at $16,000 or 2% of the outstanding amount, according to the
Blackstone Senior's Form N-CSRS for the semi-annual period ended
June 30, 2024, filed with the Securities and Exchange Commission.
Blackstone Senior is a participant in a Second Lien Initial Term
Loan (3M CME Term SOFR + 7.75%, 1% Floor) to Strategic Materials
Holding Corp. The loan matures on October 31, 2025.
Blackstone Senior, formerly known as Blackstone Senior Floating
Rate Term Fund, is a diversified, closed-end management investment
company. BSL was organized as a Delaware statutory trust on March
4, 2010. BSL was registered under the Investment Company Act of
1940, as amended on March 5, 2010.
Blackstone Senior is led by Robert Zable Principal Executive
Officer, President and Chief Executive Officer; and Gregory Roppa
Principal Financial Officer, Treasurer and Chief Financial Officer.
The Fund can be reached through:
Robert Zable
Blackstone Senior Floating Rate 2027 Term Fund
345 Park Avenue, 31st Floor,
New York, NY 10154
Telephone: (877) 876-1121
- and -
Marisa Beeney
Blackstone Alternative Credit Advisors LP
345 Park Avenue, 31st Floor
New York, NY 10154
Telephone: (877) 876-1121
Strategic Materials processes recycled glass and plastic for use in
a wide array of products.
SYCAMORE BUYER: Moody's Alters Outlook on 'Ba3' CFR to Stable
-------------------------------------------------------------
Moody's Ratings affirmed the ratings of Sycamore Buyer LLC,
including the Ba3 Corporate Family Rating, Ba3-PD Probability of
Default Rating, and the Ba3 ratings on the company's senior secured
first lien revolving credit facility and term loans. Moody's
revised the outlook to stable from negative.
The outlook revision to stable from negative reflects the
significant improvement in Sycamore's earnings and credit metrics
and Moody's expectations of a continued favorable environment for
Sycamore and other poultry processors as a result of the recent
upturn in the poultry cycle that is expected to remain strong for
the next 12-18 months. As of the 12 month period ended June 29,
2024, Sycamore's Moody's adjusted debt to EBITDA stood at 2.6x,
which is a significant improvement from 5.5x for the fiscal year
ended March 30, 2024. A significant rebound in the poultry market,
driven by higher poultry prices, low grain costs, and an increase
in poultry demand as consumers shift to poultry over higher priced
protein alternatives, such as beef are contributing to a
significant improvement in Sycamore's EBITDA. Moody's are
forecasting continued EBITDA growth in fiscal 2025 and 2026, driven
by favorable poultry prices and continued low grain costs. Given
the favorable environment, Moody's are projecting Sycamore's
Moody's adjusted debt to EBITDA to decline to below 2x by fiscal
2026.
Moody's affirmed the ratings because the cyclical poultry business
creates volatility in Sycamore Buyer's earnings and the company has
good liquidity. Considering the earnings volatility that is
expected in the cyclical protein market, it is important that
Sycamore maintain good liquidity to provide it with the capacity to
manage through down cycles. In the next 12 months, Moody's are
forecasting Sycamore to generate $300 million to $350 million in
free cash flow after capital expenditures of approximately $350
million and dividends of approximately $200 million. Given the
volatile nature of the poultry industry Moody's expect management
to either use the cash to pay down debt or to enhance liquidity in
preparation for the next down cycle.
RATINGS RATIONALE
Sycamore Buyer LLC's Ba3 CFR reflects that the July 2022
combination of Wayne Farms and Sanderson Farms, created the third
largest poultry producer in the US. The combination of these two
companies created a much stronger competitor behind Tyson Foods,
Inc. (Baa2 negative) and Pilgrim's Pride Corporation (Ba2 stable),
the #1 and #2 poultry producers in the US, respectively. The
poultry market is highly cyclical due to challenges matching supply
with demand, shifts in consumer spending on proteins and other
foods, and volatility in input costs. The business is also
vulnerable to disease that affects the supply of poultry, factors
that can influence demand such as market conditions in alternative
proteins, and significant costs to mitigate the high environmental
impact of protein cultivation and processing. Capital intensity and
the company's focus on big bird products also create high operating
leverage and earnings volatility. Sycamore Buyer's earnings have
been highly volatile since the merger with a downturn in the
poultry market leading to a significant earnings drop and negative
free cash flow. An improvement in poultry market conditions is
leading to a significant increase in the company's earnings,
leverage and free cash flow. Moody's anticipate in the ratings that
Sycamore Buyer will experience earnings and credit metric
volatility but that the company will maintain sufficient liquidity
to manage through the cycles. The company's modest 2.0x
debt-to-EBITDA leverage level (based on the company's definition)
and liquidity practices enhance financial flexibility but the
target to distribute 40% of excess cash flow (based on the
company's definition of CFO less capital expenditures) is somewhat
aggressive.
In addition to synergy realization through the combination of Wayne
Farms and Sanderson Farms, Sycamore also benefits from its equity
owners, Cargill, Incorporated and Continental Grain Co., who each
have vast experience and knowledge in commodity businesses and
trading. These capabilities help manage the earnings volatility of
the poultry market. Through Sycamore's risk management committee,
comprised of members from Sycamore's management team, Cargill,
Incorporated, and Continental Grain Co., Sycamore is able to use
derivatives and insurance-based hedging products to minimize the
impact of feed volatility. Managing feed volatility is very
important for poultry producers, as corn, soybean meal, and other
feed ingredients can represent 50-60% of the costs of growing a
chicken and about 40% of costs of goods sold for most poultry
producers.
Sycamore operates with good liquidity based on a cash balance of
$383 million as of June 29, 2024, an undrawn $750 million senior
secured revolving credit facility, and no meaningful debt
maturities through 2026 aside from approximately $65 million of
required annual term loan amortization.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Sycamore's ratings could be upgraded if the company diversifies the
product profile into other proteins, debt to EBITDA is sustained
below 1.5x, and liquidity sources (cash plus unused revolver
commitment capacity) are at least $1 billion.
Ratings could be downgraded if revenues decline, operating
performance weakens due to factors such as lower demand, higher
input costs, or difficulties with operating execution or the merger
integration, or free cash flow is low. Debt to EBITDA sustained
above 2.5x, or deteriorating liquidity such as cash plus unused
revolver commitment below $400 million could also lead to a
downgrade.
The principal methodology used in these ratings was Protein and
Agriculture published in August 2024.
Sycamore Buyer LLC ("Sycamore") headquartered in Oakwood, Georgia
is the third largest poultry producer in the US with revenues of
approximately $8 billion in the 12 month period ended June 29,
2024. The company was formed by the merger of Wayne Farms and
Sanderson Farms in July 2022 and is owned by Cargill, Incorporated
(50% ownership), Continental Grain Co. (38% ownership), and the
Healthcare of Ontario Pension Plan (12% ownership).
T-SHACK INC: Gets OK to Sell Las Vegas Property for $140,000
------------------------------------------------------------
T-Shack Inc. got the green light from the U.S. Bankruptcy Court for
the District of Nevada to sell its real property to Anna Bao Ping
Zhu Family Trust for $140,000.
The company owns a parcel of land located at 5388 Swenson Street
#26, Las Vegas, Nev.
The property will be transferred to the buyer "free and clear" of
all liens, claims and encumbrances, according to the order penned
by Judge Mike Nakagawa.
T-Shack will receive net proceeds of $128,000 after payment of the
closing costs and liens against the property.
Rebecca Garcilazo De Martinez, a licensed real estate broker for
Southerby's International Realty, assisted the company with the
sale.
About T-Shack Inc.
T-Shack Inc. is a wholesale and retail company in Mantador, N.D.
T-Shack filed Chapter 11 petition (Bankr. D. Nev. Case No.
22-11197) on April 5, 2022, with $1 million to $10 million in both
assets and liabilities. Raymond Zajac, registered agent, signed
the
petition.
Judge Mike K. Nakagawa oversees the case.
Michael J. Harker, Esq., at The Law Offices of Michael J. Harker is
the Debtor's bankruptcy counsel.
TECHPRECISION CORP: Appoints New Chief Financial Officer
--------------------------------------------------------
TechPrecision Corporation announced Sept. 23, 2024, that it has
appointed Richard D. Roomberg, CPA, CMA, to become its chief
financial officer effective Sept. 20, 2024. Management and the
Board thanked Barbara Lilley for her hard work during this very
difficult last year and noted that with Mr. Roomberg's appointment,
she has stepped down as CFO to become Controller.
Mr. Roomberg has a Bachelor of Science degree in Accounting from
Pennsylvania State University. He has been the chief accounting
officer and senior financial executive with several corporations
and has diverse corporate financial leadership experience in public
and private accounting. Recognized as a financial expert by George
Mason University, he has extensive experience reporting complex
financial transactions - completing over ten Mergers and
Acquisition transactions - and solving business problems by
ensuring accounting compliance.
On Sept. 19, 2024, the Company entered into an Employment Agreement
with Mr. Roomberg, with an effective date as of Sept. 20, 2024 and
which governs Mr. Roomberg's employment as chief financial officer
of the Company. Pursuant to the Employment Agreement, Mr. Roomberg
will: (i) receive an annual base salary of $250,000; (ii) receive a
grant of 45,000 restricted shares of the Company's common stock
pursuant to the TechPrecision Corporation 2016 Long-Term Incentive
Plan, as amended, which shall vest in equal amounts annually for
three years following the Transition Date and (iii) receive a bonus
of $50,000 upon the satisfaction of certain operational and
financial performance milestones set forth in the Employment
Agreement. Under the Employment Agreement, Mr. Roomberg also will
be eligible to participate in Company benefits provided to other
senior executives as well as benefits available to Company
employees generally.
About Techprecision
Through its wholly owned subsidiaries, Ranor, Inc. and Stadco,
TechPrecision Corporation -- http://www.techprecision.com/--
manufactures large-scale, metal fabricated and machined precision
components and equipment. These products are used predominantly in
the defense, aerospace, and precision industrial markets. The
Company's goal is to be an end-to-end service provider to its
customers by furnishing customized solutions for completed products
requiring custom fabrication and machining, assembly, inspection,
and testing.
Philadelphia, Pennsylvania-based Marcum LLP, the Company's auditor
since 2013, issued a "going concern" qualification in its report
dated Sept. 13, 2024, citing that the Company has incurred
significant losses, is in default on its debt obligations since the
Company is out of compliance with its debt covenants and is
expected to continue to be out of compliance, its revolving line of
credit is due within the year, and needs to raise additional funds
to meet its obligations and sustain its operations. These
conditions raise substantial doubt about the Company's ability to
continue as a going concern.
TEGNA INC: COO Lynn Beall to Depart Mid-2025
--------------------------------------------
TEGNA Inc. disclosed in a Form 8-K Report filed with the U.S.
Securities and Exchange Commission that the Board of Directors of
the Company determined that, in connection with a restructuring of
the Company's operations, the position of Executive Vice President
and Chief Operating Officer of Media Operations of the Company will
be eliminated, which will result in the termination of employment
without cause of Lynn Beall.
In connection with Ms. Beall's termination of employment, she will
be eligible for a severance payment in accordance with the
Company's Executive Severance Plan, as filed with the Securities
and Exchange Commission and described in the Company's Proxy
Statement filed with the SEC on March 11, 2024. The severance
payment is subject to Ms. Beall's execution of a release of claims
and compliance with all applicable restrictive covenants.
In order to ensure an orderly wind-down of the responsibilities
associated with her position as EVP/COO, on September 18, 2024 the
Company and Ms. Beall entered into a letter agreement under which
Ms. Beall will continue to provide services to the Company until
August 31, 2025 as EVP/COO or, if the position of EVP/COO is
eliminated prior to August 31, 2025, as a Senior Advisor, unless
the Advisory Period is terminated earlier in accordance with the
terms of the letter agreement. The letter agreement provides that,
in consideration for her services, Ms. Beall will continue to
receive her current annual base salary through her termination date
with the Company. Ms. Beall will be eligible for an annual bonus
for 2024, based on actual performance, and if she serves as EVP/COO
for any portion of 2025, Ms. Beall will be eligible for an annual
bonus for 2025, based on actual performance and prorated based on
the period of her service as EVP/COO in 2025. Any equity awards
award that Ms. Beall holds will continue to vest during the
Advisory Period but she will not be eligible for additional equity
awards following the date of the letter agreement.
Ms. Beall joined TEGNA (then Gannett Broadcasting) in 1988. She has
held the EVP and COO position since 2017, overseeing TEGNA's 64
stations; news and content strategy; revenue growth; and network,
retransmission and affiliate relationships. Beall is currently vice
chair of the National Association of Broadcasters Television Board
and serves on the executive committee of the CBS Television
Affiliates Association Board.
"Lynn Beall is an extraordinary leader who serves TEGNA with
distinction every day. As those who know her are aware, there's no
stronger advocate and voice for our stations and partners than
Lynn, and the results of her decades of service to TEGNA are
unmatched," said Mike Steib, CEO. "I'm grateful for Lynn's
invaluable expertise and perspective as we begin the important work
of thoughtfully evolving TEGNA's strategy."
Ms. Beall said, "I am extremely proud that TEGNA has grown from 12
stations when I joined the company in 1988 to 64 stations today and
that we have built a world-class team to operate the business. Over
the transition period, I'll be working with Mike and the entire
TEGNA team to ensure we're taking full advantage of opportunities
to reach and serve our audiences and customers. TEGNA has a great
foundation and even greater prospects ahead."
About TEGNA
Headquartered in Tysons Corner, Virginia, TEGNA Inc. (NYSE: TGNA)
is an American publicly traded broadcast, digital media and
marketing services company. It was created on June 29, 2015, when
the Gannett Company split into two publicly traded companies.
TEGNA reported a net income of $476.7 million attributable to the
Company for the year ended December 31, 2023, compared to a net
income of $630.5 million attributable to the Company for the year
ended December 31, 2022. As of June 30, 2024, TEGNA had $7.1
billion in total assets, $4.3 billion in total liabilities, and
$2.8 billion in total equity.
Egan-Jones Ratings Company, on January 16, 2024, maintained its
'CCC+' foreign currency and local currency senior unsecured ratings
on debt issued by TEGNA Inc.
TEMPUR SEALY: Fitch Keeps 'BB+' LongTerm IDR on Watch Negative
--------------------------------------------------------------
Fitch Ratings has maintained the Rating Watch Negative (RWN) on
Tempur Sealy International, Inc.'s (TPX) ratings including the
'BB+' Long-Term Issuer Default Rating (IDR). The RWN reflects the
company's definitive agreement to acquire Mattress Firm Group Inc.
in a cash and stock transaction valued at approximately $4 billion.
Fitch has also assigned a 'BBB-'/RR1' rating to TPX's proposed $1.6
billion seven-year senior secured Delayed Draw Term Loan B, and
placed the ratings on RWN.
The RWN reflects the risk that leverage could exceed TPX's ratings
sensitivities within 12 to 24 months post transaction close,
potentially leading to a Negative Rating Outlook or a one-notch
downgrade. The RWN may take over six months to resolve.
Fitch projects pro forma EBITDA leverage in the upper-3x range and
EBITDAR leverage around 5x, assuming a year-end 2024 close. Fitch
could affirm the ratings once transaction clarity emerges if EBITDA
leverage returns to below 3.0x and EBITDAR leverage to the low-4x
range within 12 months to 24 months.
Key Rating Drivers
Transformative Acquisition; Regulatory Uncertainty: TPX's
definitive agreement to acquire Mattress Firm, a leading U.S.
mattress specialty retailer with about 8% share of the North
American bedding industry, could be a transformative vertical
acquisition. This move significantly increases scale and
accelerates TPX's omnichannel retail strategy by expanding its
direct sales channel. Mattress Firm's LTM (ending July 2, 2024)
revenue and EBITDA totaled about $4 billion and $437 million,
respectively, on a base of more than 2,300 stores. The transaction
would increase TPX's North American direct channel distribution to
approximately 65% from roughly 13% pre-acquisition.
Regulatory uncertainty remains, as the Federal Trade Commission
issued an administrative complaint and authorized a lawsuit to
block the acquisition. The resolution of the lawsuit could occur in
late 2024 or early 2025. Other material transaction risks include
the macroeconomic environment, a complete shift in business mix and
cultural risk integrating the two companies. The company estimates
cost synergy opportunities at $100 million run-rate by year four
that targets product lifecycle management, logistics and sourcing.
Market Pullback; EBITDA Expectations: The U.S. mattress industry is
experiencing a significant demand pullback due to shifts in
consumer behavior and ongoing macroeconomic uncertainties. Unit
volume declined by about 20% in 2022 and is estimated to drop by
low-double digits in 2023, despite higher pricing. However, 2024
industry volumes appear to be stabilizing, with expected declines
in the mid-single digits, and a lessening decline in 2H24.
TPX's North American operations outperformed the broader industry,
with overall revenue declines of approximately 1% during 2023 and
5% in 2022. Consolidated EBITDA was $835 million in 2023, compared
with $846 million in 2022 and almost $1.1 billion in 2021. In 2024,
Fitch projects 2024 revenue could decline in the low-single digits,
with EBITDA in the upper-$800 million range based on Fitch
adjustments. This is supported by distribution share gains in the
U.S., International new product launch and margin improvement
offset by lower volume.
Elevated Leverage; Material FCF: TPX plans to finance the
acquisition, if approved, through a mix of equity and new debt.
Fitch projects proforma EBITDA leverage in the upper-3x range and
EBITDAR leverage around 5x, assuming a year-end 2024 close. This
compares to Fitch's expectations for TPX's standalone 2024 EBITDA
and EBITDAR leverage of 2.4x and 3.5x, respectively. Fitch expects
FCF for the combined company could be could be around $450 million
in 2025, increasing in 2026 that would support deleveraging plans.
TPX has publicly articulated its focus on reaching the top end of
its net target leverage ratio of approximately 3x in the first 12
months after closing. TPX's stated net debt/EBITDA leverage target
is 2.0x-3.0x. Its net leverage calculation is roughly comparable to
Fitch's EBITDA leverage, assuming $100 million of cash.
Strategy Supports Competitive Position: TPX's strong momentum over
the last couple of years stems from broad-based growth, driven by
expanded distribution through existing and new retailers. The
buildout of company-owned stores, market share gains for the
higher-margin Tempur-Pedic brand, entry into previously untapped
markets (including private label), and increased pricing have also
contributed. Additionally, TPX likely benefited from
pandemic-related consumer behavior changes.
TPX experienced strong market share gains supported by operating
initiatives that expanded its omnichannel presence, enhanced the
brand/product portfolio and improved manufacturing capabilities.
TPX also re-entered into supply agreements to reintroduce its
product lines across Mattress Firm stores beginning in 4Q19. Fitch
believes this led to a sustainable competitive advantage, with a
significant portion of market share gains coming at the expense of
TPX's main competitor, Serta Simmons Bedding, LLC (Serta; not
rated).
Competitive Industry Environment: The mattress industry is
susceptible to irrational pricing, secular shifts in consumer
preferences and bankruptcies, including Mattress Firm on the
distribution side and Serta on the supply side. TPX faces intense
competition from the e-commerce/bed-in-a-box space, such as Casper,
Amazon and other mattress e-tailers. In addition to convenience,
attractively-priced e-commerce mattresses fueled price
competition.
Nevertheless, TPX has shown the ability to lead on pricing,
especially in the past couple of years, to offset inflationary
pressures, gain market share, and outperform the broader industry.
As part of its operating strategy, TPX maintains an innovation
pipeline supported by significant investments in marketing and
promotion to sustain its competitive position.
Parent-Subsidiary Linkage: Fitch's analysis includes a weak
parent/strong subsidiary approach between parent TPX and its
subsidiary, Tempur-Pedic Management, LLC. Fitch assesses the
quality of the overall linkage as high, which results in an
equalization of IDRs across the corporate structure.
Derivation Summary
TPX's rating reflects its operational scale and strong global
market position, supported by a portfolio of well-known,
established brands across various price points, anchored by the
Tempur-Pedic brand. The ratings also reflect its single-product
focus in a competitive, fragmented market and susceptibility to
pullbacks in discretionary consumer spending. The RWN reflects the
potential leverage increase for TPX, pro forma the Mattress Firm
transaction.
TPX maintains a strong innovation pipeline, with a product line
supported by significant investments in marketing and promotion to
sustain its competitive position. It executed several successful
new launches in 2023, including a new line-up of Tempur-Pedic
mattresses, in more than 90 international markets. TPX is also
viewed as a fast-follower to industry changes, and responded by
selling bed-in-a-box alternatives across several price points,
which expanded offerings on its e-commerce platform, and acquiring
a private-label and an original equipment bedding manufacturer.
TPX has a significantly stronger financial profile than its main
competitor, Serta. Similarly rated credits in Fitch's consumer
portfolio include Levi Strauss & Co. (BB+/Stable); Spectrum Brands,
Inc. (BB/Stable); and ACCO Brands Corporation (BB/Stable).
TPX and Levi share similar distribution strategies across specialty
retailers and department stores, as well as self-distribution
through company-operated stores and e-commerce, with Levi having
similar scale in revenues and reliance on self-distribution.
Levi's 'BB+/Stable' ratings reflect its position as one of the
world's largest branded apparel manufacturers, with broad channel
and geographic exposure, while also considering the company's
narrow focus on the Levi brand and in bottoms.
The ratings consider the company's good execution both from a
topline and a margin standpoint, which support Fitch's longer-term
expectations of low-single digit revenue and EBITDA growth.
Although there has been some moderation to near-term results driven
in-part by a softer apparel spending environment, Fitch expects
that Levi will be able to maintain EBITDAR leverage (total adjusted
debt/EBITDAR, capitalizing leases at 8x) below 3.5x over time.
Spectrum's 'BB/Stable' ratings reflects Fitch's expectation that
its recovering EBITDA and material debt reduction will lead to
EBITDA leverage declining to below 2x in fiscal 2024, and sustained
in the mid to high 2x range in 2025 and thereafter, compared to
6.7x in fiscal 2023. The rating also reflects the lack of clarity
around Spectrum's longer-term business mix, driven by the potential
divestiture of its Home and Personal Care (HPC) business and active
history of M&A.
ACCO's 'BB'/Stable rating and Outlook reflect its historically
consistent FCF, which it has used to reduce debt and maintain
reasonable EBITDA leverage in the past several years. Fitch Ratings
expects ACCO's leverage will trend below 4x across the rating
horizon and the company will continue to generate good FCF.
The ratings and Outlook are constrained by secular challenges in
the office products industry and channel shifts within ACCO's
customer mix. This is reflected in recent top line weakness related
to spending pullbacks in key discretionary categories, such as
electronics, which Fitch expects to continue in 2024.
Key Assumptions
The below assumptions consider TPX on a standalone basis.
- Fitch projects 2024 revenue could decline in the low-single
digits. This reflects market share gains due to new distribution
agreements and increased sales related to international product
launches offset by mid-single digit industry unit declines.
- EBITDA in the upper-$800 million range in 2024, reflecting
benefits from moderating commodities costs and productivity
improvements partially offset by plant start-up costs. In 2025,
EBITDA could be approximately in the low-to-mid $900 million range
on revenue growth approaching the mid-single digits, reflecting
roughly flat industry volumes, market share gains and operational
initiative improvements.
- Fitch expects FCF could be in the upper $300 million area in 2024
with an expected moderation in capital spending close to around
$150 million and slightly negative working capital.
- EBITDAR and EBITDA leverage could moderate to around 3.5x and
2.4x respectively, in 2024.
- The company's RCF and term loan are floating-rate debt. Pricing
is SOFR plus 137.5bps applicable margin. Fitch assumes annualized
SOFR rates from 2025 to 2028 between 350 bps and approximately 300
bps. Pricing for the accounts receivable securitization is
one-month SOFR plus 85bps applicable margin plus 10bps credit
spread adjustment. The senior notes are fixed-rate debt.
The below assumptions reflect the consolidated company pending a
favorable outcome of the pending litigation with the FTC at YE
2024.
- Proforma revenue for the combined companies of around $8.2
billion in 2025
- Proforma EBITDA for the combined companies of around $1.4 billion
in 2025.
- FCF (after dividends) that could be around $450 million in 2025.
- Pro forma EBITDA and EBITDAR leverage around 3.7x and about 5x
respectively at transaction close and around 3x and 4.5x in 2025.
RATING SENSITIVITIES
Factors That Could, Individually Or Collectively, Lead To Positive
Rating Action/Upgrade
- Assuming the transaction does not close, Fitch could consider an
upgrade with a demonstrated ability to sustain EBITDA well above
$1.0 billion, supported by increased geographic diversification,
mid-single digit revenue growth, sustained market share gains,
demonstrated operating resiliency through shifts in the competitive
environment and economic cycles.
- Sustained EBITDA leverage under 2.5x and EBITDAR leverage below
3.5x. This would require the company to commit to maintaining TPX's
long-term net leverage (similar to Fitch's EBITDA leverage
calculation) target of 2.5x or less, compared with its publicly
stated net leverage target of 2.0x-3.0x.
Factors That Could, Individually Or Collectively, Lead To Negative
Rating Action/Downgrade
- Fitch anticipates resolving the RWN after concluding the
regulatory review process. The transaction could lead to a
one-notch downgrade if Fitch projects EBITDA leverage could sustain
above 3.0x and EBITDAR leverage could sustain above the low-4x
range beyond 12 months-24 months after the transaction closes.
- Final ratings will depend on several factors, including whether
the transaction receives regulatory approval; an assessment of
macroenvironment conditions and the mattress industry outlook at
closing; operating trends at both TPX and Mattress Firm;
capital-allocation priorities, any potential regulatory remedies;
and leverage expectations.
- Assuming the transaction does not close, negative sensitivities
include EBITDA trending below $800 million caused by sales and/or
margin declines, debt-funded shareholder-friendly policies, and/or
debt-financed acquisitions leading to EBITDA leverage sustained
above 3.0x and EBITDAR leverage over 4.0x.
Liquidity and Debt Structure
Solid Liquidity: Liquidity was $1,208.7 million as of June 30,
2024, consisting of $95.8 million in cash, and approximately
$1,112.9 million of availability on a $1.19 billion revolving
credit facility (RCF) maturing in 2028. TPX also has an undrawn
$625 million secured delayed-draw term loan (DDTL). Once drawn, the
DDTL will have the same terms and conditions as TPX's existing
credit agreement.
The company maintains an accounts receivable securitization program
maturing in April 2025 with an overall limit of $200 million. TPX
has fully drawn down the program, with $182.8 million of borrowings
as of June 30, 2024. TPX has substantial headroom within its
covenant requirements, including consolidated total net leverage of
less than 5.0x (5.5x for 12 months after qualifying material
acquisition) in the credit agreement.
Long-term debt maturities are modest and include $25 million in
annual term loan amortization payments. TPX does not have a
significant notes maturity until 2029.
Fitch expects TPX to finance the Mattress Firm acquisition, if
approved, through treasury shares, the proposed $1.6 billion
secured delayed-draw term loan B, the undrawn $625 million DDTL,
revolver borrowings and excess cash. Fitch expects TPX to generate
FCF (after dividends) that could be around $450 million in 2025 and
$550 million in 2026 that would support deleveraging plans.
Issuer Profile
Tempur Sealy International, Inc. is the world's largest bedding
manufacturer. It develops, manufactures, markets and distributes
bedding products, which are sold globally in approximately 100
countries.
Summary of Financial Adjustments
- EBITDA adjusted to exclude stock-based compensation and one
time/non-ordinary charges;
- Operating lease expense capitalized by 8.0x to calculate
historical and projected lease-adjusted debt.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
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
----------- ------ -------- -----
Tempur-Pedic
Management,
LLC LT IDR BB+ Rating Watch Maintained BB+
senior
secured LT BBB- New Rating RR1
senior
secured LT BBB- Rating Watch Maintained RR1 BBB-
Tempur Sealy I
nternational,
Inc. LT IDR BB+ Rating Watch Maintained BB+
senior
secured LT BBB- New Rating RR1
senior
unsecured LT BB+ Rating Watch Maintained RR4 BB+
senior
secured LT BBB- Rating Watch Maintained RR1 BBB-
TEMPUR SEALY: Moody's Rates New $1.6BB First Lien Term Loan 'Ba1'
-----------------------------------------------------------------
Moody's Ratings assigned a Ba1 rating to Tempur Sealy International
Inc.'s proposed $1,600 million senior secured first lien delayed
draw term loan B due 2031. All other ratings of the company are not
affected and remain under review for downgrade. Ratings under
review for downgrade are Tempur Sealy's Ba1 Corporate Family
Rating, Ba1-PD Probability of Default Rating, and Ba2 senior
unsecured notes rating. Moody's initiated the review for downgrade
on May 10, 2023 in connection with Tempur Sealy's proposed
acquisition of Mattress Firm for approximately $4.0 billion. Tempur
Sealy's SGL-1 speculative grade liquidity rating is unchanged.
Proceeds from the proposed $1,600 million senior secured term loan
B due 2031 along with funds from the company's existing $625
million delayed draw first lien term loan due 2028 (unrated), will
be used to help fund the cash portion of the pending acquisition of
Mattress Firm. The company will draw on the senior secured term
loans concurrent with the closing of the Mattress Firm acquisition.
In July 2024, the Federal Trade Commission (FTC) voted to block the
company's merger with Mattress Firm. Nonetheless, Tempur Sealy
intends to continue presenting its rationale for the business
combination and it believes that a successful litigation process
can be completed in the coming months, which could allow it to
close the acquisition in late 2024 or early 2025.
Moody's placed the ratings on review for downgrade following the
acquisition announcement because Tempur Sealy is proposing a
significant leveraging acquisition at a time when its leverage is
already elevated for the rating, the economic and housing market
slowdown is contributing to weaker mattress demand, there is
uncertainty about the depth and duration of the current slowdown in
the mattress industry and there is heightened competition. Tempur
Sealy plans to utilize excess free cash flow this year to reduce
net leverage ahead of the potential transaction. Still, Moody's
estimate that debt/EBITDA leverage pro forma for the pending
Mattress Firm acquisition will increase to around 4.0x at the end
of fiscal 2024.
The Ba1 rating on the proposed $1,600 million senior secured term
loan B due 2031 incorporates a CFR that is one notch lower than the
current Ba1 CFR. This reflects that a completion of the pending
acquisition will likely result in a one notch ratings downgrade of
the CFR to Ba2. The Ba1 rating on the proposed senior secured term
loan B also reflects the first lien credit facility's effective
priority relative to the company's existing senior unsecured notes
and other meaningful unsecured non-debt liabilities, pro forma for
the acquisition. The likely one notch downgrade of the CFR to Ba2
will also result in a one notch downgrade of the Ba2 rating on the
existing senior unsecured notes to Ba3, reflecting the notes
effective subordination to all the secured debt in the company's
capital structure.
Moody's anticipate lowering Tempur Sealy's CFR to Ba2 as a result
of the Mattress Firm acquisition, but the timing and structure of
the transaction, if completed, remain uncertain and marketplace
conditions could also evolve in a manner that affects a combined
company's credit position. As a result, Moody's are continuing to
assess in the review (1) the strategic operating rationale and
focus of management including the trajectory and opportunities of
the combined more vertically integrated mattress business over the
next 12-18 months, (2) prospective operating performance taking
into account the likelihood of a prolonged mattress industry
slowdown and weak US housing market in the face of high interest
rates; (3) the increase in operational risks involved with owning a
large number of "brick-and-mortar" store locations in a market with
increasing online sales penetration and potential future
investments to adapt to evolving consumer preferences; and (4) the
company's post-acquisition capital structure and free cash flow
generation potential including its ability to reign in financial
leverage within a reasonable period of time following the
acquisition, while also remaining disciplined with share
repurchases and dividends. Moody's are also considering Tempur
Sealy's ability to reduce net debt-to-EBITDA leverage to its 2x to
3x target range (based on the company's calculation) following the
acquisition given the ongoing industry pressures, and whether the
regulatory review leads to business concessions to complete the
transaction that could adversely affect the company's market
position or profitability. Moody's also continue to assess the
operational performance and use of cash by Tempur Sealy and
Mattress Firm prior to an acquisition close.
Marketing terms for the new credit facilities (final terms may
differ materially) include the following:
Incremental debt capacity up to the greater of $850 million and
100% of Consolidated EBITDA, plus unlimited amounts subject to 3.0x
pro forma senior secured net leverage. There is no inside maturity
sublimit. A "blocker" provision restricts the transfer of material
intellectual property to unrestricted subsidiaries. The credit
agreement provides some limitations on up-tiering transactions,
requiring adversely affected lender consent for amendments that
subordinate, or have the effect of subordinating, the debt and/or
liens.
RATINGS RATIONALE
Tempur Sealy's existing Ba1 CFR reflects the company's leading
market position, brand strength, product innovation, breadth of
products in varying pricing points, and diverse omni-channel
distribution approach. Tempur Sealy's good annual free cash flow
generation provides flexibility to fund growth investments and debt
repayment. The company also maintains very good liquidity supported
by Moody's expectation of good free cash flow of over $300 million
over the next 12 months and access to a mostly undrawn $1.19
billion revolver due 2028 (unrated). The company's credit profile
is constrained by the discretionary nature of its products, and
sensitivity to changes in macroeconomic conditions and consumer
spending. The mattress industry is experiencing a multi-year
downturn driven in part by cumulative high inflationary pressures
on consumer discretionary spending. Demand for Tempur Sealy's
products are also driven by the housing market, which is being
negatively impacted by elevated interest rates. The company's 3.5x
debt/EBITDA as of the last 12-month (LTM) period ending June 2024
is above Moody's expectations for the rating given its business
profile. Tempur Sealy's focus on acquisitions and shareholder
distributions could weaken financial flexibility during a
downturn.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
The likelihood of an upgrade is low since the ratings are on review
for downgrade. However, Tempur's ratings could be upgraded if its
operating performance materially improves and leverage remains at a
low level for a sustained period. Specifically, ratings could be
upgraded if Moody's-adjusted debt to EBITDA is sustained below 2.0x
and the company generates consistent strong free cash flow with a
healthy level of reinvestment. The company would also need to
maintain financial policies that sustain low leverage and a
conservative approach to balance sheet management and cash usage.
Ratings could be downgraded if liquidity deteriorates, the company
adopts a more aggressive financial policy, or operating performance
weakens. Additionally, the company could be downgraded if Moody's
expects financial leverage to remain high for a prolonged period of
time following the acquisition. A significant drop in consumer
confidence or any material disruption in the housing market
resulting in lower mattress demand could also lead to a downgrade.
Moody's-adjusted Debt to EBITDA above 3.0x or free cash
flow-to-debt below 10% could result in a downgrade.
Tempur Sealy International Inc. (Tempur Sealy), headquartered in
Lexington, Kentucky, develops, manufactures, markets, and sells
bedding products, including mattresses, foundations and adjustable
bases, and other products such as pillows and accessories. The
company's products are sold worldwide through third party
retailers, its own stores, and online. The company's portfolio of
brands includes Tempur-Pedic, Tempur, Stearns & Foster, and Sealy.
Tempur Sealy is publicly traded (NYSE: TPX) and reported revenue of
approximately $4.9 billion for the LTM period 30 June 2024.
The principal methodology used in this rating was Consumer Durables
published in September 2021.
THINK & LEARN: RiverNorth Marks $217,252 Loan at 77% Off
--------------------------------------------------------
RiverNorth/DoubleLine Strategic Opportunity Fund, Inc has marked
its $217,252 loan extended to Think & Learn Private, Ltd to market
at $49,192 or 23% of the outstanding amount, according to the
RiverNorth 's Form N-CSRS for the semi-annual period ended June 30,
2024, filed with the Securities and Exchange Commission.
RiverNorth is a participant in a First Lien Term Loan B (3M US L +
7%) to Think & Learn Private, Ltd. The loan matures on November 5,
2026.
RiverNorth/DoubleLine Strategic Opportunity Fund, Inc, is a
closed-end management investment company that was organized as a
Maryland corporation on June 22, 2016, and commenced investment
operations on September 28, 2016. The investment adviser to the
Fund is RiverNorth Capital Management, LLC. The Fund’s
sub-adviser is DoubleLine Capital, LP. RiverNorth is a diversified
investment company with an investment objective to seek current
income and overall total return.
RiverNorth is led by Patrick W. Galleyle, President and Chief
Executive Officer; and Jonathan M. Mohrhardt, Chief Financial
Officer and Treasurer. The Fund can be reached through:
Patrick W. Galleyle
RiverNorth/DoubleLine Strategic Opportunity Fund, Inc
360 South Rosemary Avenue, Suite 1420,
West Palm Beach, FL 33401
Telephone: (561) 484-7185
- and -
Marcus L. Collins, Esq.
RiverNorth Capital Management, LLC
360 South Rosemary Avenue, Suite 1420
West Palm Beach, FL 33401
Telephone: (561) 484-7185
Think & Learn Private Limited, doing business as Byju's, provides
online educational services.
TIDAL WASTE:S&P Assigns 'B+' Issuer Credit Rating, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings assigned its 'B+' issuer credit rating to Tidal
Waste & Recycling Holdings LLC, based on preliminary terms and
conditions.
S&P said, "We also assigned a 'BB-' issue-level rating and a '2'
recovery rating (rounded estimate: 75%) to the proposed senior
secured credit facilities, which include a $225 million revolving
credit facility (revolver or RCF) due in 2029 and a $610 million
term loan B due in 2031.
"The stable outlook reflects our view that steady demand will
continue for its waste collection and post-collection services,
allowing it to maintain credit measures appropriate for the
ratings, with S&P Global Ratings-adjusted weighted-average debt to
EBITDA between 4x and 5x."
Tidal Waste & Recycling Holdings LLC, parent of Florida-based solid
waste services company Coastal Waste & Recycling Inc., is planning
to issue debt and common equity to partially fund an acquisition
and refinance existing credit facilities.
Coastal, through Tidal Waste, is owned by a fund affiliated with
infrastructure-focused asset manager Macquarie Asset Management
(MAM). The proposed bank debt will comprise first-lien senior
secured credit facilities.
S&P's 'B+' issuer credit rating on Coastal reflects the company's
small and concentrated operations in Florida, strong EBITDA
margins, and a reasonably high percentage of recurring business.
Coastal's business has grown at a rapid pace in recent years on the
back of tuck-in acquisitions and new business wins, particularly in
the municipal solid waste (MSW) space after building out its assets
in the construction and demolition (C&D) business in Florida. The
company also has above-average EBITDA margins due to a high
exposure to C&D collection, which is generally more profitable than
MSW. However, the company still operates at a meaningfully smaller
scale than larger, national-level players in the environmental
services sector. Furthermore, its relatively high geographic
concentration and limited revenue streams, which primarily rely on
solid waste collection and processing, also limit our business risk
profile assessment. S&P said, "We also note the relatively
nonrecurring nature of the more volatile C&D waste collection
compared with MSW, although some of these service agreements are
multi-year and multi-site. We expect the company to continue to
expand its presence in Florida's MSW market, which benefits from
high population growth rates and the resulting high waste
volumes."
Coastal is planning to acquire a waste-management provider that
will expand its scale and geographical footprint.
The target is a solid waste services company providing collection,
processing, recycling, transfer transportation, and disposal
services for its primary waste stream, which is C&D waste. S&P
said, "The acquisition will be funded by a new debt facility,
comprising a new undrawn RCF and a new term loan B, and new common
equity from existing sponsor MAM. We view the acquisition as
complementary to Coastal's overall business strategy and asset
portfolio. We expect Coastal to significantly increase revenue in
2024 and 2025, primarily driven by material acquisitions completed
since its acquisition by MAM in June 2023, as well as through new
franchise contract wins with highly rated municipalities and with
commercial customers."
S&P said, "Our assessment of Coastal's financial risk incorporates
our view that its credit metrics will remain at levels we consider
appropriate for the rating, including weighted-average debt to
EBITDA between 4x and 5x.
"Following the close of this transaction with the proposed capital
structure, we expect Coastal's S&P Global Ratings-adjusted debt to
EBITDA ratio to be in the 4x-5x range on a weighted-average basis.
Despite not having a high capital expenditure (capex) requirement
that is associated with operating landfills, the company currently
reports negative free operating cash flow (FOCF) due to significant
growth capex tied to building out capacity for new business wins.
We forecast positive FOCF generation from 2025 onward as full year
impacts from 2024 acquisitions and new contracts take effect. The
company will have adequate liquidity supported by full availability
under its new revolver, cash balance at transaction close, and
sufficient cash flow generation over the next 12 months and
maintain adequate EBITDA cushion under its proposed financial
covenant.
"We expect MAM to abide by less aggressive financial policies than
those of typical financial sponsor owners.
"We characterize MAM as an infrastructure fund rather than a
financial sponsor based on our assessment of the sponsor's track
record. We note that the sponsor in its other waste management
investments, such as Waste Industries Inc. and MIP V Waste LLC,
kept leverage at reasonable levels. In addition, MAM also
demonstrated longer hold periods than typically seen from financial
sponsors and has a limited record of shareholder distributions.
Similarly, we believe its financial policies will not have a
long-term drag on Coastal's credit measures and do not expect large
debt-funded acquisitions. However, we may revisit our assessment if
necessary. To date, MAM has made sizeable equity contributions in
Coastal (including the initial investment in June 2023) and is
looking to contribute further to support the planned acquisition.
"The stable outlook on Coastal reflects our expectation that the
company's S&P Global Ratings-adjusted debt to EBITDA ratio will
remain between 4x and 5x on a weighted-average basis following the
proposed transaction. While the ratio is expected to be higher than
this level at transaction close, we expect earnings growth on the
back of the proposed acquisition, recent tuck-in acquisitions,
expansion projects currently underway, and new contract wins.
Furthermore, unlike typical financial sponsors, we expect MAM to
focus on maintaining relatively conservative leverage. We have not
factored any additional acquisitions or shareholder distributions
into our base case scenario.
"We could consider taking a negative rating action on Coastal in
the next 12 months if competitive pressures led to a material drop
in operating performance or a loss of customer contracts or if
there were integration delays with acquisitions or cost overruns on
growth projects. We could also take a negative rating action if
there were a deep and prolonged recession that affected the
company's meaningful C&D exposure and reduced our earnings
expectations. In such a scenario, we would expect its S&P Global
Ratings-adjusted debt to EBITDA to increase above 5x on a
consistent basis with no clear prospects for recovery. This could
also occur due to large debt-financed capital outlays on
acquisitions, growth projects, or debt-funded shareholder returns.
"Although unlikely, we could consider taking a positive rating
action on Coastal in the next 12 months if S&P Global
Ratings-adjusted debt to EBITDA dropped below 4x on a sustained
basis. This could occur if EBITDA were stronger than expected on
the back of higher-than-expected base business volumes or new
acquisitions. Before considering a positive rating action, we would
also expect the company to consistently generate moderately
positive FOCF, along with the sponsor's financial policies being
supportive of an improved credit profile."
TOSCA SERVICES: S&P Downgrades ICR to 'SD' on Debt Exchange
-----------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Tosca
Services LLC to 'SD' (selective default) from 'CC'. S&P also
lowered the issue-level rating on its existing first-lien term loan
to 'D' (default) from 'CC'.
The downgrade to 'SD' follows Tosca's completion of its proposed
debt exchange. All of Tosca's existing first-lien term loan lenders
agreed to exchange their existing debt into a new $605 million
second-out term loan with an extended maturity. S&P said, "In our
view, the maturity extension and the PIK feature of the new debt
falls short of the original promise to lenders. Tosca issued a new
$100 million super-priority, first-out, first-lien term loan due
November 2028, which subordinates the new second-out debt. We
lowered the issue-level rating on the existing $605 million
first-lien term loan to 'D' from 'CC'."
S&P said, "We view the debt exchange as distressed and tantamount
to a default because the existing capital structure is
unsustainable, in our view, evidenced by the persistent FOCF
deficit. Although we believed Tosca had adequate liquidity for the
next 12 months given the availability on its revolving credit
facility, we think it would likely have defaulted on its debt
obligations in the next few years absent the proposed transaction,
given its sustained FOCF deficit.
"We plan to reevaluate our rating on Tosca. We plan to review our
ratings on Tosca in the near term, incorporating our view of the
company's operating prospects and forward-looking opinion on the
company's creditworthiness under the new capital structure. We will
also review the recovery prospects on the new debt as part of our
analysis."
TREVENA INC: ICS Opportunities, 3 Others Disclose Equity Stakes
---------------------------------------------------------------
ICS Opportunities II LLC disclosed in Schedule 13G Report filed
with the U.S. Securities and Exchange Commission that as of
September 10, 2024, ICS and its affiliates -- Millennium Management
LLC, Millennium Group Management LLC and Israel A. Englander --
beneficially owned shares of Trevena, Inc.'s common stock.
ICS Opportunities reported to beneficially own 40,406 of the
shares, meanwhile Millennium entities and Mr. Englander
beneficially owned 41,390 of the shares, representing 4.7% and 4.9%
respectively.
After acquiring beneficial ownership of more than 5% of the
outstanding Common Stock on September 10, 2024, the reporting
persons ceased to be beneficial owners of more than 5% of the
outstanding Common Stock by September 19, 2024.
A full-text copy of ICS Opportunities' SEC Report is available at:
https://tinyurl.com/3pyy48sw
About Trevena
Headquartered in Chesterbrook, Pa., Trevena, Inc. is a
biopharmaceutical company focused on developing and commercializing
novel medicines for patients affected by central nervous system, or
CNS, disorders. The Company's product, OLINVYK (oliceridine)
injection, was approved by the United States Food and Drug
Administration in August 2020. The Company initiated commercial
launch of OLINVYK in the first quarter of 2021.
Philadelphia, Pa.-based Ernst & Young LLP, the Company's auditor
since 2007, issued a "going concern" qualification in its report
dated April 1, 2024, citing that the Company has suffered recurring
losses from operations and has stated that substantial doubt exists
about the Company's ability to continue as a going concern.
As of June 30, 2024, Trevena had $22.94 million in total assets,
$41.9 million in total liabilities, and $18.96 million in total
stockholders' deficit.
TRI-STATE SOLUTIONS: Unsecureds Will Get 4% in Subchapter V Plan
----------------------------------------------------------------
Tri-State Solutions of Maryland, LLC, filed with the U.S.
Bankruptcy Court for the District of Maryland a Subchapter V Plan
dated August 21, 2024.
The Debtor is a minority business enterprise authorized by the
state of Maryland to provide contract services. These services
include fence repair, vehicle maintenance, and trash pickup for
Maryland State Agencies and Prince George's County, Maryland.
The Debtor is owned by James Hayes-Barber (60%) and Herman Barber,
III (40%). Mr. Hayes-Barber is the Vice President for Operations,
and Mr. Barber is the Chief Executive Officer (CEO).
The events leading up to Tri-State Solutions' bankruptcy filing
were caused by contract issues with some of its bonded contracts.
The company attempted to handle larger contracts with more
prominent agencies but had difficulty managing them.
Due to the changes in the business, the debtor can survive the
bankruptcy filing. The Debtor's CEO works to expand the business
and has high hopes for the business's ability to be passed on to
the next generation.
During the term of this Plan, the Debtor shall submit the
disposable income (or value of such disposable income) necessary
for the performance of this plan to the creditors and shall pay the
Creditors the sums set forth herein. The term of this Plan begins
on the date of confirmation of this Plan and ends on the 36th month
subsequent to the Effective Date.
The value of the property to be distributed under the Plan during
the term of the Plan is not less than the Debtor's projected
disposable income for that same period. Unsecured creditors holding
allowed claims will receive distributions, which the Debtor has
valued at approximately $0.04cents on the dollar. The Plan also
provides for the payment of secured, administrative, and priority
claims in accordance with the Bankruptcy Code.
Class 7 consists of Unsecured Claims. This Class shall receive 10
disposable income payments semiannually of $25,000 each. The
allowed unsecured claims total $6,255,164.44. This Class will
receive a distribution of 4.0% of their allowed claims.
Monthly income derived from the sales of company products will fund
the administrative, secured, and priority creditors.
A full-text copy of the Subchapter V Plan dated August 21, 2024 is
available at https://urlcurt.com/u?l=6LzGvS from PacerMonitor.com
at no charge.
Attorney for the Debtor:
Daniel A. Staeven, Esq.
Frost & Associates, LLC
839 Bestgate Rd. Ste. 400
Annapolis, MD 21401
Tel: (410) 497-5947
Email: daniel.staeven@frosttaxlaw.com
About Tri-State Solutions of Maryland
Tri-State Solutions of Maryland, LLC, is part of the
non-residential building construction industry.
Tri-State Solutions of Maryland filed its voluntary petition for
Chapter 11 protection (Bankr. D. Md. Case No. 24-14375) on May 22,
2024, listing $0 to $50,000 in assets and $1 million to $10 million
in liabilities. Herman Barber, III, as managing member, signed the
petition.
FROST LAW serve as the Debtor's legal counsel.
UNITED BELIEVERS: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: United Believers Community Baptist Church
5600 East 112th Terrace
Kansas City, MO 64137-2724
Chapter 11 Petition Date: September 24, 2024
Court: United States Bankruptcy Court
Western District of Missouri
Case No.: 24-41363
Judge: Hon. Brian T Fenimore
Debtor's Counsel: Colin Gotham, Esq.
EVANS & MULLINIX, P.A.
7225 Renner Road, Suite 200
Shawnee, KS 66217
Tel: (913) 962-8700
Fax: (913) 962-8701
Email: cgotham@emlawkc.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Darron L. Edwards 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/6TZQCFI/United_Believers_Community_Baptist__mowbke-24-41363__0001.0.pdf?mcid=tGE4TAMA
URBAN CHESTNUT: U.S. Trustee Appoints Creditors' Committee
----------------------------------------------------------
The U.S. Trustee for Region 13 appointed an official committee to
represent unsecured creditors in the Chapter 11 case of Urban
Chestnut Brewing Company, Inc.
The committee members are:
1. James W. Byrne
2. Joseph B. Basralian and Daniele V. Basralian
3. Lester Nydegger
Official creditors' committees serve as fiduciaries to the general
population of creditors they represent. They may investigate the
debtor's business and financial affairs. Committees have the right
to employ legal counsel, accountants and financial advisors at a
debtor's expense.
About Urban Chestnut Brewing Co.
Urban Chestnut Brewing Co. is a brewer of craft beer in Saint
Louis, Mo., which specializes in German beer and lagers with a
variety of beer styles from IPAs to weissbiers.
Urban Chestnut Brewing Co. sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D. Mo. Case No. 24-43233} on Sept.
6, 2024, with $1 million to $10 million in both assets and
liabilities. David M. Wolfe, president, signed the petition.
Judge Brian C. Walsh oversees the case.
The Debtor is represented by Spencer Desai, Esq., at The Desai Law
Firm.
VAPOTHERM INC: Stockholders OK Merger Deal With Veronica Holdings
-----------------------------------------------------------------
Vapotherm, Inc. held a special meeting of stockholders on September
19, 2024 to consider certain proposals related to the Agreement and
Plan of Merger, dated as of June 17, 2024, by and among Veronica
Holdings, LLC ("Topco"), Veronica Intermediate Holdings, LLC,
wholly owned subsidiary of Topco ("Parent"), Veronica Merger Sub,
Inc., wholly owned subsidiary of Parent ("Merger Sub"), and the
Company, pursuant to which, among other things, Merger Sub will
merge with and into the Company, and as a result of which the
separate corporate existence of Merger Sub will cease, and the
Company will continue as the surviving corporation of the Merger
and as a direct, wholly owned subsidiary of Parent.
As of the close of business on August 12, 2024, the record date for
the Special Meeting, there were 6,244,935 shares of the Company's
common stock, par value $0.001 per share, outstanding and entitled
to vote at the Special Meeting. Each share of Company Common Stock
was entitled to one vote. Stockholders holding an aggregate of
3,568,829 shares of Company Common Stock entitled to vote at the
Special Meeting, representing 57.15% of the outstanding shares of
Company Common Stock as of the Record Date, and which constituted a
quorum thereof, were present in person or represented by proxy at
the Special Meeting.
At the Special Meeting, the following proposals were considered,
each of which is described in more detail in the Company's
definitive proxy statement for the Special Meeting filed with the
Securities and Exchange Commission on August 15, 2024:
1. To adopt the Merger Agreement by and among Topco, Parent,
Merger Sub and the Company, pursuant to which Merger Sub will merge
with and into the Company, with the Company surviving the Merger
2. To approve, on a non-binding basis, the compensation that
may be paid or become payable to the Company's named executive
officers that is based on or otherwise relates to the Merger
Agreement and the transactions contemplated by the Merger
Agreement; and
3. Any proposal to adjourn the Special Meeting to a later date
or dates, if necessary or appropriate, including to solicit
additional proxies to approve the Merger Agreement Proposal if
there are insufficient votes to approve the Merger Agreement
Proposal at the time of the Special Meeting.
The approval of the Merger Agreement Proposal required the
affirmative vote of the holders of a majority of the shares of
Company Common Stock outstanding as of the close of business on the
Record Date. The approval of the Compensation Proposal, on a
non-binding, advisory basis, required the affirmative vote of a
majority of votes cast at the Special Meeting. The approval of the
Adjournment Proposal required the affirmative vote of a majority of
votes cast at the Special Meeting.
Proposal No. 1: Merger Agreement Proposal -- The stockholders
approved the Merger Agreement Proposal
Proposal No. 2: Compensation Proposal -- The stockholders approved,
on a non-binding basis, the Compensation Proposal
Each of the Merger Agreement Proposal and the Compensation Proposal
was approved by the required vote of the Company's stockholders. As
there were sufficient votes from the Company's stockholders to
approve the Merger Agreement, adjournment of the Special Meeting
was unnecessary and the Adjournment Proposal was not presented to
the Company's stockholders.
The completion of the Merger remains subject to the satisfaction of
other closing conditions as set forth in the Merger Agreement.
About Vapotherm
Vapotherm, Inc. (OTCQX: VAPO) -- www.vapotherm.com -- is a publicly
traded developer and manufacturer of advanced respiratory
technology based in Exeter, New Hampshire, USA. The Company
develops innovative, comfortable, non-invasive technologies for
respiratory support of patients with chronic or acute breathing
disorders. Over 4.4 million patients have been treated with the use
of Vapotherm high velocity therapy systems.
Vapotherm reported a net loss of $14.84 million for the three
months ended March 31, 2024, compared to a net loss of $18.09
million for the three months ended March 31, 2023. As of March 31,
2024, the Company had $71.91 million in total assets, $140.39
million in total liabilities, and a total stockholders' deficit of
$68.48 million.
New York, New York-based Grant Thornton LLP, the Company's auditor
since 2016, issued a "going concern" qualification in its report
dated Feb. 22, 2024, citing that the Company incurred a net loss of
$58.2 million and generated a cash flow deficit from operations of
$24.3 million during the year ended Dec. 31, 2023, and as of that
date, the Company had stockholders' deficit of $55.3 million. These
conditions, along with other matters, raise substantial doubt about
the Company's ability to continue as a going concern.
VENUS CONCEPT: Saudi Economic Holds 7.3% Equity Stake
-----------------------------------------------------
Saudi Economic and Development Securities Company disclosed in
Schedule 13G/A Report filed with the U.S. Securities and Exchange
Commission that as of September 13, 2024, the firm and its
affiliates -- SEDCO Capital Cayman Limited, SC Venus US Limited, SC
Venus Opportunities Limited, and SEDCO Capital Global Funds - SC
Private Equity Global Fund IV -- beneficially owned shares of Venus
Concept Inc.'s common stock.
Saudi Economic is reported to beneficially own 528,793 shares of
Venus' common stock, representing 7.3% of the shares outstanding.
(a) SEDCO Capital Cayman Limited directly holds 54,202 shares of
common stock and warrants that may be exercised for 50,778 shares
of common stock. SC Venus US Limited directly holds 103,083 shares
of common stock and warrants that may be exercised for 62,222
shares of common stock. SC Venus Opportunities Limited directly
holds 116,285 shares of common stock and warrants that may be
exercised for 62,222 shares of common stock. SEDCO Capital Global
Funds—SC Private Equity Global Fund IV directly holds zero shares
of common stock and warrants that may be exercised for 80,000
shares of common stock.
The ownership percentages are based on 7,255,277 outstanding shares
of common stock as of August 7, 2024, as reported in the Issuer's
Quarterly Report on Form 10-Q filed on August 13, 2024, and
warrants held by the Reporting Persons that may be exercised for an
aggregate of 255,222 shares of common stock.
A full-text copy of Saudi Economic's SEC Report is available at:
https://tinyurl.com/4tdwvase
About Venus Concept
Toronto, Ontario-based Venus Concept Inc. is an innovative global
medical technology company that develops, commercializes, and
delivers minimally invasive and non-invasive medical aesthetic and
hair restoration technologies and related services. The Company's
systems have been designed on cost-effective, proprietary, and
flexible platforms that enable the Company to expand beyond the
aesthetic industry's traditional markets of dermatology and plastic
surgery, and into non-traditional markets, including family
medicine and general practitioners and aesthetic medical spas.
Toronto, Canada-based MNP LLP, the Company's auditor since 2019,
issued a "going concern" qualification in its report dated April 1,
2024, citing that the Company has reported recurring net losses and
negative cash flows from operations that raise substantial doubt
about its ability to continue as a going concern.
Venus Concept reported a net loss of $37.1 million for the year
ended December 31, 2023, compared to a net loss of $43.6 million
for the year ended December 31, 2022. As of June 30, 2024, the
Company had $79.8 million in total assets, $75.4 million in total
liabilities, $662,000 in non-controlling interests, and $3.7
million in total stockholders' equity.
VENUS CONCEPT: Secures Additional $1MM Bridge Financing From Madryn
-------------------------------------------------------------------
As previously disclosed, on April 23, 2024, Venus Concept Inc.,
Venus Concept USA, Inc., a wholly-owned subsidiary of the Company,
Venus Concept Canada Corp., a wholly-owned Canadian subsidiary of
the Company, and Venus Concept Ltd., a wholly-owned Israeli
subsidiary of the Company, collectively, the "Loan Parties",
entered into a Loan and Security Agreement, with Madryn Health
Partners, LP and Madryn Health Partners (Cayman Master), LP as the
"Lenders."
Pursuant to the Loan and Security Agreement, the Lenders have
agreed to provide the Borrower with bridge financing in the form of
a term loan in one or more draws in an aggregate principal amount
of up to $5,000,000. Borrowings under the Bridge Financing will
bear interest at a rate per annum equal to 12%.
On the maturity date of the Bridge Financing, the Loan Parties are
obligated to make a payment equal to all unpaid principal and
accrued interest. The Loan and Security Agreement also provides
that all present and future indebtedness and the obligations of the
Borrower to Madryn shall be secured by a priority security interest
in all real and personal property collateral of the Loan Parties.
The initial drawdown under the Loan and Security Agreement occurred
on April 23, 2024, when the Lenders agreed to provide the Borrower
with bridge financing in the form of a term loan in the principal
amount of $2,237,906.85.
The second drawdown under the Loan and Security Agreement occurred
on July 26, 2024, when the Lenders agreed to provide the Borrower
with a subsequent drawdown under the Loan and Security Agreement in
the principal amount of $1,000,000.
On September 11, 2024, the Lenders agreed to provide the Borrower
with a subsequent drawdown under the Loan and Security Agreement in
the principal amount of $1,000,000. The September Drawdown was
fully funded on the same date. The Company expects to use the
proceeds of the September Drawdown, after payment of transaction
expenses, for general working capital purposes.
About Venus Concept
Toronto, Ontario-based Venus Concept Inc. is an innovative global
medical technology company that develops, commercializes and
delivers minimally invasive and non-invasive medical aesthetic and
hair restoration technologies and related services. The Company's
systems have been designed on cost-effective, proprietary and
flexible platforms that enable the Company to expand beyond the
aesthetic industry's traditional markets of dermatology and plastic
surgery, and into non-traditional markets, including family
medicine and general practitioners and aesthetic medical spas.
Toronto, Canada-based MNP LLP, the Company's auditor since 2019,
issued a "going concern" qualification in its report dated April 1,
2024, citing that the Company has reported recurring net losses and
negative cash flows from operations that raise substantial doubt
about its ability to continue as a going concern.
VIEWBIX INC: Capitalink Ltd., Lavi Krasney Hold 8.44% Equity Stake
------------------------------------------------------------------
Capitalink Ltd. and Lavi Krasney disclosed in a Schedule 13G Report
filed with the U.S. Securities and Exchange Commission that as of
July 4, 2024, they beneficially owned 1,787,752 shares of Viewbix
Inc.'s common stock, representing 8.44% of the shares outstanding,
based on a total of 21,179,686 Common Shares of Viewbix
outstanding.
Lavi Krasney is the officer, sole director, chairman of the board
of directors and control shareholder of Capitalink Ltd.
A full-text copy of Capitalink's SEC Report is available at:
https://tinyurl.com/ykzn2krn
About Viewbix
Headquartered in Ramat Gan, Israel, Viewbix is a digital
advertising platform that develops and markets a variety of
technological platforms that automate, optimize, and monetize
digital online campaigns. Viewbix's operations were previously
focused on analysis of the video marketing performance of its
clients as well as the effectiveness of their messaging. With the
Video Advertising Platform, Viewbix allowed its clients with
digital video properties the ability to use its platforms in a way
that allows viewers to engage and interact with the video. The
Video Advertising Platform measured when a viewer performs a
specific action while watching a video and collects and reports the
results to the client. The Company, through its subsidiaries Gix
Media and Cortex, expanded its digital advertising operations
across two additional main sectors: ad search and digital content.
Tel Aviv, Israel-based Brightman Almagor Zohar & Co., A Firm in the
Deloitte Global Network, the Company's auditor since 2012, issued a
"going concern" qualification in its report dated March 25, 2024,
citing that the Company's non-compliance with its debt covenants as
of Dec. 31, 2023 and the decrease in revenues and positive cash
flows from operations may result in the Company's inability to
repay its debt obligations during the 12-month period following the
issuance date of these financial statements. These conditions raise
a substantial doubt about the Company's ability to continue as a
going concern.
For the year ended December 31, 2023, Viewbix reported a net loss
of $8,687,000, compared to a net income of $1,117,000 for the same
period in 2022. As of June 30, 2024, Viewbix had $30 million in
total assets, $20.3 million in total liabilities, and $9.7 million
in total equity.
VIEWBIX INC: M.R.M. Merhavit, Roni Menashe Hold 9.27% Equity Stake
------------------------------------------------------------------
M.R.M. Merhavit Holdings and Management Ltd and Roni Menashe
disclosed in a Schedule 13G Report filed with the U.S. Securities
and Exchange Commission that as of July 4, 2024, they beneficially
owned 1,963,200 shares of Viewbix Inc.'s common stock, representing
9.27% of the shares outstanding, based on a total of 21,179,686
Common Shares of Viewbix outstanding.
Roni Menashe is the control person of M.R.M. Merhavit Holdings and
Management Ltd.
A full-text copy of M.R.M. Merhavit's SEC Report is available at:
https://tinyurl.com/4rjd5eay
About Viewbix
Headquartered in Ramat Gan, Israel, Viewbix is a digital
advertising platform that develops and markets a variety of
technological platforms that automate, optimize, and monetize
digital online campaigns. Viewbix's operations were previously
focused on analysis of the video marketing performance of its
clients as well as the effectiveness of their messaging. With the
Video Advertising Platform, Viewbix allowed its clients with
digital video properties the ability to use its platforms in a way
that allows viewers to engage and interact with the video. The
Video Advertising Platform measured when a viewer performs a
specific action while watching a video and collects and reports the
results to the client. The Company, through its subsidiaries Gix
Media and Cortex, expanded its digital advertising operations
across two additional main sectors: ad search and digital content.
Tel Aviv, Israel-based Brightman Almagor Zohar & Co., A Firm in the
Deloitte Global Network, the Company's auditor since 2012, issued a
"going concern" qualification in its report dated March 25, 2024,
citing that the Company's non-compliance with its debt covenants as
of Dec. 31, 2023 and the decrease in revenues and positive cash
flows from operations may result in the Company's inability to
repay its debt obligations during the 12-month period following the
issuance date of these financial statements. These conditions raise
a substantial doubt about the Company's ability to continue as a
going concern.
For the year ended December 31, 2023, Viewbix reported a net loss
of $8,687,000, compared to a net income of $1,117,000 for the same
period in 2022. As of June 30, 2024, Viewbix had $30 million in
total assets, $20.3 million in total liabilities, and $9.7 million
in total equity.
VINTAGE WINE ESTATES: Sells Majority of Wineries
------------------------------------------------
Jess Lander of The San Francisco Chronicle reports that the huge
California wine conglomerate, Vintage Wine Estates, is selling off
most of its wineries.
Nearly two months after filing for bankruptcy, major wine
corporation Vintage Wine Estates has agreed to sell most of its
California wineries.
Napa Valley's Clos Pegase and Girard, and Sonoma County's B.R. Cohn
and Kunde are among more than 20 U.S. wineries and brands that were
bid on through bankruptcy proceedings, which included an auction on
Tuesday in the U.S. Bankruptcy Court District of Delaware.
The assets, which won't cover all of the company's debts, were
largely split between two major buyers, both billionaires: serial
winery buyer Bill Foley and A. Jayson Adair, the CEO of online car
auction company Copart, court filings show.
The bankruptcy court still needs to grant final approval to the
successful bids. A Primary Sale Hearing is scheduled for Sept. 27.
Vintage Wine Estates filed for Chapter 11 bankruptcy on July 24,
citing over $400 million in liabilities. Founded in 2009 by former
CEO Pat Roney, the company quickly amassed over 30 wine and spirits
brands and eventually produced 2 million cases of wine per year.
Vintage went public in June 2021, but its stock dropped 40% the
next year due to inventory issues and never recovered, dipping in
value to under $1 in 2023. In the last year, the company, which at
the time of the bankruptcy filing had more than 400 employees, had
multiple rounds of layoffs.
The day after the bankruptcy announcement, Vintage filed a Worker
Adjustment and Retraining Notice with California authorities, which
detailed its plans to eliminate 377 positions across four Bay Area
counties. It's possible new owners could maintain some of those
jobs.
Wine and NHL mogul Bill Foley is one of two major bidders in the
Vintage Wine Estates bankruptcy case.
With final approval, Bill Foley's Foley Family Wines will acquire
five wineries and brands from Vintage -- Calistoga's Swanson
Vineyards, Bodega Bay's Sonoma Coast Vineyards, Napa's Cosentino
and the Cherry Pie and Bar Dog brands — for $15 million,
according to court filings. (While the Swanson and Sonoma Coast
deals include tasting rooms, Cosentino's tasting room was sold
separately to vintner Brion Wise.) Foley's offer was a stalking
horse bid, which sets the threshold for bidding in a bankruptcy
case. It appears that no higher bids were submitted, as these
assets were not included in Tuesday's auction.
Adair's company Adair Winery Inc. has agreed to purchase
Calistoga's Clos Pegase and Girard, Kenwood's B.R. Cohn and Kunde
and Sonoma's Viansa for $85 million, court filings show.
Ace Cider founder Jeffrey House was unsuccessful in his attempt to
buy back the Sebastopol cider company he launched in 1993 and sold
to Vintage in 2021 for a reported $47.4 million. House initially
submitted a $3.6 million stalking horse bid in partnership with
equity funder Playa Capital Partnersand went up to $7.2 million,
but was ultimately outbid by two companies, according to court
filings. Cider Leasing, LLC & Ace Cider I, LLC won the rights to
purchase Ace for more than double House's initial offer: $7.6
million. Cider Leasing is owned by Mordechai Lipton, the president
of R.L. Lipton, an Ohio-based alcohol distribution company. House
told the Chronicle that his intention was "to protect the legacy of
the brand" that he built.
Court filings show that investment firm founder Ejnar Knudsen was
the successful bidder for Vintage's Laetitia Vineyard & Winery in
San Luis Obispo County, Washington's Owen Roe and two others for
$9.3 million. Layer Cake, a value-priced brand founded by noted
Napa vintner Jayson Woodbridge, is folded into a multi-brand deal
from South Carolina company Vino.com.
Other successful bidders on Vintage's assets are wine and spirits
portfolio Integrated Beverage Group; contract distiller Bartow
Ethanol of Florida; and brand acquisition and management firm Full
– Glass Licensing.
About Vintage Wine Estates
Vintage Wine Estates, Inc. (NASDAQ: VWE) produces and sells wines
and craft spirits in the United States, Canada, and
internationally. The company offers its products under the Layer
Cake, Cameron Hughes, Clos Pegase, B.R. Cohn, Firesteed, Bar Dog,
Kunde, Cherry Pie, and others. It also owns and operates
hospitality facilities; and provides bottling, fulfillment, and
storage services to other companies on a contract basis. The
company was founded in 2019 and is headquartered in Incline
Village, Nevada.
As of March 31, 2024, the Company had $478.63 million in total
assets, $393.47 million in total liabilities, and $84.92 million in
total stockholders' equity. As of December 31, 2023, the Company
had $502.5 million in total assets and $391.6 million in total
liabilities.
Vintage Wine Estates, Inc. announced that the Company and certain
of its subsidiaries filed a voluntary petition for reorganization
under chapter 11 of title 11 of the United States Code in the
United States Bankruptcy Court for the District of Delaware. This
process is intended to establish a fair, structured process for VWE
to address outstanding debt obligations while the business pursue
the sale of its assets.
Over the preceding months, the Company experienced negative
financial headwinds that severely impacted its liquidity position.
In response, the Company explored several solutions to overcome
these challenges, with the monetization of all assets being the
most viable path forward to maximize value.
On July 24, 2024, Meier Wine Cellars Acquisition, LLC and
eleven subsidiaries, including Vintage Wine Estates, Inc. (CA) and
Vintage Wine Estates, Inc. (NV), each filed petitions in the United
States Bankruptcy Court for the District of Delaware seeking relief
under chapter 11 of the United States Bankruptcy Code. The Debtors
cases are jointly administered under In re Meier's Wine Cellars
Acquisition, LLC, Case No. 24-11575.
The Debtors entered chapter 11 with approximately $310 million in
secured debt and successfully negotiated a $60.5 million
debtor-in-possession financing facility, including $26.5 million of
new money, with their prepetition secured lenders. The Debtors
intend to seek confirmation of a chapter 11 plan following the
successful sale of their assets.
Jones Day and Richards, Layton & Finger, P.A., serve as counsel to
the Debtors. Riveron RTS, LLC, is the financial advisor. Epiq is
the claims agent.
Fox Rothschild LLP is the Creditors' Committee's counsel.
WAYFAIR INC: Fitch Assigns 'B' LongTerm IDR, Outlook Stable
-----------------------------------------------------------
Fitch Ratings has assigned a first-time Long-Term Issuer default
Rating (IDR) of 'B' to Wayfair Inc. and Wayfair LLC (collectively
Wayfair). Fitch has also assigned ratings of 'BB'/'RR1' to Wayfair
LLC's proposed $700 million secured notes and existing $600 million
revolving credit facility. Fitch has assigned a 'B-'/'RR5' rating
to Wayfair Inc.'s $3.2 billion of convertible notes. The Rating
Outlook is Stable.
Wayfair's rating reflects its good positioning as a leading online
retailer of furniture and home furnishings, and the company's
recent efforts to structurally improve profitability and cash flow
following a long history of focusing primarily on growth.
Fitch expects good growth in Wayfair's EBITDA and cash flow in the
medium term on cost control and revenue growth, although the rating
recognizes the company's history of negative FCF profitability
metrics which trail retail peers. Fitch's rating case assumes
operating metrics improve such that EBITDAR leverage improves to
the high 5x range by 2026 from nearly 10x in 2023.
Key Rating Drivers
Online Disruptor: Since Wayfair's brand was established in 2011,
the company has built a unique business model in the furniture and
home furnishings space, connecting suppliers and consumers on an
e-commerce platform. Wayfair resembles an online retailer although
does not own inventory, limiting markdown risk and working capital
needs relative to retail peers. The company's good execution,
coupled with increasing consumer desire to shop online, has led to
revenue rapidly growing to nearly $12 billion in the LTM ended June
2024.
Fitch expects Wayfair can generate mid-single digit revenue growth
longer term, predicated on low single digit category growth and
ongoing e-commerce penetration expansion. As one of few essentially
online-only retailers with meaningful scale and infrastructure and
strong relationships with customers and vendors, Wayfair appears
well-positioned to continue gaining share in its category.
Fitch recognizes the company's plans to accelerate revenue growth
to drive double-digit medium-term growth through newer initiatives
like supplier advertising, brand extensions, international
expansion and physical retail openings, although these efforts
entail some execution risk. Fitch also recognizes that revenue over
the next 12 months-18 months could remain choppy due to softer
consumer spending on discretionary goods.
Structural Margin Improvement: The company's recent efforts to
reduce expenses and grow profitably have benefited Wayfair's margin
profile. Prior to 2020, the company operated with EBITDA losses as
it scaled revenue and infrastructure to drive top line which grew
exponentially to $9.1 billion in 2019 from $4.7 billion in 2017 and
$916 million in 2013.
The company saw strong revenue growth and positive EBITDA in
2020/2021 as consumers accelerated spending both on the category
and online, although these trends somewhat reversed in 2022. In
2023, the company actioned $1.4 billion in cost reductions (just
over 10% of revenue) to support structural profitability
improvement, yielding EBITDA margins in the mid-3% range in the LTM
June 2024.
Fitch projects Wayfair's EBITDA margins could improve to 5% in the
next one to two years because of recent cost reduction efforts and
the company's heightened focus on expense management. This could
yield EBITDA improving from about $300 million in 2023 to $500
million in 2024 and toward $600 million by 2026. Further margin
upside exists towards the company's targeted 10% EBTDA margin over
the medium term if the company is successful in driving additional
sales growth through its newer initiatives, particularly higher
margin verticals like supplier advertising.
Leverage Moderation: Wayfair's leverage could moderate to below 6x
in 2026 from close to 10x in 2023, largely predicated on EBITDA
growth. The company has $3.2 billion of convertible notes, due
between 2024 and 2028. The company is proposing $700 million of
secured notes, proceeds of which plus cash on hand will be used to
repay the company's $117 million and $792 million of convertible
notes due 2024 and 2025, respectively. The company does not have a
publicly articulated financial policy and Fitch expects the company
could refinance its upcoming notes maturities, yielding steady debt
levels near $3 billion.
Improving Cash Flow: Wayfair's FCF improvement should follow its
EBITDA expansion. Fitch projects FCF could expand from breakeven in
2023 to at least $100 million in 2024 and close to $300 million in
2026. Wayfair's FCF conversion is good, due to limited cash taxes
due to tax loss carry-forwards and minimal working capital needs.
Interest expense has historically been limited, due to the
company's low-cost debt and high YE cash balances averaging close
to $2 billion over the past four years, though would increase
following the company's proposed secured notes issuance. Fitch
projects capex of around $300 million annually, or 2.3% to 2.5% of
revenue, as the company continues to invest in its technology and
logistics platforms and physical retail expansion.
Fitch expects the company to continue carrying a cash balance of at
least $1 billion, in line with its history. The company plans to
deploy around $200 million of internally generated cash alongside
the proceeds from its notes offering to repay its 2024/2025
maturities. Beyond this use, FCF could be used to support the
company's growth initiatives, including investing in its newer
verticals and less developed geographies in Western Europe, or
address a portion of the convertible notes due 2026-2028.
Parent Subsidiary Linkage: Fitch's analysis includes a weak
parent/strong subsidiary approach between the parent and its
subsidiary, Wayfair LLC. Fitch assesses the quality of the overall
linkage as high, which results in an equalization of IDRs across
the corporate structure.
Derivation Summary
Wayfair's ratings balance the company's leading position in the
online furniture category and track record of strong growth with
its history of limited or negative cash flow generation and high
leverage. The ratings embed expectations of EBITDA growth over the
medium term, yielding positive FCF and EBITDAR leverage trending
below 6x.
Wayfair's peers include leading video retail and e-commerce
business Qurate Retail, Inc. (Qurate). Qurate's 'B' IDR and
Negative Outlook reflects questions regarding the company's ability
to stabilize market share longer term following recent revenue
declines across its business, somewhat mitigated by some financial
flexibility afforded through its positive FCF generation. Other
peers include national department store competitors Macy's Inc.
(Macy's; BBB-/Stable), Kohl's Corp (Kohl's; BB/Stable), and
Nordstrom, Inc. (Nordstrom; BB/Stable).
Each of these companies contend with secular headwinds affecting
the department store industry and are continuously refining
strategies to defend market share. Initiatives include investments
in omnichannel models, portfolio reshaping to reduce exposure to
weaker indoor malls, and efforts to strengthen merchandise
assortments and service levels.
Pre-pandemic, the three national peers operated with EBITDAR
leverage below 3.5x (closer to mid-2x for Kohl's) to support
investment grade ratings. Current ratings embed expectations of
Macy's, Kohl's, and Nordstrom operating with leverage under 3.0x,
4.0x, and 4.0x respectively.
Key Assumptions
Wayfair's revenue could grow around 5% longer term, given low
single-digit growth in the furniture and home furnishings category
and continued shifts in channel spending toward e-commerce and away
from physical retail. Wayfair's nearer term prospects are somewhat
more muted given a recent slowdown in spending on discretionary
goods. As such, revenue in 2024 could decline modestly from the $12
billion recorded in 2023 and grow around 2% in 2025 before
accelerating to the mid-single digits beginning 2026.
EBITDA, which was about $300 million in 2023, could improve to $500
million in 2024 despite slight revenue contraction as margins
benefit from recent cost reduction activity. Margins could improve
to the low-4% range in 2024 from 2.5% in 2023 and approach 5% by
2026, yielding close to $600 million in EBITDA.
FCF could at least $100 million in 2024, growing toward $300
million by 2026. This projection assumes neutral working capital,
some growth in interest expense following Wayfair's $700 million
secured note issuance, and around $300 million in average annual
capex to support investments in Wayfair's technology platform,
logistics infrastructure and physical retail.
EBITDAR leverage, which was close to 10x in 2023, could decline to
the high-7x range in 2024 and the high-5x range by 2026, largely
due to EBITDA growth. Fitch assumes Wayfair's debt levels declines
modestly from $3.2 billion as of YE 2023 to $3 billion given plans
to partially fund 2024/2025 notes maturities with internally
generated cash.
Wayfair's proposed secured notes and existing convertible debt have
fixed interest rate structures.
Recovery Analysis
Fitch's recovery analysis assumes Wayfair's value is maximized as a
going concern in a post default scenario, given a going-concern
valuation of approximately $2.4 billion relative to a liquidation
value of around $500 million.
Fitch's going concern value is derived from a projected EBITDA of
around $400 million. The scenario assumes a lower revenue base of
around $10 billion, around 20% below projected 2024 levels,
assuming mis-execution yields customer count declines. EBITDA
margins could trend in the 4% range, modestly below projected 2024
levels, assuming the impact of lost sales on Wayfair's fixed
expenses are somewhat offset by cost reductions.
Fitch selected a going-concern multiple of 6x, within the 4x-8x
range observed for North American corporates, reflecting an
assessment of Wayfair's industry dynamics and company-specific
factors. This is at the upper end of the 4x-6x range used in
Fitch's analysis of retailers given the company's outsized exposure
to the faster-growing e-commerce channel.
After deducting 10% administrative claims from the going concern
valuation, Wayfair's secured revolver and proposed secured notes -
which are pari passu - would have outstanding recovery prospects
while its convertible notes would have poor recovery prospects.
Fitch assumes the $600 million revolving credit facility, which is
secured by substantially all of Wayfair's assets, would be fully
drawn.
Due to the various recovery prospects, the secured debt is rated
'BB'/'RR1' while the convertible notes are rated 'B-'/'RR5'.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- An upgrade could result from stronger than expected operating
performance which caused EBITDAR leverage (capitalizing leases at
8x) to sustain below 5.5x;
- Debt reduction which led to EBITDAR leverage sustaining below
5.5x could also lead to positive rating action.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- A downgrade could result from EBITDAR leverage trending around
7.0x, which could result from stagnant operating performance
leading to EBITDA remaining under $500 million;
- A downgrade could also result from capital allocation decisions
that lead to EBITDAR leverage sustaining around 7.0x..
Liquidity and Debt Structure
As of June 30, 2024, Wayfair had $1.3 billion of cash and
approximately $530 million of availability on its $600 million
secured revolver due March 2026, net of $69 million outstanding
letters of credit. Wayfair targets around $1 billion of cash on an
ongoing basis. Fitch considers Wayfair's liquidity reasonable given
limited working capital needs as it does not own inventory through
the cycle. The company has generated negative FCF through most of
its history, although Fitch projects positive FCF beginning 2024 in
the $100 million to $300 million range given EBITDA improvements.
Wayfair's current capital structure consists of five series of
convertible notes totaling $3.2 billion, with maturities ranging
from 2024 to 2028. Upcoming maturities include $117 million due
November 2024, $754 million due October 2025 and $949 million due
August 2026. Wayfair's convertibles due 2024-2026 have conversion
prices between $116 and $417 per share, which compares to recent
trading prices around $50.
The company is proposing $700 million, five year secured notes with
proceeds to be used to repay Wayfair's 2024/2025 convertible
maturities. The secured notes will be secured by substantially all
of the company's assets and will be pari passu with the revolving
credit facility. Fitch expects Wayfair to refinance its convertible
maturities beyond 2026 although recognizes that the company could
use internally generated cash flow as part of its stated goal to
deleverage its balance sheet longer term.
Issuer Profile
Wayfair is a leading online furniture and home furnishings
retailer, generating $12 billion in 2023 revenue to over 22 million
active customers.
Summary of Financial Adjustments
- A multiple of 8x was used for operating leases as the company is
based in the United States;
- EBITDA adjusted to exclude stock-based compensation.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
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
----------- ------ --------
Wayfair LLC LT IDR B New Rating
senior secured LT BB New Rating RR1
Wayfair Inc. LT IDR B New Rating
senior
unsecured LT B- New Rating RR5
WEST HARWICH: Court Orders Appointment of Chapter 11 Trustee
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Massachusetts granted
yesterday the request of William Harrington, the U.S. Trustee for
Region 1, to appoint a Chapter 11 trustee for West Harwich
Holdings, LLC.
The U.S. trustee last week sought the appointment of an independent
trustee to take over the company's bankruptcy case following its
failure to disclose its pre-bankruptcy dealings with insiders or
provide documents showing such transactions.
The U.S. trustee criticized, among others, the company's
non-disclosure of substantial fund transfers to its affiliates when
it filed its statement of financial affairs (SOFA), and its failure
to provide enough documents showing how those funds were used.
"All of the failures evidence a continuing pattern of
non-disclosure that is antithetical to a debtor remaining in
possession in chapter 11 and is cause for the appointment of a
trustee," the U.S. trustee said in court filings.
"[West Harwich Holdings'] conduct suggests that existing management
will not voluntarily carry out its fiduciary duties to the estate
because of their self-interest in not revealing insider
transactions," the U.S. trustee said.
About West Harwich Holdings
West Harwich Holdings, LLC, a company in West Harwich, Mass., filed
Chapter 11 petition (Bankr. D. Mass. Case No. 24-11294) on July 1,
2024, with $1 million to $10 million in both assets and
liabilities. Taylor Perkins, managing partner, signed the
petition.
Judge Janet E. Bostwick oversees the case.
The Law Office of Peter M. Daigle represents the Debtor as counsel.
WIDELL RENOVATIONS: Seeks to Hire Brown Law Firm as Legal Counsel
-----------------------------------------------------------------
Widell Renovations, LLC seeks approval from the U.S. Bankruptcy
Court for the Northern District of Oklahoma to employ Brown Law
Firm, PC as legal counsel.
The firm will provide these services:
(a) negotiate allowed claims and treatment of creditors;
(b) render legal advice and prepare legal documents and
pleadings concerning claims of creditors, post-petition financing,
executing contracts, sale of assets, insurance, etc;
(c) represent the Debtor in hearings and other contested
matters;
(d) formulate a disclosure statement and plan of
reorganization; and
(e) perform all other matters needed for reorganization.
The firm's professionals will be paid at these hourly rates:
Ron Brown, Attorney $350
Associate $300
Paralegal $75
The firm received a pre-petition retainer of $8,662.50 plus a
filing fee of $1,738 from the Debtor.
Mr. Brown 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:
Ron D. Brown, Esq.
Brown Law Firm, P.C.
1609 E. 4th Street
Tulsa, OK 74120
Telephone: (918) 585-9500
Facsimile: (866) 552-4874
Email: ron@ronbrownlaw.com
About Widell Renovations
Widell Renovations, LLC, a company primarily engaged in renting and
leasing real estate properties, sought relief under Chapter 11 of
the Bankruptcy Code (Bankr. N.D. Okla. Case No. 24-11158) on Sept.
5, 2024. In the petition signed by William Widell, member and
manager, the Debtor disclosed between $1,920,700 in total assets
and $1,054,944 in total liabilities.
Judge Terrence L. Michael oversees the case.
Ron D. Brown, Esq., at Brown Law Firm, PC serves as the Debtor's
counsel.
WIDELL RENOVATIONS: Stephen Moriarty Named Subchapter V Trustee
---------------------------------------------------------------
The U.S. Trustee for Region 14 appointed Stephen Moriarty, Esq., at
Fellers, Snider, Blankenship, Bailey & Tippens, P.C., as Subchapter
V trustee for Widell Renovations, LLC.
Mr. Moriarty will be paid an hourly fee of $550 for his services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Mr. Moriarty declared that he is a disinterested person according
to Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Stephen J. Moriarty, Esq.
Fellers, Snider, Blankenship, Bailey & Tippens, P.C.
100 N. Broadway, Suite 1700
Oklahoma City, OK 73102
Telephone: (405) 232-0621
Facsimile: (405) 232-9659
Email: smoriarty@fellerssnider.com
About Widell Renovations
Widell Renovations, LLC is a Tulsa-based company primarily engaged
in renting and leasing real estate properties.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Okla. Case No. 24-11158) on September
5, 2024, with $1,920,700 in assets and $1,054,944 in liabilities.
William Widell, member and manager, signed the petition.
Judge Terrence L. Michael presides over the case.
Ron Brown, Esq., at Brown Law Firm PC represents the Debtor as
bankruptcy counsel.
WILDFIRE ENERGY I: Fitch Assigns 'B+' LongTerm IDR, Outlook Stable
------------------------------------------------------------------
Fitch Ratings has assigned first-time Long-Term Issuer Default
Ratings of 'B+' to Wildfire Energy I LLC and Wildfire Intermediate
Holdings, LLC. Fitch has also assigned a 'BB+'/'RR1' rating to the
senior secured reserve-based lending credit facility (RBL) and a
'BB-'/'RR3' rating to the proposed senior unsecured notes issued by
Wildfire Intermediate Holdings, LLC. The Rating Outlook is Stable.
Wildfire's ratings reflect its high-quality, high-oil-mix Eagle
Ford assets that drive peer-leading netbacks and strong FCF
generation. The rating also considers the company's conservative
financial policy with a leverage target below 1.0x, modest
distribution policy, disciplined acquisition strategy, and
supportive hedging policy. The rating remains constrained to the
'B' category given the company's pro forma production scale of
49Mboepd, which is lower than 'BB' category peers.
Key Rating Drivers
Credit-Neutral Proposed Issuance: Fitch views Wildfire's proposed
senior unsecured note issuance as neutral to the company's credit
profile. It improves the liquidity profile, extends the maturity
profile, and does not impact leverage metrics. The company will
have approximately $374 million outstanding on the $1.5 billion RBL
facility post-issuance, which is expected to be reduced with FCF
over the forecast period. FCF generation is supported by the
company's high-margin, oil-weighted assets and low reinvestment
rate.
High Quality Assets; Small Production Scale: Wildfire's assets
include approximately 837,000 net acres in the Eagle Ford and
Austin Chalk, providing 13 years of development opportunities
across 645 gross drilling locations. The asset base has high
liquids and oil exposure at 86% and 71%, respectively, and
production of approximately 49 Mboepd, pro forma the APA
acquisition. Though production scale remains limited, the company
has a first-year decline rate of approximately 20%, which compares
favorably to the industry average of above 30%. The company plans
to transition to a two-rig program in January 2025, aiming to
sustain production around 55 Mboepd through 2028.
Peer Leading Netbacks; Strong FCF Generation: Wildfire has the
highest Fitch-calculated netbacks in the peer group at $45.10/boe
for 2Q24. The company's netbacks benefit from strong pricing and
cost savings due to proximately to the Gulf Coast and the company's
sand mine and midstream infrastructure, along with an oil cut over
70%. Wildfire operates a low decline, mature proved developed
producing (PDP) base, leading to low capex requirements with a
reinvestment rate below 50%. High profitability and low capex spend
translate to robust FCF generation, forecast to exceed $200 million
through the cycle based on Fitch's price deck assumptions.
Conservative Financial Policy: Wildfire has a conservative
financial policy that includes a leverage target of below 1.0x, a
modest distribution policy of 10% of contributed equity per year,
and a high percentage of PDP production hedged. The company also
takes a conservative approach to M&A with a commitment to keeping
leverage below 1.5x following any acquisitions. The company has
managed distributions to prioritize the balance sheet and liquidity
and would reduce distributions if necessary during periods of
stressed commodity prices.
Growth Through Bolt-On Acquisitions: Wildfire has a track record of
increasing production scale through five bolt-on acquisitions since
the company was founded in 2019. The company targets acquisitions
that are PDP heavy with low decline assets and low-risk
development. As the largest operator in the area, the company is
well-positioned for further consolidation through additional
bolt-on acquisitions. Funding for previous acquisitions has been
conservative, utilizing a mix of RBL borrowings, cash, and sponsor
equity, while maintaining leverage below 1.5x post-acquisition. The
sponsor has shown support by providing equity for acquisitions, and
Fitch expects this conservative policy to continue.
Supportive Hedging Policy: The company has a rolling four-year
hedging strategy that aims to cover 80% of PDP production for the
next two years, 50% for the third year, and 30% in the fourth year.
Wildfire's hedging program helps lock in future returns and
meaningfully reduces cash flow volatility and downside pricing
risks. The company also hedges all acquisitions at 85% PDP for four
years and gas differentials for three years. Fitch believes
management's willingness to hedge beyond the 75% of PDP requirement
within the company's RBL agreement benefits the credit profile and
through the-cycle leverage metrics.
Derivation Summary
Wildfire is the smallest operator in the peer group with 49 Mboepd
(pro forma the APA acquisition) compared to Crescent Energy Company
(BB-/Stable; 165Mboepd as of 2Q24), Matador Resources Company
(BB-/Positive; 160Mboepd), SM Energy Company (BB-/RWP; 159Mboepd),
Kraken Oil & Gas Partners LLC (BB-/Stable; 82Mboepd), California
Resources Corporation (B+/Stable; 76Mboepd), Moss Creek Resources
Holdings, LLC (B/Stable; 61Mboepd), and Highpeak Energy Inc.
(B/Stable; 49Mboepd).
Although Wildfire is the smallest in the peer group in terms of
production scale, it has the highest oil cut at 78% and highest
netbacks in the group at $45.10/boe for 2Q24. Kraken has the next
highest netbacks in the group at $41.10/boe for 2Q24 with 73% oil,
followed by Highpeak Energy ($40.30/boe; 76% oil).
Fitch forecasts leverage of 1.6x in 2024, which is in the middle
range of the peer group.
Key Assumptions
- WTI (USD/barrels) of $75 in 2024, $65 in 2025, $60 in 2026 and
2027, and $57 thereafter;
- Henry Hub (USD/thousand cubic feet) of $2.50 in 2024, $3.00 in
2025 and 2026, and $2.75 thereafter;
- Successful launch of the proposed high-yield issuance with
proceeds used to repay RBL borrowings;
- Production growth in 2024 and 2025 driven by acquisitions,
followed by stable production of 55-60 Mboepd through 2028;
- Capex in line with management's expectations;
- Measured distributions to sponsors throughout the forecast;
- Deferred acquisition costs repaid as scheduled;
- Post-distribution FCF used to repay RBL borrowings;
- Base interest rates applicable to the company's outstanding
variable rate debt obligations reflects current SOFR forward
curve;
Recovery Analysis
KEY RECOVERY RATING ASSUMPTIONS
The recovery analysis assumes that Wildfire would be reorganized as
a going-concern in bankruptcy rather than liquidated.
Fitch has assumed a 10% administrative claim.
Going-Concern (GC) Approach
Fitch's projections under a stressed case price desk assume WTI
prices of $60 in 2024, $32 in 2025, $42 in 2026, and $45 in the
long-term; and Henry Hub prices of $2.00 in 2024 and $2.25 in the
long term.
The GC EBITDA assumption reflects Fitch's view of a sustainable,
post-reorganization EBITDA level upon which Fitch bases the
enterprise valuation, which reflects the decline from current
pricing levels to stressed levels and then a partial recovery
coming out of a troughed pricing environment. Wildfire's GC EBITDA
is supported by the company's strong hedging protection through the
stress case.
An EV multiple of 3.5x EBITDA is applied to the GC EBITDA to
calculate a post-reorganization enterprise value. The 3.5x multiple
reflects Wildfire's large, oil weighted asset base in the Eagle
Ford. The choice of this multiple also considered the following
factors:
The historical bankruptcy case study exit multiples for peer
companies ranged from 2.8x-7.0x, with an average of 5.2 and a
median of 5.4x.
Liquidation Approach
The liquidation estimate reflects Fitch's view of the value of
balance sheet assets that can be realized in sale or liquidation
processes conducted during a bankruptcy or insolvency proceeding
and distributed to creditors. Fitch considers valuations, such as
SEC PV-10, or present value of estimated future oil and gas
revenue, net of estimated direct expenses discounted at an annual
discount rate of 10%, and M&A transactions for each basin including
multiples for production per flowing barrel, proved reserves
valuation, value per acre, and value per drilling location.
Fitch has assumed the $1.5 billion RBL is 80% drawn in the
bankruptcy scenario.
The allocation of value in the liability waterfall results in
recovery corresponding to 'RR1' for the senior secured RBL facility
and 'RR3' for the senior unsecured notes. The unsecured notes are
capped at 'RR3' for ratings at the 'B+' level, which is consistent
with Fitch's Corporates Recovery Ratings and Instrument Ratings
Criteria.
RATING SENSITIVITIES
Factors That Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Total production sustained above 75Mboepd while maintaining
similar oil mix;
- Maintenance of economic drilling inventory and reserve life;
- Continued positive FCF generation that allows for reduction of
RBL borrowings;
- Maintenance of conservative financial policy resulting in
mid-cycle EBITDA leverage sustained below 2.0x.
Factors That Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Deviation from stated financial policies including overly
debt-funded M&A activity or shareholder distributions;
- Material reduction in liquidity including sustained high revolver
utilization;
- Mid-cycle EBITDA leverage sustained above 2.5x.
Liquidity and Debt Structure
Adequate Liquidity: Pro forma the proposed notes issuance, Wildfire
will have approximately $374 million outstanding under its $1.5
billion RBL facility due in 2027. Fitch expects the company's
post-distribution FCF generation will be allocated towards reducing
RBL borrowings to further enhance liquidity. The liquidity profile
is also supported by a strong four-year hedging program.
Issuer Profile
WildFire Energy I LLC is a private equity owned energy company
focused on the acquisition, exploration and production of oil and
natural gas properties in the U.S., including the East Texas Eagle
Ford shale and Austin Chalk located in East Texas.
Date of Relevant Committee
03 September 2024
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
ESG Considerations
WildFire Energy I LLC has an ESG Relevance Score of '4' for Energy
Management, which reflects the company's cost competitiveness and
financial and operational flexibility due to scale, business mix,
and diversification. This 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
----------- ------ --------
WildFire Intermediate
Holdings, LLC LT IDR B+ New Rating
senior unsecured LT BB- New Rating RR3
senior secured LT BB+ New Rating RR1
WildFire Energy I LLC LT IDR B+ New Rating
WILLSCOT HOLDINGS: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable
------------------------------------------------------------------
Fitch Ratings has affirmed the 'BB' Long-Term Issuer Default Rating
(IDR) of WillScot Holdings Corporation and its subsidiaries
Williams Scotsman, Inc. and Williams Scotsman Holding Corp.
(collectively WillScot). The Rating Outlook is Stable. In addition,
Fitch has affirmed the 'BB-' rating assigned to Williams Scotsman,
Inc.'s senior secured debt.
This rating action follows the announcement on Sept. 18, 2024 that
WillScot and McGrath RentCorp (McGrath) have mutually agreed to
terminate their previously announced merger, given there was no
commercially reasonable path to regulatory clearance with the U.S.
Federal Trade Commission. In accordance with the terms of the
agreement, WillScot will pay McGrath a termination fee of $180
million.
Key Rating Drivers
Merger Termination Reduces Rating Headroom: The rating affirmation
reflects Fitch's view that the merger termination will not
materially impair WillScot's near-term competitive position or
credit profile. However, rating headroom has been notably reduced,
negatively impacted by a weakened business profile assessment and
weaker than initially anticipated earnings. The merger termination
also highlights execution challenges, which may impact management's
ability to effectively execute its medium-term plan to enhance
profitability by over $1 billion in adjusted EBITDA over the next
several years through operational efficiency improvements and
capturing new commercial opportunities.
After accounting for legal and professional fees of $35 million in
1H24 and $180 million in termination fees, tangible equity is
expected to remain negative due mainly to the board's authorization
of $1 billion in share repurchases. Management aims to maintain
cash flow leverage within a range of 3.0x-3.5x net debt to EBITDA,
consistent with current ratings.
Established Franchise: WillScot's ratings remain supported by its
established franchise and leading market position as a provider of
modular work space and storage space solutions, and an experienced
management team. The ratings also reflect the company's strong
profitability, appropriately managed residual value risk and an
adequate liquidity profile.
Limited Funding Flexibility: The ratings are constrained by
WillScot's limited funding flexibility arising from its fully
secured funding profile and relatively weak tangible balance sheet
capitalization.
Strong Asset Quality: Fitch considers WillScot's asset quality to
be strong given the standardized nature and relatively long useful
life of its containers and modular office units, and its
conservative depreciation policies which limit residual value risk.
The company's portfolio is also adequately diversified, with its
top 50 customers comprising
WINDSTREAM SERVICES: Fitch Assigns BB- Rating on Sr. Secured Notes
------------------------------------------------------------------
Fitch Ratings has assigned a 'BB-'/'RR2' rating to the proposed
senior secured term loan B and senior secured notes issuances
issued by Windstream Services, LLC (Windstream). The ratings have
also been placed on Rating Watch Evolving (RWE).
Fitch has downgraded Windstream's existing secured debt ratings to
'BB-'/'RR2' from 'BB'/'RR1' and maintained them on RWE. Fitch has
also maintained on RWE the 'B' Long-Term Issuer Default Ratings
(IDRs) for Windstream and Windstream Holdings II, LLC (WIN) and the
'BB'/'RR1' ratings on the super senior secured debt. Fitch will
withdraw the ratings on the existing super senior term loan and the
$750 million term loan facility once they are fully repaid.
The ratings are on Watch Evolving following Uniti Group's
announcement in May 2024 that it plans to acquire WIN. This
reflects Fitch's expectation that the combined company will likely
be rated 'B+' or lower. On a standalone basis, Windstream's ratings
reflect Fitch's expectation of continued revenue pressures due to
secular declines in WIN's legacy products and elevated leverage,
offset by stabilizing EBITDA due to continued cost take-outs and
fiber investments resulting in Kinetic consumer market share gains.
Fitch expects to resolve the Rating Watch once the transaction is
complete under the announced terms, which is expected to take
longer than six months and close in 2H2025.
Key Rating Drivers
Proposed Refinancing: Windstream is seeking to refinance the
existing $250 million super senior term loan and the $750 million
term loan facility ($708 million outstanding as of June 30, 2024)
with the proposed $1.3 billion of senior secured debt offerings of
term loan and notes. The additional funds will be deployed towards
the fiber build program.
Uniti Acquisition: On May 3, 2024, Uniti announced that it has
entered into a definitive agreement to merge with Windstream. The
merger is expected to close in the 2H2025, subject to the
satisfaction of customary closing conditions and approvals.
Post-merger, Uniti shareholders will hold approximately 62% of the
outstanding common equity of the combined company. Windstream
shareholders will receive $425 million of cash, $575 million of
preferred equity in the new combined company, and common shares
representing approximately 38%. Windstream shareholders will
additionally receive non-voting warrants to acquire up to 6.9% of
common shares of the combined company. Uniti expects to fund the
$425 million of cash consideration to shareholders of Windstream
from operations, revolver borrowings and/or future capital markets
transactions.
The merger will position the combined company focused on Tier II
and Tier III markets and result in significant synergies and
elimination of inefficiencies. The company has guided to up to $100
million in opex and $20-30 million in capex synergies.
Elevated Leverage: The PF net leverage of the combined company as
of YE2023 is approximately 5.1x (4.8x including synergies). Fitch
expects the EBITDA leverage to increase to near mid 5x in 2025 due
to revenue and EBITDA pressures from Windstream's legacy revenue as
well as continued high capex as the combined company will
accelerate FTTH deployments to an additional one million
households.
On a standalone basis, Fitch evaluates the company's leverage on a
lease-adjusted basis since a significant portion of WIN's assets
are leased from Uniti (applying an 8x multiple to the master and
other lease payments, adjusted for settlement payments). Fitch
projects adjusted leverage will remain in near 5x range over the
forecast.
Revenue Pressures Continue: Windstream continues to experience
pressure particularly in Enterprise segment due to declining
legacy-products-related revenue and effects of competition.
However, the strategic Enterprise revenue, continues to grow in
double digits and offset some of these underlying pressures.
Fitch's base case assumes Enterprise revenue declines near mid to
high-single-digits in 2024 with declines moderating through the
forecast horizon, especially once the company exits Time Division
Multiplexing (TDM) in 2025.
High Standalone Strategic Execution Risk: Fitch believes there is a
meaningful execution risk to the company's strategy to contain
revenue declines and grow EBITDA over the next few years. While
there are relatively low risk opportunities such as interconnection
costs take-out that will support EBITDA, WIN's ability to gain
residential market share through increased network investments will
be a key driver for future revenue growth. In Fitch's view,
Windstream has limited capacity to mitigate execution risks while
still deleveraging.
GCI-Led Increased Spending: As part of the settlement agreement,
Uniti will reimburse WIN $1.75 billion in growth capital
investments (GCI) through 2030 and pay Windstream about $400
million over five years, at an annual interest rate of 9%.
GCI reimbursements will be critical to support WIN's fiber to the
home (FTTH) investment strategy that aims to drive 1GB speed to
approximately half of its incumbent local exchange carrier (ILEC)
footprint, roughly two million homes by 2026. The combined company
will accelerate FTTH deployments to additional one million
households.
Cost Savings Support Standalone Margins: Windstream continues to
optimize costs including realization of cost savings from
interconnection expenses (i/c expenses) as it transitions away from
legacy products. WIN launched a three-year TDM exit plan in 2020 to
migrate almost all its CLEC customers off of the TDM network to
newer technologies. Fitch believes i/c cost savings along with
additional identified cost saving opportunities will continue to
support EBITDA margins over the rating horizon.
Parent Subsidiary Linkage: Under the announced transaction terms,
Fitch will likely equalize the ratings of Uniti and Windstream
subsidiaries with the newly created combined parent company. Fitch
expects legal incentives to be low due to separation of credit
silos and no expected cross guarantees between the two silos, or
from the parent entity. Strategic incentives are high due to the
subsidiaries' substantial financial contribution from both
Windstream and Uniti to the parent, as well the critical advantage
of combining an Opco and Propco. Operational incentives are high
due to common ownership and elimination of inefficiencies once the
merger is complete.
Derivation Summary
Windstream is a hybrid company with characteristics of an incumbent
operator through its Kinetic business unit (ILEC business), which
primarily operates in rural areas of 18 states. It also provides
business services through its Enterprise and Wholesale units
(CLEC), which compete nationally.
In comparison to Frontier Communications Parent, Inc. (B+/RWP),
standalone Windstream has less exposure to the residential market.
The residential market held up relatively well during the
coronavirus pandemic but continues to face secular challenges. WIN
derives approximately 25% of revenues from consumers vs. 50% for
Frontier. Frontier has a slightly larger scale than Windstream and
has similar leverage compared with WIN's lease-adjusted leverage.
Both Frontier and WIN have similar EBITDA(/R) margins on a
like-to-like basis. Fitch recently placed Frontier's ratings on
Rating Watch Positive following Verizon Communication Inc.'s
(A-/Stable) announcement that it will acquire Frontier.
In the enterprise service market, Windstream has a weaker
competitive position based on scale and size of its operations in
the enterprise market. Larger companies, including AT&T Inc.
(BBB+/Stable), Verizon Communications Inc. and Lumen Technologies,
Inc. (CCC+), have an advantage with national or multinational
companies given their extensive footprints in the U.S. and abroad.
These companies also operate at lower leverage and have better
financial flexibility and FCF profiles.
Key Assumptions
Windstream Standalone
- Fitch expects revenue declines in mid-to-high single digit in
2024 in 2025.
- 2024 EBITDA margins are in low to mid 20%.
- No dividends are assumed over the forecast.
- Fitch expects adjusted leverage (total adjusted debt/EBITDAR) to
remain in near 5x range.
Recovery Analysis
KEY RECOVERY RATING ASSUMPTIONS
- The recovery analysis assumes that Windstream would be
reorganized as a going-concern in bankruptcy rather than
liquidated. The recovery analysis reflects WIN's standalone credit
silo waterfall.
- Fitch has assumed a 10% administrative claim.
- The revolving facility is assumed to be fully drawn.
- WIN's GC EBITDA is based on June 30, 2024 LTM EBITDA. The GC
EBITDA is assumed roughly 24% lower than the LTM EBITDA in a
bankruptcy scenario due to company's inability to grow consumer
and/or strategic business revenue that is sufficient to offset
declines in legacy revenue. These pressures could stem from
competitive pressures, an unsuccessful fiber deployment strategy or
protracted pressures on enterprise revenue. EBITDA declines faster
than anticipated, eroding benefits from cost cutting measures.
- The GC EBITDA estimate reflects Fitch's view of a sustainable,
post-reorganization EBITDA level upon which Fitch bases the
enterprise valuation.
- An EV multiple of 4.5x EBITDA is applied to the GC EBITDA to
calculate a post-reorganization enterprise value. The choice of
this multiple considered the following factors:
- The historical bankruptcy case study exit multiples for most
telecom companies ranged from 3x-7x, with a median of 5.4x.
- Windstream emerged from bankruptcy in 2020 with a reorganization
multiple of roughly 3.5x. Frontier Communications emerged in early
2021 at near 5x. FairPoint's reorganization multiple was 4.6x
following its emergence from bankruptcy in 2011.
- Fitch uses a 4.5x multiple to reflect WIN's improved capital
structure (reduced debt levels) following the restructuring and the
strategic focus on fiber spending to increase market share.
RATING SENSITIVITIES
Factors That Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- The RWE could be resolved and Windstream's IDR affirmed at 'B' if
the merger does not close and Windstream is within its standalone
rating sensitivities. Fitch could also take these actions if the
Uniti merger closes and Uniti's IDR is then downgraded to 'B',
based on the combined parent company's 'B' rating.
- The RWE could be resolved and Windstream's IDR could be upgraded
to 'B+' if the Uniti merger closes and Uniti's IDR is then affirmed
at 'B+', based on the combined parent company's 'B+' rating.
On a standalone basis:
- Revenue stabilization achieved through a) continued growth in
broadband subscribers as a result of increased GCI spending and b)
expansion in strategic enterprise revenue.
- Successful execution on cost reduction plans, resulting in EBITDA
margins sustained in low-to-mid 20s range and consistently positive
FCFs.
- EBITDAR leverage, defined as total adjusted debt/ operating
EBITDAR, sustained below 4.0x or a positive adjusted (CFO-capex)/
Debt where capex is adjusted for GCI reimbursements.
Factors That Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- The RWE could be resolved and Windstream's IDR could be
downgraded to 'B-' if the Uniti merger does not close and
Windstream is outside its standalone negative sensitivities.
On a standalone basis:
- Deterioration in operating profile, including inability to
stabilize revenue or offset EBITDA pressure through cost
reductions.
- Aggressive shareholder policies such as dividend recaps resulting
in negative FCFs (adjusted for Uniti GCI reimbursements) on a
sustained basis.
- Adjusted leverage sustained above 5.0x; or adjusted
(CFO-capex)/total debt below -7%.
Liquidity and Debt Structure
Fitch believes Windstream has sufficient liquidity supported by
cash balances and availability under its $500 million revolver. As
of June 30, 2024, there was approximately $366 million available
under the revolving facility (including $134 million of LCs into
consideration). There are no significant maturities in the near
term.
Windstream's current capital structure consists of: (a) a $500
million super senior secured revolving facility (with $475 million
extending to 2027), (b) $250 million super senior incremental term
loan maturing February 2027, (c) a $750 million term loan facility
maturing September 2027, and (c) $1,400 million of senior secured
notes due August 2028. The first lien term loan amortizes at the
rate of 1% annually. The company is looking to refinance the super
senior term loan and the $750 million term loan facility ($708
million outstanding as of June 30, 2024) with the proposed senior
secured debt offerings of term loan and notes.
The first lien obligations under both the credit agreement and the
indenture are secured by substantially all assets of the company
and its guarantor subsidiaries. The credit facility is also
guaranteed by WIN. The revolver includes a financial maintenance
covenant of 3.5x total net leverage ratio, which declines to 3.25x
effective June 30, 2024.
Windstream's settlement agreement with Uniti has a 3.0x total
leverage incurrence covenant with respect to Uniti's GCI commitment
obligations. Under the settlement agreement Uniti will not be
required to comply with its GCI funding commitment if Windstream's
total leverage ratio exceeds 3.5x (the maintenance leverage
covenant) and if Windstream breaches certain conditions on debt
incurrence, dividends and acquisitions amongst other provisions.
The maintenance and incurrence covenant do not apply at certain
rating levels, as defined in the agreement.
Issuer Profile
Windstream offers bundled broadband, voice, digital television and
security solutions to consumers, primarily in rural areas, in 18
states. On May 3, 2024, Uniti announced a re-merger with
Windstream.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
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
----------- ------ -------- -----
Windstream
Services, LLC LT IDR B Rating Watch Maintained B
senior
secured LT BB- New Rating RR2
senior
secured LT BB- Downgrade RR2 BB
super
senior LT BB Rating Watch Maintained RR1 BB
Windstream
Holdings II,
LLC LT IDR B Rating Watch Maintained B
WJA ASSET: Seeks to Hire Raines Feldman Littrell as Legal Counsel
-----------------------------------------------------------------
WJA Asset Management, LLC and its affiliates seek approval from the
U.S. Bankruptcy Court for the Central District of California to
employ Raines Feldman Littrell, LLP as counsel.
The firm will provide these services:
(a) advise the Debtors with respect to the requirements and
provisions of the Bankruptcy Code, Federal Rules of Bankruptcy
Procedure, Local Bankruptcy Rules, U.S. Trustee Guidelines, and
other applicable requirements that may affect them;
(b) assist the Debtors in complying with and fulfilling U.S.
Trustee requirements, and preparing other documents as may be
required after the initial filing of a Chapter 11 case;
(c) represent the Debtors in any proceeding or hearing in the
bankruptcy court in any action where the rights of the estates or
the Debtors may be litigated or affected; and
(d) assist the Debtors in the preparation of a disclosure
statement and formulation of a Chapter 11 plan of reorganization,
or other disposition of their cases, as appropriate.
Kyra Andrassy and Michael Simon, the firm's attorneys, will be paid
at their discounted hourly rates of $675 and $425, respectively.
In addition, the firm will seek reimbursement for expenses
incurred.
Ms. Andrassy 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:
Kyra E. Andrassy, Esq.
Raines Feldman Littrell, LLP
3200 Park Center Drive, Suite 250
Telephone: (310) 440-4100
Facsimile: (310) 691-1943
Email: kandrassy@raineslaw.com
About WJA Asset Management
Luxury Asset Purchasing International, LLC, et al., are part of a
network of entities or "Funds" formed to offer a range of
investment opportunities to individuals. Many of the existing funds
are performing and some Funds had substantial gains. However,
certain Funds, i.e., those invested in private trust deeds secured
by real estate, suffered losses.
William Jordan Investments, Inc. ("Advisor"), is a registered
investment advisor. Laguna Hills, California-based WJA Asset
Management, LLC ("Manager"), is the managing member of Luxury, et
al. William Jordan was the president and sole owner of Advisor and
was the sole member and manager of Manager.
On May 18, 2017, Luxury and its affiliates filed voluntary
petitions under Chapter 11 of the United States Bankruptcy Code. On
May 25, 2017, four other affiliated filed voluntary Chapter 11
petitions. On June 6, 2017, CA Real Estate Opportunity Fund III
filed its Chapter 11 petition. The Debtors' cases are jointly
administered under Bankr. C.D. Cal. Lead Case No. 17-11996, and the
Debtors continue to operate their businesses and manage their
affairs as DIP.
Pursuant to court orders, Howard Grobstein is now serving as the
chief restructuring officer of the Debtors and Mr. Jordan no longer
has any ongoing role in the Debtors' operations.
At the time of the filing, WJA estimated assets of less than
$500,000 and liabilities of $1 million to $10 million.
Judge Scott C. Clarkson presides over the cases.
Raines Feldman Littrell, LLP serves as counsel to the Debtors.
WOB HOLDINGS: Gets OK to Hire Gulf Atlantic as Financial Advisor
----------------------------------------------------------------
WOB Holdings, LLC and its affiliates received approval from the
U.S. Bankruptcy Court for the Middle District of Florida to employ
Gulf Atlantic Capital Corporation as financial advisor.
The firms services include:
(a) assist the Debtors with preparing for and filing the
bankruptcy;
(b) assist the Debtors with preparing their statements,
schedules, and monthly operating reports;
(c) assist the Debtors with monitoring their working capital
position and cash budgeting;
(d) assist the Debtors with developing financial models and
projections;
(e) assist the Debtors with evaluating strategic options for
restructuring the business;
(f) assist the Debtors with developing and implementing a plan
of reorganization and disclosure statement; and
(g) perform other financial advisory services as may be agreed
upon by the parties.
The firm will be compensated as follows:
(a) advance payment retainer of $75,000; and
(b) standard hourly rates of $375 to $475.
G. Michael Verdisco, a managing director at Gulf Atlantic Capital
Corporation, 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:
G. Michael Verdisco
Gulf Atlantic Capital Corporation
2701 North Rocky Point Drive, Suite 630
Tampa, FL 33607
Telephone: (813) 288-8141
Facsimile: (813) 288-8263
About WOB Holdings
WOB Holdings, LLC owns and operates craft beer restaurants in
Tampa, Fla.
WOB Holdings and its affiliates filed Chapter 11 petitions (Bankr.
M.D. Fla. Lead Case No. 24-04538) on August 2, 2024. In the
petitions signed by Paul Avery, president, WOB Holdings disclosed
$10 million to $50 million in both assets and liabilities.
Judge Catherine Peek McEwen oversees the cases.
The Debtors tapped Steven M. Berman, Esq., at Shumaker, Loop &
Kendrick, LLP as counsel and Gulf Atlantic Capital Corporation as
financial advisor.
XTI AEROSPACE: Appoints Tobin Arthur as Chief Strategy Officer
--------------------------------------------------------------
XTI Aerospace, Inc., announced Sept. 23 the appointment of Tobin
Arthur as chief strategy officer, effective as of Sept. 19, 2024.
In this new role, Mr. Arthur will help guide the Company's vision
and oversee its sales, marketing, and investor relations.
Tobin Arthur brings over 30 years of experience in helping
companies develop and implement corporate strategies focused on
innovation. Early in his career, he helped Starbucks Coffee bring
disruptive innovation to the market as it became a rapidly growing
public company. After his time at Starbucks, Mr. Arthur shifted
his focus to the healthcare sector, where he spent the last decade
building companies such as CureUs and AngelMD. CureUs, later
acquired by Springer Nature, is a pioneering medical publishing
platform that allows authors to retain their copyrights while
making medical science more accessible. AngelMD is a large online
community that connects thousands of startups with clinicians and
investors.
Mr. Arthur's experience has enabled him to invest in, and/or
advise, over 200 startups and collaborate closely with
entrepreneurs to accelerate their ventures. In 2018, he launched
the podcast Innovation4Alpha, which evolved into a consulting and
investment firm focused on ventures across sectors including
ag-tech, security, real estate, healthcare, and aviation. Mr.
Arthur holds a Bachelor of Arts degree in English from the
University of Southern California.
"I have known Tobin for many years, and his ability to anticipate
market trends and build teams to turn vision into reality will be
invaluable as XTI executes its strategy to disrupt the aviation
marketplace," said Scott Pomeroy, Chairman and CEO of XTI.
"I have been passionate about aviation and innovation for as long
as I can remember," said Tobin Arthur, chief strategy officer of
XTI. "I believe what makes XTI unique is its position to lead a
significant shift in aviation by combining the range and speed of
business aircraft with vertical take-off and landing (VTOL)
capabilities. Innovation is at the heart of XTI and the TriFan
600, from its take-off and landing technology to its interior
design, safety features, and how XTI seamlessly integrates with
vendor partners. I believe that XTI has immense potential to
revolutionize commercial, military, and medical aviation."
In connection with his appointment, the Company entered into an
employment agreement with Mr. Arthur on Sept. 19, 2024, effective
as of such date, which sets forth the terms of Mr. Arthur's
services as chief strategy officer and his compensation
arrangement. Pursuant to the terms of the Employment Agreement,
Mr. Arthur is entitled to receive an annual base salary of
$300,000, which may be increased by the Board from time to time in
its sole discretion. In addition, the Company will pay Mr. Arthur
the following compensation for his services rendered prior to the
execution of the Employment Agreement: $25,000 for the period from
Aug. 1, 2024 until Aug. 31, 2024 and $15,000 for the period from
Sept. 1, 2024 until Sept. 18, 2024. Mr. Arthur is also entitled to
receive an annual cash bonus of up to a baseline of 60% of his base
salary, with the right and ability to earn up to a cap of 90% of
his base salary, applying a weighted average percentage of the
objective and subjective criteria and milestones set forth in the
Employment Agreement, which include target amounts and target dates
for equity investments received by the Company and the Company's
average market cap in addition to the completion of certain
milestones in the development of the Company's TriFan 600 aircraft.
The Board will determine and award the annual cash bonus within 30
days after the end of each calendar year during Mr. Arthur's
employment period.
About XTI Aerospace
XTI Aerospace (XTIAerospace.com) is the parent company of XTI
Aircraft Company (XTIAircraft.com), headquartered near Denver,
Colorado. XTI Aerospace is developing the TriFan 600, a vertical
lift crossover airplane (VLCA) that combines the vertical takeoff
and landing (VTOL) capabilities of a helicopter with the speed and
range of a fixed-wing business aircraft. The TriFan 600 is
designed to reach speeds of 345 mph and a range of 700 miles.
New York-based Marcum LLP, the Company's auditor since 2012, issued
a "going concern" qualification in its report dated April 16, 2024,
citing that the Company has a significant working capital
deficiency, has incurred significant losses and needs to raise
additional funds to meet its obligations and sustain its
operations. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
[^] Recent Small-Dollar & Individual Chapter 11 Filings
-------------------------------------------------------
In re Thaddeus Vogler and Katherine B Vogler
Bankr. N.D. Cal. Case No. 24-30690
Chapter 11 Petition filed September 17, 2024
represented by: Eric Gravel, Esq.
In re Kewel K. Munger
Bankr. E.D. Cal. Case No. 24-12709
Chapter 11 Petition filed September 17, 2024
represented by: Walter C. Riley, Esq.
In re Kerry T Mowlam and Renee K. Mowlam
Bankr. M.D. Fla. Case No. 24-02816
Chapter 11 Petition filed September 17, 2024
represented by: Thomas Adam, Esq.
In re Bamby Express, Inc.
Bankr. N.D. Ill. Case No. 24-13689
Chapter 11 Petition filed September 17, 2024
See
https://www.pacermonitor.com/view/IHRS7ZY/Bamby_Express_Inc__ilnbke-24-13689__0001.0.pdf?mcid=tGE4TAMA
represented by: Richard G Larsen, Esq.
SPRINGERLARSEN, LLC
E-mail: rlarsen@springerbrown.com
In re Monte Karl Weeden
Bankr. D. Mont. Case No. 24-40058
Chapter 11 Petition filed September 17, 2024
represented by: Gary Deschenes, Esq.
In re 42Blueridge LLC
Bankr. D.N.J. Case No. 24-19194
Chapter 11 Petition filed September 17, 2024
See
https://www.pacermonitor.com/view/ITZVKDQ/42Blueridge_LLC__njbke-24-19194__0001.0.pdf?mcid=tGE4TAMA
represented by: David G. Beslow, Esq.
GOLDMAN & BESLOW, LLC
E-mail: yrodriguez@goldmanlaw.org
In re Dina Pfeiffer-Krasz
Bankr. E.D.N.Y. Case No. 24-43831
Chapter 11 Petition filed September 17, 2024
represented by: Solomon Rosengarten, Esq.
In re 154 Mott Corp
Bankr. E.D.N.Y. Case No. 24-73579
Chapter 11 Petition filed September 17, 2024
See
https://www.pacermonitor.com/view/AJVWPNA/154_Mott_Corp__nyebke-24-73579__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Remond Remodeling Co Inc
Bankr. M.D. Pa. Case No. 24-02322
Chapter 11 Petition filed September 17, 2024
See
https://www.pacermonitor.com/view/NEMFOXA/Remond_Remodeling_Co_Inc__pambke-24-02322__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re WW AGAP LLC/ WWAgap LLC
Bankr. D. Wyo. Case No. 24-20367
Chapter 11 Petition filed September 17, 2024
See
https://www.pacermonitor.com/view/Y7INA6Y/WW_AGAP_LLC_WWAgap_LLC__wybke-24-20367__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Emergency Power Systems LLC
Bankr. W.D. Ark. Case No. 24-71544
Chapter 11 Petition filed September 18, 2024
See
https://www.pacermonitor.com/view/KQAT3JY/Emergency_Power_Systems_LLC__arwbke-24-71544__0001.0.pdf?mcid=tGE4TAMA
represented by: M. Sean Brister, Esq.
BRISTER LAW FIRM
E-mail: sean@bristerlawfirm.com
In re Kwan Cheung
Bankr. C.D. Cal. Case No. 24-17595
Chapter 15 Petition filed September 18, 2024
represented by: Ronghua Guan, Esq.
In re Quadruple D Trust
Bankr. D. Colo. Case No. 24-15490
Chapter 11 Petition filed September 18, 2024
Filed Pro Se
In re E & J Expedite 4 Jesus, LLC
Bankr. N.D. Ga. Case No. 24-59829
Chapter 11 Petition filed September 18, 2024
See
https://www.pacermonitor.com/view/L2VL46Y/E__J_Expedite_4_Jesus_LLC__ganbke-24-59829__0001.0.pdf?mcid=tGE4TAMA
represented by: Paul Reece Marr, Esq.
PAUL REECE MARR, P.C.
E-mail: paul.marr@marrlegal.com
In re Joseph O. Bracken
Bankr. D. Mass. Case No. 24-11875
Chapter 11 Petition filed September 18, 2024
represented by: Marques Lipton, Esq.
In re Charlita Treniece George
Bankr. D.N.J. Case No. 24-19209
Chapter 11 Petition filed September 18, 2024
In re Gregory Morgan
Bankr. E.D.N.Y. Case No. 24-73605
Chapter 11 Petition filed September 18, 2024
represented by: Robert Pryor, Esq.
In re Empire Acquiston Group
Bankr. W.D.N.Y. Case No. 24-11004
Chapter 11 Petition filed September 18, 2024
See
https://www.pacermonitor.com/view/HXQ6COI/Empire_Acquiston_Group__nywbke-24-11004__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Matthew Sand & Gravel, Inc.
Bankr. E.D.N.C. Case No. 24-03237
Chapter 11 Petition filed September 18, 2024
See
https://www.pacermonitor.com/view/CYK2C2A/Matthew_Sand__Gravel_Inc__ncebke-24-03237__0001.0.pdf?mcid=tGE4TAMA
represented by: JM Cook, Esq.
J.M. COOK, P.A.
E-mail: j.m.cook@jmcookesq.com
In re Clover Lane Family LP
Bankr. E.D. Pa. Case No. 24-13323
Chapter 11 Petition filed September 18, 2024
See
https://www.pacermonitor.com/view/L2FLIDI/Clover_Lane_Family_LP__paebke-24-13323__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Duffy Family, LP
Bankr. E.D. Pa. Case No. 24-13324
Chapter 11 Petition filed September 18, 2024
See
https://www.pacermonitor.com/view/II67MHQ/Duffy_FamilyLP__paebke-24-13324__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re CGD Real Estate Dev. LP
Bankr. E.D. Pa. Case No. 24-13325
Chapter 11 Petition filed September 18, 2024
See
https://www.pacermonitor.com/view/IYATYNQ/CGD_Real_Estate_Dev_LP__paebke-24-13325__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re KMD Real Estate Development, LP
Bankr. E.D. Pa. Case No. 24-13322
Chapter 11 Petition filed September 18, 2024
See
https://www.pacermonitor.com/view/LI4I3WQ/KMD_Real_Estate_Development_LP__paebke-24-13322__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Valley Brook Real Estate Development LP
Bankr. E.D. Pa. Case No. 24-13328
Chapter 11 Petition filed September 18, 2024
See
https://www.pacermonitor.com/view/JJ7FJUA/Valley_Brook_Real_Estate_Development__paebke-24-13328__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Cambridge Hillside, LLC
Bankr. M.D. Pa. Case No. 24-02346
Chapter 11 Petition filed September 18, 2024
See
https://www.pacermonitor.com/view/MOQP2BY/Cambridge_Hillside_LLC__pambke-24-02346__0001.0.pdf?mcid=tGE4TAMA
represented by: Ronald Santora, Esq.
BRESSET & SANTORA, LLC
E-mail: rsantora@bressetsantora.com
In re Cambridge Corry, LLC
Bankr. M.D. Pa. Case No. 24-02348
Chapter 11 Petition filed September 18, 2024
See
https://www.pacermonitor.com/view/TSBZMEI/Cambridge_Corry_LLC__pambke-24-02348__0001.0.pdf?mcid=tGE4TAMA
represented by: Ronald Santora, Esq.
BRESSET & SANTORA, LLC
E-mail: rsantora@bressetsantora.com
In re Cambridge Creekside, LLC
Bankr. M.D. Pa. Case No. 24-02350
Chapter 11 Petition filed September 18, 2024
See
https://www.pacermonitor.com/view/SERLHGA/Cambridge_Creekside_LLC__pambke-24-02350__0001.0.pdf?mcid=tGE4TAMA
represented by: Ronald Santora, Esq.
BRESSET & SANTORA, LLC
E-mail: rsantora@bressetsantora.com
In re Curtis Henderson Enterprise, LLC
Bankr. S.D. Ala. Case No. 24-12375
Chapter 11 Petition filed September 19, 2024
See
https://www.pacermonitor.com/view/HIPWPPI/Curtis_Henderson_Enterprise_LLC__alsbke-24-12375__0001.0.pdf?mcid=tGE4TAMA
represented by: Barry A Friedman, Esq.
BARRY A FRIEDMAN & ASSOCIATES, PC
E-mail: bky@bafmobile.com
In re 165 Chester Newport Auto Parts, Inc.
Bankr. E.D.N.Y. Case No. 24-43894
Chapter 11 Petition filed September 19, 2024
See
https://www.pacermonitor.com/view/I5R4MAQ/165_Chester_Newport_Auto_Parts__nyebke-24-43894__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Cleveland Street LLC
Bankr. E.D.N.Y. Case No. 24-73610
Chapter 11 Petition filed September 19, 2024
See
https://www.pacermonitor.com/view/VM2NZVQ/Cleveland_Street_LLC__nyebke-24-73610__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Global Prime Realty 1 Corp
Bankr. E.D.N.Y. Case No. 24-43886
Chapter 11 Petition filed September 19, 2024
See
https://www.pacermonitor.com/view/IA33NZY/Global_Prime_Realty_1_Corp__nyebke-24-43886__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Biogreen Environmental Solutions Inc.
Bankr. D.P.R. Case No. 24-03950
Chapter 11 Petition filed September 19, 2024
See
https://www.pacermonitor.com/view/2ZP2OOI/BIOGREEN_ENVIRONMENTAL_SOLUTIONS__prbke-24-03950__0001.0.pdf?mcid=tGE4TAMA
represented by: Jesus Enrique Batista Sanchez, Esq.
THE BATISTA LAW GROUP, PSC
E-mail: JEB@BATISTASANCHEZ.COM
In re Weeping Mary Bowling Green, SC
Bankr. D.S.C. Case No. 24-03409
Chapter 11 Petition filed September 19, 2024
See
https://www.pacermonitor.com/view/ILIFCWI/Weeping_Mary_Bowling_Green_SC__scbke-24-03409__0001.0.pdf?mcid=tGE4TAMA
represented by: Robert Pohl, Esq.
POHL BANKRUPTCY, LLC
E-mail: Robert@POHLPA.com
In re Gandy's Transport, LLC
Bankr. N.D. Tex. Case No. 24-43354
Chapter 11 Petition filed September 19, 2024
See
https://www.pacermonitor.com/view/HCFSPGY/Gandys_Transport_LLC__txnbke-24-43354__0001.0.pdf?mcid=tGE4TAMA
represented by: M. Jermaine Watson, Esq.
CANTEY HANGER, LLP
E-mail: jwatson@canteyhanger.com
In re Audbeej Adventures, LLC
Bankr. M.D. Fla. Case No. 24-05638
Chapter 11 Petition filed September 20, 2024
See
https://www.pacermonitor.com/view/M534RXA/Audbeej_Adventures_LLC__flmbke-24-05638__0001.0.pdf?mcid=tGE4TAMA
represented by: Scott A. Stichter, Esq.
STICHTER, RIEDEL, BLAIN & POSTLER, P.A.
E-mail: sstichter@srbp.com
In re GTTB LLC
Bankr. M.D. Fla. Case No. 24-05051
Chapter 11 Petition filed September 20, 2024
See
https://www.pacermonitor.com/view/R4X2OOA/GTTB_LLC__flmbke-24-05051__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Superior Contract Cleaning Inc.
Bankr. W.D. La. Case No. 24-50807
Chapter 11 Petition filed September 20, 2024
See
https://www.pacermonitor.com/view/RAL6F7I/Superior_Contract_Cleaning_Inc__lawbke-24-50807__0001.0.pdf?mcid=tGE4TAMA
represented by: H. Kent Aguillard, Esq.
H. KENT AGUILLARD
E-mail: kent@aguillardlaw.com
In re Hackensack Brewing, LLC
Bankr. D.N.J. Case No. 24-19325
Chapter 11 Petition filed September 20, 2024
See
https://www.pacermonitor.com/view/X2FXDHQ/Hackensack_Brewing_LLC__njbke-24-19325__0001.0.pdf?mcid=tGE4TAMA
represented by: Brian G Hannon, Esq.
NORGAARD OBOYLE HANNON
E-mail: bhannon@norgaardfirm.com
In re Michael R Jones
Bankr. D.N.J. Case No. 24-19328
Chapter 11 Petition filed September 20, 2024
represented by: Brian Hannon, Esq.
In re Seared Inc.
Bankr. E.D.N.Y. Case No. 24-43918
Chapter 11 Petition filed September 20, 2024
See
https://www.pacermonitor.com/view/GUMH2UI/Seared_Inc__nyebke-24-43918__0001.0.pdf?mcid=tGE4TAMA
represented by: Lawrence F. Morrison, Esq.
MORRISON TENENBAUM PLLC
E-mail: lmorrison@m-t-law.com
In re Wallace House Corporation
Bankr. S.D.N.Y. Case No. 24-11616
Chapter 11 Petition filed September 20, 2024
See
https://www.pacermonitor.com/view/SUH64NY/Wallace_House_Corporation__nysbke-24-11616__0001.0.pdf?mcid=tGE4TAMA
represented by: Lawrence Morrison, Esq.
MORRISON TENENBAUM PLLC
E-mail: lmorrison@m-t-law.com
In re Real Estate of Distinction
Bankr. W.D.N.Y. Case No. 24-11022
Chapter 11 Petition filed September 20, 2024
See
https://www.pacermonitor.com/view/G7LQJAY/Real_Estate_of_Distinction__nywbke-24-11022__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Hagen Construction LLC
Bankr. D. Ore. Case No. 24-62115
Chapter 11 Petition filed September 20, 2024
See
https://www.pacermonitor.com/view/4WMRH5A/Hagen_Construction_LLC__orbke-24-62115__0001.0.pdf?mcid=tGE4TAMA
represented by: Douglas Holbrook, Esq.
HOLBROOKLAW LLC
E-mail: doug@holbrooklaw.net
In re Matthew Brandon Martorello
Bankr. N.D. Tex. Case No. 24-90016
Chapter 11 Petition filed September 20, 2024
See
https://www.pacermonitor.com/view/AJCKBTI/Matthew_Brandon_Martorello__txnbke-24-90016__0001.0.pdf?mcid=tGE4TAMA
represented by: Daniel P. Winikka, Esq.
WINIKKA LAW, PLLC
E-mail: dan@danwinlaw.com
In re Donald J. Harford
Bankr. S.D. Tex. Case No. 24-34369
Chapter 11 Petition filed September 20, 2024
represented by: Donald Wyatt, Esq.
In re Brandon Paul Ussery
Bankr. S.D. Tex. Case No. 24-80274
Chapter 11 Petition filed September 20, 2024
Filed Pro Se
In re D.A. Ransom Company LLC
Bankr. E.D. Ark. Case No. 24-13098
Chapter 11 Petition filed September 23, 2024
See
https://www.pacermonitor.com/view/6GWNGVY/DA_Ransom_Company_LLC__arebke-24-13098__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Bryan Michael Thomas Briggs
Bankr. N.D. Cal. Case No. 24-41467
Chapter 11 Petition filed September 23, 2024
In re IMS Group LLC
Bankr. M.D. Fla. Case No. 24-05119
Chapter 11 Petition filed September 23, 2024
See
https://www.pacermonitor.com/view/M2Q3FZQ/IMS_Group_LLC__flmbke-24-05119__0001.0.pdf?mcid=tGE4TAMA
Filed Pro Se
In re Lawrence W Schumacher and Gail J. Schumacher
Bankr. N.D. Ill. Case No. 24-14083
Chapter 11 Petition filed September 23, 2024
represented by: Scott Clar, Esq.
In re Lighthouse Photography Dream Weddings, Inc.
Bankr. E.D.N.Y. Case No. 24-73670
Chapter 11 Petition filed September 23, 2024
See
https://www.pacermonitor.com/view/X6Y4W6A/Lighthouse_Photography_Dream_Weddings__nyebke-24-73670__0001.0.pdf?mcid=tGE4TAMA
represented by: Ronald D. Weiss, Esq.
RONALD D. WEISS, P.C.
E-mail: weiss@ny-bankruptcy.com
In re Remond Remodeling Co., Inc.
Bankr. M.D. Pa. Case No. 24-02390
Chapter 11 Petition filed September 23, 2024
See
https://www.pacermonitor.com/view/MEGP6YI/Remond_Remodeling_Co_Inc__pambke-24-02390__0001.0.pdf?mcid=tGE4TAMA
represented by: Jason P Provinzano, Esq.
LAW OFFICES OF JASON P PROVINZANO LLC
E-mail: mylawyer@jpplaw.com
In re J&G Consulting Services LLC
Bankr. E.D. Va. Case No. 24-33528
Chapter 11 Petition filed September 23, 2024
See
https://www.pacermonitor.com/view/WOFVXHY/JG_Consulting_Services_LLC__vaebke-24-33528__0001.0.pdf?mcid=tGE4TAMA
represented by: James E. Kane, Esq.
KANE & PAPA, P.C.
E-mail: jkane@kaneandpapa.com
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