/raid1/www/Hosts/bankrupt/TCR_Public/241226.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, December 26, 2024, Vol. 28, No. 360
Headlines
100 PERCENT: Seeks Chapter 11 Bankruptcy Protection in Colorado
10618 NE 11TH AVE: Gets OK to Hire Nicholas B. Bangos as Counsel
301 W NORTH: Seeks to Extend Plan Exclusivity to April 22, 2025
3265 E. VALLEY VISTA: Gets OK to Use Cash Collateral Until Feb. 13
ACCEL MOTORS: Seeks to Hire Morrison-Tenenbaum as Legal Counsel
ACCURIDE CORP: Hires Deloitte & Touche LLP as Independent Auditor
AHF PARENT: S&P Alters Outlook to Negative, Affirms 'B' ICR
AIO US: Seeks to Extend Plan Exclusivity to March 10, 2025
AIRE ANCIENT: Web Site Not Accessible to Blind, Zhang Says
AMERICAN NEIGHBORHOOD: Fails to Prevent Data Breach, Wray Says
AMERICAN VEIN: Commences Subchapter V Bankruptcy Proceeding
ARC MANAGEMENT: Trustee Hires Henry F. Sewell as Legal Counsel
ARC MANAGEMENT: Trustee Seeks to Tap Hays Financial as Accountant
ASP UNIFRAX: S&P Upgrades ICR to 'CCC+' on New Capital Structure
BARROW SHAVER: Seeks to Extend Plan Exclusivity to April 16, 2025
BARTLEY INVESTMENTS: 3304 W San Pedro Property Sale OK'd
BARTLEY INVESTMENTS: 3717 West Obispo Property Sale to OK'd
BELLTOWN FARMS: Seeks to Hire Turner Legal Group as Legal Counsel
BLINK HOLDINGS: Seeks to Extend Plan Exclusivity to March 10, 2025
BUTLER TRUCKING: Patricia Fugee Named Subchapter V Trustee
CAREMAX INC: Hires Alvarez & Marsal as Restructuring Advisor
CAREMAX INC: Seeks to Hire Sidley Austin as Bankruptcy Counsel
CAREMAX INC: Seeks to Tap Piper Sandler & Co. as Investment Banker
CARNIVAL CORP: S&P Alters Outlook to Positive, Affirms 'BB' ICR
CCA CONSTRUCTION: BML Properties Slams Bankruptcy Filing
CELSIUS NETWORK: Casla Realty Loses Bid to Transfer Case Venue
CINCINNATI BELL: S&P Affirms 'B-' Debt Rating on Sale of CBTS
CLINICAL NETWORK RESEARCH: Seeks Chapter 11 Bankruptcy Protection
COASTAL GREEN: Ruediger Mueller of TCMI Named Subchapter V Trustee
COKING COAL: Court OKs Cash Collateral Access, DIP Loan From Tacora
COKING COAL: Gets Interim OK to Hire Dinsmore & Shohl as Counsel
COMPAC USA: Commences Subchapter V Bankruptcy Process
CONN CORP: Seeks Approval to Hire Pate Horton & Ess as Accountant
CONTAINER STORE: Gets Court Clearance to Tap Chapter 11 Financing
CONTAINER STORE: S&P Downgrades ICR to 'D' on Bankruptcy Filing
CONTAINER STORE: Seeks Chapter 11 Bankruptcy Protection in Texas
CRITICAL REHAB: Seeks to Hire Harvard & Associates as Accountant
CRYSTAL BASIN: Lisa Holder Named Subchapter V Trustee
DINE-MITE HOSPITALITY: Gets OK to Use Cash Collateral Until Jan. 9
DIOCESE OF SYRACUSE: Court Rules on Standing, Discovery Issues
DITECH HOLDING: $58,610.99 Skorcz Claim Disallowed
DRAFTKINGS INC: Faces Class Lawsuit Over Marketing Practices
DRAFTKINGS INC: Wan Sues Over Data Privacy Violations
DUSOBOX: To Sell Assets to Precision Corr for $8.2MM
EBIX INC: 2nd Circuit Affirms Judgment in Saraf, et al. Suit
ECO ROOF: Seeks to Hire Sherman & Howard as Litigation Counsel
EDGEWOOD FOOD: Request for $3,060.00 in Attorney's Fees Granted
ELITA 7: Seeks Chapter 11 Protection in Massachusetts
EMS WAREHOUSING: Seeks Bankruptcy Protection in Massachusetts
ENVIVA INC: Plan Exclusivity Period Extended to March 7, 2025
FARADAY FUTURE: Forges Licensing Collaboration With Grow Fandor
FLATIRON NEW: Seeks Cash Collateral Access Until Feb. 28
FORT GORDON: Moody's Affirms 'Ba1' Rating on 2006 Class I Bonds
GLOSSLAB LLC: Seeks Chapter 11 Bankruptcy Protection
GRAFTECH FINANCE: Ends Debt Exchange Offer, Consent Solicitation
GRAFTECH INTERNATIONAL: S&P Downgrades ICR to 'D' on Debt Exchange
GRAY TELEVISION: Moody's Affirms 'B2' CFR, Outlook Stable
GREAT LAKES: S&P Places 'CC(sf)' Bond Rating on Watch Negative
GRESHAM WORLDWIDE: Plan Exclusivity Extended to Jan. 31, 2025
GRIT & GRAVEL: Access to Cash Collateral Terminated
H-FOOD HOLDINGS: Russell Johnson Represents Utility Companies
HALO ESTATES: Seeks to Hire Rodriguez Law Group as Legal Counsel
HASTY GROUP: Seeks to Hire Krigel Nugent + Moore as Legal Counsel
HAWAII STAGE: Seeks to Hire Choi & Ito as Bankruptcy Counsel
HEALTHY SPOT: Hires Levene Neale Bender Yoo & Golubchik as Counsel
HERITAGE GROCERS: S&P Alters Outlook to Negative, Affirms 'B' ICR
HYPHA LABS: CEO Douglass Acquires 1,000 Series C Preferred Shares
HYPHA LABS: Widens Net Loss to $707K in Third Quarter
IHEARTCOMMUNICATIONS INC: S&P Raises ICR to 'CCC+', Outlook Neg.
IHEARTMEDIA INC: Finalizes Debt Exchange, S&P Lowers Subsidiary
ILEARNING ENGINES: Voluntarily Files for Chapter 11 Bankruptcy
ILEARNINGENGINES: Seeks Chapter 11 Bankruptcy Protection
IMPERIAL GROUP: Sec. 341(a) Meeting of Creditors on January 17
ISPECIMEN INC: Appoints Robert Lim as CEO and Director
ISPECIMEN INC: Incurs $1.44 Million Net Loss in Third Quarter
JJK PROPERTIES: Seeks to Hire Lane Law Firm as Legal Counsel
JOP3 DEVELOPMENT: Hires NAI Robert Lynn as Real Estate Broker
JUMPSTAR ENTERPRISES: Drew McManigle Named Subchapter V Trustee
K&NN TRUCKING: Nathan Smith Named Subchapter V Trustee
KARAS FOOD: Court Extends Use of Cash Collateral Until Jan. 21
KNS HOLDCO:S&P Raises ICR to 'CCC+' After Distressed Debt Exchange
KODIAK GAS: S&P Raises ICR to 'BB-' on Improving Leverage
LATIGO HOMES: Files Chapter 11 Bankruptcy in Texas
LILIUM NV: Finds Purchaser for Key Subsidiaries
LINX OF LAKE: Gets Interim OK to Use Cash Collateral Until Feb. 6
LONESTAR FIBERGLASS: Sec. 341(a) Meeting of Creditors on January 21
M3 ROOFING: Aleida Martinez Molina Named Subchapter V Trustee
MACY'S INC: S&P Affirms 'BB+' Issuer Credit Rating, Outlook Stable
MILLENKAMP CATTLE: Gets OK to Use Cash Collateral Until April 30
MIRANDA LOGISTICS: Access to Cash Collateral Terminated
MMEX RESOURCES: Incurs $471K Net Loss in Second Quarter
MONICA L. COLUMBIA: Counsel's $203,084.89 Fee Application Denied
MONTICELLO CONSTRUCTION: Exclusive Plan Filing Extended
MULTIPLAN CORP: S&P Downgrades ICR to 'CC' on Distressed Exchange
MULTIPLAN CORP: Shares Climb 82% Over $4.5-Bil. Refinancing Deal
N.C. 17-19: Seeks Chapter 11 Bankruptcy Protection in New York
NORMAN REGIONAL: Moody's Confirms 'B1' Rating, Outlook Negative
NORTHVOLT AB: Paul Weiss & Gray Reed Represent Second Lien Lenders
NORTHWEST GRADING: Files Chapter 11 Bankruptcy Protection in Idaho
OCEANKEY (US) II: Moody's Alters Outlook on 'B2' CFR to Negative
OMIMEX PETROLEUM: Katharine Clark Named Subchapter V Trustee
ONYX OWNER: Seeks Bankruptcy Protection in Delaware
ORION HEALTHCORP: Court Abstains from Hearing U.S., et al Case
ORION HEALTHCORP: Court Tosses Parmar, et al's Counterclaims
PANDYA REAL: Hits Chapter 11 Bankruptcy Protection in Pennsylvania
PARAMOUNT RESOURCES: S&P Withdraws 'BB-' Issuer Credit Rating
PARTY CITY: Files for Bankruptcy Again Within Two Years
PERFECT VIEW: Hires Palermo Landsman as Accountant and Bookkeeper
PERFECTIONS INC: Seeks Approval to Hire TriCPS as Accountant
PRIMAL MATERIALS: Areya Holder Aurzada Named Subchapter V Trustee
PRIME DEVELOPMENT: Seeks to Use Cash Collateral
RAGING BULL: Amends Priority Claims Pay Details
REDLINE METALS: Seeks to Extend Plan Exclusivity to Feb. 28, 2025
RICHARDSON CREED: Seeks Bankruptcy Protection in Oregon
RLK GROUP: Unsecureds to Get Share of Income for 36 Months
ROSE AIRCRAFT: Files Chapter 11 Bankruptcy in Arkansas
RYVYL INC: All Four Proposals Approved at Annual Meeting
RYVYL INC: Incurs $5.17 Million Net Loss in Third Quarter
SBG BURGER: Affiliate to Sell Business Store to Pattman LLC
SICHEM INC: Files Chapter 11 Bankruptcy Protection in Texas
SILVERGATE CAPITAL: Milbank & Potter Update List of Stockholders
SMARTFOODS INC: Wilson Sues Over Mislabeled Popcorn Products
SOVEREIGN CAPITAL: Seeks Chapter 11 Bankruptcy Protection
STEPHENS GARAGE: Sec. 341(a) Meeting of Creditors on January 21
STEWARD HEALTH: Cain & Skarnulis Revises Rule 2019 Statement
STOLI GROUP: Hires Hilco Valuation Services as Appraisal Agent
STOLI GROUP: LA Dodgers Earns Seat on Creditors' Committee
SURGEM LLC: Files Bare-Bones Bankruptcy Petition in New Jersey
TIMELESS AESTHETICS: Gets Final OK to Use Cash Collateral
UPLIFT RX: Former Counsel Loses Bid to Dismiss Civil RICO Claims
US NUCLEAR: Michael Pope Reinstated to Board After Miscommunication
VERITAS HOLDINGS: S&P Upgrades ICR to 'CCC', On Watch Positive
VIO FRANCHISE: Web Site Not Accessible to Blind, Gaspa Says
VISION PAINTING: Seeks Cash Collateral Access
VISION PAINTING: Seeks Court Approval to Hire Bankruptcy Counsel
WEBSTERNT LLC: Commences Subchapter V Bankruptcy Proceeding
WELLFUL INC: Moody's Lowers CFR to Caa2 & Alters Outlook to Stable
WESTCHESTER COUNTY HEALTH CARE: S&P Cuts Rev. Bond Rating to 'BB+'
WOM SA: Benesch Friedlander Represents Ad Hoc Group of Noteholders
WOM SA: Gets Court Nod to Exit Chapter 11 Bankruptcy
YELLOW CORP: Contests Government's $2-Bil. Pollution Cleanup Claim
ZAYO GROUP: Lenders Ink Cooperation Deal After Talks Falter
ZUMIEZ INC: Web Site Not Accessible to Blind, Dalton Says
ZURVITA INC: Zinzino Acquire Assets in Ch. 11, Provides $4.5M DIP
*********
100 PERCENT: Seeks Chapter 11 Bankruptcy Protection in Colorado
---------------------------------------------------------------
On December 18, 2024, 100 Percent Chiropractic Cotto LLC filed
Chapter 11 protection in the District of Colorado. According to
court filing, the Debtor reports $1,573,853 in debt owed to 1
and 49 creditors. The petition states funds will be available to
unsecured creditors.
A meeting of creditors under Sec. 341(a) to be held on January 23,
2025 at 01:00 PM at Telephonic Chapter 11: Phone 888-497-4718,
Passcode 6026644#.
About 100 Percent Chiropractic Cotto LLC
100 Percent Chiropractic Cotto LLC --
https://100percentchiropractic.com/our-services/ -- is a a
chiropractic clinic that offers wide spectrum of services,
including chiropractic care for the entire family, nutritional
supplements, revitalizing massage and stretch therapies, and
specialized prenatal chiropractic care.
100 Percent Chiropractic Cotto LLC sought relief under Subchapter
V of Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Col. Case
No. 24-17465 on December 18, 2024. In the petition filed by Yahdi
Cotto-Jorge as manager, the Debtor reports total assets of $915,089
and total liabilities of $1,573,853.
Honorable Bankruptcy Judge Kimberley H. Tyson handles the case.
The Debtor is represented by:
K. Jamie Buechler, Esq.
BUECHLER LAW OFFICE, LLC
999 18th Street, Suite 1230 S
Denver, CO 80202
Tel: 720-381-0045
E-mail: Jamie@kjblawoffice.com
10618 NE 11TH AVE: Gets OK to Hire Nicholas B. Bangos as Counsel
----------------------------------------------------------------
10618 NE 11th Ave, LLC received approval from the U.S. Bankruptcy
Court for the Southern District of Florida to employ the law firm
of Nicholas B. Bangos, PA as counsel.
The firm will render these services:
`
(a) advise the Debtor with respect to its powers and duties in
the continued management and operation of its affairs and property,
attend meetings and negotiate with representatives of creditors and
other parties-in-interest;
(b) advise and consult on the conduct of the Chapter 11 case;
(c) advise the Debtor in connection with any contemplated
sales of assets, formulate and implement bidding procedures,
evaluate competing offers, draft, appropriate documents with
respect to the proposed sales and counsel it in connection with the
closing of such sales;
(d) analyze the Debtor's leases and contracts and the
assumptions, rejections, or assignments thereof and the validity of
liens against its assets, and advise on matters relating thereto;
(e) take all necessary actions to protect and preserve the
Debtor's estate;
(f) prepare pleadings in connection with the Chapter 11 case
on the Debtor's behalf;
(g) negotiate and prepare on the Debtor's behalf a Chapter 11
plan of reorganization or liquidation, disclosure statement and all
related agreements and/or documents, and take any necessary actions
on behalf of it to obtain confirmation of such plan;
(h) attend meetings with third parties and participate in
negotiations with respect to the above matters;
(i) appear before the court, any appellate courts, and the
U.S. Trustee to protect and represent the interests of the Debtor's
estate before such courts and the U.S. Trustee; and
(j) perform all other necessary legal services and provide all
other necessary legal advise to the Debtor in connection with this
Chapter 11 case.
The firm will be paid at these hourly rates:
Nicholas Bangos, Partner $750
Associates $100 - $400
Paraprofessionals $125
In addition, the firm will seek reimbursement for expenses
incurred.
The firm received a retainer of $15,000 from Benjamin Milgram, a
principal of the Debtor.
Mr. Bangos 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:
Nicholas B. Bangos, Esq.
Nicholas B. Bangos, PA
2560 RCA Blvd., Suite 114
Palm Beach Gardens, FL 33410
Telephone: (561) 781-0202
Email: nick@nbbpa.com
About 10618 NE 11th Ave
10618 NE 11th Ave, LLC, a Miami-based company, filed Chapter 11
petition (Bankr. S.D. Fla. Case No. 24-21789) on November 10, 2024,
with $1 million to $10 million in both assets and liabilities.
Judge Robert A. Mark oversees the case.
Nicholas B. Bangos, PA serves as the Debtor's bankruptcy counsel.
301 W NORTH: Seeks to Extend Plan Exclusivity to April 22, 2025
---------------------------------------------------------------
301 W North Avenue, LLC, asked the U.S. Bankruptcy Court for the
Northern District of Illinois to extend its exclusivity periods to
file a plan of reorganization and obtain acceptance thereof to
April 22, 2025, respectively.
In this case, cause exists to extend the exclusivity periods,
because the relevant factors weigh in favor of extension.
* Factor 1: Necessity of Time to Negotiate and Obtain Adequate
Information. The Debtor requires additional time to continue to
communicate with its primary secured mortgage lender with the goal
of confirming a consensual plan of reorganization. If the parties
can agree to treatment under the plan, the Debtor is in a unique
position to maximize the value of its estate for all of the various
stakeholders. This first factor weighs in favor of an extension.
* Factor 2: Good Faith Progress Toward Reorganization. The
Debtor has made good faith progress toward reorganization. The
Debtor has already filed a Disclosure Statement and a confirmable
Plan and has made good faith efforts to reach a consensual plan
with secured creditors, including its main secured mortgage lender.
This second factor also supports granting the Debtor an extension.
* Factor 3: Paying Debts as They Come Due. The Debtor is
paying expenses as they come due. Not only are post-petition
expenses being paid, but the Real Estate is generating significant
net income, and the Debtor has been paying significant monthly
amounts to its secured mortgage lender throughout the bankruptcy
case. This third factor supports granting the Debtor an extension
of the Exclusivity Periods.
* Factor 4: Reasonable Prospects for Filing a Viable Plan. The
Debtor has reasonable prospects for filing a viable plan. Here, the
Debtor has a realistic reorganization underway and has already
filed a confirmable Plan. The fourth factor weighs in favor of the
requested extension.
* Factor 5: The Length of Time the Case Has Been Pending. This
bankruptcy case has been pending since February 27, 2024. During
that time, the Debtor has been engaged in various administrative
tasks alongside its attempts to negotiate with its secured
creditors. The extension requested by this Motion is well within
the eighteen-month limitation (from commencement of this Case) for
an extension of the Plan Proposal Period and the twenty-month
limitation for an extension of the Solicitation Period.
* Factor 6: Unresolved Contingencies. Finally, certain
unresolved contingencies prevent the Debtor from finalizing a
chapter 11 plan. In addition to the pending Motion to Dismiss, the
Debtor is still attempting to negotiate the treatment of its
secured mortgage lender's claim as well as other lien creditors.
The amount and nature of these claims will impact their treatment
and the treatment of other claims under a plan. Therefore, this
final factor thus weighs in favor of the Court extending
exclusivity.
301 W North Avenue, LLC is represented by:
Robert W. Glantz, Esq.
Jeffrey M. Schwartz, Esq.
MUCH SHELIST, P.C.
191 N. Wacker Drive, Suite 1800
Chicago, IL 60606
Telephone: (312) 521-2000
Facsimile: (312) 521-3000
Email: rglantz@muchlaw.com
jschwartz@muchlaw.com
About 301 W North Avenue
301 W North Avenue, LLC is engaged in activities related to real
estate.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ill. Case No. 24-02741) on February
27, 2024. In the petition signed by F. Martin Paris, Jr., president
of MK Manager Corp. as manager of Debtor, the Debtor disclosed up
to $50 million in both assets and liabilities.
Judge Donald R. Cassling oversees the case.
Robert Glantz Much Shelist, P.C., Esq. at MUCH SHELIST PC, is the
Debtor's legal counsel.
3265 E. VALLEY VISTA: Gets OK to Use Cash Collateral Until Feb. 13
------------------------------------------------------------------
3265 E. Valley Vista, LLC and Linear Companies, LLC got the green
light from the U.S. Bankruptcy Court for the District of Arizona to
use cash collateral until Feb. 13 next year.
The order signed by Judge Brenda Martin authorized 3265 E. Valley
Vista to use its cash collateral, which consists of revenues, to
pay operating expenses in accordance with its budget up to a
variance of 5%.
Meanwhile, Linear Companies was authorized to use the revenue from
its properties located at 2913 N. 75th Street and 9740 E. Desert
Cove to pay the operating expenses of those properties set forth in
its budget, with a 5% variance.
3265 E. Valley Vista and Linear Companies originally requested to
extend the use of cash collateral to May 31.
About 3265 E. Vallley Vista
3265 E. Vallley Vista, LLC is engaged in the vacation rental
market.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Ariz. Case No. 2:24-bk-10529-BKM) on
December 9, 2024. In the petition signed by Sean Parsons, member,
the Debtor disclosed up to $10 million in both assets and
liabilities.
Randy Nussbaum, Esq., at Sacks Tierney P.A., represents the Debtor
as legal counsel.
ACCEL MOTORS: Seeks to Hire Morrison-Tenenbaum as Legal Counsel
---------------------------------------------------------------
Accel Motors, Inc. seeks approval from the U.S. Bankruptcy Court
for the Eastern District of New York to employ Morrison-Tenenbaum
PLLC as its counsel.
The firm will provide the following services:
(a) advise the Debtor with respect to its powers and duties in
the management of its estate;
(b) assist in any amendments of schedules and other financial
disclousres and in the preparation/review/amendment of a disclosure
statement and plan of reorganization;
(c) negotiate with the Debtor's creditors and take necessary
legal steps to confirm and consummate a plan of reorganization;
(d) prepare on behalf of the Debtor all necessary legal papers
in this case;
(e) appear before the Bankruptcy Court to represent and
protect the interests of the Debtor and its estate; and
(f) perform all other legal services for the Debtor that may
be necessary and proper for an effective reorganization.
The firm will be paid at these hourly rates:
Partners $695
Associates/Of Counsel $495
Paraprofessionals $350
In addition, the firm will seek reimbursement for expenses
incurred.
Prior to the petition date, the firm received an initial retainer
of $15,000 from the Debtor.
Lawrence Morrison, Esq., an attorney at Morrison-Tenenbaum,
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:
Lawrence F. Morrison, Esq.
Morrison-Tenenbaum, PLLC
87 Walker Street, Second Floor
New York, NY 10013
Telephone: (212) 620-0938
Email: lmorrison@m-t-law.com
About Accel Motors
Accel Motors Inc. is primarily engaged in renting and leasing real
estate properties.
Accel Motors Inc. sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D.N.Y. Case No. 24-45239) on December 16,
2024. In the petition filed by Mehdi Moslem, president, the Debtor
disclosed estimated assets and liabilities between $1 million and
$10 million.
Judge Nancy Hershey Lord oversees the case.
Lawrence F. Morrison, Esq., at Morrison-Tenenbaum, PLLC serves as
the Debtor's counsel.
ACCURIDE CORP: Hires Deloitte & Touche LLP as Independent Auditor
-----------------------------------------------------------------
Accuride Corporation and its affiliates seek approval from the U.S.
Bankruptcy Court for the District of Delaware to employ Deloitte &
Touche LLP as independent auditor.
The firm will provide these services:
(a) perform an audit in accordance with auditing standards
generally accepted in the United States of America and express an
opinion on whether the Debtors' consolidated financial statements
for the fiscal year ending December 31, 2024, are presented fairly,
in all material aspects;
(b) provide audit services and conduct procedures associated
with the services described above that are beyond the scope of the
base audit procedures; and
(c) provide additional services deemed appropriate and
necessary to benefit the Debtors' estates.
The firm will be paid at a fixed fee of $435,000 for its audit
services.
The hourly rates of the firm's professionals for out-of-scope
services are as follows:
Partner, Principal or Managing Director $900 - $1,100
Senior Manager $700 - $820
Manager $650 - $700
Senior $550 - $610
Analyst $470 - $510
In addition, the firm will seek reimbursement for expenses
incurred.
Prior to petition date, the Debtors paid the firm $280,000 for
prepetition services.
Bill McFarland, an audit and assurance partner at Deloitte &
Touche, 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:
Bill McFarland
Deloitte & Touche LLP
2200 Ross Avenue, Suite 1600
Dallas, TX 75201
Telephone: (713) 982-3499
Email: bimcfarland@deloitte.com
About Accuride Corp.
Accuride Corporation and its affiliates are a global leader in
steel and aluminum wheels and wheel-end components and assemblies,
supplying innovative products to over 1,000 customers in the
commercial vehicles, passenger cars, agriculture, construction and
industrial equipment markets.
Headquartered in Livonia, Michigan, the Debtors are part of a
global enterprise that employs approximately 3,600 individuals at
facilities in the United States, Canada, Mexico, Germany, France,
Turkey, Russia, and China.
Accuride's U.S. entities first filed for Chapter 11 protection in
October 2009, also in Delaware, to restructure in excess of $675
million in debt. The Court confirmed the Company's Plan of
Reorganization in February 2010.
On Oct. 9, 2024, Accuride Corp. and its U.S. entities filed
voluntary petitions for protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Lead Case No. 24-12289). Accuride
reported $500 million to $1 billion in assets and liabilities as of
the bankruptcy filing.
In the new Chapter 11 cases, the Debtors tapped Kirkland & Ellis
LLP as bankruptcy counsel; Young Conaway Stargatt & Taylor, LLP, as
local bankruptcy counsel; Quinn Emanuel Urquhart & Sullivan, LLP as
special counsel; Perella Weinberg Partners LP as investment banker;
and Deloitte & Touche LLP as independent auditor. Alvarez & Marsal
North America, LLC is the CRO provider and Omni Agent Solutions is
the claims agent.
AHF PARENT: S&P Alters Outlook to Negative, Affirms 'B' ICR
-----------------------------------------------------------
S&P Global Ratings revised its outlook to negative from stable and
affirmed its 'B' issuer credit rating on AHF Parent Holding Inc.
(AHF).
S&P said, "The negative outlook reflects our expectation that AHF's
S&P Global Ratings-adjusted debt to EBITDA will remain above 5x in
2025 as the subdued level of new construction and R&R activity
continues to adversely affect its volumes.
"Lower flooring volumes continue to exert pressure on the company's
credit metrics such that we expect adjusted debt to EBITDA to
remain above 5x for the next 12 months. As of Sept. 30, 2024, the
company's S&P Global Ratings-adjusted debt to EBITDA was 8.3x on a
rolling-12-months (RTM) basis compared with 2.5x during the same
period in September 2023. We expect the short-term operating
environment to remain challenging for AHF as reduced volumes
continue to exert downward pressure on the company's EBITDA margin.
As a result, we forecast adjusted leverage to remain above 5x for
the next 12 months.
"We forecast negative operating cash flows in fiscal 2024 and early
2025, with improvement expected by the end of 2025. As of
September 2024, the company's cash flow from operations (CFO) as a
percentage of debt was negative 4.1% on a RTM basis, compared with
30.5% during the same period in September 2023, as declines in
sales volume of some of the company's non-tile categories exerted
downward pressure on the company's net working capital position. We
expect this trend to continue into early 2025 as the company
rationalizes its net working capital needs in a challenging volume
environment. While we expect the company's CFO generation will be
negative in the next few upcoming quarters, we believe it will
improve sequentially and turn positive in the second half of 2025
as the company's volumes improve and inventory levels are better
aligned with sales. That said, we forecast about negative 4% CFO as
a percentage of debt in fiscal 2024 and about 4% by the end of
2025.
"The negative outlook on AHF reflects our belief that its S&P
Global Ratings-adjusted leverage will remain above 5x, and its
EBITDA interest coverage will remain in the 1.0x-1.5x range over
the next 12 months as its demand remains weak amid the challenging
macroeconomic environment.
"We could lower our ratings on AHF in the next six to 12 months if
leverage remained above 6x or if free operating cash flow remained
negative without any prospect for improvement.
"We could revise our outlook to stable if flooring volumes
recovered so that AHF maintained S&P Global Ratings-adjusted debt
to EBITDA under 5x."
AIO US: Seeks to Extend Plan Exclusivity to March 10, 2025
----------------------------------------------------------
AIO US, Inc. and its debtor affiliates asked the U.S. Bankruptcy
Court for the District of Delaware to extend their exclusivity
periods to file a plan of reorganization and obtain acceptance
thereof to March 10, 2025 and May 12, 2025, respectively.
Since the Petition Date, the Debtors' primary focus in these
chapter 11 cases has been obtaining Court approval of and
consummating the Natura Settlement and a Sale that maximizes value
for creditors and other stakeholders. In pursuit of these goals,
the Debtors expended significant time and resources over the past
four months engaged in protracted litigation with the Creditors'
Committee, including expansive document requests, numerous
depositions, and other discovery.
The Debtors explain that given the substantial progress made by the
companies in these chapter 11 cases, ample cause exists to extend
the Exclusive Periods. In less than four months, the Debtors
obtained first-day and second-day relief, including postpetition
financing, reached a Global Settlement with the Creditors'
Committee and Natura, their largest prepetition lender and parent,
and closed the Sale of substantially all of their assets.
The Debtors claim that their chapter 11 cases are also highly
complex. The Sale process required significant cross-border
coordination among multidisciplinary teams of Debtor and nonDebtor
employees and advisors. Various creditor constituencies, including
talc claimants, holders of the Debtors' unsecured bonds due 2043,
and former employees, hold claims against the Debtors, and multiple
parties in interest, including insurers, contract counterparties,
and employees, have appeared before the Court or responded
informally to the Debtors' requests for relief.
Furthermore, on the Petition Date, the Debtors owed Natura
prepetition debt exceeding $1 billion. Resolving these liabilities
thorough the Natura Settlement and the Sale required significant
planning, documentation, discovery, and litigation, demonstrating
that the complexity of these cases warrants an extension of the
Exclusive Periods. Accordingly, the Debtors believe the size and
complexity of these chapter 11 cases warrant the requested
extension of the Exclusive Periods.
The Debtors assert that they have remained in frequent
communication with the Creditors' Committee throughout these
chapter 11 cases and are engaged in productive negotiations over
the terms of a chapter 11 liquidating plan. The Debtors request
this extension of the Exclusive Periods to allow for these
negotiations to continue without the distraction of competing
chapter 11 plans, not to pressure the creditors to agree to the
Debtors' requests in regard to the terms. The Debtors believe an
extension will allow the Debtors and their creditor constituents
the necessary time to continue to discuss the best possible terms,
working towards a consensual plan that will benefit all
stakeholders.
The Debtors further assert that they have been paying undisputed
administrative expenses as they come due and will continue to do so
since the Petition Date. The Debtors continue to monitor their
liquidity closely and are confident that sufficient funding will be
available to satisfy their postpetition payment obligations during
the requested extension of the Exclusive Periods.
Finally, this Motion is without prejudice to any party in interest
seeking to shorten the Exclusive Periods pursuant to section
1121(d) of the Bankruptcy Code. As such, no party in interest will
be prejudiced if the requested extensions are approved.
Accordingly, the Debtors respectfully submit this factor weighs in
favor of granting the extension of the Exclusive Periods.
The Debtors' Counsel:
Zachary I. Shapiro, Esq.
Mark D. Collins, Esq.
Michael J. Merchant, Esq.
David T. Queroli, Esq.
RICHARDS, LAYTON & FINGER, P.A.
One Rodney Square
920 North King Street
Wilmington, Delaware 19801
Tel: (302) 651-7700
E-mail: collins@rlf.com
merchant@rlf.com
shapiro@rlf.com
queroli@rlf.com
- and -
Ronit J. Berkovich, Esq.
Matthew P. Goren, Esq.
Alejandro Bascoy, Esq.
WEIL, GOTSHAL & MANGES LLP
767 Fifth Avenue
New York, New York 10153
Tel: (212) 310-8000
E-mail: ronit.berkovich@weil.com
matthew.goren@weil.com
alejandro.bascoy@weil.com
About AIO US, Inc.
AIO US Inc., Avon Products Inc, and some of its affiliates are
manufacturers and marketers of beauty, fashion, and home products
with operations and customers across the globe.
AIO US and its affiliates sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. D. Del. Lead Case No. 24-11836) on
Aug. 12, 2024. In the petition filed by Philip J. Gund as chief
restructuring officer, AIO US disclosed $1 billion to $10 billion
in assets and debt.
Richards, Layton & Finger, P.A. and Weil, Gotshal & Manges LLP are
counsel to the Debtors. Ankura Consulting Group LLC serves as
restructuring advisor to the Debtors. Rothschild & Co US Inc is the
Debtors' investment banker and financial advisor. Epiq Corporate
Restructuring LLC acts as claims and noticing agent to the Debtors.
AIRE ANCIENT: Web Site Not Accessible to Blind, Zhang Says
----------------------------------------------------------
ANDREW ZHANG, individually and on behalf of all others similarly
situated, Plaintiff v. AIRE ANCIENT BATHS UES, LLC, Defendant, Case
No. 1:24-cv-09526 (S.D.N.Y., Dec. 13, 2024) alleges violation of
the Americans with Disabilities Act.
The Plaintiff alleges in the complaint that the Defendant's Web
site, https://beaire.com, is not fully or equally accessible to
blind and visually-impaired consumers, including the Plaintiff, in
violation of the ADA.
The Plaintiff seeks a permanent injunction to cause a change in the
Defendant's corporate policies, practices, and procedures so that
the Defendant's Web site will become and remain accessible to blind
and visually-impaired consumers.
Aire Ancient Baths UES, LLC provides spa services, including body
massage, facial massage, hot stone massage, and skincare
treatments. [BN]
The Plaintiff is represented by:
Uri Horowitz, Esq.
14441 70th Road
Flushing, NY 11367
Telephone: (718) 705-8706
Facsimile: (718) 705-8705
AMERICAN NEIGHBORHOOD: Fails to Prevent Data Breach, Wray Says
--------------------------------------------------------------
ALEC WRAY, individually and on behalf of all others similarly
situated, Plaintiff v. AMERICAN NEIGHBORHOOD MORTGAGE ACCEPTANCE
COMPANY, LLC D/B/A ANNIEMAC HOME MORTGAGE, Defendant, Case No.
1:24-cv-11140 (D.N.J., Dec. 13, 2024) is class action arising out
of the failures of the Defendant to properly secure and safeguard
the Personally Identifying Information1 of at least 171,074 its
customers, including Plaintiff and the proposed Class Members,
resulting in the unauthorized disclosure of that PII to
cybercriminals in a data breach from August 21, 2024, to August 23,
2024 (the "Data Breach").
The Plaintiff alleges in the complaint that the Defendant failed to
undertake adequate measures to safeguard the PII of Plaintiff and
the proposed Class Members, including failing to implement industry
standards for data security, and failing to properly train
employees on cybersecurity protocols, resulting in the Data
Breach.
American Neighborhood Mortgage Acceptance Company, LLC d/b/a
AnnieMac Home Mortgage is a mortgage lender based out of Mount
Laurel, New Jersey. [BN]
The Plaintiff is represented by:
James E. Cecchi, Esq.
CARELLA BYRNE CECCHI
BRODY & AGNELLO, P.C.
5 Becker Farm Road
Roseland, NJ 07068
Telephone: (973) 994-1700
Email: jcecchi@carellabyrne.com
AMERICAN VEIN: Commences Subchapter V Bankruptcy Proceeding
-----------------------------------------------------------
On December 19, 2024, American Vein & Lymphatic Society filed
Chapter 11 protection in the Northern District of Illinois.
According to court filing, 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.
About American Vein & Lymphatic Society
American Vein & Lymphatic Society is the leading resource for
venous and lymphatic care physicians, health professionals, and
patients.
American Vein & Lymphatic Society sought relief under Chapter
11 of the U.S. Bankruptcy Code (Bankr. N.D. Ill. Case No.
24-18981) on December 19, 2024. In the petition filed by Satish
Vayuvegula, M.D., as president, the Debtor reports estimated assets
up to $50,000 and estimted liabilities between $1 million and $10
million.
Honorable Bankruptcy Judge Michael B. Slade handles the case.
The Debtor is represented by:
Thomas Fawkes, Esq.
TUCKER ELLIS LLP
233 S. Wacker Dr.
Suite 6950
Chicago, IL 60606
Tel: 312-256-9425
Fax: 216-592-5009
E-mail: Thomas.Fawkes@tuckerellis.com
ARC MANAGEMENT: Trustee Hires Henry F. Sewell as Legal Counsel
--------------------------------------------------------------
S. Gregory Hays, the trustee appointed in the Chapter 11 case of
ARC Management Group, LLC, seeks approval from the U.S. Bankruptcy
Court for the Northern District of Georgia to employ the Law
Offices of Henry F. Sewell, Jr., LLC as counsel.
The firm will render these services:
(a) review and prepare on behalf of the trustee all legal
papers necessary to the administration of the Debtor's estate and
conduct examinations incidental to the administration of the
bankruptcy estate;
(b) advise the trustee with respect to his powers and duties
in the administration of the case;
(c) attend meetings and negotiate with representatives of
creditors and other parties in interest and advise and consult on
the conduct of the Chapter 11 case;
(d) take necessary action to protect and preserve the estate
of the Debtor;
(e) review and prepare on behalf of the trustee all documents
and agreements as they become necessary and desirable;
(f) review and object to claims, provide litigation services
relating to claims objections and proceedings to determine the
extent, validity and priority of liens, and analyze, recommend,
prepare, and pursue any causes of action created under the
Bankruptcy Code;
(g) advise and assist the trustee in connection with any
disposition of assets of the estate of the Debtor;
(h) appear before this court, any appellate courts, and the
U.S. Trustee, and protect the interests of the estate of the Debtor
before such courts and the U.S. Trustee; and
(i) provide assistance to the trustee as to any and all other
action incident to the proper preservation and administration of
the assets of the bankruptcy estate and perform all other necessary
legal services and give all other necessary legal advice to the
trustee in connection with this Chapter 11 case.
The firm will be paid at these hourly rates:
Henry Sewell, Jr., Attorney $475
Eric Silva, Attorney $350
In addition, the firm will seek reimbursement for expenses
incurred.
Mr. Sewell Jr. 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:
Henry F. Sewell, Jr., Esq.
Law Offices of Henry F. Sewell, Jr., LLC
2964 Peachtree Road NW, Suite 555
Atlanta, GA 30305
Telephone: (404) 926-0053
Email: hsewell@sewellfirm.com
About ARC Management Group
ARC Management Group, LLC, is a provider of billing, collection and
debt recovery services.
The Debtor sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. N.D. Ga. Case No. 23-61742) on Nov. 28, 2023. In the
petition signed by William D. Wilson, chief executive officer, the
Debtor disclosed up to $1 million in assets and up to $10 million
in liabilities.
Judge Barbara Ellis-Monro oversees the case.
William Rountree, Esq., at Rountree, Leitman, Klein & Geer, LLC, is
the Debtor's legal counsel.
S. Gregory Hays was appointed as trustee in this Chapter 11 case.
The trustee tapped the Law Offices of Henry F. Sewell, Jr., LLC as
counsel and Hays Financial Consulting, LLC as accountants.
ARC MANAGEMENT: Trustee Seeks to Tap Hays Financial as Accountant
-----------------------------------------------------------------
S. Gregory Hays, the trustee appointed in the Chapter 11 case of
ARC Management Group, LLC, seeks approval from the U.S. Bankruptcy
Court for the Northern District of Georgia to employ Hays Financial
Consulting, LLC as his accountant.
The firm will render these services:
(a) prepare and file any and all tax returns which may be
required and provide assistance, advice and consultation with
regard to state and federal income taxes and impact on assets;
(b) analyze holdings of the Debtor;
(c) analyze financial impact of any settlements related to the
Debtor and the bankruptcy estate;
(d) provide accounting and other financial services to the
Debtor as needed;
(e) investigate and analyze funds owed to the Debtor and
reconcile same;
(f) assist with the determination and resolution of claims
asserted by various parties, employees and taxing agencies;
(g) advise and assist the Debtor and attorneys in connection
with an investigation of its affairs to assist in the
administration of this estate and/or liquidation of the assets of
the bankruptcy estate;
(h) advise and assist the Debtor and its legal counsel in
connection with the investigation, analysis, and compilation of
data relating to financial and accounting matters or issues in
connection with any proceeding in this case, and prepare such
reports, summaries, documents and exhibits as may be required in
connection therewith;
(i) analyze records and claims; and
(j) review and prepare any tax returns for the Debtor as may
be required.
The firm will be paid at these hourly rates:
Managing Director $350 - $425
Director $225 - $350
Manager $150 - $225
Associates/Senior Associates $100 - $200
In addition, the firm will seek reimbursement for expenses
incurred.
Mr. Hays, a managing principal at Hays Financial Consulting,
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:
S. Gregory Hays
Hays Financial Consulting, LLC
2964 Peachtree Rd. NW, Ste. 555
Atlanta, GA 30305
Telephone: (404) 926-0060
About ARC Management Group
ARC Management Group, LLC, is a provider of billing, collection and
debt recovery services.
The Debtor sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. N.D. Ga. Case No. 23-61742) on Nov. 28, 2023. In the
petition signed by William D. Wilson, chief executive officer, the
Debtor disclosed up to $1 million in assets and up to $10 million
in liabilities.
Judge Barbara Ellis-Monro oversees the case.
William Rountree, Esq., at Rountree, Leitman, Klein & Geer, LLC, is
the Debtor's legal counsel.
S. Gregory Hays was appointed as trustee in this Chapter 11 case.
The trustee tapped the Law Offices of Henry F. Sewell, Jr., LLC as
counsel and Hays Financial Consulting, LLC as accountants.
ASP UNIFRAX: S&P Upgrades ICR to 'CCC+' on New Capital Structure
----------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on ASP Unifrax
Holdings Inc. (dba Alkegen) to 'CCC+' from 'SD' (selective
default). S&P also assigned issue-level ratings of 'B+' to the
super-priority revolver, 'CCC+' to the first-lien debt facilities,
and 'CCC' to the second-lien debt facilities. Finally, S&P raised
its issue-level ratings on the existing stub secured notes and stub
unsecured notes to 'CCC' from 'D', and it subsequently withdrew
these ratings at the company's request.
S&P said, "The negative outlook reflects our expectation of at
least a 1-in-3 chance of a downgrade within the next 12 months if
Alkegen does not substantially improve its operating performance.
"We expect the new capital structure will ease Alkegen's cash cost
burden over the next two years and support improved liquidity. We
expect an easing in Alkegen's cash costs from three factors under
its new capital structure: lower cash interest costs over the next
two years, a lower cash payment of the annual management fee, and
elimination of debt amortization payments. Most of Alkegen's new
debt--its first-lien term loan, first-lien notes, and second-lien
notes--allows for partial PIK payment of interest costs through
Sept. 30, 2026. We expect the company will use this PIK option,
lowering quarterly cash interest costs by about $13 million, or
about 20%. Also, the new debt terms will have an annual cap of $2.5
million on cash payment of management fees to the financial
sponsor, Clearlake Capital Group L.P. We expect most of this
sponsor fee expense will be noncash and accrue as an unsecured
liability subordinated to all other debt. We include this amount in
our calculation of debt. Lastly, Alkegen's new debt has no
amortization payments.
"We believe Alkegen's liquidity will be adequate over the next 12
months, supported by its new $200 million revolver, which was
undrawn as of Sept. 30, 2024, along with its $175 million
delayed-draw term loan. The delayed-draw facility can be used to
support operational needs. Although we do not expect the company
will draw on the facility in our base-case forecast, we believe it
would likely tap it to help meet cash needs in an unexpected
tightening of liquidity.
"However, we believe a meaningful improvement in business
conditions is key to supporting Alkegen's capital structure after
the optional PIK period. We expect management to exercise the PIK
interest option for the full allowable period of two years, until
the end of the third quarter in 2026. After that, interest payments
would become fully payable in cash, a sizable increase in cash
interest costs of about 40%. Alkegen would need a large rebound in
demand to sustain FFO cash interest coverage of 1x or better after
the PIK period. Consequently, we view Alkegen's capital structure
as unsustainable, which increases the likelihood of a transaction
we would consider distressed if there is no meaningful improvement
in operating performance over the next 12-24 months.
"Under our base-case forecast, we expect persistent muted operating
performance and cash flow over the next 12 months. We expect lower
interest rates would stimulate the economy and modestly improve
industrial activity and consumer demand. This would slightly raise
demand for insulation, filtration, and catalysis products in
Alkegen's key end markets for industrial production, general
industrial, and automotive. We also expect higher volumes, partly
offset by a slight decline in price, following the company's recent
recalibration to improve competitive positioning in certain product
lines. Overall, we believe that customers' appetite for capital
spending is clouded by a backdrop of uncertainty around
geopolitical risk, U.S. trade policy, and macroeconomic uncertainty
in China.
"Our base-case forecast considers a decline in total S&P Global
Ratings-adjusted revenue in 2024 of 9%-10% (a decline in the
mid-single-digit percentages pro forma for the divestiture of
Thermal Acoustics Solutions in 2023), followed by a modest recovery
in the low-single-digit area in 2025. We expect operational
initiatives to streamline the cost structure will improve S&P
Global Ratings-adjusted EBITDA margins by 150-200 basis points
(bps) in 2024 to about 15%-16%, with continued improvement of up to
100 bps in 2025, largely from improving operating leverage.
Overall, we expect a continued free operating cash flow (FOCF)
deficit in 2024, moderating slightly in 2025 due to lower cash
interest costs, paused cash payment of the sponsor fee, and higher
absolute earnings."
The negative outlook reflects the likelihood of at least a 1-in-3
chance of a downgrade in the next 12 months if Alkegen does not
meaningfully improve demand and operating performance.
S&P could lower its rating on ASP Unifrax if its performance does
not improve and it envisions a specific default scenario over a
12-month horizon, which could occur if we expect:
-- FFO to cash interest coverage will decline below 1x and remain
there;
-- A significant decline in liquidity; or
-- An increased likelihood of a transaction or restructuring that
involves lenders receiving less than the original promise in
timing, amount, or maturity.
S&P could raise its rating on ASP Unifrax if it believes the
company's capital structure is no longer unsustainable and expect:
-- The company will maintain FFO cash interest coverage above 1x
and significantly reduce leverage, including after the optional PIK
period; this could occur, for example, due to a meaningful rebound
in demand and operating performance;
-- The company generates neutral or better FOCF; and
-- It will maintain adequate liquidity.
BARROW SHAVER: Seeks to Extend Plan Exclusivity to April 16, 2025
-----------------------------------------------------------------
Barrow Shaver Resources Company LLC, asked the U.S. Bankruptcy
Court for the Southern District of Texas to extend its exclusivity
periods to file a plan of reorganization and obtain acceptance
thereof to April 16, 2025 and June 17, 2025, respectively.
The Debtor explains that the size and complexity of this Bankruptcy
Case alone warrants the requested extensions of the Exclusivity
Periods. This Bankruptcy Case involves a Debtor with $72,358,968.30
in scheduled liabilities. Further compounding the complexity of
issues with creditors, many of the creditors purport to hold liens
related to the Debtor's oil and gas operations that must be
carefully reviewed.
Notably, the Bankruptcy Case began as an involuntary case. Despite
these circumstances leading up to and since the Voluntary Petition
Date, the Debtor has made substantial progress in negotiating with
its stakeholders and administering this Bankruptcy Case. Through
its professionals, the Debtor has negotiated compromises and
resolutions to complex problems facing the Debtor's restructuring
and sale process that are necessary for any possibility of a
successful resolution of the Bankruptcy Case.
The Debtor claims that it is not seeking an extension of the
Exclusivity Periods to pressure or prejudice creditors. Instead,
the Debtor seeks an extension of time to engage with its creditors
and propose a plan that will best serve the interests of the Debtor
and its stakeholders and to ensure maximum recovery for those
stakeholders. Due to the involuntary petition, the first 120 days
of the Bankruptcy Case have been largely dedicated to establishing
numerous procedures for improving business operations and
maximizing the value of the Debtor's oil and gas assets.
The Debtor asserts that the company and its advisors have made
significant progress towards negotiating and proposing a plan of
reorganization, and simply require more time to avoid compromising
these efforts to the detriment of the Debtor's estate by adding the
additional burden of competing plans. Moreover, the Debtor, under
the CRO and with the assistance of its professionals, is continuing
to improve operations and implement business practices that
maximize value.
Simultaneously, the Debtor's professionals are continuing to guide
the Debtor through the bankruptcy process, negotiating with
interested parties, creditors, the UCC, and the UST, while
complying with the Bankruptcy Code, Bankruptcy Rules, Local Rules,
and Complex Procedures, to ensure that the preliminary negotiations
are ongoing for when the Debtor is ready to file a plan. All of
these efforts would be jeopardized by the expiration of the
Exclusivity Periods.
Barrow Shaver Resources Company, LLC is represented by:
Joseph E. Bain, Esq.
Sean T. Wilson, Esq.
Olivia K. Greenberg, Esq.
Elizabeth De Leon, Esq.
JONES WALKER LLP
811 Main Street, Suite 2900
Houston, Texas 77002
Telephone: (713) 437-1800
Facsimile: (713) 437-1810
Email: jbain@joneswalker.com
swilson@joneswalker.com
ogreenberg@joneswalker.com
edeleon@joneswalker.com
About Barrow Shaver Resources Company
Barrow Shaver Resources Company, LLC is a privately held,
independent oil and gas exploration and acquisition company based
in Tyler, Texas. Barrow Shaver is engaged in prospect generation,
producing properties acquisition, lease acquisition, assembly and
marketing of prospects for the exploration and development of oil
and natural gas in the prolific producing trends of the East Texas
and West Texas Basins.
Barrow Shaver Resources Company sought protection under Chapter 11
of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 24-33353) on
Aug. 19, 2024. In the petition signed by James Katchadurian, chief
restructuring officer, the Debtor disclosed up to $100 million in
both assets and liabilities.
Judge Alfredo R. Perez oversees the case.
The Debtor tapped Jones Walker LLP as counsel, CR3 Partners, LLC as
financial advisor, and Kroll Restructuring Administration, LLC as
claims, noticing, and solicitation agent.
BARTLEY INVESTMENTS: 3304 W San Pedro Property Sale OK'd
--------------------------------------------------------
Bartley Investments Ltd. received the green light from the U.S.
Bankruptcy Court for the Middle District of Florida, Tampa
Division, to sell its property located at 3804 W. San Pedro Street,
Tampa, Florida 33629.
The Debtor is authorized to sell the property "as is" and free and
clear of any liens, claims, interests, encumbrances, and security
interests of any kind, to Brandon Lanci and/or Milana Custom Homes,
LLC and/or its assigns for a purchase price of $775,000 subject to
final approval at the court hearing presently scheduled for January
16, 2025 at 1:30 p.m.
Any party, including Allan Bartley, may submit a competing offer to
purchase the Real Property prior to the January 16th hearing.
The liens of any alleged secured creditors, including the
Hillsborough County Tax Collector and Tamala Menendez, will attach
to the proceeds from the sale to the same extent, validity, and
priority as they exist against the Real Property.
The Debtor is authorized to pay all ordinary and necessary closing
expenses normally attributed to a seller of real estate at
closing.
The net sale proceeds, after payment of closing costs and any
amounts owed to the Hillsborough County Tax Collector, will be held
in a Debtor-in-possession account on which Dr. Ruediger Mueller is
the sole signatory until further order of the Court regarding the
distribution of
the net sale proceeds.
Dr. Ruediger Mueller is authorized to execute any and all documents
necessary to consummate the sale on behalf of the Debtor.
About Bartley Investments Ltd.
Bartley Investments Ltd. owns 12 rental properties in Tampa Villa
South, Tampa, Florida valued at $8.68 million.
Bartley Investments Ltd sought relief under Subchapter V of Chapter
11 of the U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No. 24-02952)
on May 23, 2024. In the petition signed by Allan N. Bartley,
general partner, the Debtor disclosed total assets of $8,764,925
and total liabilities of $3,703,633.
Honorable Bankruptcy Judge Catherine Peek McEwen oversees the
case.
The Debtor tapped Buddy D. Ford, Esq., at Buddy D. Ford, P.A. as
counsel and Accounting & Business Partners LLC as accountant.
BARTLEY INVESTMENTS: 3717 West Obispo Property Sale to OK'd
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida, Tampa
Division, has approved Bartley Investments Ltd., to sell its real
property located at 3717 West Obispo Street, Tampa, Florida 33629.
The Debtor is authorized to sell the property "as is" and free and
clear of any liens, claims, interests, encumbrances, and security
interests of any kind, to Brandon Lanci and/or Milana Custom Homes
LLC, or their assigns for the sum of $790,000.
The Court authorized Dr. Ruediger Mueller, the Subchapter V
trustee, to execute any and all documents necessary to consummate
the sale of the Real Property on behalf of the Debtor, including,
but not limited to, the "AS IS" Residential Contract for Sale and
Purchase and the deed.
The Debtor is authorized to pay broker’s fees in the amount of
$32,587.50, outstanding real estate taxes, and all other ordinary
and necessary closing expenses normally attributed to a seller of
real estate at closing.
The net sale proceeds after payment of the amounts set forth will
be held in trust in an interest bearing segregated
Debtor-in-possession bank account on which Dr. Ruediger Mueller is
the sole signatory, until further order of the Court regarding the
distribution of the net sale proceeds.
The liens of any secured creditors, including Tamala Menendez, will
attach to the proceeds of the sale to the same extent, validity,
and priority as they existed against the Real Property.
The Debtor shall provide a copy of the closing statement from the
sale of the property to the office of the United States Trustee and
Tamala Menendez within 5 days of the closing date. AWS Title
Services shall provide counsel for Tamala Menendez and Dr. Ruediger
Meuller with a draft closing statement at least twenty-four (24)
hours prior to closing.
About Bartley Investments Ltd
Bartley Investments Ltd. owns 12 rental properties in Tampa Villa
South, Tampa, Florida valued at $8.68 million.
Bartley Investments Ltd sought relief under Subchapter V of Chapter
11 of the U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No. 24-02952)
on May 23, 2024. In the petition signed by Allan N. Bartley,
general partner, the Debtor disclosed total assets of $8,764,925
and total liabilities of $3,703,633.
Honorable Bankruptcy Judge Catherine Peek McEwen oversees the
case.
The Debtor tapped Buddy D. Ford, Esq., at Buddy D. Ford, P.A. as
counsel and Accounting & Business Partners LLC as accountant.
BELLTOWN FARMS: Seeks to Hire Turner Legal Group as Legal Counsel
-----------------------------------------------------------------
Belltown Farms GF Opco, LLC seeks approval from the U.S. Bankruptcy
Court for the District of Nebraska to employ Turner Legal Group,
LLC as its legal counsel.
Turner Legal Group will provide these services:
(a) perform all necessary services as the Debtor's bankruptcy
counsel;
(b) advise the Debtor with respect to its powers and duties;
(c) attend meetings and negotiate with creditors and other
parties in interest;
(d) take all necessary action to protect and preserve the
Debtor's assets;
(e) prepare, or coordinate preparation of legal papers and
other pleadings necessary to administer the Debtor's estate;
(f) take any necessary action on behalf of the Debtor to
obtain approval of a disclosure statement and confirmation of a
plan of reorganization;
(g) represent the Debtor in connection with any potential
post-petition financing;
(h) appear before this court, appellate courts, and any other
courts to protect the interests of the Debtor and its estate; and
(i) perform any and all other necessary legal services in
connection with the Debtor's case and reorganization as requested.
The firm will be paid at its hourly rates from $175 to $315 plus
expenses.
The firm also requested a retainer of $20,000 from the Debtor.
Patrick Turner, Esq., an attorney at Turner Legal Group, 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:
Patrick R. Turner, Esq.
Turner Legal Group, LLC
14707 California Street #1
Omaha, NB 68154
Telephone: (402) 690-675
Email: pturner@turnerlegalomaha.com
About Belltown Farms GF Opco
Belltown Farms GF Opco, LLC is engaged in the business of oilseed
and grain farming.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Neb. Case No. 24-41171) on December 2,
2024. In the petition signed by Peter Tom Hill-Norton, authorized
signatory, the Debtor disclosed up to $50 million in both assets
and liabilities.
Judge Brian S. Kruse oversees the case.
Patrick R. Turner, Esq., at Turner Legal Group, LLC, represents the
Debtor as legal counsel.
BLINK HOLDINGS: Seeks to Extend Plan Exclusivity to March 10, 2025
------------------------------------------------------------------
Judge J. Kate Stickles of the U.S. Bankruptcy Court for the
District of Delaware extended Blink Holdings, Inc. and its
affiliates' exclusive periods to file their plan of reorganization,
and solicit acceptances thereof to March 10, 2025 and May 12, 2025,
respectively.
In a court filing, the Debtors believe that, in light of the
progress that the Debtors and other professionals have made in the
Chapter 11 Cases over the past three months, and the Debtors'
demonstrated efforts to work cooperatively with their stakeholders,
it is reasonable and appropriate that the Debtors be granted an
extension of the Exclusive Periods. Accordingly, the Debtors submit
that this factor weighs in favor of extending the Exclusive
Periods.
The Debtors explain that throughout the chapter 11 process, the
companies have endeavored to establish and maintain cooperative
working relationships with their primary creditor constituencies.
Importantly, the Debtors are not seeking the extension of the
Exclusive Periods to delay administration of the Chapter 11 Cases
or to exert pressure on their creditors, but rather to continue the
orderly, efficient, and cost-effective chapter 11 process. Thus,
this factor also weighs in favor of the requested extension of the
Exclusive Periods.
Moreover, termination of the Exclusive Periods would adversely
impact the Debtors' efforts to preserve and maximize the value of
the estates and the progress of the Chapter 11 Cases. In effect, if
the Court were to deny the Debtors' request for an extension of the
Exclusive Periods, any party in interest would be free to propose
an alternative chapter 11 plan for the Debtors. Terminating the
Exclusive Periods would only foster a chaotic environment and
provide opportunistic parties to engage in counterproductive
behavior in pursuit of alternatives that are not value-maximizing
or feasible under the circumstances of the Chapter 11 Cases.
Counsel to the Debtors:
Michael R. Nestor, Esq.
Sean T. Greecher, Esq.
Allison S. Mielke, Esq.
Timothy R. Powell, Esq.
Rebecca L. Lamb, Esq.
Benjamin C. Carver, Esq.
Young Conaway Stargatt & Taylor, LLP
Rodney Square
1000 North King Street
Wilmington, Delaware 19801
Telephone: (302) 571-6600
Facsimile: (302) 571-1253
Email: mnestor@ycst.com
sgreecher@ycst.com
amielke@ycst.com
tpowell@ycst.com
rlamb@ycst.com
bcarver@ycst.com
About Blink Holdings
Blink Holdings, Inc., is a provider of fitness services in the high
value, low price fitness category.
Blink Holdings and more than 100 of its affiliates sought relief
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead
Case No. 24-11686) on Aug. 12, 2024. At the time of the filing,
Blink Holdings disclosed $100 million to $500 million in both
assets and debt.
Judge J. Kate Stickles presides over the cases.
Young Conaway Stargatt & Taylor, LLP serves as the Debtors'
counsel. Moelis & Company is the Debtors' investment banker and
EPIQ Corporate Restructuring LLC is the Debtors' notice and claims
agent.
The U.S. Trustee for Region 3 appointed an official committee to
represent unsecured creditors in the Debtors' Chapter 11 cases.
BUTLER TRUCKING: Patricia Fugee Named Subchapter V Trustee
----------------------------------------------------------
The U.S. Trustee for Regions 3 and 9 appointed Patricia Fugee of
FisherBroyles, LLP as Subchapter V trustee for Butler Trucking,
LLC.
Ms. Fugee will be paid an hourly fee of $365 for her services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Ms. Fugee declared that she is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Patricia B. Fugee
FisherBroyles, LLP
27100 Oakmead Drive #306
Perrysburg, OH 43551
Phone: (419) 874-6859
Email: Patricia.Fugee@FisherBroyles.com
About Butler Trucking
Butler Trucking, LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ohio Case No. 24-32443) on December
17, 2024, with $50,001 to $100,000 in assets and $500,001 to $1
million in liabilities.
Judge John P. Gustafson presides over the case.
Eric R. Neuman, Esq., represents the Debtor as legal counsel.
CAREMAX INC: Hires Alvarez & Marsal as Restructuring Advisor
------------------------------------------------------------
CareMax Inc. and its affiliates seek approval from the U.S.
Bankruptcy Court for the Northern District of Texas to employ
Alvarez & Marsal North America, LLC as restructuring advisor.
The firm will provide the Debtors Paul Rundell as chief
restructuring officer (CRO) and certain additional personnel.
The CRO and additional personnel will render these services:
(a) perform a financial review;
(b) oversee the Debtors' global cash and disbursement
management with review of each potential disbursement;
(c) communicate on behalf of the Debtors all material
information about their assets, liabilities, and operational and
financial performance to their secured lenders;
(d) transfer any cash or sums in the Debtors' accounts;
(e) assist the Debtors with cash management;
(f) assist the Debtors with review and revision of their
business plan, and such other related forecasts as may be required
in negotiations or for other corporate purposes;
(g) assist the chief executive officer (CEO) and the Debtors'
other engaged professionals in developing for the board and/or
special committee's review possible restructuring plans or
strategic alternatives for maximizing the enterprise value of their
various business lines;
(h) serve as the principal contact with the Debtors' creditors
with respect to their financial and operational matters; and
(i) perform such other services as requested or directed by
the board, special committee, or other of the Debtors' personnel as
authorized by the board, and agreed to by the firm.
The firm's professionals will be paid at these hourly rates:
Managing Directors $1,100 - $1,575
Directors $850 - $1,100
Associates $625 - $825
Analysts $450 - $600
The firm will seek reimbursement for expenses incurred.
In addition to the hourly compensation, the firm will be entitled
to incentive compensation in the amount of $1,250,000. The
completion fee due will be increased by $250,000 if the
confirmation of a Chapter 11 plan or the closing of any
restructuring will yield a recovery for the holders of the Debtors'
equity.
Prior to the petition date, the firm received retainers and
payments totaling $3,071,262 from the Debtors.
Paul Rundell, a managing director at Alvarez & Marsal, 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:
Paul Rundell
Alvarez & Marsal North America, LLC
540 West Madison Street, Suite 1800
Chicago, IL 60661
Telephone: (312) 601-4220
Facsimile: (312) 332 4599
About CareMax Inc.
CareMax Inc. is a provider of medical centers for elderly
patients.
CareMax and its affiliates sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Texas Lead Case No. 24-80093) on
November 17, 2024. In its petition, CareMax reported estimated
liabilities between $500 million and $1 billion and estimated
assets between $100 million and $500 million.
Judge Michelle V. Larson oversees the cases.
The Debtors tapped Thomas Robert Califano, Esq., at Sidley Austin,
LLP as bankruptcy counsel; Alvarez & Marsal North America, LLC as
financial advisor; and Piper Sandler & Co. as investment banker.
Stretto, Inc. is the Debtors' claims, noticing and solicitation
agent.
CAREMAX INC: Seeks to Hire Sidley Austin as Bankruptcy Counsel
--------------------------------------------------------------
CareMax, Inc. and its affiliates seek approval from the U.S.
Bankruptcy Court for the Northern District of Texas to employ
Sidley Austin LLP as counsel.
The firm will provide these services:
(a) provide legal advice with respect to the Debtors' powers
and duties in the continued operation of their business;
(b) take all necessary action to protect and preserve the
Debtors' estates,
(c) prepare on behalf of the Debtors all necessary legal
papers in connection with the administration of their estates;
(d) advise the Debtors concerning, and prepare responses to,
legal papers that may be filed by other parties in these Chapter 11
cases;
(e) attend meetings and negotiate with representatives of
creditors and other parties in interest, attend court hearings, and
advise the Debtors on the conduct of their Chapter 11 cases;
(f) advise, negotiate, and assist with any sale or other
disposition of the Debtors' assets;
(g) prepare and refine on behalf of the Debtors a Chapter 11
plan, disclosure statement, and/or all related agreements and
documents necessary to facilitate an exit from these Chapter 11
cases, take appropriate action to obtain confirmation of such plan,
and take such further actions as may be required in connection with
the implementation of such plan;
(h) provide legal advice and perform legal services with
respect to matters relating to corporate governance, the
interpretation, application or amendment of the Debtors'
organizational documents, material contracts, and matters involving
them with their officers, directors, and managers;
(i) provide legal advice and legal services with respect to
litigation, tax, and other general legal issues for the Debtors to
the extent requested; and
(j) perform all other necessary legal services in connection
with the prosecution of these Chapter 11 cases.
The firm's counsel and staff will be paid at these hourly rates:
Attorneys $835 - $2,350
Paraprofessionals $625
In addition, the firm will seek reimbursement for expenses
incurred.
Prior to petition date, Sidley Austin received $1,500,000 advance
retainer from the Debtors. Subsequently, the Debtors paid an
additional advance payment retainers totaling $13,970,000 in the
aggregate.
Thomas Califano, Esq., an attorney at Sidley Austin, 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:
Thomas R. Califano, Esq.
Sidley Austin LLP
2021 McKinney Avenue, Suite 2000
Dallas, TX 75201
Telephone: (214) 981-3300
Facsimile: (214) 981-3400
Email: tom.califano@sidley.com
About CareMax Inc.
CareMax Inc. is a provider of medical centers for elderly
patients.
CareMax and its affiliates sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Texas Lead Case No. 24-80093) on
November 17, 2024. In its petition, CareMax reported estimated
liabilities between $500 million and $1 billion and estimated
assets between $100 million and $500 million.
Judge Michelle V. Larson oversees the cases.
The Debtors tapped Thomas Robert Califano, Esq., at Sidley Austin,
LLP as bankruptcy counsel; Alvarez & Marsal North America, LLC as
financial advisor; and Piper Sandler & Co. as investment banker.
Stretto, Inc. is the Debtors' claims, noticing and solicitation
agent.
CAREMAX INC: Seeks to Tap Piper Sandler & Co. as Investment Banker
------------------------------------------------------------------
CareMax, Inc. and its affiliates seek approval from the U.S.
Bankruptcy Court for the Northern District of Texas to employ Piper
Sandler & Co. as investment banker.
The firm will provide these services:
(a) review and analyze the Debtors' assets and liabilities and
the operating and financial strategies;
(b) review and analyze the business plans and financial
projections prepared by the Debtors;
(c) evaluate the Debtors' debt capacity in light of their
projected cash flows and assist in the determination of an
appropriate capital structure;
(d) evaluate the Debtors' liquidity;
(e) determine a range of values for the Debtors and any
securities that they offer or propose to offer in connection with a
restructuring;
(f) assist the Debtors in raising debt or equity financing;
(g) assist the Debtors in Merger and Acquisition (M&A)
transaction related activities;
(h) assist the Debtors in planning for dialogue and
negotiations with creditors for a potential Restructuring;
(i) assist the Debtors and their other professionals in
reviewing the terms of any proposed restructuring, M&A transaction
and/or new capital raise in responding thereto and, if directed, in
evaluating alternative proposals for a restructuring, M&A
transaction, and/or new capital raise, as applicable;
(j) assist or participate in negotiations with the parties in
interest;
(k) advise the Debtors with respect to, and attend, meetings
of their board of directors, creditor groups and other interested
parties, as reasonably requested; and
(l) render such other investment banking services as may be
agreed upon by Piper Sandler and the Debtors.
The firm will be paid at these following compensation structure:
(a) Monthly fee of $150,000 per month;
(b) Completion fee of $4,200,000;
(c) Core Provider Business M&A Fee equal or greater than 3.25
percent of the aggregate consideration and $4,200,000 payable upon
closing of an M&A transaction;
(d) Additional M&A fee equal to 3.25 percent of the aggregate
consideration, payable upon the closing of any M&A transaction;
and
(d) New Capital fee of 2 percent of the face amount of any
senior secured financing raised, 3 percent of the face amount of
any junior secured or senior or subordinated unsecured financing
raised and 5 percent in the case of any other financing.
In addition, the firm will seek reimbursement for expenses
incurred.
The Debtors paid Piper Sandler fees of $1,873,779 in accordance
with the engagement agreement.
Bilal Bazzy, a managing director at Piper Sandler & Co., 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:
Bilal Bazzy
Piper Sandler & Co.
800 Nicollet Mall, Suite 900
Minneapolis, MN 55402
Telephone: (800) 333-6000
About CareMax Inc.
CareMax Inc. is a provider of medical centers for elderly
patients.
CareMax and its affiliates sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Texas Lead Case No. 24-80093) on
November 17, 2024. In its petition, CareMax reported estimated
liabilities between $500 million and $1 billion and estimated
assets between $100 million and $500 million.
Judge Michelle V. Larson oversees the cases.
The Debtors tapped Thomas Robert Califano, Esq., at Sidley Austin,
LLP as bankruptcy counsel; Alvarez & Marsal North America, LLC as
financial advisor; and Piper Sandler & Co. as investment banker.
Stretto, Inc. is the Debtors' claims, noticing and solicitation
agent.
CARNIVAL CORP: S&P Alters Outlook to Positive, Affirms 'BB' ICR
---------------------------------------------------------------
S&P Global Ratings revised its outlook on global cruise operator
Carnival Corp. to positive from stable and affirmed all ratings,
including the 'BB' issuer credit rating.
The positive outlook reflects S&P's expectation that Carnival's
forward bookings will support FFO to debt increasing closer to its
20% upgrade threshold over the next 12 months and leverage
improving to around 4x.
S&P believes Carnival's 2025 booked position and strong pricing
will support continued improvement in credit measures in fiscal
year 2025. Carnival reported on its recent earnings call that the
company is entering fiscal 2025 (ending Nov. 30) with its best
booked position on record for both price (in constant currency) and
occupancy. The company has nearly two-thirds of its 2025 inventory
already booked and expects a 4.2% increase in net yields on a
constant currency basis. This follows 11% yield growth in fiscal
2024, which was 250 basis points higher than its initial yield
guidance in December 2023 and largely due to higher prices across
all its brands. While yields benefitted from the premium that new
ships command, Carnival noted that even excluding new builds,
yields were up almost 10% over fiscal 2023.
Carnival indicated that price and occupancy are higher than 2024
for all four quarters of 2025. However, despite the recent strength
in bookings, Carnival's booked position for the second half of the
year is probably lower than for the first half, which would be
typical at this point in the fiscal year. S&P expects Carnival's
second half booked position will improve during the typical winter
wave season early in the year, when bookings are typically
significant. Carnival reported strong momentum in the fourth
quarter, with booking volumes for the fourth quarter for fiscal
2025 higher compared to a strong 2024. The company also noted that
booking volumes for the fourth quarter for 2026 broke records. The
company's booking curves for both its North American and European
segments are each at their longest advanced booking windows on
record.
S&P said, "We estimate net revenue will increase around 4% and
reported EBITDA will increase about 6% in 2025. As a result, we
expect Carnival's fiscal 2025 S&P Global Ratings-adjusted debt to
EBITDA will improve to approximately 3.9x by the end of the year
from an estimated 4.4x in fiscal 2024. This level of leverage is
below our 4.5x upgrade threshold for Carnival at the 'BB' issuer
credit rating. However, our forecast for funds from operations
(FFO) to debt improves to about 19% in fiscal 2025, which is just
under our 20% FFO to debt upgrade threshold. FFO to debt remains
impaired by the company's higher interest burden, but we expect
this will improve over time as the company addresses higher-cost
debt issued during the pandemic in its capital structure through
refinancing or repayment. Nevertheless, we believe the positive
outlook is supported by an expectation for FFO to debt to get close
to 20% in fiscal 2025 and above 20% in fiscal 2026."
Refinancings in fiscal 2025 could support further interest
reduction and increase cash available for debt reduction. In its
June 2023 investor day, Carnival outlined a three-year program to
reduce net debt by more than $10 billion from its first-quarter
2023 peak. The company has reduced its debt balance by over $8
billion from the peak in January 2023. The combination of debt
repayment and opportunistic refinancings has continued to support
reduced interest expense and improving FFO. In fiscal 2025,
Carnival expects interest expense will be over $200 million less
than in fiscal 2024 and over $500 million less than in fiscal
2023.
Despite improving interest expense, Carnival still has two bonds
totaling approximately $3 billion with interest rates in excess of
10%. S&P said, "Given Carnival's improving credit measures and
current yields on these bonds, we believe Carnival would likely be
able to refinance these instruments at a much lower cost. Both
these bonds become callable in fiscal 2025. In our forecast, we
assume the company is able to refinance these bonds in the second
half of 2025 at rates that are at least 300 basis points lower than
the current interest rates. Furthermore, we believe lower capital
expenditures in fiscal 2025 compared to fiscal 2024 and the lack of
a ship delivery in fiscal 2026 will provide Carnival with
additional cash flow for debt repayment over the next two years,
thereby lowering interest and improving FFO."
S&P believes Carnival's moderate ship delivery schedule will allow
the company to continue reducing leverage. The cruise industry is
capital intensive because of the significant capital requirements
needed to fund new ships and the need to take delivery of ships
regardless of the operating environment. Cruise operators generally
must commit to new ship orders at least three to five years in
advance given the limited number of shipyards globally that are
equipped to build cruise ships. While the operators typically
obtain financing commitments for the ships before delivery (often
at the same time as they contract for the ship's delivery), which
provides some liquidity support if cash flow declines, the
incremental debt can significantly deteriorate credit measures
during periods of operating weakness because debt balances increase
while EBITDA declines.
Carnival's ship delivery schedule slows in fiscal 2025 as the
company will take delivery of only one ship this year and no ships
in fiscal 2026. This follows three large ship deliveries in fiscal
2024. Carnival resumed ordering ships earlier this year and has one
ship scheduled for delivery in each of fiscal 2027, fiscal 2028,
fiscal 2029, fiscal 2031, and fiscal 2033. Carnival's recent ship
orders align with its plans to target one to two ship deliveries
per year. This compares to three to five ships annually from fiscal
2018 to fiscal 2022. Carnival's more measured approach to ordering
new ships than pre-pandemic supports its strategy to repair its
balance sheet. S&P expects this more measured level of ship
deliveries will allow Carnival to generate significant cash flow
for leverage reduction over the next few years, despite expected
ship debt to finance new deliveries. Prior to the pandemic,
Carnival's internally generated cash flow could fund four to five
large ships annually.
Demand for future cruise bookings could decline in a slowing
macroeconomic environment. Vacationers have remained more
resilient than we previously expected but a decline in savings
built up during the pandemic could lead to tighter personal travel
budgets. However, consumers' desire to vacation would likely lead
them to search for deals rather than cut travel spending
altogether. Cruise operators have historically used price as a
lever to fill their ships in weaker economic conditions. In S&P's
view, if the global economy unexpectedly slows more than its
current base case, the risk of discounting to fill the ships would
be lower than in previous economic slowdowns. This is because even
though the price gap between a cruise vacation and comparable
land-based vacation has narrowed over the past year, it still
remains wider than usual. In addition, Carnival's current booked
position for fiscal 2025 and its lower capacity growth in fiscal
2025 and fiscal 2026 are risk mitigants and provide good revenue
visibility. Carnival has nearly two-thirds of its 2025 inventory
already booked and the industry doesn't usually see significant
spikes in cancellations if the economy weakens modestly.
S&P said, "The positive outlook reflects our expectation that
Carnival's forward bookings will support FFO to debt increasing
closer to our 20% upgrade threshold over the next 12 months and
leverage improving to around 4x. This incorporates our expectation
for good but moderating yield growth in 2025, interest savings from
refinancings and debt repayment, and the possible refinancing of
some of Carnival's remaining high coupon bonds that are callable in
2025.
"We could raise the rating to 'BB+' if we expected Carnival's
operating performance would improve in a manner that would sustain
FFO to debt above 20% and S&P Global Ratings-adjusted debt to
EBITDA below 4.5x.
"We could lower our rating on Carnival if 2025 operating
performance were weaker than we expected, such that we believed
debt to EBITDA would be sustained above 5x and FFO to debt below
15%."
CCA CONSTRUCTION: BML Properties Slams Bankruptcy Filing
--------------------------------------------------------
BML Properties Ltd. expressed its disappointment in the bankruptcy
filing by CCA Construction Inc., formerly known as China
Construction America.
Sarkis Izmirlian, chair of BML Properties Ltd. and the original
developer of the Baha Mar resort in Nassau, Bahamas, said, "This is
just another example of CCA, and its multibillion-dollar parent
company China State Construction Engineering Corporation attempting
to evade responsibility for its actions by hiding behind a Chapter
11 proceeding."
In October 2024, New York Supreme Court Justice Borrock handed down
a 74-page decision against CCA and its affiliates detailing
multiple instances of fraud and usurping funds at the highest
levels of CCA related to Baha Mar, and awarded over $1.6 billion to
BML Properties. The judgement clearly states that:
-- BMLP proved by clear and convincing evidence that the
Defendants' multiple acts of fraud and breaches caused to the
Project to miss its opening and BMLP's subsequent loss of its
entire investment.
-- The testimony of the Defendants was not credible and was
inconsistent with the contemporaneous documents adduced at trial.
-- BMLP adduced sufficient evidence to demonstrate that piercing
the corporate veil is appropriate.
-- The Defendant entities were all subsidiaries of one parent
company, CSCEC Holding Company, Inc.
-- There was clear and convincing evidence that their acts were an
absolute sham and shakedown of Mr. Izmirlian.
"I am confident that both the bankruptcy judge and the New York
appellate court will see CCA for what it is, a company fraudulently
managed by bad actors. We will take every step necessary to enforce
our rights against CCA and all those who orchestrated CCA's frauds,
including its parent CSCEC," said Izmirlian.
About CCA Construction Inc.
Founded in 1985, China Construction America (CCA) is a subsidiary
of the world largest investment and construction group--China State
Construction Engineering Corp. Ltd. (CSCEC). CCA sets its vision to
become the most competitive investment and construction company in
the Americas. In 2020, it is ranked as the 57th largest contractor
in the United States.
CELSIUS NETWORK: Casla Realty Loses Bid to Transfer Case Venue
--------------------------------------------------------------
Judge Martin Glenn of the United States Bankruptcy Court for the
Southern District of New York denied Casla Realty LLC's Motion to
Transfer Venue in the case captioned as MOHSIN Y. MEGHJI,
LITIGATION ADMINISTRATOR, AS REPRESENTATIVE FOR THE POSTEFFECTIVE
DATE DEBTORS, Plaintiff, v. CASLA REALTY LLC, Defendant, Adv. Pro.
24-04002 (MG)(Bankr. S.D.N.Y.).
On July 13, 2024, the Plaintiff filed a complaint against Casla.
Allegedly, former Celsius employee Jason Stone rented a house from
Casla through his wholly-owned Puerto Rican LLC and transferred
Celsius assets to pay for it. tone sent 195 Ethereum to Casla in
December 2020, to pay for Stone's yearlong rent and security
deposit for a lease at a Puerto Rico townhouse which combined to
$126,000 in value. Specifically, Stone caused Celsius to make
multiple transfers of Celsius assets totaling 195 ETH into two
wallets owned or controlled by Casla to pay for Stone's rent and
security deposit.
Following that payment, Stone found out that the townhouse was
(allegedly) uninhabitable and in violation of a warranty of
habitability which Casla had signed in the rental agreement, but
when alerted to the issues with the property, Casla refused to
return the money Stone had sent to it, instead sequestering it into
Binance accounts and preventing Stone from recovering the funds.
Casla denies that the house was uninhabitable and that the true
reason why Stone sought a refund was because Ethereum's value had
doubled in between the time Stone paid the rent in Ethereum and
when he complained about the property.
On May 21, 2021, HoA sued Casla in the District Court for the
District of Puerto Rico, seeking to nullify the rent agreement
which HoA and Casla entered into and seeking damages as well. The
District of Puerto Rico dismissed the case with prejudice for lack
of diversity jurisdiction. HoA then sued Casla in state court in
Puerto Rico on February 18, 2022, on the grounds that the lease
agreement was null and void under the Civil Code of Puerto Rico,
and seeking damages.
HoA and Casla settled the state court case on June 10, 2022. The
settlement agreement provides that Casla will return a portion of
the rental fee ($68,375) in dollars to HoA, and HoA agreed not to
pursue recovery of the ETH transferred. The settlement also
releases Casla, HoA, and Stone (and their
agents/employees/officers/directors/etc.) from liability arising
from this rental agreement. The settlement agreement was signed by
Jason Stone on behalf of HoA, and by a representative from Casla.
This adversary proceeding is part of the larger Celsius bankruptcy
proceeding. The Litigation Administrator for Celsius claims that
Celsius and Stone were insolvent at the time of the transfers to
Casla, and sued Casla on the grounds of constructive fraudulent
transfer, unjust enrichment, conversion, and fraudulent inducement
The complaint was served on Casla on July 26, 2024.
Casla filed its motion to transfer venue on September 9.
On October 10, Casla answered the Plaintiff's Complaint and raised
defenses it styled as affirmative defenses: failure to state a
claim, failure to join a necessary party, res judicata, the
opponent's being in pari delicto, failure to mitigate damages, lack
of damages causation, unclean hands, contributory negligence, lack
of subject matter jurisdiction in this Court, the fact that it is a
good-faith transferee for value, waiver, estoppel, and double
recovery in light of a settlement the Plaintiff reached with a
necessary party.
Casla requests that the Bankruptcy Court transfer the case to state
court in Puerto Rico or, in the alternative, to the U.S. Bankruptcy
Court for the District of Puerto Rico. Casla takes issue with what
it calls the Litigation Administrator's "attempt to relitigate"
what it views as already-settled issues governed by a settlement
agreement, and argues that the settlement agreement requires all
related disputes to be heard by the Puerto Rican state court which
initially heard the case. Casla argues that the same claims in the
Complaint have already been litigated in Puerto Rico, and that a
judgment was entered in Puerto Rico state court in that matter in
June of 2022. Celsius was not a party to the Puerto Rico action,
and it was not a party to the settlement of that action.
The Litigation Administrator, in turn, argues that (1) the
Bankruptcy Court has exclusive jurisdiction to hear the Litigation
Administrator's claims, and transfer therefore is not permissible;
(2) even if transfer were permitted, Casla has not met the "heavy
burden" required to overcome the presumption favoring the
Bankruptcy Court's maintaining jurisdiction; and (3) the settlement
agreement between HoA and Casla is inapplicable in this case.
The Litigation Administrator points to a provision in Celsius's
confirmed Chapter 11 Plan regarding the Bankruptcy Court's
jurisdiction.
Even setting this Plan provision aside, the Litigation
Administrator believes that Casla has not overcome the strong
presumption in favor of the Bankruptcy Court's maintaining
jurisdiction over the case: not only is the presumption of validity
of the plaintiff's choice of forum strengthened in bankruptcy
cases, but Casla's arguments rest on a "fundamental
misunderstanding of the nature" of the action. Since this is an
avoidance action and not a contract dispute, New York is the most
convenient venue because witnesses and experts related to Celsius's
insolvency are located here, as is most of the evidence. The
Bankruptcy Court is immersed in the key issues in this litigation;
and moving the litigation to Puerto Rico would impose an
unnecessary financial burden on the debtor's estate.
The Bankruptcy Court finds removal would not be proper in this
case. The language of Celsius's Chapter 11 Plan gives the
Bankruptcy Court exclusive jurisdiction over all adversary
proceedings which arise from the debtor's Chapter 11 case.
Moreover, even absent the Plan language, the interests of justice
and consideration for the convenience of the parties counsel in
favor of retaining jurisdiction over this matter. First, this is an
adversary proceeding in a bankruptcy case, establishing the
presumption that the Bankruptcy Court is the appropriate venue.
Second, an analysis of the section 1404(a) factors shows that Casla
has not overcome this presumption: The witnesses in this adversary
proceeding will be spread between New York and Puerto Rico,
certainly, but will not necessarily be concentrated in Puerto Rico.
Judge Glenn concludes that conservation of estate resources is
essential in a bankruptcy proceeding and favors retaining venue of
this adversary proceeding in this Court. This Court has deep
knowledge of the bankruptcy law governing this adversary
proceeding. In a bankruptcy, heavy weight is accorded to the
plaintiff's choice of forum. And finally, given that this case
arises from a chapter 11 case which unfolded, and since this Court
has institutional knowledge about the Debtor's assets, financial
condition, and operations, judicial economy counsels in favor of
keeping the case.
A copy of the Court's decision is https://urlcurt.com/u?l=XEcjZt
Attorneys for Defendant Casla Realty PR LLC:
Robert M. Sasloff, Esq.
Wayne Greenwald, Esq.
JACOBS P.C.
595 Madison Avenue, 39 th Floor
New York, NY 10022
E-mail: robert@jacobspc.com
wayne@jacobspc.com
Attorneys for Plaintiff:
Mitchell P. Hurley, Esq.
AKIN GUMP STRAUSS HAUER & FELD LLP
One Bryant Park
New York, NY 10036
E-mail: mhurley@akingump.com
- and -
Elizabeth D. Scott, Esq.
Nicholas R. Lombardi, Esq.
AKIN GUMP STRAUSS HAUER & FELD LLP
2300 N. Field Street, Suite 1800
Dallas, TX 75201
E-mail: edscott@akingump.com
nlombardi@akingump.com
About Celsius Network
Celsius Network LLC -- http://www.celsius.network/-- is a
financial services company that generates revenue through
cryptocurrency trading, lending, and borrowing, as well as by
engaging in proprietary trading.
Celsius helps over a million customers worldwide to find the path
towards financial independence through a compounding yield service
and instant low-cost loans accessible via a web and mobile app.
Celsius has a blockchain-based fee-free platform where membership
provides access to curated financial services that are not
available through traditional financial institutions.
The Celsius Wallet claims to be one of the only online crypto
wallets designed to allow members to use coins as collateral to get
a loan in dollars, and in the future, to lend their crypto to earn
interest on deposited coins (when they're lent out).
Crypto lenders such as Celsius boomed during the COVID-19 pandemic,
drawing depositors with high interest rates and easy access to
loans rarely offered by traditional banks. But the lenders'
business model came under scrutiny after a sharp sell-off in the
crypto market spurred by the collapse of major tokens terraUSD and
luna in May 2022.
New Jersey-based Celsius froze withdrawals in June 2022, citing
"extreme" market conditions, cutting off access to savings for
individual investors and sending tremors through the crypto
market.
The list of major crypto firms that have filed for bankruptcy
protection in 2022 now includes Celsius Network, Three Arrows
Capital and Voyager Digital.
Celsius Network, LLC and its subsidiaries sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead Case
No. 22-10964) on July 14, 2022. In the petition filed by CEO Alex
Mashinsky, the Debtors estimated assets and liabilities between $1
billion and $10 billion.
The Debtors tapped Kirkland & Ellis, LLP and Kirkland & Ellis
International, LLP as bankrupty counsels; Fischer (FBC & Co.) as
special counsel; Centerview Partners, LLC as investment banker; and
Alvarez & Marsal North America, LLC as financial advisor. Stretto
is the claims agent and administrative advisor.
On July 27, 2022, the U.S. Trustee appointed an official committee
of unsecured creditors. The committee tapped White & Case, LLP as
its bankruptcy counsel; Elementus Inc. as its blockchain forensics
advisor; M3 Advisory Partners, LP as its financial advisor; and
Perella Weinberg Partners, LP as its investment banker.
Shoba Pillay, Esq., is the examiner appointed in the Debtors'
Chapter 11 cases. Jenner & Block, LLP and Huron Consulting
Services, LLC, serve as the examiner's legal counsel and financial
advisor, respectively.
* * *
On November 9, 2023, the Bankruptcy Court entered the Findings of
Fact, Conclusions of Law, and Order Confirming the Modified Joint
Chapter 11 Plan of Celsius Network LLC and Its Debtor Affiliates.
The Effective Date of the Plan occurred January 31, 2024.
CINCINNATI BELL: S&P Affirms 'B-' Debt Rating on Sale of CBTS
-------------------------------------------------------------
S&P Global Ratings affirmed its 'B-' issue-level rating on
Cincinnati Bell Inc.'s debt following the company's announcement
that it had completed the sale of its IT solutions and services
business, CBTS, for $670 million. The company used net proceeds
from the sale to repay the $120 million balance on its $400 million
revolving credit facility due 2028, repay the $21 million balance
on its network receivables facility, and repay the $208 million
balance on its CBTS receivables facility, which was terminated on
repayment. In addition, the company returned roughly $320 million
of cash to balance sheet to support its fiber builds in Hawaii and
Ohio.
S&P said, "Our gross default valuation modestly declines to $1.4
billion from $1.5 billion as the divestiture is partially offset by
an increase in our enterprise valuation multiple and the
incremental value from the company's fiber investments over the
last two years. The lower valuation combined with the repayment of
debt on its cash flow revolver and asset-backed loan (ABL)
facilities (which is limited because we assume revolvers and ABLs
are drawn by 85% and 60%, respectively, in our hypothetical default
scenario) results in a modest rise in the rounded recovery estimate
to 60% from 55% and the issue-level and recovery ratings remaining
a 'B-' and '3', respectively."
The increase in the enterprise valuation multiple to 6x from 5.5x
reflects the company's position as a pure-play fiber infrastructure
operator following the sale of its lower margin IT solutions
business, which had accounted for roughly 20% of the company's
earnings.
S&P said, "Our 'B-' issuer credit rating and stable outlook on
Cincinnati Bell are unchanged. While the company's S&P Global
Ratings-adjusted debt to EBITDA will decline to about 6.0x pro
forma for the transaction, from about 6.9x as of Sept. 30, 2024, we
believe leverage will likely remain around 6x over the next few
years because of its continued free operating cash flow deficits
and funding requirements."
ISSUE RATINGS--RECOVERY ANALYSIS
Key analytical factors
-- S&P's simulated default scenario envisions a default occurring
because of lower revenue and margin pressure stemming from mounting
competition from the incumbent cable providers and providers of
fixed wireless access (FWA) broadband service. These factors
contribute to significantly lower the company's revenue,
profitability, and cash flow. Deteriorating operating results would
likely cause a payment default at the point where Cincinnati Bell's
liquidity and cash flow become insufficient to cover its cash
interest expense, mandatory debt amortization, and
maintenance-level capital expenditure requirements.
-- S&P's recovery analysis assumes that the revolving credit
facility is 85% drawn at the time of default.
-- S&P said, "We have valued the company on a going-concern basis
using a 6x multiple of our projected emergence EBITDA of $240
million. The 6x multiple is somewhat higher than the multiples in
the 4.5x-5.5x range we use for other rated incumbent wireline
companies, which reflects Cincinnati Bell's higher proportion of
fiber assets relative to its peers."
Simulated default assumptions:
-- Simulated year of default: 2026
-- EBITDA at emergence: $240 million
-- Implied enterprise value (EV) multiple: 6x
-- Gross EV: $1.4 billion
Simplified waterfall:
-- Net EV (after 5% administrative costs): $1.35 billion
-- Valuation split (obligors/nonobligors): 100%/0%
-- Priority claims (asset-based facility, Cincinnati Bell
Telephone notes, Paniolo Fiber financing): $124 million
-- Estimated net EV available for secured debt: $1.2 billion
-- Estimated senior secured debt claims: $2.0 billion
--Recovery expectations: 50%-70% (rounded estimate: 60%)
Note: All debt amounts include six months of prepetition interest.
CLINICAL NETWORK RESEARCH: Seeks Chapter 11 Bankruptcy Protection
-----------------------------------------------------------------
On December 10, 2024, Clinical Network Research Development
Corporation filed Chapter 11 protection in the Central District of
California. According to court filing, the Debtor reports between
$1 million and $10 million in debt owed to 50 and 99 creditors. The
petition states funds will be available to unsecured creditors.
A meeting of creditors under Sec. 341(a) to be held on January 14,
2025 at 09:30 AM at UST-SVND2, TELEPHONIC MEETING. CONFERENCE
LINE:1-866-820-9498, PARTICIPANT CODE:6468388.
About Clinical Network Research Development Corp.
Clinical Network Research Development Corp. offers a serene, safe,
sober living environment for quality and affordable structured
transitional living.
Clinical Network Research Development Corp. sought relief under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No.
24-12055 on December 10, 2024. In the petition filed by Yong Chu
Kim Brillouet, as CEO, president and chief executive, the Debtor
reports estimated assets and liabilities between $1 million and $10
million each.
Honorable Bankruptcy Judge Martin R. Barash handles the case.
The Debtor is represented by:
Michael L. Tusken, Esq.
LAW OFFICES OF MICHAEL TUSKEN
1510 West Whittier Boulevard, #42
La Habra CA 90631
Tel: 562-365-9495
Fax: 562-252-8529
E-mail: Michael@TuskenLaw.com
COASTAL GREEN: Ruediger Mueller of TCMI Named Subchapter V Trustee
------------------------------------------------------------------
The U.S. Trustee for Region 21 appointed Ruediger Mueller of TCMI,
Inc. as Subchapter V trustee for Coastal Green Energy Solutions,
LLC.
Mr. Mueller will be paid an hourly fee of $350 for his services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Mr. Mueller declared that he is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Ruediger Mueller
TCMI, Inc.
1112 Watson Court
Reunion, FL 34747
Telephone: (678) 863-0473
Facsimile: (407) 540-9306
Email: truste@tcmius.com
About Coastal Green Energy Solutions
Coastal Green Energy Solutions, LLC is a privately held company
that specializes in replacing windows and doors.
Coastal Green Energy Solutions sought protection under Chapter 11
of the U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No. 24-07416) on
December 17, 2024, with $155,350 in assets and $2,107,420 in
liabilities. Saesha North, manager of Coastal Green Energy
Solutions, signed the petition.
Judge Roberta Colton presides over the case.
Buddy D. Ford, Esq., at Buddy D. Ford, P.A. represents the Debtor
as legal counsel.
COKING COAL: Court OKs Cash Collateral Access, DIP Loan From Tacora
-------------------------------------------------------------------
Coking Coal, LLC received interim approval from the U.S. Bankruptcy
Court for the Eastern District of Kentucky, Pikeville Division, to
obtain post-petition financing from Tacora Capital, LP and use the
lender's cash collateral to get through bankruptcy.
The company obtained a super-priority, senior secured
debtor-in-possession financing up to an aggregate principal amount
not to exceed $46.337 million from Tacora Capital LP, or other
entity designated by the lender.
The DIP facility consists of (i) a revolving credit line of up to
$4.5 million at any one time outstanding, and (ii) a roll up of the
outstanding obligations of the company to the lender in respect of
the pre-petition loan documents in the aggregate amount of $41.8
million, of which approximately $1.5 million will be available
prior to the entry of the final DIP order.
The DIP loan will mature on the earliest to occur of (a) the date
that is 140 days following the petition date, (b) the closing date
of any sale of the company's assets pursuant to 11 U.S.C. Section
363, and (c) the date of acceleration of the post-petition
obligations or termination of the DIP loan following an event of
default in accordance with its terms.
The events of default include:
(a) Non-Payment. Failure by borrower to pay when due any amounts
owing to lender;
(b) Falsity of Representations and Warranties. Any representation
or warranty made by borrower in the agreement or in any other loan
document or in any certificate, document or financial or other
statement furnished at any time under or in connection with the
agreement or any other loan document will be false or misleading in
any material respect as of the date made or deemed to have been
made; and
(c) Failure to Perform Certain Covenants. Failure by borrower to
observe or perform any other covenants, conditions or provisions
contained in the agreement or in any other loan document which is
not cured within five days from the occurrence of such failure;
provided, however, that the five-day grace period will not apply to
any event of default
Coking Coal is required to comply with these milestones:
(a) On or before December 30, 2024 or such later date as may be
agreed to in writing by the lender, the Company must file in the
Chapter 11 Case and properly serve (i) the Sale Procedures Motion
seeking approval of the Sale Procedures Order and (ii) an executed
copy of the 363 Asset Purchase Agreement.
(b) On or before the date that is 25 days after the initial
deadline, or such later date to which the lender consents in
writing in its sole discretion, the bankruptcy court must have held
a hearing on the Sale Procedures Motion.
(c) On or before the date that is 33 days after the initial
deadline, or such later date to which the lender consents in
writing in its sole discretion, the bankruptcy court must have
entered the Sale Procedures Order.
(d) On or before the date that is 96 days after the initial
deadline, or such later date to which the lender consents in
writing in its sole discretion, the Company must have held the
Auction.
(e) Unless the lender must have otherwise provided its prior
written consent in its sole discretion, on or before the date that
is 100 days after the initial deadline, the bankruptcy court must
have entered the Sale Order approving the 363 Sale, the results of
the Auction and the winning bid received at the Auction.
(f) Unless the lender must have otherwise provided its prior
written consent in its sole discretion, on or before the date that
is (x) 103 days after the initial deadline, if a waiver of the stay
set forth in Bankruptcy Rule 6004 is obtained, or (y) 117 days
after the initial deadline, if such a waiver is not obtained, the
Company must have consummated the 363 Sale, pursuant to the 363
Asset Purchase Agreement or pursuant to the Third-Party Asset
Purchase Agreement with the Winning Bidder; provided, however, that
the bid set forth by the Winning Bidder in the Third-Party Asset
Purchase Agreement must be acceptable to the lender in its sole
discretion.
Coking Coal has approximately $121 million of liabilities, of which
approximately $41.8 million is secured debt owed to Tacora under
the pre-petition loan documents.
In addition, the company owes approximately $44.2 million to AHL5
pursuant to an intercompany loan. Panorama Equipment Leasing I LLC,
John Deere Construction & Forestry Company, Penn Virginia Operating
Co LLC, INMET Mining, LLC, Rowan P. Parchi, Humphries Goldsmid PTY
Ltd., EurAsia Center AG, and Marco International Corporation also
purport to have liens on certain equipment or assets owned by the
company. The Inmet Mining, LLC Liquidating Trust asserts a first
priority security interest over certain Pigeon Creek Complex
equipment and permits. The remaining balance of the company's
obligations is generally comprised of unsecured claims.
The company requires the use of cash collateral to pay actual,
necessary ordinary course operating expenses.
As adequate protection, the cash collateral creditors will be
granted (i) a valid, perfected replacement security interest in and
lien on the collateral to which they hold priority liens existing
as of the Petition Date or thereafter acquired and any proceeds
thereof and (ii) a valid, perfected security interest in and lien
on all of the DIP collateral, subject and subordinate only to (x)
the carveout and (y) the liens securing the DIP loan; (iii) a
superpriority administrative expense claim as provided for in
section 507(b) of the Bankruptcy Code, subject and subordinate only
to (x) the carveout and (y) the superpriority Claims held by the
DIP lender under the DIP loan.
A copy of the motion is available at https://urlcurt.com/u?l=bJNMmT
from PacerMonitor.com.
About Coking Coal, LLC
Coking Coal, LLC operates in the coal mining industry.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. Ky. Case No. 24-70529) on December 16,
2024. In the petition signed by Lloyd Hill, president and chief
executive officer, the Debtor disclosed up to $100 million in
assets and up to $500 million in liabilities.
Judge Gregory R. Schaaf oversees the case.
Ellen Arvin Kennedy, Esq., at DINSMORE & SHOHL LLP, represents the
Debtor as legal counsel.
COKING COAL: Gets Interim OK to Hire Dinsmore & Shohl as Counsel
----------------------------------------------------------------
Coking Coal, LLC received interim approval from the U.S. Bankruptcy
Court for the Eastern District of Kentucky to employ Dinsmore &
Shohl LLP as its counsel.
The firm will render these services:
(a) advise the Debtor with respect to its powers and duties;
(b) attend meetings and negotiate with representatives of
creditors and other parties in interest;
(c) take all necessary action to protect and preserve the
Debtor's estate;
(d) prepare on behalf of the Debtor certain legal papers
necessary to the administration of the estate;
(e) represent the Debtor in connection with obtaining
post-petition financing, take-out financing, exit financing, or
such other commercial transactions as may be deemed reasonably
necessary in the exercise of its business judgment;
(f) advise the Debtor in connection with any potential sales
of assets;
(g) appear before (i) the Bankruptcy Court, (ii) any appellate
proceedings occasioned by the filing of a notice of appeal pursuant
to Bankruptcy Rule 8003(a) by a party in interest, and (iii) the
United States Trustee;
(h) prepare and promote a proposed plan of reorganization and
disclosure statement;
(i) take any necessary action on behalf of the Debtor to
obtain confirmation of such plan, as necessary;
(j) perform all other legal services which the Debtor that may
deem in the exercise of its business judgment to be necessary and
proper in this case in order to protect the interests of the Debtor
or its estate; and
(k) provide all other necessary legal advice to the Debtor in
connection with this case.
The firm's professionals will be paid at these hourly rates:
Ellen Arvin Kennedy, Attorney $645
Matthew Stockl, Attorney $480
Brandon Lira, Attorney $355
Jennifer Pitcock, Paralegal $205
In addition, the firm will seek reimbursement for expenses
incurred.
The firm received a retainer of $30,000 from the Debtor.
Ms. Kennedy 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 Arvin Kennedy, Esq.
Dinsmore & Shohl LLP
100 West Main Street, Suite 900
Lexington, KY 40504
Telephone: (859) 425-1000
Facsimile: (859) 425-1099
Email: ellen.kennedy@dinsmore.com
About Coking Coal
Coking Coal LLC is an Appalachia, Va.-based coal mining company
that produces metallurgical-grade coal used in iron smelting and
steel fabrication.
Coking Coal LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. Ky. Case No. 24-70529) on December 16,
2024. In its petition, the Debtor reports estimated assets between
$50 million and $100 million and estimated liabilities between $100
million and $500 million.
Judge Gregory R. Schaaf oversees the case.
Ellen Arvin Kennedy, Esq., at Dinsmore & Shohl LLP serves as the
Debtor's counsel.
COMPAC USA: Commences Subchapter V Bankruptcy Process
-----------------------------------------------------
On December 21, 2024, Compac USA Inc. filed Chapter 11 protection
in the Southern District of Florida According to court filing,
the Debtor reports $739,872 in debt owed to 100 and 199
creditors. The petition states funds will be available to unsecured
creditors.
About Compac USA Inc.
Compac USA Inc. is a Florida entity incorporated in 2002 to market
and sell Compac stone products. The Debtor specializes in obsidian,
terrazzo, and quartz surfaces for architecture and design. The
Debtor maintains showrooms in Miami, Florida and New York, New
York.
Compac USA Inc. sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Fla. Case No. 24-23372) on December
21, 2024. In the petition filed by Francisco A. Sanchis-Brines, as
president, the Debtor reports total assets as of November 24, 2024
amounting to $5,342,926 and total current liabilities as of
November. 24, 2024 amounting to $739,872.
Honorable Bankruptcy Judge Corali Lopez-Castro handles the case.
The Debtor is represented by:
Joseph A. Pack, Esq.
PACK LAW
51 NE 24th St., #108
Miami, FL 33137
Tel: (305) 916-4500
Email: joe@packlaw.com
CONN CORP: Seeks Approval to Hire Pate Horton & Ess as Accountant
-----------------------------------------------------------------
Conn Corp, LLC seeks approval from the U.S. Bankruptcy Court for
the Eastern District of North Carolina to employ Pate, Horton &
Ess, PA as accountant.
The firm will render these services:
(a) general accounting and bookkeeping advice;
(b) payroll taxes and returns assistance;
(c) general tax consulting;
(d) tax return preparation; and
(e) limited assurance services.
The firm will be paid at these hourly rates:
Robert Gottschalk III, CPA $300
Staff Members $150
In addition, the firm will seek reimbursement for expenses
incurred.
Mr. Gottschalk 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:
Robert B. Gottschalk, III, CPA
Pate, Horton & Ess, PA
541 E. Park Ave.
Nashville, NC 27856
Telephone: (252) 459-3186
About Conn Corp.
Conn Corp. LLC, doing business as Thompson Nursery, Thompson,
Thompson Nursery Inc., and Thompson Power Equipment, is a
professional landscaping company that offers irrigation systems,
hardscapes, landscaping, tree and stump removal, and turf
maintenance services.
Conn Corp. LLC sought relief under Subchapter V of Chapter 11 of
the U.S. Bankruptcy Code (Bankr. E.D.N.C. Case No. 24-03563) on
October 11, 2024. In the petition filed by Maria Conn, managing
member, the Debtor reports estimated assets and liabilities between
$1 million and $10 million each.
The Honorable Bankruptcy Judge Pamela W. Mcafee handles the case.
The Debtor tapped C. Scott Kirk, Esq., at C. Scott Kirk, Attorney
at Law, PLLC as counsel and Robert B. Gottschalk, III, CPA, at
Pate, Horton & Ess, PA as accountant.
CONTAINER STORE: Gets Court Clearance to Tap Chapter 11 Financing
-----------------------------------------------------------------
Emlyn Cameron of Law360 reports that on December 23, 2024, a Texas
bankruptcy judge allowed The Container Store Group Inc. to tap into
a portion of its $255 million financing package.
According to Law360, the support will help the company navigate its
prepackaged Chapter 11 proceedings to address more than $269
million in debt.A Texas bankruptcy judge on December 23, 2024
granted The Container Store Group Inc. a lifeline, allowing the
company to access part of its $255 million financing package as it
gets underway with a prepackaged Chapter 11 to address over $269
million in debt.
About Container Store Group Inc.
Container Store Group Inc. is a company renowned for for selling
closet organizers and storage solutions.
Container Store Group Inc. sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. S.D. Tex.) on December 22, 2024. In
its petition, the Debtor reports assets and liabilities between
$100 million and $500 million.
CONTAINER STORE: S&P Downgrades ICR to 'D' on Bankruptcy Filing
---------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on The
Container Store Group Inc. (TCS) to 'D' from 'CCC-'. At the same
time, S&P lowered its issue-level rating on the company's term loan
to 'D' from 'CCC-'.
The downgrade follows TCS Chapter 11 bankruptcy filing.
At least 90% of the company's term loan lenders have entered into a
transaction support agreement, pledging their support for the
in-court recapitalization which, among other things, will provide
the Company with (i) $40 million of new money financing, (ii) at
least $45 million of deleveraging, (iii) substantial debt service
relief, and (iv) material maturity runway. In addition, the company
has modified its asset-backed lending facility to add $40 million
in upsized capacity.
Pursuant to the transaction support agreement, the company has
negotiated and solicited support for a pre-packaged plan of
reorganization and expects to confirm the plan of reorganization
within the next 35 days. TCS will emerge as a private company,
under the ownership of its term loan lenders.
The company announced that its stores will continue to operate as
normal, and all vendors to be unimpaired and paid in full.
As of Sept. 28, 2024 TCS's outstanding debt was approximately $240
million.
TCS's bankruptcy filing follows persistently weak operating
performance with declines in revenues and EBITDA amid macroeconomic
pressures and weaker consumer spending, which pressured the
company's liquidity and cash flows.
CONTAINER STORE: Seeks Chapter 11 Bankruptcy Protection in Texas
----------------------------------------------------------------
Jonathan Randles of Bloomberg News reports that the Container Store
Group Inc. has filed for bankruptcy to address rising losses and a
heavy debt burden affecting its business.
According to the report, the retailer, famous for selling closet
organizers and storage solutions, filed a Chapter 11 petition on
Sunday, December 22, 2024, in the Southern District of Texas,
declaring assets and liabilities between $100 million and $500
million.
The Coppell, Texas-based company sought bankruptcy protection after
Beyond Inc., the parent of Bed Bath & Beyond and other brands,
raised doubts about its ability to complete a lender deal tied to a
$40 million preferred equity investment.
About Container Store Group Inc.
Container Store Group Inc. is a company renowned for for selling
closet organizers and storage solutions.
Container Store Group Inc. sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. S.D. Tex.) on December 22, 2024. In
its petition, the Debtor reports assets and liabilities between
$100 million and $500 million.
CRITICAL REHAB: Seeks to Hire Harvard & Associates as Accountant
----------------------------------------------------------------
Critical Rehab Corporation seeks approval from the U.S. Bankruptcy
Court for the Northern District of Florida to employ Harvard &
Associates, CPA, PA as accountant.
The accountant will prepare the Debtor's 2023 tax returns and tax
consulting services.
Adriana Bush, CPA, the primary accountant in this representation,
will be paid at a fixed fee of $1,200 per year.
Ms. Bush 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:
Adriana Bush, CPA
Harvard & Associates, CPA, PA
1408 N. Piedmont Way
Tallahassee, FL 32308
Telephone: (850) 224-9008
About Critical Rehab Corporation
Critical Rehab Corporation filed a petition under Chapter 11,
Subchapter V of the Bankruptcy Code (Bankr. N.D. Fla. Case No.
24-40444) on November 4, 2024, with up to $50,000 in assets and up
to $500,000 in liabilities. Meagan Peluso, president, signed the
petition.
Judge Karen K. Specie oversees the case.
The Debtor tapped Justin M. Luna, Esq., at Latham Luna Eden &
Beaudine LLP as counsel and Adriana Bush, CPA at Harvard &
Associates, CPA, PA as accountant.
CRYSTAL BASIN: Lisa Holder Named Subchapter V Trustee
-----------------------------------------------------
The U.S. Trustee for Region 17 appointed Lisa Holder, Esq., a
practicing attorney in Bakersfield, Calif., as Subchapter V trustee
for Crystal Basin Cellars, Inc.
Ms. Holder will be paid an hourly fee of $300 for her services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Ms. Holder declared that she is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Lisa Holder, Esq.
3710 Earnhardt Drive
Bakersfield, CA 93306
Phone: (661) 205-2385
Email: lholder@lnhpc.com
About Crystal Basin Cellars
Crystal Basin Cellars, Inc. sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. E.D. Calif. Case No. 24-25612) on
December 13, 2024, with $1 million to $10 million in both assets
and liabilities. Michael Owen, president of Crystal Basin Cellars,
signed the petition.
Judge Christopher D. Jaime presides over the case.
Peter G. Macaluso, Esq., at the Law Office of Peter G. Macaluso
represents the Debtor as bankruptcy counsel.
DINE-MITE HOSPITALITY: Gets OK to Use Cash Collateral Until Jan. 9
------------------------------------------------------------------
Dine-Mite Hospitality Group, LLC received interim approval from the
U.S. Bankruptcy Court for the Southern District of California to
use cash collateral until Jan. 9, 2025.
The company requires the use of cash collateral to pay ordinary
expenses associated with its business operations, including, but
not limited to, funding payroll and other employee related
obligations, and procuring goods and services necessary for
operating without interruption.
The company cited increased construction costs and delays, as well
as a missed peak season opening, as the primary reasons for its
financial difficulties. Despite efforts to improve sales, the
restaurant's cash flow remains insufficient to meet its debt
obligations. To maximize its value, the company intends to continue
operating while exploring a potential sale.
On June 7, 2024, the company obtained a $300,000 loan from WebBank
for use as working capital.
The lender has a security in the funds the company generates
through sales, so it's to the lender's benefit for the company to
continue to operate. Further, the company will provide the lender
with replacement liens on post-petition cash collateral, to the
same extent and with the same validity as its pre-bankruptcy liens.
About Dine-Mite Hospitality Group LLC
Dine-Mite Hospitality Group LLC is part of the Ambrogio15
Restaurant Group which also has several successful restaurants in
the San Diego Area.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Calif. Case No. 24-04771) on December
17, 2024. In the petition signed by Giacomo Pizzigoni, managing
member, the Debtor disclosed up to $500,000 in assets and up to $1
million in liabilities.
Matthew D. Resnik, Esq., at RHM Law, LLP, represents the Debtor as
legal counsel.
DIOCESE OF SYRACUSE: Court Rules on Standing, Discovery Issues
--------------------------------------------------------------
Judge Wendy A. Kinsella of the United States Bankruptcy Court for
the Northern District of New York ruled on the impact of Truck
Insurance Exchange v. Kaiser Gypsum Co., Inc. on certain insurers'
standing and related discovery disputes in the bankruptcy case of
The Roman Catholic Diocese of Syracuse, New York.
Before the Court are disputes regarding standing and discovery
demands pertaining to confirmation of the Third Amended Joint
Chapter 11 Plan of Reorganization for the Roman Catholic Diocese of
Syracuse, New York dated April 16, 2024.
An Amended Order Setting Confirmation Hearing Schedule was issued
establishing discovery and other deadlines, which led to the
current disputes between The Roman Catholic Diocese of Syracuse,
New York and the Official Committee of Unsecured Creditors, along
with the Parishes and certain other Catholic-affiliated entities on
one side, and certain insurers, Interstate Fire & Casualty Company
and Fireman's Fund Insurance Company, Certain Underwriters at
Lloyd's, London, and London Market Companies and Travelers
Insurance Company Limited, Travelers Casualty and Surety Company,
and Traveler's Indemnity Company on the other.
According to Judge Kinsella, recognizing the Supreme Court's recent
decision in Truck Insurance Exchange v. Kaiser Gypsum Company, 602
U.S. 268 (2024), would impact the analysis of Certain Insurers'
standing to raise and be heard on various issues which will in turn
permeate the discovery and confirmation process. Judge Kinsella
directed any interested party to file a memorandum of law regarding
the impact of Truck on the discovery disputes. Subsequently the
Plan Proponents filed the Fourth Amended Plan and the Disclosure
Statement for Fourth Amended Plan to address the Supreme Court's
ruling in Harrington v. Purdue Pharma L.P., 144 S. Ct. 2071 (2024)
finding non-consensual third party releases impermissible in a
chapter 11 plan. The parties agreed the Truck standing issue and
the discovery disputes remained relevant to confirmation of the
Fourth Amended Plan and filed a joint status report to clarify the
outstanding disputes after many meet and confer sessions.
The Court heard extensive oral argument on the matters on October
18, 2024. Thereafter, the Plan Proponents filed the Fifth Amended
Plan and Disclosure Statement for Fifth Amended Plan in accordance
with the Court's Order Denying Approval of Fourth Amended
Disclosure Statement.
The Plan Proponents and Parishes initially assert Truck may have
limited application since, unlike the insurance company in Truck,
the Diocese's Insurers have not acknowledged or been found to be
financially responsible for the survivors' claims. Even if Truck
applies, they contend the Insurers are still limited by
constitutional and prudential standing requirements when engaging
in discovery and pursuing confirmation objections. They argue an
insurer may only raise objections to plan provisions where it can
demonstrate that it will "suffer a concrete and particularized
injury in fact that is actual and imminent, not speculative, as a
result of plan confirmation," and may only assert objections
"relevant to their legal rights and interests as insurers, and
cannot object to confirmation on the ground that a plan infringes
upon the rights of another non-objecting party."
Certain Insurers counter that after Truck, traditional notions of
Article III and prudential standing no longer limit their ability
to participate in the confirmation proceedings. As parties in
interest under Sec. 1109(b) of the Bankruptcy Code, they can raise
and be heard on any issue because the Plan might impact them in
several ways. Truck eliminates an issue-by-issue analysis and
gives them unrestricted standing to seek discovery and object to
all plan provisions regardless of whether the matter at issue
directly impacts, or could directly impact, them. If the Insurers
may be affected by the Plan as a whole, they argue demonstrating a
specific adverse impact is unnecessary.
While Truck Insurance's liability for defending and paying on
asbestos judgments was conclusively established in state court, the
Diocese's Insurers have not acknowledged liability or been
adjudicated to be liable for survivors' claims under their
policies. The Court rejects this argument. It is undisputed that
the Diocese asserts the Insurers have financial responsibility for
the survivors' claims, having commenced the Adversary Proceeding
alleging breach of contract and seeking declaratory judgment to
establish the rights and obligations of the Diocese, the Parishes
and the Insurers under the insurance policies. The Diocese is also
attempting to assign its interest in insurance claims and
recoveries against the Insurers to the Trust. Under these
circumstances, the Court finds that liability does not need to be
acknowledged or adjudicated before the teachings of Truck apply.
In rejecting that argument, the Court finds the Truck analysis
employed by the Supreme Court to be directly on point -- Certain
Insurers are parties in interest in this case under Sec. 1109(b)
and Truck.
The Plan Proponents' Omnibus Motion to Compel seeks answers,
supplements or revisions to certain interrogatories, requests for
admission, and requests for document production, arguing the
Insurers have failed to provide sufficient responses. The Insurers
assert they have provided all information that is discoverable and
responsive to the requests. They also argue they are not required
to respond to discovery relating to how the Plan affects them or
how it fails to satisfy the Bankruptcy Code requirements for
confirmation.
The Insurers' Omnibus Discovery Brief contains a request that the
Court compel the production of documents and information identified
in the Diocese's and Committee's privilege logs. The Insurers
assert the particular entries they have identified are not subject
to a privilege, or the privilege has been waived.
According to the Court, several of the Discovery Disputes result
from differing views of which party carries the burden of proof at
confirmation. The Insurers argue the Plan Proponents cannot shift
their burden to show the Plan is proposed in good faith under Sec.
1129(a)(3), and they do not have any obligation to prove good faith
is lacking. It is well settled that "[t]he plan proponent bears the
burden of establishing the plan's compliance with each of the
requirements set forth in Sec. 1129(a), while the objecting parties
bear the burden of producing evidence to support their objections."
As a result, the Insurers must provide discovery in those areas
they intend to use in support of their objections and affirmative
defenses to confirmation.
The Court partially grants certain motions: to compel, for
protective orders and to quash, and denies certain other relief
requested.
A copy of the Court's decision dated December 9, 2024, is
http://urlcurt.com/u?l=wW89UO
About The Roman Catholic Diocese of Syracuse
The Roman Catholic Diocese of Syracuse, New York --
http://www.syracusediocese.org/-- through its administrative
offices (a) provides operational support to the Catholic parishes,
schools and certain other Catholic entities that operate within the
territory of the Diocese in support of their shared charitable,
humanitarian and religious missions; (b) conducts school operations
by managing tuition and scholarship payments, employee payroll, and
other school-related operating expenses for separately incorporated
Diocesan schools, as well as providing parish schools with
financial, operational and educational support; and (c) provides
comprehensive risk management services to the OCEs through the
Diocese's insurance program.
The Roman Catholic Diocese of Syracuse, New York filed its
voluntary petition for relief under Chapter 11 of the Bankruptcy
Code (Bank. N.D.N.Y. Case No. 20-30663) on June 19, 2020. Stephen
A. Breen, chief financial officer, signed the petition. At the time
of filing, the Debtor estimated $10 million to $50 million in
assets and $50 million to $100 million in liabilities.
Judge Margaret M. Cangilos-Ruiz oversees the case.
Bond, Schoeneck and King, PLLC, serves as the Debtor's bankruptcy
counsel. The Debtor also tapped Mullen Coughlin LLC as special
counsel, Arete Advisors LLC as cybersecurity consultant, and
Moxfive LLC as technical advisor. Stretto is the claims agent and
administrative advisor.
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors in the Debtor's bankruptcy case. The committee
tapped Stinson, LLP, Saunders Kahler, LLP and Berkeley Research
Group, LLC, as its bankruptcy counsel, local counsel and financial
advisor, respectively.
DITECH HOLDING: $58,610.99 Skorcz Claim Disallowed
--------------------------------------------------
The Honorable James L. Garrity, Jr. of the United States Bankruptcy
Court for the Southern District of New York entered a Memorandum
Decision and Order sustaining the objection of the Consumer Claims
Trustee in the bankruptcy case of Ditech Holding Corporation with
respect to the proof claim filed by Jacqueline Skorcz. The Court
disallows the claim.
Jacqueline Skorcz is acting pro se herein. She timely filed Proof
of Claim No. 1262 is an unsecured claim in the amount of $58,610.99
against Ditech Holding Corp. (f/k/a Walter Investment Management
Corp.) . The Consumer Claims Trustee filed the Thirty-Ninth Omnibus
Objection seeking to disallow proofs of claim, including the Claim,
that do not provide a sufficient legal basis to establish liability
on the part of Ditech. In substance, the Consumer Claims Trustee
contends that the Court should disallow the Claim because it fails
to state a claim for relief against Ditech.
The Consumer Claims Trustee asserts, in substance, that the Claim,
as supplemented by the Response, does not satisfy the pleading
standards of Rule 8(a) of the Federal Rules of Civil Procedure
because it lacks sufficient information for her to ascertain the
nature and basis of the Claim. . The Trustee asserts that
Claimant's "primary concern" is "Debtor's failure to return an
insurance proceeds check in September 2012 in the amount of
$4,975.57." She contends that although Claimant does not
articulate the legal theories under which she pursues relief for
any of [the] alleged acts by Debtor, given Claimant's pro se
status, she interprets the Claim, as a request for relief for
breach of contract and for relief under the Real Estate Settlement
Procedures Act. Specifically, she construes the Claim to assert
that Ditech breached its obligation to provide insurance proceeds
and violated RESPA's requirements that loan servicers respond to
requests for information.
The Consumer Claims Trustee maintains that even as liberally
construed, the Claim runs afoul of Rule 12(b)(6), and fails to
allege facts supporting a breach of a contract, (and, in any event,
is time-barred under Arkansas law), and fails to state a claim for
relief under RESPA.
At a Sufficiency Hearing, the Court employs the legal standard of
review applied to a motion to dismiss for failure to state a claim
upon which relief may be granted under Rule 12(b)(6) of the Federal
Rules of Civil Procedure. The Court conducted the Sufficiency
Hearing.
The Court finds the Claim fails to state a claim to relief against
Ditech.
According to the Court, Claimant fails to allege facts
demonstrating how she was damaged by Ditech's alleged failure to
release the Insurance Proceeds. The Court also finds Claimant has
failed to state a claim for breach of contract against Ditech. Even
if Claimant could allege facts in support of a breach of contract
claim against Ditech, that claim is time-barred under Arkansas law,
the Court concludes.
A copy of the Court's decision is http://urlcurt.com/u?l=EodO8O
About Ditech Holding Corporation
Fort Washington, Pennsylvania-based Ditech Holding Corporation and
its subsidiaries -- http://www.ditechholding.com/-- are
independent servicer and originator of mortgage loans.
Ditech Holding and certain of its subsidiaries, including Ditech
Financial LLC and Reverse Mortgage Solutions, Inc., filed voluntary
Chapter 11 petitions (Bankr. S.D.N.Y. Lead Case No. 19 10412) on
Feb. 11, 2019, after reaching terms with lenders of a Chapter 11
plan that will reduce debt by $800 million.
The Debtors tapped Weil, Gotshal & Manges LLP as legal counsel,
Houlihan Lokey as investment banker and AlixPartners LLP as
financial advisor. Epiq Bankruptcy Solutions LLC served as claims
and noticing agent.
Kirkland & Ellis LLP and FTI Consulting Inc. served as the
consenting term lenders' legal counsel and financial advisor,
respectively.
The U.S. Trustee for Region 2 appointed an official committee of
unsecured creditors in the Debtors' cases on Feb. 27, 2019. The
creditors' committee tapped Pachulski Stang Ziehl & Jones LLP as
its legal counsel and Goldin Associates, LLC, as its financial
advisor.
On May 2, 2019, the U.S. trustee appointed an official committee of
consumer creditors. The consumers committee tapped Quinn Emanuel
Urquhart & Sullivan, LLP, as counsel and TRS Advisors LLC, as
financial advisor.
On Sept. 26, 2019, the Bankruptcy Court confirmed Ditech's Chapter
11 bankruptcy plan, which became effective four days later. A
Consumer Claims Trustee has been appointed in the case and is
represented by Richard Levin, Esq., at Jenner & Block, LLP.
DRAFTKINGS INC: Faces Class Lawsuit Over Marketing Practices
------------------------------------------------------------
harrismartin.com reports that DraftKings is facing a class action
lawsuit in a New York district court over alleged unfair and
deceptive marketing practices regarding its deposit bonus
promotions.
According to documents filed in the U.S. District Court for the
Eastern District of New York, Nerye Aminov has filed a class action
lawsuit against DraftKings alleging charges including violating New
York General Business Law and intentional misrepresentation,
fraudulent inducement and unjust enrichment over its marketing
practices for first-time deposit bonuses.
The suit was recently removed from the New York Supreme Court of
Queens County at the request of DraftKings.
DraftKings' deposit promotion
The claims of unfair and deceptive marketing practices by
DraftKings were allegedly in an effort to acquire new customers.
The alleged practices include the promotion of deposit bonuses and
the use of "flashy" TV, social media, online and print advertising
of DraftKings.
In the suit, Aminov claims that DraftKings' "Get a $1,000 Deposit
Bonus" promotion was fraudulent as he never received the promised
bonus immediately after opening a new DraftKings account and making
an initial deposit. The suit claims the promotion was fraudulent,
as its policy and practice is to pay the bonuses in small
increments over time.
Aminov alleges deceptive practices despite adhering to DraftKings'
bonus requirements. The suit claims the promotion impacted New York
users who were "almost certain to lose money chasing it." Aminov
alleges that DraftKings did not properly inform its new users that
its deposit bonus is calculated as 20% of up to $5,000 of the new
users' first deposit. The suit claims that DraftKings didn't
disclose the immediate need of a $5,000 deposit and a wagering of
at least $25,000 to be eligible for the promotion's $1,000 deposit
bonus.
Aminov alleges that DraftKings users could not have reasonably
understood the promotion. The suit also claims that DraftKings'
targeting of new bettors is an unfair business practice.
Details of DraftKings' alleged unfair practices
In the suit, Aminov claims in January 2022 he signed up for
DraftKings and made an initial $500 deposit with the expectation
that he would receive a $1,000 deposit bonus. DraftKings allegedly
credited Aminov with only a $100 bonus. Aminov claims that he would
not have signed up for DraftKings had he known its business
practices were unfair.
The plaintiff and others similarly situated are seeking the ceasing
of DraftKings' marketing practices and restitution to customers who
have suffered losses because of the operator's practices. Aminov
seeks the return of his initial deposit or the full $1,000 deposit
bonus.
The plaintiff is also seeking statutory damages. The class action
suit includes a nationwide class of DraftKings users who opened an
account and deposited with the operator in response to its $1,000
deposit bonus promotion. Its subclass includes New York customers
who were impacted by the same DraftKings promotion of a deposit
bonus.
Legal woes for DraftKings
Aminov's suit adds to recent legal proceedings regarding
DraftKings' marketing practices.
DraftKings is facing a class action suit in Massachusetts for
allegedly violating state consumer protection laws for the
advertising of its $1,000 deposit bonus. In August, a Massachusetts
judge denied DraftKings motion to dismiss the case, which was filed
by two residents, Shane Harris and Melissa Scanlon.
The two plaintiffs are working with the Public Health Advocacy
Institute.
DraftKings received favorable news in August when a woman who filed
a class action suit against the operator decided to drop her case.
The plaintiff, Samantha Guery, filed a suit in April 2024 alleging
DraftKings was engaging in deceptive and fraudulent marketing
practices with its now-shuttered "risk-free" promotions for a
user's first wager. [GN]
DRAFTKINGS INC: Wan Sues Over Data Privacy Violations
-----------------------------------------------------
JEFFREY WAN, individually and on behalf of all others similarly
situated, Plaintiff v. DRAFTKINGS INC., Defendant, Case No.
1:24-cv-09557 (S.D.N.Y., Dec. 13, 2024) alleges violation of the
Video Privacy Protection Act.
The Plaintiff alleges in the complaint that the Defendant caused
the Plaintiff's video viewing habits to be sent along with the
Plaintiff's personally identifiable information to Facebook and
upon information and belief, other third parties, without the
Plaintiff's knowledge or consent each time the Plaintiff requested
and viewed video content and video games sold through the Website.
The Plaintiff never consented, agreed, nor permitted the Defendant
to disclose Plaintiff's PII and viewing information to Facebook or
other third parties and certainly did not do so for purposes
violative of the VPPA, says the suit.
DraftKings Inc. operates as a daily fantasy sports contest and
sports betting company. The Company allows users to enter daily and
weekly fantasy sports-related contests and win money based on
individual player performances in American sports. [BN]
The Plaintiff is represented by:
Adrian Gucovschi, Esq.
Benjamin Rozenshteyn, Esq.
Nathaniel Haim Sari, Esq.
GUCOVSCHI ROZENSHTEYN, PLLC.
140 Broadway, FL 46
New York, NY 10005
Telephone: (212) 884-4230
Facsimile: (212) 884-4230
Email: adrian@gr-firm.com
ben@gr-firm.com
nsari@gr-firm.com
DUSOBOX: To Sell Assets to Precision Corr for $8.2MM
----------------------------------------------------
Dusobox Corporation seeks permission from the U.S. Bankruptcy Court
for the Middle District of Florida, Orlando Division, to sell
assets, free and clear of liens, claims, and encumbrances.
The Debtor's acquired assets to be sold include substantially all
of the Debtor's assets including all contracts and leases
identified in, machinery, equipment, furniture, fixtures,
intellectual property (including trademarks, trade secrets, and
other proprietary rights), customer lists and associated goodwill,
permits to the extent transferable, and other tangible and
intangible assets.
Excluded assets and liabilities include certain cash, accounts
receivable, inventory and causes of action retained by the estate.
The Debtor signs an asset purchase agreement with Precision Corr
FL, LLC, with the purchase price of $8,250,000 cash, subject to
downward adjustments as set forth in the agreement.
The Debtor is a Florida corporation engaged in the manufacture of
corrugated display solutions and packaging products. Its operations
have historically involved the design, production, and sale of
high-quality packaging and display materials. Due to financial
challenges and constraints, the Debtor commenced Chapter 11 case to
preserve and maximize the value of its assets for the benefit of
creditors.
The Debtor hires Mr. Michael Shepardson to market its assets to
numerous prospective purchasers, ensuring that a wide range of
interested parties had the opportunity to submit offers.
The Purchaser shall provide a good-faith deposit of $150,000 to be
held in escrow by the Deposit Escrow Agent. The Deposit shall be
credited against the Purchase Price at Closing or returned to the
Purchaser if the Sale does not close for any reason as outlined in
the agreement.
The Purchaser will assume only those liabilities expressly
identified in the agreement, including obligations under the
Assigned Contracts that accrue after the Closing Date.
The proposed closing date of the sale will be on or before January
31, 2025, subject to the satisfaction or waiver of all closing
conditions as set forth in the agreement.
The Debtor requests that any objections by parties to the Assigned
Contracts to assumption and/or assignment (and corresponding Cure
Costs) should be filed on or before 5:00 p.m. Eastern prevailing
time on December 27, 2024, and determined at the Sale Hearing.
The Debtor further seeks that the purchaser receive the protections
afforded to a good faith purchaser in the context of a sale when
the purchaser is an unrelated third party who is not affiliated
with or does not have any insider relationship with the Debtors and
where the transaction is for fair value.
The Debtor also seeks approval of the Break-Up Fee and Expense
Reimbursement set forth in the agreement The Break-Up Fee is
commensurate with the real and substantial post-petition benefits
conferred upon the Debtor's estate by the Purchaser and constitute
actual and necessary costs and expenses incurred by the Debtor in
preserving the value of its state.
About the Dusobox Corporation
Dusobox Corporation is a designer, engineer and manufacturer of
custom corrugated display solutions and product packaging. It is
based in Orlando, Fla.
Dusobox filed Chapter 11 petition (Bankr. M.D. Fla. Case No.
24-00391) on Jan. 29, 2024, with $1 million to $10 million in
assets and $10 million to $50 million in liabilities.
Judge Tiffany P. Geyer oversees the case.
Michael A. Nardella, Esq., at Nardella & Nardella, PLLC is the
Debtor's legal counsel.
EBIX INC: 2nd Circuit Affirms Judgment in Saraf, et al. Suit
------------------------------------------------------------
In the case captioned as RAHUL SARAF, Plaintiff-Appellant,
CHRISTINE MARIE TEIFKE, on behalf of herself and all others
similarly situated, Plaintiff, v. EBIX, INC., ROBIN RAINA, STEVEN
M. HAMIL, Defendants-Appellees, Case No. 23-1182-cv (2nd Cir.),
Judges Robert D. Sack, Denny Chin and Joseph F. Bianco of the
United States Court of Appeals for the Second Circuit vacated the
stay of this appeal and affirmed the judgment of the United States
District Court for the Southern District of New York dismissing the
claims against Ebix, Inc.
By summary order, dated March 27, 2024, the Circuit Judges affirmed
the district court's judgment as to the dismissal of the claims
against Defendants-Appellees Robin Raina and Steven M. Hamil, and
stayed this appeal with respect to Defendant-Appellee Ebix, Inc.,
in light of its Chapter 11 bankruptcy petition pending in the
United States Bankruptcy Court for the Northern District of Texas.
In that Order, they advised Ebix to promptly notify the Second
Circuit if the Bankruptcy Court granted relief from the automatic
stay imposed by 11 U.S.C. Sec. 362 with respect to this appeal
against Ebix or if the stay lapsed. By letter dated October 22,
2024, Ebix informed the Second Circuit that the automatic stay
entered under Section 362 had been terminated as of the effective
date of the Third Amended Joint Chapter 11 Plan of Ebix, Inc. and
its Debtor Affiliates, which occurred on August 30, 2024.
A copy of the Court's decision dated December 13, 2024, is
http://urlcurt.com/u?l=Ef7RE2
Attorney for Plaintiff-Appellant:
Michael Dell'Angelo, Esq.
BERGER MONTAGUE PC
1818 Market Street, Suite 3600
Philadelphia, PA 19103
Telephone: 215-875-3080
E-mail: mdellangelo@bm.net
Attorney for Defendants-Appellees:
Paul J. Lockwood, Esq.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
One Rodney Square
920 N. King St.
Wilmington, DE 19801
Telephone: 1.302.651.3210
E-mail: paul.lockwood@skadden.com
About Ebix, Inc.
Ebix Inc. -- https://www.ebix.com/ -- is headquartered in Atlanta,
Ga., and it supplies software and electronic commerce solutions to
the insurance industry. With approximately 200 offices across six
continents, Ebix, (NASDAQ: EBIX) endeavors to provide on-demand
infrastructure exchanges to the insurance, financial services,
travel, and healthcare industries.
Ebix and its affiliates filed Chapter 11 petitions (Bankr. N.D.
Tex. Lead Case No. 23-80004) on Dec. 17, 2023. At the time of the
filing, Ebix reported between $500 million and $1 billion in both
assets and liabilities.
Judge Scott W. Everett oversees the cases.
The Debtors tapped Sidley Austin, LLP as bankruptcy counsel;
O'Melveny and Myers, LLP as special counsel; AlixPartners, LLP as
financial advisor; and Jefferies, LLC as investment banker. Omni
Agent Solutions, Inc. is the claims agent.
The U.S. Trustee for Region 6 appointed an official committee to
represent unsecured creditors in the Debtors' Chapter 11 cases. The
committee was represented by McDermott Will & Emery, LLP.
ECO ROOF: Seeks to Hire Sherman & Howard as Litigation Counsel
--------------------------------------------------------------
ECO Roof and Solar Inc. seeks approval from the U.S. Bankruptcy
Court for the District of California to employ Sherman & Howard LLC
as its special counsel.
The Debtor needs a special counsel to represent it in pre-petition
lawsuits and its claims against Seven Lakes Association Inc. and
any matters related thereto.
The firm will be paid at these hourly rates:
Kellie Nelson Fetter, Attorney $645 - $845
Mark Williams, Attorney $645 - $845
Peter Cal, Attorney $645 - $845
Hilary Morgan, Attorney $575
Paralegals & Law Clerks $230 - $305
Ms. Morgan 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:
Hilary Morgan, Esq.
Sherman & Howard LLC
675 15th St.
Denver, CO 80202
Telephone: (303) 297-2900
About ECO Roof and Solar
Eco Roof and Solar Inc. specializes in renewable energy solutions,
particularly focused on solar energy systems and sustainable
roofing options. The Company aims to provide environmentally
friendly alternatives for residential and commercial properties,
emphasizing energy efficiency and reduced carbon footprints.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Colo. Case No. 24-15628), listing
between $1 million and $10 million in estimated assets and between
$10 million and $50 million in estimated liabilities. The petition
was signed by Dylan Lucas as president.
The Hon. Joseph G. Rosania Jr. presides over the case.
The Debtor tapped David V. Wadsworth, Esq., at Wadsworth Garber
Warner Conrardy, P.C. as bankruptcy counsel and Hilary Morgan,
Esq., at Sherman & Howard LLC as special counsel.
On November 5, 2024, the Office of the United States Trustee
appointed an official committee of unsecured creditors in this
Chapter 11 case. The committee tapped Steptoe & Johnson PLLC as
counsel.
EDGEWOOD FOOD: Request for $3,060.00 in Attorney's Fees Granted
---------------------------------------------------------------
Judge Lisa Ritchey Craig of the United States Bankruptcy Court for
the Northern District of Georgia granted Edgewood Food Mart, Inc.'s
request for attorney's fees as sanctions in n the case captioned as
LAMAR LESTER, Plaintiff, v. EDGEWOOD FOOD MART, INC., AMIN
PANJWANI, 400 EDGEWOOD, LLC, AND TRUIST BANK, Defendants, CASE NO.
24-05009-LRC (Bankr. N.D. Ga.).
On May 8, 2024, Defendant filed its Motion for Sanctions Pursuant
to Fed. R. Bankr. P. 9011.
The Court entered an Order granting the 9011 Motion, finding that
Plaintiff Lamar Lester and Plaintiff's Counsel Herald J.A.
Alexander violated Rule 9011(b) by filing a complaint against
Defendant for an improper purpose.
Defendant seeks a sanction equivalent to 7.2 hours in attorney's
time, in the total amount of $3,060.00. Defendant's counsel charges
a rate of $425.00 per hour. Defendant's counsel asserts that this
fee is reasonable, relying on the Johnson factors, Johnson v.
Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir. 1974), and
the lodestar standard, as explained by the Court in Pennsylvania v.
Delaware Valley Citizens Council for Clean Air, 478 U.S. 546
(1986).
Plaintiff objects to Defendant's request for attorney's fees,
though his objections do not actually dispute the reasonableness of
the fees. Instead, Plaintiff revisits arguments he has made at
several points during Defendant's bankruptcy case. Plaintiff
alleges that Defendant's bankruptcy case was filed for an improper
purpose and that the services rendered were not reasonably likely
to benefit Defendant's bankruptcy estate. Judge Craig says, "These
arguments are misplaced. The Court, in confirming the plan, found
that the bankruptcy case was filed in good faith and not for any
improper purpose. Further, the Court, in approving the Defendant's
counsel's First and Second Applications for Compensation -- which
encompass the hours being considered here -- found that the
services rendered by Defendant's counsel did, or were reasonably
likely to, benefit Defendant's bankruptcy estate."
The Court has already determined that an award of fees is
appropriate and must now determine what is reasonable.
Defendant is entitled to the presumption that the lodestar method
has resulted in a reasonable fee, and Plaintiff and Plaintiff's
Counsel have presented nothing to the Court to rebut that
presumption. Accordingly, Plaintiff and Plaintiff's counsel bear
full responsibility for the costs associated with this adversary
proceeding, the Court finds.
The Court holds that sanctions in the aggregate sum of $3,060.00
are imposed, jointly and severally, on Plaintiff and Plaintiff's
Counsel. Defendant has been consistently responsive to Mr. Lester's
numerous pleadings. The Court finds that an amount equivalent to
all of Defendant's attorney's fees incurred in connection with this
adversary proceeding is the appropriate amount to deter repetition
of this conduct.
A copy of the Court's decision is https://urlcurt.com/u?l=1JyJD2
About Edgewood Food Mart
Edgewood Food Mart, Inc., owns a gas station and convenience store.
It filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. N.D. Ga. Case No. 23-61204) on Nov. 10,
2023, with up to $500,000 in assets and up to $10 million in
liabilities. Tamara Miles Ogier, Esq., at Ogier, Rothschild &
Rosenfeld, PC, is the Debtor's legal counsel.
ELITA 7: Seeks Chapter 11 Protection in Massachusetts
-----------------------------------------------------
On December 20, 2024, Elita 7 LLC filed Chapter 11 protection in
the District of Massachusetts. According to court filing, the
Debtor reports in debt owed to 1 and 49 creditors. The
petition states funds will be available to unsecured creditors.
About Elita 7 LLC
Elita 7 LLC sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. D. Mass. Case No. 24-41303) on December 20, 2024. In
the petition filed by Steve Dashevsky, as manager, the Debtor
reports, the Debtor reports estimated assets and liabilities
between $1 million and $10 million each.
Honorable Bankruptcy Judge Elizabeth D. Katz handles the case.
The Debtor is represented by:
John O. Desmond, Esq.
5 Edgell Road, Suite 30A
Farmingham, MA 01701
Tel: 508-879-9638
Email: attorney@jdesmond.com
EMS WAREHOUSING: Seeks Bankruptcy Protection in Massachusetts
-------------------------------------------------------------
On December 19, 2024, EMS Warehousing and Distribution Inc. filed
Chapter 11 protection in the District of Massachusetts. According
to court filing, the Debtor reports $1,200,251 in debt owed to 1
and 49 creditors. The petition states funds will be available to
unsecured creditors.
About EMS Warehousing and Distribution Inc.
EMS Warehousing and Distribution Inc. is a provider of warehousing
and distribution services.
EMS Warehousing and Distribution Inc. sought relief under Chapter
11 of the U.S. Bankruptcy Code (Bankr. D. Mass. Case No. 24-41297)
on December 19, 2024. In the petition filed by Wayne Edwards, as
president, the Debtor reports total assets of $398,092 and
estimated liabilities of $1,200,251
Honorable Bankruptcy Judge Elizabeth D. Katz handles the case.
The Debtor is represented by:
David B. Madoff, Esq.
MADOFF & KHOURY LLP
124 Washington Street, Suite 202
Foxborough, MA 02035
Tel: 508-543-0040
Fax: 508-543-0020
E-mail: alston@mandkllp.com
ENVIVA INC: Plan Exclusivity Period Extended to March 7, 2025
-------------------------------------------------------------
Judge Brian F. Kenney of the U.S. Bankruptcy Court for the Eastern
District of Virginia extended Enviva Inc. and its affiliates'
exclusive periods to file a plan of reorganization and obtain
acceptance thereof to March 7, 2025 and May 6, 2025, respectively.
As shared by Troubled Company Reporter, the Debtors explain that
the Chapter 11 Cases are sufficiently large and complex to warrant
the requested extension of the Exclusivity Periods. The Debtors
have approximately $1.8 billion in funded debt obligations and
numerous active constituents, including numerous sophisticated
contract counterparties, lenders, and stakeholders. The size and
complexity of these chapter 11 cases thus weigh in favor of
extending the Exclusivity Periods.
The Debtors claim that continued exclusivity will permit the
Debtors to maintain flexibility so competing plans do not derail
the Debtors' restructuring process. Being required to dual-track
negotiations across multiple plans could give rise to uncertainty
and significantly increase professional costs to the detriment of
all stakeholders. Ultimately, extending the Exclusivity Periods
will benefit the Debtors' estates, their creditors, and all other
key parties in interest by allowing the Debtors time to continue to
work to solicit and confirm the Plan.
Since the Petition Date, the Debtors have paid, and will continue
to pay, their post-petition debts in the ordinary course of
business or as otherwise provided by Court order, which further
supports an extension of exclusivity.
Counsel to the Debtors:
Michael A. Condyles, Esq.
Peter J. Barrett, Esq.
Jeremy S. Williams, Esq.
Kutak Rock LLP
901 East Byrd Street, Suite 1000
Richmond, VA 23219-4071
Tel: (804) 644-1700
Fax: (804) 783-6192
Email: michael.condyles@kutakrock.com
peter.barrett@kutakrock.com;
jeremy.williams@kutakrock.com
About Enviva Inc.
Headquartered in Bethesda, Md., Enviva Inc.
--https://www.envivabiomass.com -- is a producer of industrial wood
pellets, a renewable and sustainable energy source produced by
aggregating a natural resource, wood fiber, and processing it into
a transportable form, wood pellets. Enviva exports its wood pellets
to global markets through its deep-water marine terminals at the
Port of Chesapeake, Virginia, the Port of Wilmington, North
Carolina, and the Port of Pascagoula, Mississippi, and from
third-party deep-water marine terminals in Savannah, Georgia,
Mobile, Alabama, and Panama City, Florida.
Enviva Inc. and certain affiliates sought protection under Chapter
11 of the U.S. Bankruptcy Code (Bankr. E.D. Va. Lead Case No.
24-10453) on March 13, 2024. In the petition signed by Glenn T.
Nunziata, interim chief executive officer and chief financial
officer, Enviva Inc. disclosed $2,893,581,000 in assets and
$2,631,263,000 in liabilities.
Judge Brian F. Kenney oversees the cases.
The Debtors tapped Vinson & Elkins, LLP as general bankruptcy
counsel; Kutak Rock, LLP as local counsel; Lazard Freres & Co., LLC
as investment banker; Alvarez & Marsal Holdings, LLC as financial
advisor; and Kurtzman Carson Consultants, LLC as notice and claims
agent.
The U.S. Trustee for Region 4 appointed an official committee to
represent unsecured creditors in the Debtors' Chapter 11 cases.
The committee tapped Akin Gump Strauss Hauer & Feld, LLP as lead
bankruptcy counsel; Hirschler Fleischer, PC as local counsel;
Ducera Partners, LLC as investment banker; and AlixPartners, LLP as
financial advisor.
FARADAY FUTURE: Forges Licensing Collaboration With Grow Fandor
---------------------------------------------------------------
Faraday Future Intelligent Electric Inc. announced Nov. 13 a
comprehensive strategic licensing agreement with Grow Fandor, an IP
commercialization company. As FF's exclusive licensee for
ecosystem products, Grow Fandor will manage the design,
development, sales, and operations for certain ecosystem products
bearing the FF and Faraday X (FX) brands. This collaboration has
the potential to become a new growth driver for FF.
Under the terms of the licensing agreement, Grow Fandor has
exclusive licensing rights as the only third-party allowed to use
the FF and FX brands and marks during the contract term. This
right includes, but is not limited to, categories like apparel,
automotive accessories, home goods, and personal care products. FF
will not be required to contribute any resources for development of
branded products. Furthermore, FF will financially benefit from an
annual license fee and additional licensing royalties. Grow Fandor
will fully assume responsibility for all tasks related to these
products, encompassing research and development, supply chain
management, sales, and after-sales services.
The anticipated economic benefits for FF from this collaboration
include: (1) a royalty fee, payable quarterly, calculated as the
greater of: (a) 50% of the annual net profit from FF and FX
ecosystem products, and (b) 5% of net sales revenue from all
relevant brand ecosystem products, payable quarterly (whichever
amount is higher will be the final royalty fee for that year); and
(2) a $250,000 annual base license fee. The initial annual license
fee has been paid and received, and subsequent annual license fees
will be payable within 30 days after each contract year.
FF retains approval rights for the use of its trademarks and the
right to audit products bearing these marks, sales revenue, and the
right to share sales, enabling and the ability FF to sell ecosystem
products through its own channels. Grow Fandor must secure written
approval from FF before launching any product designs,
advertisements, or announcements involving FF trademarks, ensuring
FF's control over its brand image.
Branded products have become a significant revenue source for many
automotive companies, especially within the luxury and performance
segments. FF has been actively exploring opportunities in this
space, and with this new collaboration, it positions FF for growth
and market expansion within this unique consumer products sector.
Previously, YT Jia gifted nearly 60% of his shares in Grow Fandor
to FF, making FF a significant shareholder with 10% ownership of
the company's shares.
This strategic licensing agreement represents a new level of
collaboration between the two companies, allowing FF to benefit
from an additional revenue stream beyond vehicle manufacturing,
without increased financial, labor, or other expenses. This
business expansion not only diversifies FF's revenue sources but
could also enhance global brand recognition for both FF and FX.
"We are very pleased to establish a strategic collaboration with
Grow Fandor for our ecosystem products. Grow Fandor's commitment
to supporting FF's growth in this new area is invaluable, and we
look forward to realizing the potential of this promising new
business segment," said Matthias Aydt, Global CEO of FF.
A spokesperson for Grow Fandor added, "We are honored to enter this
strategic collaboration with FF. Grow Fandor is dedicated to
maximizing the brand value of FF and FX. We believe this
cooperation will drive a dynamic synergy between our companies,
fostering mutual growth and success."
About Faraday Future
Los Angeles, CA-based Faraday Future (NASDAQ: FFIE) --
http://www.ff.com-- designs and engineers next-generation
intelligent, connected, electric vehicles. FF manufactures
vehicles at its production facility in Hanford, California, with
additional future production capacity needs addressed through a
contract manufacturing partner in South Korea. FF is also
exploring other potential contract manufacturing options in
addition to the contract manufacturer in South Korea. The Company
has additional engineering, sales, and operational capabilities in
China and is exploring opportunities for potential manufacturing
capabilities in China through a joint venture or other
arrangement.
New York, NY-based Mazars USA LLP, the Company's auditor since
2022, issued a "going concern" qualification in its report dated
May 28, 2024, citing that the Company has incurred operating losses
since inception, has continued cash outflows from operating
activities, and has an accumulated deficit. These conditions raise
substantial doubt about its ability to continue as a going
concern.
FLATIRON NEW: Seeks Cash Collateral Access Until Feb. 28
--------------------------------------------------------
Flatiron New Mexico, LLC asked the U.S. Bankruptcy Court for the
District of New Mexico for authority to use cash collateral through
February 28, 2025.
The company requires the use of cash collateral to continue
operating its restaurant. Use of cash collateral is necessary to
pay rent, salary and wages, purchase inventory and supplies, pay
taxes, pay other operating and administrative expenses, and pay
attorney fees.
Torro LLC and Funding Metrics LLC, doing business as Lendini,
assert an interest in the company's cash collateral.
The value of the collateral for Torro's collateral on the petition
date exceeded $98,000, as the collateral includes inventory and
equipment.
Flatiron proposed and Torro has agreed to accept adequate
protection. Torro will continue to have a security interest upon,
and the company's obligations to Torro will be secured by, security
interests in all assets in which Torro had a lien or security
interest as of the Petition Date, which will be subject to the same
defenses and avoidance powers (if any), as existed on the Petition
Date. In addition, Torro will have and is granted liens against
property of the same type as the Pre-Petition Collateral acquired
by the company post-petition. The assets in which Torro is granted
Replacement Liens are called the "Post-Petition Collateral."
The liens and security interests in the Post-Petition Collateral
will be deemed valid and perfected as of the Petition Date, without
further filing or recording under any state or federal law, to the
same extent as the liens in the Pre-Petition Collateral of the same
type was valid and perfected as of the Petition Date.
In addition to the equity cushion and Replacement Liens, the
company will make adequate protection payments to Torro in the
amount of $500 per month, due on the 15th of each month, beginning
on January 15, 2025, constituting Adequate Protection for the
duration of the First Cash Collateral Period.
Flatiron will continue to maintain in effect general property and
liability insurance for its business operation.
About Flatiron New Mexico LLC
Flatiron New Mexico, LLC filed a Chapter 11 bankruptcy petition
(Bankr. D.N.M. Case No. 24-11279) on Nov. 27, 2024.
In the petition signed by Christian Manzer, manager, the Debtor
disclosed up to $50,000 in assets and up to $500,000 in
liabilities.
Chris Gatton, Esq., at Gatton & Associates, P.C., represents the
Debtor as legal counsel.
FORT GORDON: Moody's Affirms 'Ba1' Rating on 2006 Class I Bonds
---------------------------------------------------------------
Moody's Ratings has affirmed the outstanding Ba1 and Ba2 ratings on
Fort Gordon Housing LLC's Series 2006 Bonds: Class I and Class II
bonds, respectively. These affirmations affect approximately $69.4
million of total debt outstanding. The outlook remains stable.
On October 27, 2023 the US Defense Department officially renamed
Fort Gordon as Fort Eisenhower.
RATINGS RATIONALE
The affirmations reflect favorable annual Basic Allowance for
Housing (BAH) increases over the last four years which will provide
sufficient revenue support to sustain debt service coverage (DSC)
in line with 2023 results of 1.12x and 1.07x, respectively.
Improving operating performance was achieved despite historical
challenges in housing demand at the project. Furthermore, the
project will benefit in the near term from the Army's sizable
additional funding allocations for project reinvestment, including
work to upgrade off-line and/or deteriorated on-base housing that
will ultimately improve project revenue flow. Fort Eisenhower's
position as a vital hub for US military cyber operations supports
the base's long-term essentiality and bolsters overall personnel
demand.
Offsetting considerations include several years of modest debt
service coverage caused by weak occupancy at 77.5% of total units
given the presence of a large number of older, less desirable
units. The soft real estate market within the Augusta, GA region
places additional competitive pressures on the project, especially
as BAH increases averaging 6.8% annually from 2021-2024 provide
service members with greater flexibility to choose other housing
options. The ratings also consider the estimated $27 million in
Hurricane Helene-related damages, which struck in early October
2024. Balfour Beatty Military Housing Management LLC, the property
manager, estimates total uninsured costs to the project of about
$50,000, though increasing recovery expenses or lower actual
reimbursement rates pose a potential risk to the limited liquidity
levels currently maintained.
RATING OUTLOOK
The stable outlook reflects the project's ability to sustain
improved financial performance despite noted operating constraints.
Additionally, the outlook incorporates the availability of
additional capital funding that will enhance project inventory and
potential revenue flow.
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS
-- Consistently increasing debt service coverage levels maintained
above 1.29x and 1.10x for Class I and Class II, respectively.
-- Improved operating margins through increases in BAH, occupancy
and rental revenues
-- Cash funded debt service reserve fund or replacement of current
surety with a highly rated provider
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS
-- Significant decline in anticipated DSC below 1.0x on both
tranches due to below-average BAH increases, further declines in
occupancy, increases in operating expenses, or other pressures on
net operating income
LEGAL SECURITY
The Bonds are limited obligations of Fort Eisenhower LLC (f/k/a
Fort Gordon Housing LLC), payable solely from the assets and
revenues pledged under the Indenture, including revenues generated
by the operation of the residential rental housing units. Each
class of Bonds is secured by a Debt Service Reserve Fund (DSRF),
which is funded by a debt service surety in an amount equal to
maximum annual debt service on the respective class of Bonds.
PROFILE
Fort Eisenhower is located in Augusta, Georgia within Richmond
County, approximately 150 miles east of Atlanta. It is located in
the northeastern portion of the state of Georgia, and is adjacent
to the Georgia-South Carolina state border. Fort Eisenhower is the
biggest employer in the region, employing a workforce of
approximately 15,700 military personnel and 7,100 civilians.
The borrower is Fort Gordon LLC (f/k/a Fort Gordon Housing LLC)
which was formed as a Delaware limited liability company on April
26, 2006 for the purpose of developing and maintaining housing at
Fort Eisenhower through the Military Housing Privatization
Initiative pursuant to the National Defense Authorization Act of
1996. Operations for the base began on May 1, 2006. In July 2012,
the Department of the Army declared the Initial Development Period
complete. The current number of end state units is 1,072.
METHODOLOGY
The principal methodology used in these ratings was Global Housing
Projects published in August 2024.
GLOSSLAB LLC: Seeks Chapter 11 Bankruptcy Protection
----------------------------------------------------
Jonathan Randles of Bloomberg News reports that Glosslab LLC --
https://glosslab.com/ -- a New York City nail salon chain
recognized for its membership-based model and celebrity investors,
has filed for bankruptcy.
The company and its affiliates filed for court protection in New
York on Monday, December 23, 2024, with plans to sell its remaining
assets to VD Brand Holdings Inc., according to court documents. CEO
Rachel Apfel Glass revealed in a filing that the business faced
setbacks due to rapid expansion and a March New York Post article
highlighting financial troubles and a legal dispute with European
Wax Center founder Joshua Coba.
GRAFTECH FINANCE: Ends Debt Exchange Offer, Consent Solicitation
----------------------------------------------------------------
Caleb Mutua of Bloomberg News reports that GrafTech said it
completed a previously announced offer to exchange senior secured
notes due 2028 and solicited consent to eliminate substantially all
covenants and events of default and release all of the collateral
securing existing notes.
Holders had the opportunity to exchange their outstanding 4.625%
senior secured notes due 2028 for new 4.625% second lien notes due
2029 to be issued by GrafTech Finance, the company said in a
statement Monday, December 23, 2024.
Their 9.875% senior secured notes due 2028 together with the 4.625%
notes for new 9.875% second lien notes due 2029 to be issued by
GrafTech Global.
About GrafTech Finance
GrafTech Finance, Inc. and GrafTech Global Enterprises Inc. are
wholly owned subsidiaries of GrafTech Holdings Inc., which in turn
is 100% owned by GrafTech International Ltd. GrafTech International
Ltd., headquartered in Brooklyn Heights, Ohio, is a manufacturer of
graphite electrodes and needle coke products. The company has about
178,000 metric tons of electrode capacity excluding its idled
facility in St. Mary's, Pennsylvania. GrafTech generated $618
million in revenues for the twelve months ended March 31, 2024.
GRAFTECH INTERNATIONAL: S&P Downgrades ICR to 'D' on Debt Exchange
------------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Ohio-based
graphite electrode producer GrafTech International Ltd. to 'D' from
'CC'. S&P lowered the affected issue-level debt ratings to 'D' from
'CC'.
Over the coming days, S&P will reassess its issuer credit rating on
GrafTech based on its new capital structure.
GrafTech has completed an exchange of its senior secured notes.
S&P said, "We view the completed debt exchange as a default. We
view the offer as providing the lenders less than the original
promise because the maturity is being extended, the coupon rate
remains the same, and new first-lien debt is placed ahead of the
senior secured notes in terms of priority of repayment. The secured
notes were exchanged at par.
"Over the coming days, we expect to reassess our issuer credit
rating and issue-level ratings on GrafTech. Our reassessment will
reflect the company's revised capital structure and our
forward-looking opinion of its creditworthiness."
GRAY TELEVISION: Moody's Affirms 'B2' CFR, Outlook Stable
---------------------------------------------------------
Moody's Ratings affirmed Gray Television, Inc.'s B2 corporate
family rating, B2-PD probability of default rating, Ba3 ratings on
the company's senior secured bank credit facilities and senior
secured first lien notes, and Caa1 ratings on the senior unsecured
notes. The Speculative Grade Liquidity rating was downgraded to
SGL-2 from SGL-1. The outlook is stable.
RATINGS RATIONALE
The affirmation of the B2 CFR reflects Gray's commitment to
deleverage the balance sheet by repaying/repurchasing over $500
million of debt in 2024 with excess cash flow and proceeds from
asset divestitures, as well as focusing on reducing operating
expenses and improving cash flow. The affirmation also considers
Moody's expectation that Gray's strong market position as the
second-largest television broadcast group in the US,
well-diversified network affiliates, lead rankings in a large
majority of its markets and strong audience share will allow it to
remain a partner of choice to pay-TV distributors who see the
company's content as a must have. In addition, Moody's expect Gray
will continue to attract solid advertiser demand and deliver better
core ad revenue performance than its peers despite industry
pressures in core linear TV advertising and retransmission revenue.
Given Gray's good execution on stabilizing its credit profile
against a challenging industry backdrop and Moody's expectation for
relatively steady leverage, these considerations collectively
support Moody's view that the company's credit metrics are
currently appropriately positioned within the B2 rating. However,
Gray must continue to focus on its debt reduction efforts and
effectively implement cost reductions, both of which are key to
offsetting some of the structural challenges and maintaining the B2
rating and stable outlook.
Gray's B2 CFR is supported by the company's quasi-national
footprint and scale across its network of broadcast stations, as
well as their significant reach and strong market positions. Gray
is one of the largest US broadcasters with 171 owned and operated
network affiliated TV stations across 113 markets of which roughly
70% are large or mid-sized markets. Gray has a very strong
portfolio of stations and is the largest owner of number-one ranked
television stations: with #1 ranked television stations in 80
designated market areas (DMAs) and #1 or #2 ranked stations in 102
or 90% of its DMAs.
The company's revenue model benefits from a mix of recurring
retransmission fees that historically helped to offset the inherent
volatility of traditional advertising revenue. Over the next
several years, however, Moody's expect retransmission revenue will
continue to experience pressure as the rate of traditional
subscriber losses outpaces annual fee increases, which constrains
the rating. In even numbered years, revenue benefits from material
political advertising spend, especially during presidential
election years, which can mask pressure in retransmission revenue,
but also boosts EBITDA. During election years, Gray generates solid
free cash flow (FCF), which declines during non-political years.
The B2 CFR is constrained by the ongoing structural decline in
linear TV core advertising as non-political TV advertising budgets
continue to erode in favor of digital media. Moody's expect Gray's
linear TV core ad revenue will continue to be pressured over the
rating horizon, which could worsen during periods of weak CPM (cost
per thousand impressions) pricing, depressed TV ratings,
deteriorating macroeconomic conditions and/or displacement during
election years. To offset these challenges and diversify its
operations, Gray has invested in new technologies, businesses
(e.g., Assembly Atlanta, a media production "studio city" in
Georgia) and over-the-top (OTT) distribution, however these
investments can burden cash flows given their lower margin profile
and create operational risk in the short-term until they become
profitable.
The stable outlook reflects the structural and secular pressures in
Gray's business offset by the scale, breadth and diversity of its
high quality TV station assets in top-ranked markets. At LTM
September 30, 2024, Gray's total debt to EBITDA leverage was around
5.8x, pro forma for debt repurchases/repayments through 20 November
2024 (compared to roughly 6.3x at FYE 2023) and projected to
decline to 5.6x at FYE 2024. The improvement is being aided by
political advertising revenue owing to the 2024 presidential
election, which boosts EBITDA, as well as open market debt
repurchases totaling around $500 million (principally at the front
end of the debt stack). As political advertising recedes and
retransmission and core advertising revenue growth remain pressured
next year, Moody's expect leverage in the 5.4x-5.7x range by FYE
2025 (note: all leverage metrics are Moody's adjusted on a two-year
average EBITDA basis). Relatively steady leverage metrics will be
facilitated by the realization of at least $60 million in cost
reductions as well as additional debt repurchases/repayments over
the coming year. On November 20, Gray's Board approved a further
$250 million of debt repurchases, subject to available liquidity.
The stable outlook also reflects the successful refinancing of
Gray's 2026 debt maturities with no significant maturities until
May 2027 when the $528 million outstanding 7% senior unsecured
notes expire, which Moody's expect the company will continue
purchasing opportunistically. The outlook embeds Moody's
expectation that the company will successfully renew expiring
multichannel video programming distributor (MVPD) contracts and
renegotiate affiliate programming agreements over the next 12-24
months.
Over the next 12-18 months, Moody's expect Gray will maintain good
liquidity as reflected in the SGL-2 Speculative Grade Liquidity
rating. At LTM September 30, 2024, FCF (defined by Moody's as cash
flow from operations less capex less dividends) totaled $219
million (Moody's adjusted) and cash and cash equivalents were
around $69 million. Moody's forecast FCF of around $250 to $300
million in FY 2024 (presidential election year) declining to around
$100 to $150 million in FY 2025 (non-election year). The expected
improvement in 2024/25 FCF compared to 2022/23 is aided by the
normalization of capital expenditures following completion of the
Assembly Atlanta film studios complex last summer as well as
planned cost savings. Moody's anticipate that the bulk of FCF will
be used for debt repurchases/repayments and small investments. If
Gray were to draw on its $680 million revolving credit facility
(RCF) due December 2027, the company would have to comply with a
first-lien senior secured net leverage ratio covenant of 4.25x. At
September 30, 2024, $674 million was available under the RCF and
Gray was in compliance with all required covenants under its debt
obligations. Moody's expect Gray to maintain ample covenant
headroom under the RCF in the coming quarters.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
While unlikely near-term given the structural and secular industry
pressures, over the longer-term ratings could be upgraded if Gray
sustains leverage comfortably well below 4.5x (Moody's adjusted on
a two-year average EBTIDA basis) and FCF to debt above 6% (Moody's
adjusted on a two-year average FCF basis). Gray would also need to:
(i) exhibit organic revenue growth and stable-to-improving EBITDA
margins on a two-year average basis; (ii) adhere to conservative
financial policies; and (iii) maintain at least good liquidity to
be considered for an upgrade. Ratings could be downgraded if Gray's
leverage was sustained above 5.5x (Moody's adjusted on a two-year
average EBITDA basis) as a result of weak operating performance or
more aggressive financial policies. A downgrade could also arise if
FCF to debt was sustained below 3% (Moody's adjusted on a two-year
average FCF basis) or Gray experienced deterioration in liquidity
or covenant compliance weakness.
Headquartered in Atlanta, GA, Gray Television, Inc. is a multimedia
broadcast company that currently owns and operates television
stations across 113 markets reaching 36% of US households (25%
including the 50% UHF discount). In roughly 90% of its markets, the
company operates the #1 or #2 ranked station. Gray is publicly
traded with the Howell-Robinson family and affiliates of the late
J. Mack Robinson collectively owning around 11% of combined classes
of common stock. The dual class equity structure provides these
affiliated entities with around 46% voting share. Revenue for the
twelve months ended September 30, 2024 totaled around $3.5
billion.
The principal methodology used in these ratings was Media published
in June 2021.
GREAT LAKES: S&P Places 'CC(sf)' Bond Rating on Watch Negative
--------------------------------------------------------------
S&P Global Ratings placed its 'CC(sf)' long term rating on the
Arizona Industrial Development Authority's series 2019A senior
living revenue bonds (Great Lakes Senior Living Communities LLC
Project) on CreditWatch with negative implications.
The series 2019B and 2019C bonds are rated 'D(sf)'.
"The CreditWatch action on the series A bond rating reflects our
view that there is at least a one-in-two likelihood that we will
lower to rating to 'D' within 30 days if debt service is not paid
on time and in full on Jan. 1, 2025, as a result of insufficient
funds," said S&P Global Ratings credit analyst Daniel Pulter.
GRESHAM WORLDWIDE: Plan Exclusivity Extended to Jan. 31, 2025
-------------------------------------------------------------
Judge Scott H. Gan of the U.S. Bankruptcy Court for the District of
Arizona extended Gresham Worldwide, Inc.'s exclusive periods to
file a plan of reorganization and obtain acceptance thereof to Jan.
31, 2025 and March 31, 2025, respectively.
As shared by Troubled Company Reporter, the Debtor explains that
application of the Dow Corning factors to its case demonstrates
that the requested extensions of the Exclusivity Periods are
appropriate pursuant to Section 1121(d) of the Bankruptcy Code.
First, this bankruptcy case has been pending for just three months
and this is Debtor's first request to extend the Exclusivity
Periods. Second, as this Court has certainly observed, Debtor's
efforts during much of the first three months of this case have
been primarily consumed by litigation with Arena Investor LP's over
Arena's opposition to Debtor's use of cash collateral and request
for DIP financing and Arena's motion to appoint a chapter 11
trustee.
As a result of this protracted litigation, Debtor has largely been
denied the benefit of the statutory breathing space the Exclusivity
Periods are designed to provide under chapter 11. While Debtor has
recently made good progress in evaluating its financial conditions,
its future prospects for reorganization, and projected financial
needs following confirmation of a plan, Debtor needs more time to
evaluate the ongoing financial performances of its operating
divisions and subsidiaries and to develop a plan.
Gresham Worldwide, Inc. is represented by:
Patrick A. Clisham, Esq.
Engelman Berger, PC
2800 North Central Avenue, Suite 1200
Phoenix, AZ 85004
Telephone: (602) 271-9090
Facsimile: (602) 222-4999
Email: pac@eblawyers.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 the Chapter 11 case. The Committee tapped Stinson LLP
as legal counsel.
GRIT & GRAVEL: Access to Cash Collateral Terminated
---------------------------------------------------
Mission Valley Bank announced the termination of Grit & Gravel,
Inc.'s authority to use the bank's cash collateral.
In a Dec. 23 notice filed with the U.S. Bankruptcy Court for the
Central District of California, Los Angeles Division, the bank said
it received information from the company of its decision to
terminate operations.
"In conjunction therewith and as a result of certain other actions,
[Grit & Gravel] is in breach of various provisions of the cash
collateral order," Mission Valley Bank said, referring to the
court's Dec. 19 order giving the company interim approval to use
cash collateral until Jan. 20 next year.
As a result, Grit & Gravel was instructed to immediately cease
using the cash collateral and separately segregate the cash
collateral for the benefit of the bank, according to the notice.
The bankruptcy court on Dec. 19 approved the use of cash collateral
to allow the company to pay its operating expenses and, in return,
Mission Valley Bank was granted a replacement lien on the company's
assets.
About Grit & Gravel Inc.
Founded in 2020, Grit & Gravel, Inc. is a certified Woman Business
Enterprise that crushes, recycles, stores, and sells concrete,
stone and gravel at its facility in South Central Los Angeles.
These services complement the trucking, earthwork, excavation
shoring, and demolition and disposal services provided by its
affiliate Miranda Logistics.
Grit & Gravel sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Calif. Case No. 24-20278) with up to
$50,000 in assets and up to $10 million in liabilities. The
petition was signed by Stephanie Miranda as chief executive
officer, chief financial officer and secretary.
Judge Julia W. Brand oversees the case.
The Debtor is represented by Sean A. OKeefe, Esq., at Okeefe &
Assoc. Law Corp., P.C.
H-FOOD HOLDINGS: Russell Johnson Represents Utility Companies
-------------------------------------------------------------
Pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure,
the Law Firm of Russell R. Johnson III, PLC, submitted a verified
statement to disclose that it is representing the utility companies
in the Chapter 11 cases of H-Food Holdings, LLC, and affiliates.
The Utilities have unsecured claims against the Debtors arising
from prepetition utility usage.
The Law Firm of Russell R. Johnson III, PLC was retained to
represent the Utilities in November and December 2024.
The names and addresses of the Utilities represented by the Firm
are:
1. Ohio Power Company d/b/a American Electric Power American
Electric Power
Attn: Jason Reid
1 Riverside Plaza, 13th Floor
Columbus, Ohio 43215
2. Constellation NewEnergy – Gas Division, LLC
Attn: Renee E. Suglia, Esq., Assistant General Counsel
3. AEP Energy, Inc.
Attn: Elizabeth A. Lehman
Manager, Billing & Collections
1 Riverside Plaza
Columbus, Ohio 43215
The Firm can be reached at:
Russell R. Johnson III, Esq.
LAW FIRM OF RUSSELL R. JOHNSON III, PLC
2258 Wheatlands Drive
Manakin-Sabot, VA 23103
Telephone: (804) 749-8861
Facsimile: (804) 749-8862
E-mail: russell@russelljohnsonlawfirm.com
About H-Food Holdings LLC
H-Food Holdings LLC, formerly known as Matterhorn Merger Sub, LLC,
founded in 2009 in Grand Rapids, Michigan, the Debtors are a
contract manufacturer of food products, producing and supplying,
among other things, nutrition bars, frozen packaged foods, meal
kits, snacks, sauces, refrigerated trays, overwrap, custom
packaging solutions, and more to customers. As the largest food
co-manufacturer in North America, the Debtors manufacture some of
the most valued and recognizable brands, and the Debtors' key
customers include many of the leading consumer packaged goods
customers in North America.
H-Food Holdings LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 24-90586) on Nov.
22, 2024. In the petition filed by Robert M. Caruso, as chief
restructuring officer, the Debtor reports estimated assets and
liabilities between $1 billion and $10 billion each.
Judge Alfredo R. Perez presides over the case.
The Debtors tapped ROPES & GRAY LLP as general bankruptcy counsel;
PORTER HEDGES LLP as co-bankruptcy counsel; EVERCORE GROUP LLC as
investment banker; and ALVAREZ & MARSAL NORTH AMERICA, LLC as
financial advisor.
HALO ESTATES: Seeks to Hire Rodriguez Law Group as Legal Counsel
----------------------------------------------------------------
Halo Estates LLC seeks approval from the U.S. Bankruptcy Court for
the Central District of California to employ Rodriguez Law Group,
Inc. as bankruptcy counsel.
The firm will provide these services:
(a) advise the Debtor regarding matters of bankruptcy law and
concerning the requirements of the Bankruptcy Code, and Bankruptcy
Rules relating to the administration of this case, and the
operation of its estate;
(b) represent the Debtor in proceedings and hearings in the
court involving matters of bankruptcy law;
(c) assist in compliance with the requirements of the Office
of the United States trustee;
(d) provide the Debtor legal advice and assistance with
respect to its powers and duties;
(e) assist the Debtor in the administration of the estate's
assets and liabilities;
(f) prepare necessary legal documents on behalf of the
Debtor;
(g) assist in the collection of all accounts receivable and
other claims that the Debtor may have and resolve claims against
its estate;
(h) provide advice, as counsel, concerning the claims of
secured and unsecured creditors, prosecution and/or defense of all
actions; and
(i) prepare, negotiate, prosecute, and attain confirmation of
a plan of reorganization.
The firm will be paid a flat fee of $7,500 for its services.
Patricia Renee Rodriguez, Esq., president of Rodriguez Law Group,
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:
Patricia Rodriguez, Esq.
Rodriguez Law Group, Inc.
1055 E. Colorado Blvd., Suite 500
Pasadena, CA 9116
Telephone: (626) 888-5206
Email: prod@attorneyprod.com
About Halo Estates
Halo Estates LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Case No. 24-11656) on Sept. 30,
2024. In the petition filed by Rosie Patterson, member, the Debtor
estimated between $1 million and $10 million in both assets and
liabilities.
Judge Martin R. Barash oversees the case.
The Debtor tapped Ashby & Geddes, P.A., as bankruptcy counsel.
Patricia Rodriguez, Esq., at Rodriguez Law Group, Inc. serves as
the Debtor's counsel.
HASTY GROUP: Seeks to Hire Krigel Nugent + Moore as Legal Counsel
-----------------------------------------------------------------
The Hasty Group, LLC seeks approval from the U.S. Bankruptcy Court
for the District of Kansas to employ Krigel Nugent + Moore, PC as
counsel.
The firm will render these services:
(a) advise the Debtor with respect to its powers and duties;
(b) attend meetings and negotiate with representatives of
creditors and other parties in interest;
(c) take all necessary action to protect and preserve the
estate;
(d) prepare on behalf of Debtor all legal papers necessary to
the administration of the estate;
(e) negotiate and prosecute on the Debtor's behalf all
contracts for the sale of assets, plan of reorganization, and all
related agreements and/or documents, and take any action that is
necessary for it to obtain confirmation of its Plan of
Reorganization;
(f) appear before this court and the United States Trustee,
and protect the interests of the Debtor's estate before the court
and the U.S. Trustee; and
(g) perform all other necessary legal services and provide all
other necessary legal advice to the Debtor in connection with this
Chapter 11 proceeding.
The firm's counsel and staff will be paid at these hourly rates:
Sanford Krigel, Attorney $400
SJ Moore, Attorney $400
Ivan Nugent, Attorney $400
Erlene Krigel, Paralegal $300
Karen Rosenberg, Paralegal $300
Dana Wilders, Paralegal $300
Lara Pabst, Paralegal $300
Sean Cooper, Paralegal $300
Jared Marsh, Paralegal $300
Legal Assistants $100
Ms. Krigel 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:
Erlene Krigel, Esq.
Krigel Nugent + Moore, PC
4520 Main St., Ste. 700
Kansas City, MO 64111
Telephone: (816) 756-5800
About The Hasty Group
The Hasty Group, LLC filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. D. Kan. Case No.
24-21592) on Dec. 13, 2024, listing under $1 million in both assets
and liabilities.
Judge Dale L. Somers oversees the case.
Erlene Krigel, Esq., at Krigel Nugent + Moore, PC represents the
Debtor as counsel.
HAWAII STAGE: Seeks to Hire Choi & Ito as Bankruptcy Counsel
------------------------------------------------------------
Hawaii Stage and Lighting Rentals, Inc. seeks approval from the
U.S. Bankruptcy Court for the District of Hawaii to employ Choi &
Ito to handle its Chapter 11 case.
The hourly rates of the firm's attorneys are:
Chuck C. Choi $450
Allison A. Ito $300
Prior to the petition date, the firm received $103,720.89 from the
Debtor.
Allison Ito, Esq., an attorney at Choi & Ito, 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:
Allison A. Ito, Esq.
Choi & Ito
700 Bishop Street, Suite 1107
Honolulu, HI 96813
Telephone: (808) 533-1877
Facsimile: (808) 566-6900
Email: aito@hibklaw.com
About Hawaii Stage and Lighting Rentals
Hawaii Stage and Lighting Rentals Inc., doing business as Hawaii
Stage and Hawaii Stage Event Production Company, is a full service
event production company serving the Hawaiian Islands since 1976.
Hawaii Stage and Lighting Rentals Inc. sought relief under Chapter
11 of the U.S. Bankruptcy Code (Bankr. D. Haw. Case No. 24-01132)
on December 14, 2024. In the petition filed by Joseph Kuhio Lewis,
president, the Debtor reports estimated assets and liabilities
between $1 million and $10 million each.
Judge Robert J. Faris handles the case.
Allison A. Ito, Esq., at Choi & Ito serves as the Debtor's counsel.
HEALTHY SPOT: Hires Levene Neale Bender Yoo & Golubchik as Counsel
------------------------------------------------------------------
Healthy Spot Operating, LLC seeks approval from the U.S. Bankruptcy
Court for the Central District of California to employ Levene,
Neale, Bender, Yoo & Golubchik LLP as counsel.
The firm will render these services:
(a) advise the Debtor with regard to the requirements of the
Bankruptcy Court, Bankruptcy Code, Bankruptcy Rules and the Office
of the United States Trustee;
(b) advise the Debtor with regard to certain rights and
remedies of its bankruptcy estate and the rights, claims and
interests of creditors;
(c) represent the Debtor in any proceeding or hearing in the
Bankruptcy Court involving its estate unless it is represented in
such proceeding or hearing by other special counsel;
(d) conduct examinations of witnesses, claimants or adverse
parties and represent the Debtor in any adversary proceeding except
to the extent that any such adversary proceeding is in an area
outside of the firm's expertise or which is beyond its staffing
capabilities;
(e) prepare and assist the Debtor in the preparation of
reports, applications, pleadings and orders;
(f) represent the Debtor with regard to obtaining use of
debtor in possession financing and/or cash collateral;
(g) assist the Debtor in any asset sale process;
(h) assist the Debtor in the negotiation, formulation,
preparation and confirmation of a plan of reorganization and the
preparation and approval of a disclosure statement in respect of
the plan; and
(i) perform any other services which may be appropriate in the
firm's representation of the Debtor during its bankruptcy case.
The firm's attorneys and paraprofessionals will be paid at these
hourly rates:
David Neale $750
Ron Bender $750
Timothy Yoo $750
David Golubchik $750
Eve Karasik $750
Gary Klausner $750
Edward Wolkowitz $750
Beth Ann Young $750
Monica Kim $725
Philip Gasteier $725
Daniel Reiss $725
Todd Frealy $725
Kurt Ramlo $725
Richard Steelman, Jr. $725
Juliet Oh $725
Todd Arnold $725
Krikor Meshefejian $725
John Patrick Fritz $725
Joseph Rothberg $725
Jeffrey Kwong $725
Michael D'Alba $725
Carmela Pagay $700
Anthony Friedman $700
Lindsey Smith $650
Robert Carrasco $550
Paraprofessionals $300
In addition, the firm will seek reimbursement for expenses
incurred.
The firm also received a pre-bankrutcy retainer of $50,000 from the
Debtor.
Mr. Neale 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 L. Neale, Esq.
Levene, Neale, Bender, Yoo & Golubchik LLP
2818 La Cienega Avenue
Los Angeles, CA 90034
Telephone: (310) 229-1234
Email: dln@lnbyg.com
About Healthy Spot Operating
Healthy Spot Operating LLC is a pet care retail company that offers
dog grooming, dog daycare, and community experiences.
Healthy Spot Operating LLC sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No. 24-20065) on
December 10, 2024. In the petition filed by Mark Boonnark, chief
executive officer, the Debtor reports estimated assets between $10
million and $50 million and estimated liabilities between $1
million and $10 million.
David L. Neale, Esq., at Levene, Neale, Bender, Yoo & Golubchik LLP
serves as the Debtor's counsel.
HERITAGE GROCERS: S&P Alters Outlook to Negative, Affirms 'B' ICR
-----------------------------------------------------------------
S&P Global Ratings revised the rating outlook on Heritage Grocers
Group LLC's (HGG) to negative from stable and affirmed its 'B'
issuer credit rating on HGG. At the same time, S&P affirmed its 'B'
issue-level rating and '3' recovery rating to the proposed debt
facilities. The '3' indicates its expectation of meaningful
(50%-70%; rounded estimate: 60%) recovery in the event of a payment
default.
The negative outlook reflects the risks to S&P's base case forecast
due to the company’s elevated leverage and pressure on
profitability, which could lead it to sustain leverage above 6x.
S&P said, "The negative outlook reflects the company's elevated
leverage and our expectation that headwinds affecting revenue and
margins will persist in 2025. The company's three banners are
regionally focused in areas with strong Hispanic demographics. The
Tony's and El Rancho banners, which account for about 40% of total
stores, have greater exposure to low-income consumers than the
Cardenas banner. Reductions in SNAP benefits have pressured
low-income consumers this year resulting in an increased
promotional environment with greater competition from discount
grocers. This has caused transaction counts to decline modestly
leading to an approximate 3% decline in same-store sales (SSS) in
2024. Furthermore, the promotional environment, as well as
inflationary pressures that can't fully be passed to customers,
caused adjusted EBITDA margins to decline to 7.7% on a trailing
12-month basis at the end of the third quarter compared with 9% at
the end of last year. This has caused adjusted leverage to approach
6x versus our previous expectation of mid-5x.
"The company is taking steps to improve its value proposition and
store traffic. We expect the company's initiatives will lead to
incremental margin gains and improved SSS in 2025. However, we
believe pressure on low-income consumers will continue and that the
aggressive promotional environment in the grocery industry will
persist. As a result, we expect competition from larger competitors
and discount grocers that have greater scale will continue to
intensify in 2025. We expect adjusted leverage of about 6x for
2024, improving to 5.9x in 2025. Further pressure on revenue and
profitability resulting from competitive pressures and stress on
the low-income consumer could cause credit metrics to deteriorate
further relative to our base case. This would likely lead to
adjusted leverage sustained at 6x or above with weak free operating
cash flow (FOCF), which would lead us to reassess our view of its
creditworthiness.
"We expect HGG's adjusted leverage will be elevated around 6x in
2024 and 2025 due to lower adjusted EBITDA margins and believe it
will improve in 2025. Our base case projects revenue of about $3
billion in 2024 reflecting the decline in SSS. The promotional
environment has caused significant gross margin compression in
2024. As a result, we project adjusted EBITDA margins around 7.3%
for the year compared with 9% in 2023. We believe the company's
strategic initiatives, and the realization of synergies from the El
Rancho acquisition, will lead to improvements in SSS and
profitability in 2025, but headwinds in the industry will still
affect performance. As a result, our base case projects flat
adjusted EBITDA margins of 7.3% in 2025. This leads us to forecast
adjusted EBITDA of around $223 million in 2024 and 2025 with
adjusted leverage of about 6.0x and 5.9x, respectively. Our
forecast projects adjusted interest coverage of 1.5x in 2024 and
2025, compared with 1.8x in 2023. We expect leverage and EBITDA
generation will further improve in 2026 based on stabilized revenue
growth and improved gross margins that will lift adjusted EBITDA
margins to the high-7% area. We do not expect debt repayment in
excess of amortization and instead think the financial sponsor
Apollo Global Management will prioritize growth investments and
secondarily consider returning capital to shareholders as cash flow
improves.
"We expect weak FOCF in 2024 and 2025, which reflects weaker EBITDA
generation amid a pressured consumer environment. Revenue and
profitability headwinds have led to a decline in operating cash
flow in 2024. As a result, we expect FOCF this year of about $10
million. We believe improved profitability will lead to modest FOCF
improvements in 2025, albeit not substantial. We expect significant
FOCF generation in 2026 due to better operating leverage stemming
from stabilized revenue growth and improved margins. Our
expectation is the company will reduce its growth capital
expenditures (capex) for now to preserve cash flow and liquidity.
As a result, we expect its total store count to remain flat through
2025.
"The negative outlook reflects the risks to our base case stemming
from increased competitive and promotional pressures amid a weaker
consumer environment that could lead the company to sustain credit
metrics commensurate with a lower rating. We expect HGG's S&P
Global Ratings-adjusted debt to EBITDA will be around 6x over the
next 12 months with at least 1.5x of adjusted interest coverage.
"We could lower our rating on HGG if we expect it will maintain S&P
Global Ratings-adjusted debt to EBITDA at or above 6x or if we
believed the company would sustain adjusted interest coverage below
1.5x. In this scenario, we would expect promotions to not
sufficiently improve traffic and grow its customers baskets,
leading to weaker margins and cash flow."
S&P could revise its outlook on HGG to stable if:
-- S&P expects it will sustain leverage below 6x; and
-- It develops a track record of positive earnings growth and
higher FOCF generation with adjusted interest coverage approaching
2x.
HYPHA LABS: CEO Douglass Acquires 1,000 Series C Preferred Shares
-----------------------------------------------------------------
Hypha Labs, Inc. disclosed in a Form 8-K filed with the Securities
and Exchange Commission that on Dec. 10, 2024, it entered into a
securities purchase agreement with A. Stone Douglass, the Company's
chairman, president, chief executive officer, chief financial
officer and secretary, pursuant to which Mr. Douglass purchased
1,000 shares of the Company's Series C Preferred Stock for a
purchase price of $0.10 per share of Series C Preferred Stock.
The principal feature of the Series C Preferred Stock is that it
provides the holder thereof, so long as he or she is an executive
officer of the Company, with the ability to vote with the holders
of the Company's common stock on all matters presented to the
holders of common stock, whether at a special or annual meeting, by
written action in lieu of a meeting or otherwise, on the basis of
200,000 votes for each share of Series C Preferred Stock. The
shares of Series C Preferred Stock are not convertible into common
stock, are not entitled to dividends, are not subject to
redemption, and have a stated value of $0.10 per share payable on
any liquidation of the Company in preference to any payment payable
to the holders of common stock.
The board of directors of the Company desires to and believes it is
in the best interests of the Company to increase the authorized
shares of the Company's common stock and preferred stock in order
to provide for the Company's financing and capital-raising ability.
The Board believes that the increase in the authorized shares of
the Company's common stock is necessary and advisable to provide
for conversions of its outstanding convertible securities and to
provide for the grants of restricted stock and stock options. In
addition, the Board believes it is in the best interests of the
Company to have additional shares of common stock and preferred
stock authorized for general corporate purposes, including
acquisitions or other strategic transaction opportunities. In
order to eliminate the costs and management time involved in
obtaining proxies in order to obtain stockholder approval to amend
the Company's Articles of Incorporation, as amended, to increase
(1) the authorized shares of the Company's common stock from
250,000,000 shares to 880,000,000 shares and (2) the authorized
shares of the Company's preferred stock from 10,000,000 shares to
70,000,000 shares, the Board determined that the sale of the Series
C Preferred Stock to Mr. Douglass was in the best interests of the
Company, as it allowed Mr. Douglass to vote a majority of the
Company's voting stock in favor of the Amendment and will provide
the Company with the ability to effectuate the Amendment on an
expedited basis.
On Dec. 10, 2024, by written consent, Mr. Douglass, being the sole
holder of the Series C Preferred Stock and the holder of a majority
of the Company's voting stock, approved the Amendment. The
Amendment will only take effect if and when the Company files the
Amendment with the Secretary of State of the State of Nevada.
About Hypa Labs
Formerly Digipath, Inc., Hypha Labs, Inc.'s mission was to provide
pharmaceutical-grade analysis and testing to the cannabis industry,
under ISO-17025:2017 guidelines, to ensure consumers and patients
knew exactly what was in the cannabis they ingest and to help
maximize the quality of its clients' products through research,
development, and standardization. Hypha Labs had been operating a
cannabis-testing lab in Nevada since 2015.
Spokane, Washington-based Fruci & Associates II, PLLC, 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 from
operations and has cash on hand that may not be sufficient to
sustain its operations. These factors, among others, raise
substantial doubt about the Company's ability to continue as a
going concern.
HYPHA LABS: Widens Net Loss to $707K in Third Quarter
-----------------------------------------------------
Hypha Labs, Inc. filed with the Securities and Exchange Commission
its Quarterly Report on Form 10-Q disclosing a net loss of $706,897
on $0 of revenues for the three months ended June 30, 2024,
compared to net income of $293,533 on $0 of revenues for the three
months ended June 30, 2023.
For the nine months ended June 30, 2024, the Company reported a net
loss of $319,430 on $0 of revenues compared to a net loss of
$14,295 on $0 of revenues for the nine months ended June 30, 2023.
As of June 30, 2024, the Company had $752,365 in total assets,
$1.41 million in total liabilities, $333,600 in mezzanine equity,
and a total stockholders' deficit of $990,494.
As of June 30, 2024, the Company had negative working capital of
$374,215, and accumulated recurring losses of $20,081,427, and
$509,028 of cash on hand, which may not be sufficient to sustain
operations. The Company said these factors raise substantial doubt
about its ability to continue as a going concern.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1502966/000149315224032361/form10-q.htm
About Hypa Labs
Formerly Digipath, Inc., Hypha Labs, Inc.'s mission was to provide
pharmaceutical-grade analysis and testing to the cannabis industry,
under ISO-17025:2017 guidelines, to ensure consumers and patients
knew exactly what was in the cannabis they ingest and to help
maximize the quality of its clients' products through research,
development, and standardization. Hypha Labs had been operating a
cannabis-testing lab in Nevada since 2015.
Spokane, Washington-based Fruci & Associates II, PLLC, 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 from
operations and has cash on hand that may not be sufficient to
sustain its operations. These factors, among others, raise
substantial doubt about the Company's ability to continue as a
going concern.
IHEARTCOMMUNICATIONS INC: S&P Raises ICR to 'CCC+', Outlook Neg.
----------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on
iHeartCommunications Inc. to 'CCC+' from 'SD' (selective default)
and affirmed its 'CCC+' issuer credit rating on its ultimate parent
iHeartMedia Inc.
S&P said, "We assigned a 'CCC+' issue-level rating and '3' recovery
rating to the company's new senior secured term loan maturing in
2029, new senior secured notes due in 2029, new senior secured
notes due 2030, and new senior secured notes due in 2031. We also
assigned a 'CCC-' issue-level rating and '6' recovery rating to its
new senior secured second-lien notes due 2030.
"At the same time, we raised the issue-level ratings on the
company's senior secured term loan maturing in 2026, senior secured
notes due in 2026, and senior secured notes due 2027 to 'CCC-' from
'D' and revised the recovery ratings to '6' from '2'. We raised the
issue-level rating on the company's senior secured notes due 2028
to 'CCC+' from 'D' and revised the recovery rating to '3' from '2'.
We also raised the issue-level rating on the company's senior
unsecured notes due 2027 to 'CCC-' from 'D'. The recovery rating
remains '6'."
The negative outlook reflects ongoing headwinds facing the company
due to secular pressures and the potential for a lower rating if it
envisions a default within 12 months. Still, S&P expects
iHeartMedia will have sufficient liquidity through balance sheet
cash, expected cash flow generation, and availability under its ABL
facility to meet its operating and fixed-charge obligations over
the next 12 months.
S&P views iHeartMedia's capital structure as unsustainable.
While the transaction extended the company's debt maturity profile,
the company still has a heavy debt burden of about $4.8 billion.
Therefore, we expect leverage to remain elevated well above 5x over
the next several years, which we believe is high for a broadcast
radio company given its exposure to cyclical advertising revenue
and competition from alternative media. The company reduced gross
debt by about $450 million as part of the transaction (through debt
repayment and captured discounts), but leverage remains elevated at
about 7x, and the company's annual interest expense will increase
due to higher interest rates on the new debt.
S&P said, "We expect broadcast radio advertising revenue will
continue to decline over the next several years, such that the
company will become more reliant on increasing digital revenue and
cutting costs to improve financial performance and credit metrics.
As a result, we believe the company is dependent on favorable
business, financial, and economic conditions to meet its financial
obligations.
"We lowered our business risk assessment given secular and cyclical
challenges."
While iHeartMedia is much larger than its peers, it is not immune
to the challenges facing the sector; its broadcast radio
advertising revenue has continued to decline amid both cyclical and
secular challenges from macroeconomic weakness and the shift of
advertising dollars from traditional media to online. With lower
broadcast revenue and a largely fixed cost base, the EBITDA margin
of its multiplatform group (including its broadcast radio, network,
and sponsorship/events segments) declined to about 21% in the
recent quarter from 35% in 2019 (before the pandemic).
While the company has taken out about 7% of the multiplatform
group's cost since 2019, those savings have largely been used to
fund other new initiatives. S&P said, "We forecast S&P Global
Ratings-adjusted consolidated EBITDA margins in the low-20% area
over the next few years, compared with almost 30% in 2019. This is
despite cost-savings initiatives that management expects will
result in net cost savings of $150 million in 2025. Due to these
factors, we revised our business risk assessment on iHeartMedia to
weak from fair. As a result of this revision, we are no longer
netting cash against reported debt when calculating S&P Global
Ratings-adjusted credit metrics."
The negative outlook reflects ongoing headwinds facing the company
due to secular pressures and the potential for a lower rating if
S&P envisions a default within 12 months. Still, S&P expects
iHeartMedia will have sufficient liquidity through balance sheet
cash, expected cash flow generation, and availability under its ABL
facility to meet its operating and fixed-charge obligations over
the next 12 months.
S&P could lower its rating if it expects a default in the next 12
months. This could happen if:
-- Secular declines in broadcast radio advertising accelerate or
digital revenue growth is less robust than expected, causing its
liquidity to deteriorate; or
-- The company pursues below-par debt repurchases, debt exchanges,
or an out-of-court restructuring that we deem tantamount to a
default.
While unlikely over the next year, S&P could raise the rating if:
-- S&P Global Ratings-adjusted gross leverage declines below 5x;
-- The company generates sustainably positive FOCF; and
-- EBITDA interest coverage remains comfortably above 1.5x.
S&P believes this would likely require sustained revenue and EBITDA
growth from an acceleration in digital revenue growth to more than
offset expected declines in broadcast radio advertising revenue.
IHEARTMEDIA INC: Finalizes Debt Exchange, S&P Lowers Subsidiary
---------------------------------------------------------------
Caleb Mutua of Bloomberg News reports that iHeartMedia Inc. said it
completed an offer to exchange a portion of its debt, extending
maturities and reducing principal, in a move that S&P said was
"tantamount to a default."
The offer targeted a series of bonds and loans due between 2026 and
2028, according to the report. Approximately $4.8 billion -- or
92.2% -- of the aggregate principal amount of the existing debt
participated in the offers, which expired on Dec. 18 at 9:00 a.m.,
New York City time, the firm said in a statement on Monday,
December 24, 2024.
About iHeartMedia
iHeartmedia Inc. develops, owns, and operates the iHeart.com
Website, which includes a broad selection of video content posted
along with their stories.
* * *
As reported by the Troubled Company Reporter on March 5, 2024, S&P
Global Ratings lowered its issuer credit rating on iHeartMedia Inc.
to 'CCC+' from 'B' because it believes the company is dependent on
favorable business, financial, and economic conditions to meet its
financial obligations.
ILEARNING ENGINES: Voluntarily Files for Chapter 11 Bankruptcy
--------------------------------------------------------------
iLearningEngines, Inc., a leader in AI-powered learning and work
automation, nnounced that on December 20, 2024 the Company
voluntarily initiated Chapter 11 proceedings in the United States
Bankruptcy Court for the District of Delaware.
The Company will seek Court approval to continue operating on a
business as usual basis during the proceedings and intends to
continue to provide support to its installed customer base that
relies on its Applied AI platform to run their businesses.
"We appreciate the continued support of our customers, partners and
employees, and our hope is that this process will put us in a
better position to serve those stakeholders going forward, allowing
for a stronger, more robust business over the long-term," said
iLearningEngines Interim CEO Tom Olivier. "Since taking over as
Interim CEO on December 5, 2024, I have met with a number of our
distribution partners and customers. We will continue to work
closely with them as we work through this process."
In coming days, the Company will file certain customary motions
seeking Court approval to support its operations during the
process, including the continued payment of employee wages and
benefits as well as compensating vendors and suppliers under normal
terms for goods and services provided on or after the filing
dates.
Filings in the Chapter 11 Case and information about the Chapter 11
Case, including as-entered orders of the Bankruptcy Court, may be
viewed for a fee at the website maintained by the Bankruptcy Court
at http://www.deb.uscourts.gov/,by following the directions for
accessing the ECF system on such website.
Faegre Drinker Biddle & Reath LLP is serving as legal advisor to
iLearningEngines, and ICR is serving as the Company's strategic
communications advisor.
About iLearningEngines, Inc.
iLearningEngines is a leading Applied AI platform for Learning and
Work Automation. iLE is one of the fastest growing technology
companies in North America.
ILEARNINGENGINES: Seeks Chapter 11 Bankruptcy Protection
--------------------------------------------------------
Alex Wittenberg of Law360 Bankruptcy Authority reports that
iLearningEngines, an artificial intelligence software company, has
filed for Chapter 11 bankruptcy protection in Delaware, with debts
totaling up to $500 million. The company cited mounting pressures,
including a recent cyberattack and a proposed securities class
action, as contributing factors.
About iLearningEngines
iLearningEngines offers an Artifical Intelligence ("AI") platform
focused on automation of learning and enabling organizations to
drive mission critical outcomes at scale.
iLearningEngines sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Lead Case No. 24-12826) on December
20, 2024. In the petition filed by Bonnie-Jeanne Gerety, as interim
chief financial officer, the Debtor reports total assets as of
September 30, 2024 amounting to $148,848,000 and total Debts as of
September 30, 2024 amounting to $141,036,000.
Honorable Bankruptcy Judge Laurie Selber Silverstein handles the
case.
The Debtor is represented by:
Ian J. Bambrick, Esq.
FAEGRE DRINKER BIDDLE & REATH LLP
222 Delaware Avenue
Suite 1410
Wilmington, DE 19801
Tel: 302-467-4200
Email: ian.bambrick@faegredrinker.com
IMPERIAL GROUP: Sec. 341(a) Meeting of Creditors on January 17
--------------------------------------------------------------
On December 17, 2024, Imperial Group Holdings LLC filed Chapter 11
protection in the Eastern District of Wisconsin. According to
court filing, the Debtor reports $41,470,237 in debt owed to 1
and 49 creditors. The petition states funds will be available to
unsecured creditors.
A meeting of creditors under 341(a) to be held on January 17, 2025
at 10:00 AM via 341 Spokane-Richland ATT Telephone Line
1-877-953-9294 Access Code 4822893.
About Imperial Group Holdings LLC
Imperial Group Holdings LLC owns Cambridge Manor - Bellevue, WA - a
58-unit luxury townhomes located at 12855 Coal Creek Parkway SE
Bellevue, WA.
Imperial Group Holdings LLC sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D. Wis. Case No. 24-02040) on
December 17, 2024. In the petition filed by Wai Yi Lin, as
manager, the Debtor reports total assets of $44,569,440 and total
liabilities of $41,470,237.
The Debtor is represented by:
Armand J. Kornfeld, Esq.
BUSH KORNFELD LLP
601 Union St., Suite 5000
Seattle, WA 98101-2373
Tel: (206) 292-2110
Fax: (206) 292-2104
Email: jkornfeld@bskd.com
ISPECIMEN INC: Appoints Robert Lim as CEO and Director
------------------------------------------------------
iSpecimen Inc. announced Dec. 12 that it has appointed Robert Lim
as CEO and director.
Mr. Lim is the principal and co-founder of De Novo Law Corporation,
a Vancouver-based law firm specializing in corporate/commercial law
and civil litigation. With a forward-thinking approach to legal
practice, Mr. Lim established De Novo Law Corporation to deliver
innovative, client-focused solutions to a diverse range of
businesses and individuals.
Before founding De Novo Law Corporation, Mr. Lim was the principal
of Robert Bradley Lim Law Corporation, a legal practice he founded
and led with a strong emphasis on providing personalized and
strategic legal counsel. His journey into law was preceded by
valuable experience at a prominent real estate and business law
firm, where he honed his skills as a legal assistant, articling
student. These experiences laid the groundwork for his deep
understanding of complex legal and commercial matters.
Before embarking on his legal career, Mr. Lim brought a unique
perspective to the profession through his background in marketing.
He served as a marketing coordinator for NEXT Environmental, an
environmental consulting firm, where he developed key skills in
communication and strategic planning. He later founded a
successful digital marketing agency, providing tailored marketing
solutions to clients across British Columbia.
Drawing from his diverse professional background, Mr. Lim is
committed to helping businesses thrive, as exemplified by his
philosophy: "At the heart of any successful business is the ability
to adapt, grow, and improve profitability. I'm passionate about
working alongside organizations like iSpecimen to identify untapped
opportunities, streamline operations, and ultimately enhance profit
margins while driving sustainable growth."
The Company said Mr. Lim's multifaceted expertise in law and
marketing enables him to approach legal challenges with creativity
and a keen sense of strategy, making him a trusted advisor to his
clients.
About iSpecimen
Headquartered in Lexington, Massachusetts, iSpecimen --
http://www.ispecimen.com-- offers an online marketplace for human
biospecimens, connecting scientists in commercial and non-profit
organizations with healthcare providers that have access to
patients and specimens needed for medical discovery. Proprietary,
cloud-based technology enables scientists to intuitively search for
specimens and patients across a federated partner network of
hospitals, labs, biobanks, blood centers and other healthcare
organizations.
Boston, Massachusetts-based Wolf & Company, P.C., the Company's
auditor since 2014, issued a "going concern" qualification in its
report dated March 13, 2024, citing that the Company has suffered
recurring losses and negative cash flows from operations and has a
significant accumulated deficit. These conditions raise
substantial doubt about the Company's ability to continue as a
going concern.
ISPECIMEN INC: Incurs $1.44 Million Net Loss in Third Quarter
-------------------------------------------------------------
iSpecimen Inc. filed with the Securities and Exchange Commission
its Quarterly Report on Form 10-Q disclosing a net loss of $1.44
million on $2.66 million of revenue for the three months ended
Sept. 30, 2024, compared to a net loss of $2.11 million on $2.78
million of revenue for the three months ended Sept. 30, 2023.
For the nine months ended Sept. 30, 2024, the Company reported a
net loss of $6.45 million on $7.82 million of revenue compared to a
net loss of $8.03 million on $7.35 million of revenue for the nine
months ended Sept. 30, 2023.
As of Sept. 30, 2024, the Company had $11.26 million in total
assets, $6.55 million in total liabilities, and $4.71 million in
total stockholders' equity.
Ispecimen stated, "The Company may be unsuccessful in increasing
its revenues or contain its operating expenses, or it may be unable
to raise additional capital on commercially favorable terms. The
Company's failure to generate additional revenues or contain
operating costs would have a negative impact on the Company's
business, results of operations and financial condition and the
Company's ability to continue as a going concern. If the Company
does not generate enough revenue to provide an adequate level of
working capital, its business plan will be scaled down further.
"These conditions raise substantial doubt regarding the Company's
ability to continue as a going concern for a period of one year
from the date these unaudited condensed financial statements are
issued. Management's plan to mitigate the conditions that raise
substantial doubt includes generating additional revenues,
deferring certain projects and capital expenditures and eliminating
certain future operating expenses for the Company to continue as a
going concern. However, there can be no assurance that the Company
will be successful in completing any of these options. As a
result, management's plans cannot be considered probable and thus
do not alleviate substantial doubt about the Company's ability to
continue as a going concern."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1558569/000155837024014743/ispc-20240930x10q.htm
About iSpecimen
Headquartered in Lexington, Massachusetts, iSpecimen --
http://www.ispecimen.com/-- offers an online marketplace for human
biospecimens, connecting scientists in commercial and non-profit
organizations with healthcare providers that have access to
patients and specimens needed for medical discovery. Proprietary,
cloud-based technology enables scientists to intuitively search for
specimens and patients across a federated partner network of
hospitals, labs, biobanks, blood centers and other healthcare
organizations.
Boston, Massachusetts-based Wolf & Company, P.C., the Company's
auditor since 2014, issued a "going concern" qualification in its
report dated March 13, 2024, citing that the Company has suffered
recurring losses and negative cash flows from operations and has a
significant accumulated deficit. These conditions raise
substantial doubt about the Company's ability to continue as a
going concern.
JJK PROPERTIES: Seeks to Hire Lane Law Firm as Legal Counsel
------------------------------------------------------------
JJK Properties, LLC seeks approval from the U.S. Bankruptcy Court
for the Southern District of Texas to employ The Lane Law Firm,
PLLC as counsel.
The firm will provide these services:
(a) assist, advise and represent the Debtor relative to the
administration of the Chapter 11 case;
(b) assist, advise and represent the Debtor in analyzing its
assets and liabilities, investigating the extent and validity of
lien and claims, and participating in and reviewing any proposed
asset sales or dispositions;
(c) attend meetings and negotiate with the representatives of
the secured creditors;
(d) assist the Debtor in the preparation, analysis, and
negotiation of any plan of reorganization and disclosure statement
accompanying any plan of reorganization;
(e) take all necessary action to protect and preserve the
interests of the Debtor;
(f) appear, as appropriate, before this court, the appellate
courts, and other courts in which matters may be heard and to
protect the interests of the Debtor before said courts and the
United States Trustee; and
(g) perform all other necessary legal services in this case.
The firm will be paid at its hourly rates:
Robert Lane, Attorney $595
Joshua Gordon, Associate $550
Associate Attorneys $500
Paraprofessionals $250
In addition, the firm will seek reimbursement for expenses
incurred.
The firm received a retainer of $35,000 from November 20, 2024
through December 11, 2024 from the Debtor.
Mr. Lane 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:
Robert C. Lane, Esq.
The Lane Law Firm, PLLC
6200 Savoy, Suite 1150
Houston, TX 77036
Telephone: (713) 595-8200
Facsimile: (713) 595-8201
Email: notifications@lanelaw.com
About JJK Properties
JJK Properties, LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Tex. Case No. 24-35845) on Dec. 12,
2024, listing under $1 million in both assets and liabilities.
Judge Eduardo V. Rodriguez oversees the case.
Robert C. Lane, Esq., at The Lane Law Firm, PLLC serves as the
Debtor's counsel.
JOP3 DEVELOPMENT: Hires NAI Robert Lynn as Real Estate Broker
-------------------------------------------------------------
JOP3 Development, LLC seeks approval from the U.S. Bankruptcy Court
for the Northern District of Texas to employ NAI Robert Lynn as
real estate broker.
The Debtor needs a broker to sell its property located at 615 Six
Flags Drive, Arlington, Texas.
The firm will receive a commission of 6 percent from the property's
sale price.
NAI Robert Lynn represents no interest adverse to the Debtor or to
the estate on the matters upon which it is to be engaged for the
Debtor.
The firm can be reached at:
NAI Robert Lynn
4851 LBJ Freeway, 10th Floor
Dallas, TX 75244
Telephone: (214) 256-7100
Facsimile: (214) 256-7101
About JOP3 Development
JOP3 Development is a Single Asset Real Estate debtor (as defined
in 11 U.S.C. Section 101(51B)).
JOP3 Development, LLC sought relief under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Tex. Case No. 24-33644) on Nov. 10,
2024, listing as much as $1 million to $10 million in both assets
and liabilities. Jon O. Pope, III, managing member, signed the
petition.
Judge Michelle V. Larson oversees the case.
Hayward PLLC serves as the Debtor's legal counsel.
JUMPSTAR ENTERPRISES: Drew McManigle Named Subchapter V Trustee
---------------------------------------------------------------
The U.S. Trustee for Region 7 appointed Drew McManigle as
Subchapter V trustee for JumpStar Enterprises, LLC.
Mr. McManigle will be paid an hourly fee of $450 for his services
as Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Mr. McManigle declared that he is a disinterested person according
to Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Drew McManigle
700 Milam, Suite 1300
Houston, TX 77002
Telephone: (410) 350-1839
Email: drew@macco.group
About JumpStar Enterprises
JumpStar Enterprises, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. S.D. Texas Case No. 24-35874) on
December 16, 2024, with up to $50,000 in assets and $500,001 to $1
million in liabilities.
Lloyd A. Lim, Esq., at Kean Miller, LLP represents the Debtor as
legal counsel.
K&NN TRUCKING: Nathan Smith Named Subchapter V Trustee
------------------------------------------------------
The U.S. Trustee for Region 17 appointed Nathan Smith, Esq., as
Subchapter V trustee for K&NN Trucking, LLC.
Mr. Smith, a partner at Malcolm & Cisneros, 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. Smith declared that he is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Nathan F. Smith, Esq.
Malcolm & Cisneros
2112 Business Center Drive
Irvine, CA 92612
Phone: (949) 252-9400
Email: nathan@mclaw.org
About K&NN Trucking
K&NN Trucking, LLC operates in the general freight trucking
industry.
K&NN Trucking sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Nev. Case No. 24-16543) on December 16,
2024. Nathan Nuesca, managing member of K&NN Trucking, signed the
petition.
As of November 30, 2024, K&NN Trucking had $809,191 in total assets
and $1,260,375 in total liabilities.
Judge Mike K. Nakagawa presides over the case.
Damon K. Dias, Esq., at Dias Law Group, Ltd represents the Debtor
as bankruptcy counsel.
KARAS FOOD: Court Extends Use of Cash Collateral Until Jan. 21
--------------------------------------------------------------
Karas Food, Inc. received interim approval from the U.S. Bankruptcy
Court for the Central District of California, Riverside Division,
to use its secured creditors' cash collateral until Jan. 21, 2025,
marking the second extension since the company's Chapter 11 filing
in November.
The court previously issued an interim order, allowing the company
to access cash collateral until Dec. 17 only.
The second interim order signed by Judge Mark Houle approved the
use of cash collateral to pay the company's business
expenses pursuant to its projected budget, with a 10% variance. The
order also authorized the company to pay the U.S. Trustee's
quarterly fees.
All secured creditors may object and seek "adequate protection"
payments at the final hearing set for Jan. 21.
In a separate order, the bankruptcy court approved a stipulation
between Karas Food and Bank of Hope, allowing the company to
utilize the bank's cash collateral.
The order granted Bank of Hope a replacement lien on all
post-petition revenues of the company to the same extent and with
the same priority and validity as its pre-bankruptcy lien. In
addition, the order required Karas Food to pay the monthly debt
service of $17,292.63.
About Karas Food Inc.
Karas Food, Inc. sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Calif. Case No. 24-16750) on November
12, 2024, with $1 million to $10 million in both assets and
liabilities. Wahid Karas, president of Karas Food, signed the
petition.
Judge Mark D. Houle oversees the case.
The Debtor is represented by Robert B. Rosenstein, Esq., at
Rosenstein & Associates.
KNS HOLDCO:S&P Raises ICR to 'CCC+' After Distressed Debt Exchange
------------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on U.S.-based
KNS Holdco LLC to 'CCC+' from 'D' (general default).
S&P said, "We also assigned our 'B' issue-level rating to the
company's new first-lien secured priming term loans. The recovery
rating is '1', indicating our expectations for very high (90% -
100%; rounded estimate: 95%) recovery in the event of a payment
default.
"Furthermore, we assigned our 'CCC+' issue-level rating on the
company's new second-out term loans. The recovery rating is '4',
indicating our expectations for average (30% - 50%; rounded
estimate: 45%) recovery in the event of a payment default.
"We withdrew our 'D' issue-level rating on the company's old
first-lien secured term loans.
"The negative outlook on KNS reflects the possibility that we will
lower our ratings if the risk of a near-term default increases such
that we envision a specific default scenario in the subsequent 12
months."
On Dec. 19, 2024, KNS acquired a middle market vitamin, minerals,
and supplements (VMS) company. It funded the transaction with a
combination of equity from its sponsor owner, Kainos Capital, and
$120 million of super-senior financing provided by its existing
lenders, which resulted in default.
Pro forma for the acquisition, KNS' VMS portfolio will make up a
more substantial portion of the company's business mix, which we
view as a modest credit positive. S&P believes KNS' VMS business
exhibits better growth and margin prospects than its weight
management segment, which is in secular decline.
S&P said, "With its distressed debt exchange now complete, we
believe the company's liquidity position and cash flow generation
prospects have improved, albeit possibly only temporarily depending
on the company's ability to further stabilize its still
underperforming weight management business. We continue to view
KNS' capital structure as unsustainable."
The acquisition of Ancient Nutrition provides modest
diversification away from the company's struggling weight
management business. Prior to the acquisition, weight management
accounted for about half of KNS' consolidated revenue and 45% of
gross profit, with the balance coming from VMS. Pro forma for the
acquisition, the company's VMS platform now accounts for nearly 60%
of sales, 70% of contribution profit, and 85% of EBITDA. S&P views
this modest diversification as credit positive in the near term,
but we do not believe a bolstered VMS portfolio will offset
significant weight management declines over the long term, leading
to moderate top-line and S&P Global Ratings-adjusted EBITDA
contraction in 2026 and beyond. That said, as weight management
declines become more entrenched, we expect the impact to overall
consolidated profitability to become less pronounced.
S&P said, "We believe KNS' weight management division, which
includes frozen packaged meal plans and ala carte offerings under
the Nutrisystem and Jenny Craig brand names, will continue to
suffer protracted declines over the next few years. We view the
weight management industry to be in secular decline, with many
businesses indexed to weight loss struggling considerably. We do
not expect these industry specific headwinds to abate over the next
few years. Our base case assumes weight management revenue will
decline upwards of 30% per year in 2025 and 2026.
"Pro forma leverage at close is not exceedingly high, and we expect
KNS' cash interest coverage will improve next year, driven by
incremental EBITDA from the acquisition along with continued cash
interest relief on some instruments in its new capital structure.
We estimate pro forma S&P Global Ratings-adjusted
leverage—inclusive of the company's perpetual payment-in-kind
(PIK) preferred stock that view as debt—of about 7x at close of
the acquisition and debt restructuring, increasing to the mid-7x
area in 2025. While we could consider such leverage levels
sustainable if the company can sustain positive free operating cash
flow (FOCF), future interest coverage may remain tight depending on
management's ability to improve operating performance."
Per the terms of the new super-senior credit agreement, KNS will
have the option to pay a portion of interest as PIK on its
second-out term loan. Additionally, the third-out term loan is
entirely PIK until March 31, 2026. Notably, the third-out term loan
converts to cash pay at that time, provided the company maintains a
covenant defined fixed-charge coverage ratio in excess of 1.25x.
S&P said, "In totality, we expect KNS' cash debt service
requirements will be manageable over the next 12 months with EBITDA
cash interest coverage of about 1.7x in 2025, but we anticipate
cash interest coverage will decline in 2026 and 2027 when we
forecast the PIK interest coverage will convert to cash pay. As
such, future coverage may remain pressured absent either a material
improvement in business prospects for weight management or
significant outperformance of the VMS business relative to our base
case."
S&P said, "We believe that KNS' capital structure is unsustainable
over the long term. The company's business as it is currently
composed will have a higher EBITDA base from the acquisition. At
the same time, we believe revenue and EBITDA will moderately
contract over the forecast period, leading to gradually lower cash
flow generation prospects over time, especially once the PIK toggle
on the company's third-out term loan expires. In our base case, we
assume KNS will maintain a covenant-defined, fixed-charge coverage
ratio slightly above 1.25x, hence the convert to cash pay will be
contractually required after the first quarter of 2026. That said,
we do not envision a specific default scenario over the next 12
months due to the company's much improved liquidity position and
near-term cash flow generation prospects. In 2025, we forecast KNS
will generate roughly $25 million of FOCF and the company will be
able to maintain an undrawn revolver.
"The negative outlook on KNS reflects the possibility that we will
lower our ratings if the risk of a near-term default increases such
that we envision a specific default scenario in the subsequent 12
months.
"We would likely lower our rating on KNS if weak profitability and
cash flow deficits point to a specific default scenario within the
subsequent 12 months. This could include a liquidity shortfall or
financial covenant default that leads to further balance sheet
restructuring." This could occur if:
-- Continued protracted declines in the weight management segment
outpace growth in VMS and the addition of Ancient Nutrition profits
and cash flows;
-- Weaker macroeconomic conditions result in slower consumer
spending, precipitating stagnation or declines in the VMS category;
or
-- The company does not realize anticipated synergies associated
with the Ancient Nutrition acquisition, and consolidated operating
performance continues to suffer.
S&P could take a positive rating action on KNS if the company can
demonstrate consistent earnings growth and sustained positive FOCF
such that we no longer consider its capital structure as
unsustainable over the long term. This could occur if:
-- The company's VMS platform, including Ancient Nutrition, can
sustain a growth trajectory such that declines in weight management
become immaterial to overall profitability;
-- Management stabilizes the weight management business such that
it contributes at least break-even EBITDA to consolidated
performance;
-- Marketing and advertising investments drive meaningful
high-value customer growth in VMS;
-- Ancient Nutrition synergies are achieved as expected; and
-- S&P expects positive FOCF to be sustained without
payment-in-kind cash interest relief.
KODIAK GAS: S&P Raises ICR to 'BB-' on Improving Leverage
---------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on Kodiak Gas
Services, LLC, a Texas-based natural gas compression company, to
'BB-' from 'B+'.
At the same time, S&P raised its issue-level ratings on its senior
unsecured notes to 'BB-'. The '4' recovery rating remains
unchanged, indicating its expectation for average recovery
prospects (30%-50%; rounded estimate: 40%).
The stable outlook reflects S&P's expectation that Kodiak will
maintain leverage under 4.0x and utilization of more than 90%
through its forecast period.
Kodiak will continue to lower leverage toward its 3.5x target
through EBITDA growth in 2025. This will stem from the complete
integration of CSI Compressco, additional horsepower coming online,
and Consumer Price Index (CPI)-linked contract escalators improving
gross margin. S&P expects 2024 S&P Global Ratings-adjusted EBITDA
of $560 million-$580 million, which excludes transaction-related
adjustments.
S&P said, "We expect the company will continue to invest in
securing additional large horsepower units in 2025 at similar or
growing levels. The re-contracting environment remains robust,
driving higher rates on new contracts, while existing contracts
with CPI-linked escalators support gross margin enhancement. As
such, we expect an increase in S&P Global Ratings-adjusted EBITDA
to $710 million-$750 million in 2025, which should drive leverage
toward management's target of 3.5x.
"We believe the company’s ability to maintain its targeted
leverage has support from its contract profile and focus in the
Permian. About 89% of Kodiak’s revenues are backed by take-or-pay
contacts, with a weighted average term of 32 months for recently
executed contracts. We expect natural gas demand to remain strong
as additional liquefied natural gas (LNG) export capacity on the
Gulf Coast comes online over the next 24 months. Long-term natural
gas demand may continue to drive longer contracting tenures on new
horsepower for compression providers in the Permian.
"The stable outlook on Kodiak reflects our expectation that
utilization will remain above 90% and S&P Global Ratings-adjusted
debt to EBITDA will decrease toward 3.5x in 2025.
"We could consider taking a negative rating action on Kodiak if we
believe its debt to EBITDA will exceed 4x for an extended period."
"This could arise if demand for compression services weakens such
that rates and utilization decreases, likely stemming from:
-- An industrywide prolonged decline in natural gas production;
and
-- The company taking no action to address elevated leverage.
While unlikely in the near term, S&P could consider taking a
positive rating action if Kodiak:
-- Significantly increases its size; and
-- Sustains leverage under 3.5x.
LATIGO HOMES: Files Chapter 11 Bankruptcy in Texas
--------------------------------------------------
On December 2, 2024, Latigo Homes LLC filed Chapter 11 protection
in the Northern District of Texas. According to court filing, the
Debtor reports between $1 million and $10 million in debt owed to 1
and 49 creditors. The petition states funds will not be available
to unsecured creditors.
A meeting of creditors under Sec. 341(a) to be held on January 3,
2025 at 11:00 AM, TELEPHONIC MEETING.
About Latigo Homes LLC
Latigo Homes LLC is a Single Asset Real Estate debtor (as defined
in 11 U.S.C. Section 101(51B)).
Latigo Homes LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Tex. Case No. 24-44482) on December 2,
2024. In the petition filed by Steven Davis as managing member, the
Debtor reports estimated assets and liabilities between $1 million
and $10 million each.
Honorable Bankruptcy Judge Mark X. Mullin handles the case.
The Debtor is represented by:
Robert T DeMarco, Esq.
DEMARCO MITCHELL, PLLC
500 N. Central Expressway Suite 500
Plano, TX 75054
Tel: (972) 991-5591
E-mail: robert@demarcomitchell.com
LILIUM NV: Finds Purchaser for Key Subsidiaries
-----------------------------------------------
Leen Al-Rashdan of Bloomberg News reports that Lilium NV is
receiving a boost from a consortium of European and North American
investors who intend to acquire the operating assets of the air
taxi company's key subsidiaries.
The German startup has signed an asset purchase agreement with the
privately held Mobile Uplift Corporation GmbH and expects the deal
to help its two subsidiaries secure the necessary funding to
restart operations, Lilium stated, according to the report.
Although remaining employees were laid off as of December 20, 2024
the consortium plans to rehire them, according to Bloomberg.
Lilium did not disclose the price but mentioned the deal is in
accordance with German insolvency law, the report states.
About Lilium
Lilium (NASDAQ: LILM) -- www.lilium.com -- is creating a
sustainable and accessible mode of high-speed, regional
transportation for people and goods. Using the Lilium Jet, an
all-electric vertical take-off and landing jet, designed to offer
leading capacity, low noise, and high performance with zero
operating emissions, Lilium is accelerating the decarbonization of
air travel. Working with aerospace, technology, and infrastructure
leaders, and with announced sales and indications of interest in
Europe, the United States, China, Brazil, UK, and the Kingdom of
Saudi Arabia, Lilium's 800+ strong team includes approximately 450
aerospace engineers and a leadership team responsible for
delivering some of the most successful aircraft in aviation
history. Founded in 2015, Lilium's headquarters and manufacturing
facilities are in Munich, Germany, with teams based across Europe
and the U.S.
Munich, Germany-based PricewaterhouseCoopers GmbH
Wirtschaftsprufungsgesellschaft, the Company's auditor since 2019,
issued a "going concern" qualification in its report dated March
28, 2023, citing that he Company has incurred recurring losses from
operations since its inception and expects to continue to generate
operating losses that raise substantial doubt about its ability to
continue as a going concern.
LINX OF LAKE: Gets Interim OK to Use Cash Collateral Until Feb. 6
-----------------------------------------------------------------
Linx of Lake Mary, LLC received interim approval from the U.S.
Bankruptcy Court for the Middle District of Florida, Orlando
Division, to use cash collateral until Feb. 6, 2025.
The company will require the use of approximately $128,960 of cash
collateral to continue to operate its business for the next four
weeks, and, depending on the circumstances, a greater or lesser
amount will be required for each comparable period thereafter.
The company projects $128,950 in total expenses for one month.
HLI Investments and Funding-Fund 2, LLC may assert a first priority
security interest in the company's cash and cash equivalents by
virtue of a recorded UCC lien. Linx of Lake Mary is evaluating
whether this lien is properly perfected and attached to the subject
collateral. HLI is owed approximately $630,000.
About Linx of Lake Mary LLC
Linx of Lake Mary LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No. 24-06781) on
December 13, 2024. In the petition signed by Patrick Schneider,
manager, the Debtor disclosed up to $10 million in both assets and
liabilities.
Judge Grace E. Robson oversees the case.
Justin M. Luna, Esq., at Latham, Luna, Eden & Beaudine, LLP,
represents the Debtor as legal counsel.
LONESTAR FIBERGLASS: Sec. 341(a) Meeting of Creditors on January 21
-------------------------------------------------------------------
On December 19, 2024, filed Chapter 11 protection in the Western
District of Texas. According to court filing, the Debtor
reports $3,431,884 in debt owed to 200 and 999 creditors. The
petition states funds will be available to unsecured creditors.
A meeting of creditors under Sec. 341(a) to be held on January 21,
2025 at 01:00 PM via Via Phone: (866)909-2905; Code: 5519921#.
About LoneStar Fiberglass Components of Texas LLC
LoneStar Fiberglass Components of Texas LLC manufactures fiberglass
swimming pools and spas that are installed inground with lifetime
warranties.
LoneStar Fiberglass Components of Texas LLC sought relief
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. W.D. Tex.
Case No. 24-52593) on December 19, 2024. In the petition filed by
Chris Owens, as managing member, the Debtor reports total assets of
$1,411,586 and total liabilities of $3,431,884.
Honorable Bankruptcy Judge Michael M. Parker handles the case.
The Debtor is represented by:
Morris Eugene 'Trey' White III, Esq.
VILLA & WHITE LLP
100 NE Interstate 410 Loop #615
San Antonio, TX 78216
Tel: 210-225-4500
Email: treywhite@villawhite.com
M3 ROOFING: Aleida Martinez Molina Named Subchapter V Trustee
-------------------------------------------------------------
The U.S. Trustee for Region 21 appointed Aleida Martinez Molina,
Esq., as Subchapter V trustee for M3 Roofing & Construction, LLC.
Ms. Molina will be paid an hourly fee of $450 for her services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Ms. Molina declared that she is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Aleida Martinez Molina, Esq.
2121 NW 2nd Avenue, Suite 201
Miami, FL 33127
Telephone: (305) 297-1878
Email: Martinez@subv-trustee.com
About M3 Roofing & Construction
M3 Roofing & Construction, LLC sought protection under Chapter 11
of the U.S. Bankruptcy Code (Bankr. S.D. Fla. Case No. 24-23109) on
December 16, 2024, with up to $50,000 in assets and $100,001 to
$500,000 in liabilities.
Judge Corali Lopez-Castro presides over the case.
Diego Mendez, Esq. represents the Debtor as legal counsel.
MACY'S INC: S&P Affirms 'BB+' Issuer Credit Rating, Outlook Stable
------------------------------------------------------------------
S&P Global Ratings affirmed all of its ratings, including its 'BB+'
issuer credit rating on New York-based department store Macy's Inc.
The company's commercial paper rating remains 'B'.
The stable outlook reflects S&P's view that Macy's will rely on
strong merchandise execution and capital allocation priorities to
maintain relatively stable credit metrics, including S&P Global
Ratings-adjusted leverage in the low- to mid-2x area over the next
12 months.
S&P now assesses Macy's M&G as moderately negative following the
conclusion of the investigation into accounting matters. Macy's
recently disclosed a material weakness in its internal control over
financial reporting where an employee concealed around $151 million
in small package delivery expenses over nearly three years,
disrupting the company's financial reporting and revealing a
material weakness in internal controls.
The Audit Committee concluded on December 10, 2024 that both
management's report and KPMG LLP's opinion on the effectiveness of
these controls as of February 3, 2024 should no longer be
considered reliable. Macy's stated that the errors did not
materially affect its results of operations or financial position
for any historical annual or interim period. The company said this
did not impact cash and vendor payments. It determined the matter
did not require it to reissue historical financial statements.
Macy's delayed but ultimately did report third quarter earnings in
December and has completed its investigation.
As a result of the findings, Macy's announced remedial actions
including addressing internal controls over financial reporting
through re-evaluating the risk of employee circumvention of
controls, re-designing process level control activities, and
evaluating information supporting the functioning of control
activities. S&P said, "While we do not view the financial impact
from accounting matters as material, we consider it important for
management to address the deficiencies and deliver the remediation
actions announced. We will be following the resolution of the
situation, and that no further similar or other accounting issues
are identified."
S&P said, "We continue to expect Macy's S&P Global Ratings-adjusted
leverage will remain in the low-2x over the next two years. Macy's
S&P Global Ratings-adjusted EBITDA margin improved 40 basis points
(bps) to 10.4% in the latest twelve months through November 2,
2024. We anticipate margins will remain around 9.5%-10.5% over the
next two years due to top-line pressures, lower contribution from
private brands to total sales (a trend similar to last year), and
increased investments in digital capabilities. However, we
anticipate better inventory management, higher sell-throughs, and
implementation of cost-saving initiatives will partially offset
some of these headwinds. Our forecast incorporates a 40 bp impact
to gross margins in 2024 from the revision of its delivery expense,
the related accrual and tax effects.
"The stable outlook reflects our view that Macy's can navigate a
challenging macroeconomic environment successfully, capitalizing on
its strong merchandise and capital allocation strategies and
maintaining S&P Global Ratings-lease adjusted leverage of 2x-3x
over the coming year. Given the limited financial impact thus far,
we do not believe the accounting issue speaks to broader negative
implications for the enterprise's risk profile and are maintaining
our rating and outlook."
S&P could lower the rating if:
-- There are additional negative developments with accounting that
hinder the company's ability to remediate its internal control
deficiency over the next two years;
-- A worsening macroenvironment or operational misstep causes
weaker performance compared with S&P's base case, resulting in
sales and EBITDA margin declining beyond its expectations; or
-- Financial policy becomes more aggressive, with leverage
sustaining above 3x.
S&P could raise the rating if:
-- Performance expands beyond S&P's base-case expectations,
including gaining traction in growth initiatives to support a
better view of the overall business, including positive comparable
sales and EBITDA margin gains even through a soft economic
environment; and
-- S&P expects the company will maintain its conservative
financial policy, supporting S&P Global Ratings-adjusted leverage
sustained comfortably below 2x.
MILLENKAMP CATTLE: Gets OK to Use Cash Collateral Until April 30
----------------------------------------------------------------
Millenkamp Cattle, Inc. and its affiliates got the green light from
the U.S. Bankruptcy Court for the District of Idaho to use cash
collateral until April 30, 2025.
The order signed by Judge Noah Hillen authorized the companies to
use the cash collateral of secured lenders for payment of expenses
outlined in their projected budget.
The secured lenders are Rabo AgriFinance, LLC, Metropolitan Life
Insurance Company, and Conterra Holdings, LLC. These lenders were
granted "adequate protection" liens on all post-petition cash
collateral to the same extent and with the same validity and
priority as their pre-bankruptcy liens.
The companies' authority to use cash collateral is conditioned upon
providing weekly variance reports, borrowing base certificates,
production or sales reports, and monthly accrual financials to the
lenders.
Moreover, Rabo AgriFinance and Conterra may withdraw their consent
to the use of cash collateral in the event the companies fail to
pay to a trade creditor accounts payable in an amount not less than
$100,000 in each instance or $500,000 in the aggregate during the
Chapter 11 cases in respect of any of the companies' obligations
arising on or after the petition date.
About Millenkamp Cattle
Millenkamp Cattle Inc. is a family-owned agriculture business in
Jerome, Idaho.
Millenkamp Cattle sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Idaho Case No. 24-40158) on April 2,
2024, with $10 million to $50 million in assets and $500 million to
$1 billion in liabilities. William J. Millenkamp, manager, signed
the petition.
Judge Noah G. Hillen oversees the case.
The Debtor is represented by Matthew T. Christensen, Esq., at
Johnson May, PLLC.
MIRANDA LOGISTICS: Access to Cash Collateral Terminated
-------------------------------------------------------
Mission Valley Bank announced the termination of Miranda Logistics
Enterprises, Inc.'s authority to use the bank's cash collateral.
In a Dec. 23 notice filed with the U.S. Bankruptcy Court for the
Central District of California, Los Angeles Division, Mission
Valley Bank said it received information from the company of its
decision to terminate operations.
"In conjunction therewith and as a result of certain other actions,
[Miranda] is in breach of various provisions of the cash collateral
order," the bank said, referring to the court's Dec. 19 order
giving the company interim approval to use cash collateral until
Jan. 20 next year.
As a result, Miranda was instructed to immediately cease using the
cash collateral and separately segregate the cash collateral for
the benefit of the bank, according to the notice.
The bankruptcy court on Dec. 19 approved the use of cash collateral
to allow the company to pay its operating expenses and, in return,
Mission Valley Bank was granted a replacement lien on the company's
assets.
About Miranda Logistics Enterprise
Miranda Logistics Enterprise, Inc., a Los Angeles-based company,
provides trucking, earthwork, excavation shoring, and demolition
and disposal services.
Miranda Logistics Enterprise sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. C.D. Calif. Case No. 24-20277)
with up to $50,000 in assets and up to $10 million in liabilities.
The petition was signed by Marco Miranda as chief executive
officer, secretary, and chief financial officer.
Judge Vincent P. Zurzolo oversees the case.
The Debtor is represented by Sean A. OKeefe, Esq., at Okeefe &
Assoc. Law Corp., P.C.
MMEX RESOURCES: Incurs $471K Net Loss in Second Quarter
-------------------------------------------------------
MMEX Resources Corporation filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $471,447 on $0 of revenues for the three months ended Oct. 31,
2024, compared to a net loss of $434,561 on $0 of revenues for the
three months ended Oct. 31, 2023.
For the six months ended Oct. 31, 2024, the Company reported a net
loss of $926,669 on $0 of revenues compared to a net loss of $1.62
million on $0 of revenues for the six months ended Oct. 31, 2023.
As of Oct. 31, 2024, the Company had $1.03 million in total assets,
$5.70 million in total liabilities, and a total stockholders'
deficit of $4.67 million.
MMEX Resouces stated, "Since inception, our operations have
primarily been funded through private debt and equity financing,
and we expect to continue to seek additional funding through
private or public equity and debt financing. Our ability to
continue as a going concern is dependent on our ability to generate
sufficient cash from operations to meet our cash needs and/or to
raise funds to finance ongoing operations and repay debt. However,
there can be no assurance that we will be successful in our efforts
to raise additional debt or equity capital or that amounts will be
adequate to meet our needs. These factors, among others, raise
substantial doubt that we will be able to continue as a going
concern for a reasonable period of time."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1440799/000147793224008092/mmex_10q.htm
About MMEX Resources Corporation
Since 2016, the focus of MMEX Resources Corporation's business has
been to build crude oil distillation units and refining facilities
(CDUs) in the Permian Basin in West Texas. The Company revised its
business plan in 2021 to move MMEX to clean energy production,
leveraging its history, management and business relationships from
the traditional energy sector. Since 2021 MMEX has expanded its
focus to the development, financing, construction and operation of
clean fuels infrastructure projects powered by renewable energy.
The Company has formed three special purpose entities of the
Company - one to transition from legacy refining transportation
fuels by producing them as ultra clean fuels with carbon capture, a
second which plans to produce blue hydrogen from natural gas and
utilize the hydrogen to produce electric power and a third which
plans to produce green hydrogen converted to green ammonia in the
United States and internationally. These three sub-divisions will
be operating respectively as Pecos Clean Fuels & Transport, LLC,
Trans Permian H2Hub, LLC and Hydrogen Global, LLC. The planned
projects are designed to be powered by solar and wind renewable
energy. Through April 30, 2024, the Company has had no revenues and
has reported continuing losses from operations.
Houston, TX-based M&K CPAS, PLLC, the Company's auditor since 2013,
issued a "going concern" qualification in its report dated July 29,
2024, citing that the Company has recurring net losses, working
capital deficit, and stockholders' deficit as of April 30, 2024,
which raises substantial doubt about its ability to continue as a
going concern.
MONICA L. COLUMBIA: Counsel's $203,084.89 Fee Application Denied
----------------------------------------------------------------
Judge Victoria S. Kaufman of the United States Bankruptcy Court for
the Central District of California will deny the allowance of all
compensation requested by the Law Offices of Robert M. Yaspan,
general counsel to Monica L. Columbia, in the amount of
$203,084.89. The Court will also order the disgorgement of all
funds received to pay the firm's fees with respect to this
bankruptcy case no later than
January 3, 2025.
On May 19, 2023, Monica L. Columbia filed a voluntary chapter 11
petition.
In May 2024, following the death of Debtor's spouse, from whom
Debtor was separated, Debtor filed an amended schedule A/B, stating
that she had a fee simple interest in her residence located at 4309
Natoma Ave., Woodland Hills CA 91364. Amended Schedule A/B. Debtor
provided a value of $2.2 million for her interest in the Property.
Among other personal property, Debtor also disclosed: (1) a 100%
interest in Indulge Fine Jewelry (describing that business as
closed in 2021); (2) $15,000 in accounts receivable; (3) inventory
with a value of $468,000; and (4) inventory on consignment from Jan
Beyer with a value of $761,110.00, regarding which the Debtor has
stated that she is "entitled to commission percentage upon sale per
oral agreement."
On June 6, 2023, Debtor filed an application to employ the Law
Offices of Robert M. Yaspan as general counsel for Debtor.
On August 22, 2024, the Firm filed its First Interim Application
for Compensation of General Counsel to the Debtor-in Possession. In
the Fee Application, the Firm sought approval and payment of
$203,084.89 in fees and reimbursement of $7,495.27 in expenses.
On September 12, 2024, the Court held a hearing on the Fee
Application.
On October 17, 2024, the United States Trustee filed an opposition
to the Fee Application. The Trustee Opposition disclosed to the
Court -- for the first time -- that Mr. Yaspan was in possession of
some of Debtor's jewelry, which jewelry was inventory for her
business.
The U.S. Trustee submits that, taking into account Mr. Yaspan's
transactions with Debtor regarding the jewelry, and his lack of
disclosure of those transactions, the following remedies are
warranted: full denial of the Fee Application and refund of any
fees received by the Firm.
On October 31, 2024, the Court held a continued hearing on the Fee
Application.
Over more than a year, and on multiple occasions, Mr. Yaspan took
possession of jewelry in Debtor's inventory, with the intent to
acquire that jewelry. Mr. Yaspan's goal was to purchase the
inventory for a low price, although it was in the interests of the
estate and its creditors for Debtor to maximize the proceeds
generated from her sale of the jewelry. Accordingly, during the
Firm's representation of Debtor as a debtor in possession, Mr.
Yaspan had a financial interest which conflicted with the Firm's
employment under Sec. 327(a) and the Firm's ethical obligations,
the Court finds.
The Court concludes that, throughout nearly all of his
representation of Debtor, Mr. Yaspan held an interest adverse to
the estate and was not a disinterested person. As a result,
pursuant to Sec. 328(c), the Court may deny the Fee Application in
full and order the Firm to disgorge all of the funds it has
received in connection with this case.
Even if Mr. Yaspan's jewelry transactions with Debtor had not
created an actual conflict of interest, Mr. Yaspan violated Rule
2014 by failing to disclose his acquisition of the jewelry from
Debtor, any gifts he made of the jewelry and his transactions with
Debtor to obtain the jewelry, the Court notes. Accordingly, on this
alternative basis, the Court has discretion to deny the allowance
of all compensation requested in the Fee Application and order the
disgorgement of fees previously paid with respect to this case.
A copy of the Court's decision is https://urlcurt.com/u?l=IBLf4Y
Monica L. Columbia filed for Chapter 11 bankruptcy protection
(Bankr. C.D. Cal. Case No. 23-10696) on May 19, 2023, listing under
$1 million in both assets and liabilities. The Debtor is
represented by Robert Yaspan, Esq.
MONTICELLO CONSTRUCTION: Exclusive Plan Filing Extended
-------------------------------------------------------
Judge Jamie A. Wilson of the U.S. Bankruptcy Court for the Southern
District of Mississippi extended Monticello Construction & Real
Estate, LLC's exclusive period period to file disclosure statement
and plan for additional 60 days.
As shared by Troubled Company Reporter, the Debtor explains that it
is required to file its disclosure statement and plan of
reorganization on or before November 12, 2024. The Debtor and its
counsel have diligently attempted to gather the information
necessary to complete the documents and file them in a timely
manner. However, because of the extent of the information involved,
they have not been able to do so.
In addition, the only remaining steps needed to finish the case is
to sell the remaining lots. To that end, the Debtor has filed its
Motion to Approve Auction and Bidding Procedures to auction two of
the remaining lots and its Motion for Authority to Sell Real
Outside the Ordinary Course of Business Free and Clear of Liens,
Claims and Interests to approve the sale of one of the remaining
lots.
Monticello Construction & Real Estate is represented by:
Craig M. Geno, Esq.
Law Offices of Craig M. Geno, PLLC
587 Highland Colony Parkway
Ridgeland, MS 39157
Telephone: (607) 427-0048
Facsimile: (607) 427-0050
Email: cmgeno@cmgenolaw.com
About Monticello Construction & Real Estate
Monticello Construction & Real Estate, LLC, sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Miss. Case No.
24-00872) on April 10, 2024, with up to $10 million in both assets
and liabilities. Moe Chowdhury, managing member, signed the
petition.
Judge Jamie A. Wilson oversees the case.
The Law Offices of Craig M. Geno, PLLC, is the Debtor's legal
counsel.
MULTIPLAN CORP: S&P Downgrades ICR to 'CC' on Distressed Exchange
-----------------------------------------------------------------
On Dec. 24, 2024, S&P Global Ratings lowered its long-term issuer
credit rating on MultiPlan Corp. to 'CC' from 'B', its issue
ratings on its senior secured debt to 'CC' from 'B', and its issue
ratings on its senior unsecured debt to 'C' from 'CCC+'. All the
ratings are on CreditWatch with negative implications.
MultiPlan has launched a comprehensive debt restructuring
transaction. Pursuant to the deal, it will issue a new debt mix at
par value of the existing debt held by participating lenders. The
company has entered into a transaction support agreement with
lenders comprising approximately 78% of the aggregate principal
amount of its outstanding debt.
S&P said, "In our view, lenders will receive less than originally
promised because the maturity dates on the debt to be exchanged at
par value will be extended by three or more years and replaced with
a new debt mix that alters the priority and timing of payments.
While the interest rates on the new debt are modestly higher on a
weighted basis, we believe they are well below what the company
would be required to pay for new capital under current market
conditions and what an issuer with a similar risk profile would
have to pay to raise new capital.
"We also view the transaction as distressed because, absent a
transaction, we believe there is a realistic possibility of a
conventional default over the medium term. We expect MultiPlan's
adjusted financial leverage to be modestly below 8.0x by year-end
2024 and that it has limited ability to materially reduce leverage
ahead of very sizable debt maturities totaling $4.57 billion from
2027-2028."
The contributing factors to the shortfall and S&P's subsequent
revisions include diminished claim flow volumes. These were caused
by a clearinghouse disruption in first-half 2024,
slower-than-expected new product sales growth, notification of loss
of business from a key customer due to insourcing beginning in
2025, and incremental spending for a new product and services
development. MultiPlan has also incurred large noncash charges
through 2024 in connection with goodwill impairment testing.
Moreover, the company is contending with litigation by various
providers, of which the outcome and impact on business strategy are
uncertain.
MULTIPLAN CORP: Shares Climb 82% Over $4.5-Bil. Refinancing Deal
----------------------------------------------------------------
Randi Love of Bloomberg Law reports that MultiPlan Corp., a
health-care analytics company, has secured an agreement with a
majority of its creditors to extend the maturities of its existing
debt, according to a statement obtained by Bloomberg.
The company's stock jumped as much as 82% on Tuesday, from December
24, 2024 -- by 10:13 a.m. in New York -- after Bloomberg first
reported the news.
Creditors holding around 78% of various bonds and term loans have
signed onto the deal, which aims to address debt maturing between
2026 and 2028. As of September 30, 2024, MultiPlan disclosed $4.5
billion in long-term debt in public filings.
About Multiplan Corp.
Multiplan Corporation is a leading value-added provider of data
analytics and technology-enabled end-to-end cost management,
payment and revenue integrity solutions to the U.S. healthcare
industry. The company is based in New York, New York.
N.C. 17-19: Seeks Chapter 11 Bankruptcy Protection in New York
--------------------------------------------------------------
On December 17, 2024, N.C. 17-19 Adams Street LLC filed Chapter 11
protection in the Southern District of New York. According to
court filing, the Debtor reports $2,664,197 in debt owed to 1 and
49 creditors. The petition states funds will be available to
unsecured creditors.
A meeting of creditors under Sec. 341(a) to be held on January 16,
2025 at 01:30 PM at Office of UST (TELECONFERENCE ONLY).
About N.C. 17-19 Adams Street LLC
N.C. 17-19 Adams Street LLC is the fee simple owner of the real
property located at 17-19 Adams Street, Bedford Hills, NY 10507
having an appraised value of $1.6 million.
N.C. 17-19 Adams Street LLC sought relief under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 24-23097) on
December 17, 2024. In the petition filed by Nuo Camaj, as sole
owner and member, the Debtor reports total assets of $1,600,100 and
total liabilities of $2,664,197.
Honorable Bankruptcy Judge Sean H. Lane handles the case.
The Debtor is represented by:
James J. Rufo, Esq.
THE LAW OFFICE OF JAMES J. RUFO
222 Bloomingdale Road, Suite 202
White Plains, NY 10605
Tel: (914) 600-7161
Email: jrufo@jamesrufolaw.com
NORMAN REGIONAL: Moody's Confirms 'B1' Rating, Outlook Negative
---------------------------------------------------------------
Moody's Ratings has confirmed Norman Regional Hospital Authority's
(OK) (NRH) B1 rating. The outlook is negative. Previously, NRH's
rating was under review for further downgrade. This concludes the
review for further downgrade initiated by on October 3, 2024.
The confirmation of the B1 rating is driven by NRH's progress in
reducing the magnitude of operating losses and stabilizing
liquidity through October 2024, as well as the successful renewal
of a line of credit.
RATINGS RATIONALE
The B1 favorably reflects NRH's leading market position, which will
continue to be protected by a local city ordinance that restricts
entrance of inpatient competition. Improvement in patient volumes
through October 2024 and cost savings related to consolidation of
services following the expansion of the main facility (opened
August 2024) will provide a solid foundation for margin
improvement. However, liquidity and leverage metrics, including
days cash and cash to debt, will remain weak due to significant
cash declines from capital overruns related to the master facility
plan and multiple years of poor operating performance. As of
October 2024, cash on hand and cash to debt were very weak at 40
days and 21%, respectively, inclusive of a $35 million draw on a
line of credit. Nonetheless, with reduced capital spending in
fiscal 2025, liquidity has prospects to stabilize in the 30-40 day
range (inclusive of line of credit draws) and gradually improve if
operating targets are met.
RATING OUTLOOK
The negative outlook reflects the possibility of further liquidity
erosion should management be unable to achieve targeted operating
improvements. Inability to achieve margins capable of supporting
ongoing capital needs and debt service requirements would pressure
the rating. Moody's would consider changing the outlook to stable
if NRH is able to maintain positive cash flow and stabilize
liquidity while repaying the line of credit.
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS
-- Material growth in liquidity absent additional debt
-- Sustained and material improvement in operating performance
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS
-- Decline in cash on hand to below 30 days or cash to debt to
below 15%
-- Inability to improve operating cash flow margin to above
breakeven in FY 2025
LEGAL SECURITY
The bonds are secured by a gross revenue pledge of the hospital.
Required covenants relating to the master trust indenture, loan
agreement and other related legal documents include a 1.1x maximum
annual debt service coverage. NRH was not in compliance at the June
30, 2022 and 2023 measurement dates but remedied the non-compliance
by engaging a consultant.
PROFILE
Norman Regional Hospital Authority (NRH) is a regional hospital
system located in Cleveland County, Oklahoma (approximately 20
miles south of Oklahoma City) with 387 licensed beds. NRH is a
public trust and GASB-reporting hospital. NRH operates Norman
Regional Hospital, Norman Regional HealthPlex, Norman Regional
Moore facility, and recently opened Norman Regional Nine facility,
as well as numerous outpatient locations. A local city ordinance
insulates NRH from competition within the City of Norman limits.
METHODOLOGY
The principal methodology used in these ratings was Not-for-profit
Healthcare published in October 2024.
NORTHVOLT AB: Paul Weiss & Gray Reed Represent Second Lien Lenders
------------------------------------------------------------------
The law firms of Paul, Weiss, Rifkind, Wharton & Garrison LLP and
Gray Reed filed a verified statement pursuant to Rule 2019 of the
Federal Rules of Bankruptcy Procedure to disclose that in the
Chapter 11 cases of Northvolt AB and its affiliates, the firms
represent Ad Hoc Group of Second Lien Lenders.
The Ad Hoc Group was formed by certain unaffiliated holders (each,
a "Member") of the Debtors' loans under that certain Second Lien
Facility Agreement, dated as of July 28, 2020, by and among,
Northvolt ETT AB as Borrower, Northvolt ETT Fastighetsforvaltning
AB as PropCo, the Financial Institutions party thereto as Original
Lenders, ING Bank N.V. as Intercreditor Agent, and Danske Bank A/S
as Original Facility Agent.
In fall 2024, the Ad Hoc Group of Second Lien Lenders retained
Paul, Weiss to represent it as counsel in connection with a
potential restructuring of the Debtors. In November 2024, the Ad
Hoc Group of Second Lien Lenders retained Gray Reed to serve as its
co-counsel with respect to such matters.
Counsel represents only the Ad Hoc Group of Second Lien Lenders.
Counsel does not undertake to represent the interests of, and are
not a fiduciary for, any other creditor, party in interest, or
other entity.
In addition, neither the Ad Hoc Group of Second Lien Lenders nor
any Member of the Ad Hoc Group of Second Lien Lenders (i) has
assumed any fiduciary duties to any other creditor or person or
(ii) purports to act, represent, or speak on behalf of any other
entities in connection with these chapter 11 cases.
The Ad Hoc Group Members' address and the nature and amount of
disclosable economic interests held in relation to the Debtors as
of December 19, 2024, are as follows:
1. Certain funds and/or accounts, or subsidiaries of such funds
and/or accounts, managed, advised
or controlled by PFA Pension, Forsikringsaktieselska, or an
affiliate thereof.
PFA Pension
Sundkrogsgade 4
2100 Copenhagen Denmark
* EUR112,500,000.00
2. Certain funds and/or accounts, or subsidiaries of such funds
and/or accounts, advised or
managed by Danica Pension, Livsforsikringsaktieselskab, or an
affiliate thereof.
Danica Pension
Bernstorffsgade 40, 1577
København V Denmark
* EUR112,500,000.00
3. Certain funds and/or accounts, or subsidiaries of such funds
and/or accounts, managed, advised
or controlled by APG Asset Management N.V., or an affiliate
thereof.
Stichting Pensioenfonds
ABP, Coriovallumstraat
46, 6411CD Heerlen, the Netherlands
* EUR12,781,124.98
Stichting Depositary
APG Developed
Markets Active Credits
Pool, Oude Lindestraat
70, 6411EJ, Heerlen, the Netherlands
* EUR2,218,875.02
4. Certain funds and/or accounts, or subsidiaries of such funds
and/or accounts, managed, advised
or controlled by ING Sustainable Investments B.V., or an
affiliate thereof.
ING Sustainable
Investments B.V.
Bijlmerdreef 24, 1102CT
Amsterdam Netherlands
* EUR15,000,000.00
Counsel to the Ad Hoc Group of Second Lien Lenders:
Jason S. Brookner, Esq.
Emily F. Shanks, Esq.
GRAY REED
1300 Post Oak Blvd, Suite 2000
Houston, Texas 77056
Telephone: (713) 986-7000
Facsimile: (713) 986-7100
Email: jbrookner@grayreed.com
eshanks@grayreed.com
- and –
PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP
Alice Belisle Eaton, Esq.
Jessica Choi, Esq.
Bruce C. Racine, Esq.
1285 Avenue of the Americas
New York, New York 10019
Telephone: (212) 373-3000
Facsimile: (212) 757-3990
Email: aeaton@paulweiss.com
jchoi@paulweiss.com
bracine@paulweiss.com
About Northvolt AB
Northvolt AB was established in 2016 in Stockholm, Sweden.
Pioneering a sustainable model for battery manufacturing, the
company has received orders from several leading automotive
companies. The company is currently delivering batteries from its
first gigafactory, Northvolt Ett, in Skelleftea, Sweden and from
its R&D and industrialization campus, Northvolt Labs, in Vasteras,
Sweden.
On Nov. 21, 2024, Northvolt AB and eight affiliated debtors filed
voluntary petitions for relief under Chapter 11 of the United
States Bankruptcy Code (Bankr. S.D. Tex. Case No. 24-90577).
The cases are before the Honorable Alfredo R. Perez.
Northvolt is being advised by Teneo as its restructuring and
communications advisor. Kirkland & Ellis LLP, A&O Shearman and
Mannheimer Swartling Advokatbyrå AB are serving as legal counsel.
The company has also engaged Rothschild & Co to run its marketing
process. Stretto is the claims agent.
The U.S. Trustee for Region 7 appointed an official committee to
represent unsecured creditors in the Debtors' Chapter 11 cases.
NORTHWEST GRADING: Files Chapter 11 Bankruptcy Protection in Idaho
------------------------------------------------------------------
On December 20, 2024, Northwest Grading Inc. filed Chapter 11
protection in the District of Idaho. According to court filing,
the Debtor reports $8,832,400 in debt owed to 1 and 49 creditors.
The petition states funds will be available to unsecured
creditors.
About Northwest Grading Inc.
Northwest Grading, Inc. sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Idaho Case No. 24-20429) on December
20, 2024. In the petition filed by William J. Krick, as president,
the Debtor reports total assets of $3,417,570 and total
liabilities of $8,832,400.
Honorable Bankruptcy Judge Noah G. Hillen handles the case.
The Debtor is represented by:
Matthew Christensen, Esq.
JOHNSON MAY
199 N. Capitol Blvd.
Suite 200
Boise, ID 83702
Tel: (208) 384-8588
E-mail: mtc@johnsonmaylaw.com
OCEANKEY (US) II: Moody's Alters Outlook on 'B2' CFR to Negative
----------------------------------------------------------------
Moody's Ratings affirmed OceanKey (US) II Corp.'s (MediaOcean)
ratings, including its B2 corporate family rating, B2-PD
probability of default rating, and B2 ratings on the senior secured
first lien term loan and senior secured first lien revolving credit
facility. The outlook was changed to negative from stable.
The change in outlook to negative follows MediaOcean's recently
announced intent to acquire Innovid for roughly $500 million at a
price of $3.15 per share of common stock. The company currently
expects to raise $350 million in additional first lien term debt,
along with a $50 million upsize to their revolver, to fund this
acquisition. The negative outlook considers uncertainty around the
final capital structure, expected synergies and operating
performance of the combined entity, impact of the newly implemented
Certified Service Partner (CSP) program, and credit metrics
inclusive of leverage and free cash flow (FCF) to debt. Outside of
the impact and timing of synergies tied to Innovid and the CSP
program, this transaction is leveraging and can delay expected
deleveraging and suitable cash generation expected for the B2 CFR.
RATINGS RATIONALE
The B2 CFR reflects MediaOcean's high pro forma debt leverage,
relatively small revenue base, customer concentration among top
advertising agencies and an acquisitive growth strategy. The
company's narrow focus on software solutions for the advertising
industry exposes it to the cyclical advertising market, which has
been vulnerable to economic downturns. In addition, rapidly
evolving privacy regulations and changes being implemented by
walled gardens (Google, Amazon, Facebook, Apple) can present both
risks and opportunities for MediaOcean, given the company's
increased focus on digital advertising. MediaOcean's two most
recent acquisitions, 4C and Flashtalking, strengthened the
company's positioning in the advertising industry that is
undergoing structural shifts given the increasing role of tech
firms and data-driven solutions in the market.
MediaOcean benefits from a leading presence within its targeted
market and a subscription centric sales model that provides a high
degree of predictability given multiyear contracts and
long-standing relationships with the advertising agencies.
MediaOcean management's strong track record of integrating acquired
businesses and cross-selling solutions to existing customers also
supports its credit profile.
Moody's expect that MediaOcean will maintain good liquidity over
the next 12-18 months. As of September 2024, the company's sources
of liquidity consist of $92 million in cash and a $75 million
undrawn revolver. Baring impacts from the Innovid transaction,
Moody's expect MediaOcean to remain FCF positive in the next 12-18
months, with FCF/debt in the low to mid single digit percent
range.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ratings could be upgraded if MediaOcean's scale is increased
substantially by generating consistent organic revenue and EBITDA
growth such that adjusted leverage is expected to be sustained
below 4x. The company would also have to demonstrate conservative
financial policies.
The ratings could be downgraded if leverage were expected to be
maintained above 6.5x on other than a temporary basis, free cash
flow to debt were to fall below 5%, or if revenue declines.
Headquartered in New York, New York, MediaOcean is a global,
market-leading provider of financial and operational software
solutions for the advertising industry, enabling agencies and
brands to manage and coordinate the entire advertising workflow.
The company is owned by private equity firms CVC Capital Partners
and TA Associates. MediaOcean generates under $400 million in
annual revenues, although above $500 million pro forma for the
Innovid transaction.
The principal methodology used in these ratings was Software
published in June 2022.
OMIMEX PETROLEUM: Katharine Clark Named Subchapter V Trustee
------------------------------------------------------------
The U.S. Trustee for Region 6 appointed Katharine Battaia Clark of
Thompson Coburn, LLP as Subchapter V trustee for Omimex Petroleum,
Inc.
Ms. Clark will be paid an hourly fee of $525 for her services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Ms. Clark declared that she is a disinterested person according to
Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Katharine Battaia Clark
Thompson Coburn, LLP
2100 Ross Avenue, Ste. 3200
Dallas, TX 75201
Office: 972-629-7100
Mobile: 214-557-9180
Fax: 972-629-7171
Email: kclark@thompsoncoburn.com
About Omimex Petroleum Inc.
Omimex Petroleum Inc. provides energy and fertilizer services. It
focuses on the exploration, development, acquisition and operation
of oil and gas properties, and production of various fertilizers.
Omimex Petroleum serves oil and gas industry internationally.
Omimex sought relief under Subchapter V of Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Texas Case No. 24-34018) on December
10, 2024, with $1 million to $10 million in both assets and
liabilities. Christopher Chambers, sole director of Omimex, signed
the petition.
The Debtor is represented by Jeff Caruth, Esq., at Weycer, Kaplan,
Pulaski & Zuber, P.C.
ONYX OWNER: Seeks Bankruptcy Protection in Delaware
---------------------------------------------------
On December 18, 2024, Onyx Owner LLC filed Chapter 11 protection
in the District of Delaware. According to court filing, the Debtor
reports $10 million and $50 million in debt owed to 1 and 49
creditors. The petition states funds will not be available to
unsecured creditors.
About Onyx Owner LLC
Onyx Owner LLC business involves a residential apartment project
consisting of 266 residential apartment units and related amenities
located at 1100 First Street SE, Washington DC 2003.
Onyx Owner LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 24-12816) on December 18,
2024. In the petition filed by Joshua Ufberg, as authorized
signatory, the Debtor reports estimated assets and liabilities
between $10 million and $50 million each.
The Debtor is represented by:
Robert J. Dehney, Sr., Esq.
MORRIS, NICHOLS, ARSHT & TUNNELL
1201 North Market Street
P.O. Box 1347
Wilmington DE 19899
Tel: 302-658-9200
Email: rdehney@morrisnichols.com
ORION HEALTHCORP: Court Abstains from Hearing U.S., et al Case
--------------------------------------------------------------
Chief Judge Alan S. Trust of the United States Bankruptcy Court for
the Eastern District of New York decided to permissively abstain
from hearing the remainder of the case captioned as Howard M.
Ehrenberg in his capacity as Liquidating Trustee of Orion
Healthcorp, Inc., et al., Plaintiff, v. United States of America,
Department of Treasury, Internal Revenue Service, Defendant, Adv.
Pro. No. 18-08048 (AST) (Bankr. E.D.N.Y.). The adversary proceeding
shall be administratively closed within thirty (30) days, unless
either side files a motion to withdraw the reference.
On March 29, 2018, various chapter 11 debtors, as plaintiffs, filed
a complaint commencing this adversary proceeding. Plaintiff Debtors
named a multitude of non-debtor parties as defendants in the
original complaint, as well as the United States of America,
Department of Treasury, Internal Revenue Service. Each of the
non-debtor individual and/or corporate Non-IRS defendants were
former shareholders of Debtor Constellation Healthcare
Technologies, Inc.
On June 24, 2019, Howard M. Ehrenberg in his capacity as
Liquidating Trustee of Debtors filed a first amended complaint.
On March 12, 2020, the Trustee filed a second amended complaint.
Over the course of this litigation, the Trustee has settled with,
obtained judgments against and/or dismissed from this action the
many numerous non-debtor shareholder defendants. The IRS remains
the only defendant in the Adversary Proceeding.
On March 20, 2024, the Trustee filed a third amended complaint
which asserted claims only against the IRS and removed all other
defendants.
Pursuant to the Third Amended Complaint, the Trustee seeks to
recover approximately $10,435,097.13 of payments made on behalf of
shareholders of CHT to the IRS. However, the IRS Funds are not
monies that CHT or any of the other Debtors themselves had a right
to recover as overpayments of tax liabilities.
The complex factual background of this case relates to a
"go-private" merger transaction which took place between CHT
Holdco, LLC and CHT. The Merger closed on or about January 30,
2017.
The proceeds of the Merger were paid to non-debtor individuals
and/or entities. According to the Third Amended Complaint, a total
of $212,502,269.25 in proceeds were paid out in connection with the
Merger. Approximately $100 million of the Merger Proceeds was paid
to Parmar Shareholder Entities (as defined in the Third Amended
Complaint). Other CHT shareholders who were previously named in the
Adversary Proceeding as defendants in the Second Amended Complaint,
received the remaining approximate $120 million of the Merger
Proceeds as follows: (a) approximately $80.3 million in cash, and
(b) $13.6 million in promissory notes in exchange for their CHT
shares.
As of the Closing Date, the CC Holdco Bank Account held the full
$212,502,269.25 of Merger Proceeds. On the Closing Date,
$177,154,981.43 in Merger Proceeds was transferred from the CC
Holdco Bank Account to an account at the Royal Bank of Scotland,
plc. maintained by Capita Registrars Limited, the exchange agent
for the Merger. The remaining $35,347,287.82 was held in the CC
Holdco Bank Account. Capita and CC Holdco ultimately disbursed the
Merger Proceeds to CHT shareholders and/or otherwise used the
Merger Proceeds to pay fees and costs incurred in connection with
the Merger.
At the time of the Merger, Capita retained $10,435,097.13 of these
CHT shareholder payments (i.e., the IRS Funds). According to the
Trustee, the IRS Funds were withheld because Capita did not have
sufficient information at the time to determine whether a
withholding tax was due and owing to the IRS pursuant to applicable
law due to the status of the CHT shareholders as foreign persons
and/or entities. Specifically, Capita was concerned that the IRS
Funds may have been required to be withheld at the time of the
Merger and remitted to the IRS pursuant to 26 U.S.C. Sec. 1141 (for
individual shareholders), 26 U.S.C. Sec. 1142 (for corporate
shareholders), and/or 26 U.S.C. §1145, each of which requires a
percentage of consideration paid for certain transactions involving
foreign shareholders to be withheld and deposited with the IRS.
Those shareholders could then submit a US tax return and
potentially receive a refund. Ultimately, Capita elected to
transfer the IRS Funds back to CHT so that CHT could determine
whether such IRS Funds should be remitted to the IRS with the
requisite shareholder information.
On May 3, 2024, the IRS filed a motion to dismiss the Adversary
Proceeding. On October 1, 2024, the Bankruptcy Court entered an
Order to Show Cause For Abstention directing the parties to
demonstrate why it should or should not mandatorily or permissively
abstain from hearing this Adversary Proceeding pursuant to 28
U.S.C. Sec. 1334(c)(1) or (c)(2). The Order to Show Cause also gave
the parties an opportunity to move to withdraw the reference of the
Adversary Proceeding to the District Court.
Neither the Trustee nor the IRS has moved to withdraw the
reference.
On October 25, 2024, the IRS responded to the Order to Show Cause,
reiterating its request to dismiss this Adversary Proceeding for
the reasons set forth in the Dismissal Motion, but otherwise
seeking that this Court permissively abstain from hearing these
matters.
On October 25, 2024, the Trustee filed a memorandum of law in
opposition to the Order to Show Cause and requested that the
Bankruptcy Court neither mandatorily nor permissively abstain from
hearing the Adversary Proceeding.
The IRS's primary contention is that this Adversary Proceeding
boils down to a tax refund dispute concerning the tax liabilities
of non-debtor former shareholders of CHT. Conversely, the Trustee
asserts that it has not sued the IRS to obtain a tax refund and
explains these claims are "bread-and-butter, standard chapter 5
fraudulent transfer bankruptcy claims" against the IRS because the
IRS allegedly received a fraudulent conveyance pursuant to
Bankruptcy Code section 548 and is purportedly holding funds
belonging to Debtors which necessitates turnover pursuant to
Bankruptcy Code section 542. The Trustee also maintains that this
is not an action brought pursuant to Bankruptcy Code section 505.
The Bankruptcy Court disagrees with the Trustee and concludes that
permissive abstention is appropriate.
Judge Trust concludes that abstention will have no effect on
efficient administration of the estate. Either this Court or the
federal district court would have to determine who has rights to
the IRS Funds, and any appeal from this Court to the District Court
would be likely, and quite possibly de novo review of decisions of
law. Thus, abstention saves a step in the process. Further, the
unsettled tax law issues clearly predominate over bankruptcy law
issues in this Adversary Proceeding. In that regard, it appears
that the United States District Court would be the more appropriate
forums for determining those predominate tax law issues.
A copy of the Court's decision dated is
http://urlcurt.com/u?l=DdN9dQ
About Orion HealthCorp
Constellation Healthcare Technologies, Inc., is a healthcare
services organization providing outsourced revenue cycle
management, practice management, and group purchasing services to
U.S. physicians. Orion Healthcorp, et al. --
http://www.orionhealthcorp.com/-- are a consolidated enterprise of
several companies aggregated through a series of acquisitions,
which operate the following businesses: (a) outsourced revenue
cycle management for physician practices, (b) physician practice
management, (c) group purchasing services for physician practices,
and (d) an independent practice association business, which is
organized and directed by physicians in private practice to
negotiate contracts with insurance companies on their behalf while
those physicians remain independent and which also provides other
services to those physician practices. Orion has locations in
Houston, Texas; Jericho, New York; Lakewood, Colorado;
Lawrenceville, Georgia; Monroeville, Pennsylvania; and Simi Valley
California.
Constellation Healthcare Technologies, Inc., along with certain of
its subsidiaries, including Orion Healthcorp, Inc., on March 16,
2018, initiated voluntary proceedings under Chapter 11 of the U.S.
Bankruptcy Code to facilitate an orderly and efficient sale of its
businesses. The lead case is In re Orion Healthcorp, Inc.
(E.D.N.Y. Lead Case No. 18-71748).
The Debtors have liabilities of $245.9 million.
The Hon. Carla E. Craig is the case judge.
The Debtors tapped DLA Piper US LLP as counsel; Hahn & Hessen LLP,
as conflicts counsel; FTI Consulting, Inc., as restructuring
advisor; Houlihan Lokey Capital, Inc., as investment banker; and
Epiq Bankruptcy Solutions, LLC as claims and noticing agent.
The Office of the U.S. Trustee on April 4, 2018, appointed three
creditors to serve on the official committee of unsecured creditors
in the Chapter 11 cases. The Committee tapped Pachulski Stang Ziehl
& Jones LLP as its legal counsel, and CBIZ Accounting, Tax and
Advisory of New York, LLC, as its financial advisor.
On July 5, 2018, affiliate New York Network Management, L.L.C.,
followed parent Orion into bankruptcy to implement a deal to sell
its assets for at least $16.5 million.
ORION HEALTHCORP: Court Tosses Parmar, et al's Counterclaims
------------------------------------------------------------
Chief Judge Alan S. Trust of the United States Bankruptcy Court for
the Eastern District of New York granted the corporate plaintiffs'
motion to dismiss the counterclaims asserted by defendants in their
answer to the second amended complaint in the case captioned as
Howard M. Ehrenberg in his capacity as Liquidating Trustee of Orion
Healthcorp, Inc., et al., CHT Holdco, LLC, and CC Capital CHT
Holdco LLC, Plaintiffs, v. Parmjit Singh Parmar (a/k/a Paul
Parmar), et al. Defendants, Adv. Pro. No. 18-08053 (AST) (Bankr.
E.D.N.Y.). The counterclaims are dismissed with prejudice.
The plaintiffs who filed the motion are the following: CHT Holdco
LLC and CC Capital CHT Holdco LLC ("Corporate Plaintiffs").
The defendants who filed the counterclaims at issue are the
following non-debtor entities: Constellation Health LLC;
Constellation Health Investment LLC; First United Health, LLC; Naya
Constellation Health LLC; Vega Advanced Care LLC; Pulsar Advance
Care LLC; Lexington Landmark Services LLC; 2 River Terrace
Apartment 12J, LLC; 21B One River Park LLC; Aquila Alshain LLC;
Ranga Bhoomi LLC; PPSR Partners, LLC; Taira no Kiyomori LLC; Axis
Medical Services, LLC; and The Red Fronted Macaw Trust
(collectively, the "Parmar Entities").
The counterclaims of the Parmar Entities include a first
counterclaim for fraud in the inducement/fraudulent
misrepresentation and a second counterclaim for breach of fiduciary
duty.
The Adversary Proceeding was commenced on April 4, 2018 by multiple
chapter 11 debtors. Only some of the Parmar Entities were initially
named as defendants in the original complaint.
Debtors filed an amended complaint on June 4, 2018. All Parmar
Entities were named as defendants in the First Amended Complaint.
Corporate Plaintiffs were named as defendants in that amended
complaint.
Over the course of this litigation, multiple other defendants
settled and/or were dismissed from this Adversary Proceeding.
On January 14, 2021, Howard M. Ehrenberg in his capacity as
Liquidating Trustee of Orion Healthcorp, Inc., et al., filed the
second amended complaint. Corporate Plaintiffs were realigned as
plaintiffs in this action for the first time in the Second Amended
Complaint. Parmar Entities remained named as defendants.
In the Motion, brought pursuant to Rules 12(b)(1) and (b)(6) of the
Federal Rules of Civil Procedure, Corporate Plaintiffs allege that
the Counterclaims should be dismissed with prejudice. Corporate
Plaintiffs assert the Counterclaims are an attempt by Parmar
Entities to "shift responsibility" for crimes committed by Parmar
by attacking the victims of fraudulent activity, and trying to
relitigate claims previously dismissed and/or voluntarily released.
In particular, Corporate Plaintiffs argue that:
(1) the Counterclaims are barred by statute of limitations
because those claims arise out of purported misrepresentations and
omissions that occurred on or about January 30, 2017, and yet, the
Counterclaims were not filed until January 2, 2024,
(2) the Counterclaims are barred by res judicata because the
allegations relate to the same facts, transactions and occurrences
previously and unsuccessfully pled in the federal action in the
United States District Court for the District of New Jersey Alpha
Cephus, LLC, et al. v. Chu, et al., Case No. 18-cv-14322 and those
claims in the NJ Action were dismissed with
prejudice,
(3) the Counterclaims are barred by certain Releases (defined
below) executed by Parmar and Parmar Entities,
(4) Parmar Entities lack standing under Federal Rule 12(b)(1) to
bring certain Counterclaims which are derivative claims that must
be brought solely and exclusively by the Liquidating Trustee, and
(5) Parmar Entities have failed to state a claim pursuant to
Federal Rule 12(b)(6) for fraudulent misrepresentation.
The Counterclaims were filed on January 2, 2024, approximately
five-and-a-half years after the First Answer Crossclaims. Judge
Trust says, "The problem here, as correctly asserted by Corporate
Plaintiffs, is that the Counterclaims do not relate back to the
First Answer Crossclaims in accordance with Federal Rule 15(c)."
Because the Counterclaims do not relate back to the First Answer
Crossclaims, they have not been plead within the appropriate
statutes of limitations. Thus, the Counterclaims are also dismissed
because they are now barred by statute of limitations, the Court
concludes.
Judge Trust concludes, "To allow Parmar Entities to now assert the
untimely Counterclaims runs contrary to the purpose of Federal Rule
15(c) and would greatly prejudice Corporate Plaintiffs. Corporate
Plaintiffs would be further prejudiced by the Counterclaims being
asserted almost six years into the case, five-and-a-half years
after the First Answer Crossclaims were filed and five years after
those crossclaims were voluntarily dismissed."
A copy of the Court's decision dated is
http://urlcurt.com/u?l=A1gnMd
About Orion HealthCorp
Constellation Healthcare Technologies, Inc., is a healthcare
services organization providing outsourced revenue cycle
management, practice management, and group purchasing services to
U.S. physicians. Orion Healthcorp, et al. --
http://www.orionhealthcorp.com/-- are a consolidated enterprise of
several companies aggregated through a series of acquisitions,
which operate the following businesses: (a) outsourced revenue
cycle management for physician practices, (b) physician practice
management, (c) group purchasing services for physician practices,
and (d) an independent practice association business, which is
organized and directed by physicians in private practice to
negotiate contracts with insurance companies on their behalf while
those physicians remain independent and which also provides other
services to those physician practices. Orion has locations in
Houston, Texas; Jericho, New York; Lakewood, Colorado;
Lawrenceville, Georgia; Monroeville, Pennsylvania; and Simi Valley
California.
Constellation Healthcare Technologies, Inc., along with certain of
its subsidiaries, including Orion Healthcorp, Inc., on March 16,
2018, initiated voluntary proceedings under Chapter 11 of the U.S.
Bankruptcy Code to facilitate an orderly and efficient sale of its
businesses. The lead case is In re Orion Healthcorp, Inc.
(E.D.N.Y. Lead Case No. 18-71748).
The Debtors have liabilities of $245.9 million.
The Hon. Carla E. Craig is the case judge.
The Debtors tapped DLA Piper US LLP as counsel; Hahn & Hessen LLP,
as conflicts counsel; FTI Consulting, Inc., as restructuring
advisor; Houlihan Lokey Capital, Inc., as investment banker; and
Epiq Bankruptcy Solutions, LLC as claims and noticing agent.
The Office of the U.S. Trustee on April 4, 2018, appointed three
creditors to serve on the official committee of unsecured creditors
in the Chapter 11 cases. The Committee tapped Pachulski Stang Ziehl
& Jones LLP as its legal counsel, and CBIZ Accounting, Tax and
Advisory of New York, LLC, as its financial advisor.
On July 5, 2018, affiliate New York Network Management, L.L.C.,
followed parent Orion into bankruptcy to implement a deal to sell
its assets for at least $16.5 million.
PANDYA REAL: Hits Chapter 11 Bankruptcy Protection in Pennsylvania
------------------------------------------------------------------
On December 20, 2024, Pandya Real Estate Holdings LLC filed
Chapter 11 protection in the Eastern District of Pennsylvania.
According to court filing, the Debtor reports between $500,000 and
$1 million in debt owed to 1 and 49 creditors. The petition states
funds will be available to unsecured creditors.
About Pandya Real Estate Holdings LLC
Pandya Real Estate Holdings LLC is a Single Asset Real Estate
debtor (as defined in 11 U.S.C. Section 101(51B)).
Pandya Real Estate Holdings LLC sought relief under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. E.D. Pa. Case No. 24-14544) on
December 20, 2024. In the petition filed by Jignesh Pandya, as
authorized representative of the Debtor, the Debtor reports between
$500,000 and $1 million.
Honorable Bankruptcy Judge Ashely M. Chan handles the case.
The Debtor is represented by:
Alexander G. Tuttle, Esq.
LAW OFFICES OF ALEXANDER TUTTLE
196 W. Ashland St.
Doylestown, PA 18901
Tel: 215-723-7969
E-mail: agt@tuttlelegal.com
PARAMOUNT RESOURCES: S&P Withdraws 'BB-' Issuer Credit Rating
-------------------------------------------------------------
S&P Global Ratings withdrew its 'BB-' issuer credit rating on
Paramount Resources Ltd. at the issuer's request. S&P placed the
rating on CreditWatch with negative implications on Nov. 18, 2024.
S&P said, "The CreditWatch placement reflected our view of
uncertainty surrounding Paramount's overall creditworthiness
following its announced asset sale to Ovintiv Inc. Paramount
announced it intends to sell the majority of its Montney-producing
assets to Ovintiv for cash consideration of C$3.325 billion,
subject to adjustments, plus certain Horn River Basin properties of
Ovintiv. Paramount intends to distribute about C$2.2 billion of the
proceeds to shareholders as a special cash distribution of C$15 per
common share. We expect the company's production at close of the
transaction will be approximately 30,000 barrels of oil equivalent
per day (boe/d), a 70% decline relative to its third quarter
production of almost 100,000 boe/d. Accordingly, we estimated the
sale of a material portion of the company's producing assets would
likely result in a weaker assessment of Paramount's competitive
position and significantly weaker free cash flow generation and
overall creditworthiness for the company.
"We acknowledge Paramount currently has no debt on its balance
sheet. We intended to resolve the CreditWatch placement and lower
the issuer credit rating by up to two notches upon transaction
close, which is anticipated in the first quarter of 2025."
S&P Global Ratings was unable to resolve the CreditWatch placement
and determine accurate final ratings before the withdrawal because
S&P lacked the necessary information at the time of the request to
withdraw the ratings.
PARTY CITY: Files for Bankruptcy Again Within Two Years
-------------------------------------------------------
Dorothy Ma of Bloomberg Law reports that Party City Holdco Inc. has
entered bankruptcy for the second time in two years and plans to
shut down its roughly 700 stores due to declining sales driven by
persistent inflation.
The New Jersey-based party supplies retailer filed for Chapter 11
bankruptcy in Texas, according to court filings.
In a separate announcement, the company stated it would retain more
than 95% of its 12,000 employees to support the wind-down process.
Following its first bankruptcy, Party City reduced its debt by
nearly $1 billion and downsized to approximately 800 stores
nationwide.
About Party City Holdco
Party City Holdco Inc. (NYSE: PRTY) is the global leader in the
celebrations' industry, with its offerings spanning more than 70
countries around the world. It is also the largest designer,
manufacturer, distributor, and retailer of party goods in North
America. Party City Holdco had 761 company-owned stores as of
September 2022. It is headquartered in Woodcliff Lake, N.J. with
additional locations throughout the Americas and Asia.
Party City Holdco and its domestic subsidiaries sought protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Lead
Case No. 23-90005). As of Sept. 30, 2022, Party City Holdco had
total assets of $2,869,248,000 against total debt of
$3,022,960,000.
Judge David R. Jones oversees the cases.
The Debtors tapped Paul, Weiss, Rifkind, Wharton & Garrison, LLP,
as legal counsel; Moelis & Company, LLC as investment banker;
AlixPartners, LLP as financial advisor; A&G Realty Partners as real
estate advisor; and Kroll as the claims agent.
PricewaterhouseCoopers LLP (PwC) provides accounting and valuation
advisory services, tax-related services, and internal audit
Sarbanes-Oxley Act support services.
Davis Polk & Wardwell, LLP and Lazard serve as legal counsel and
investment banker, respectively, to the ad hoc group of first lien
holders.
The U.S. Trustee for Region 6 appointed an official committee to
represent unsecured creditors in the Chapter 11 cases. The
committee is represented by Pachulski Stang Ziehl & Jones, LLC.
2nd Attempt
Party City Holdco sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Tex. Case No. 24-90621) on December on
December 21, 2024. In its petition, the Debtor reports estimated
assets and liabilities between $1 million and $10 million each.
Honorable Bankruptcy Judge Alfredo R. Perez handles the case.
John F Higgins, IV of Porter Hedges LLP is the Debtor's counsel.
PERFECT VIEW: Hires Palermo Landsman as Accountant and Bookkeeper
-----------------------------------------------------------------
Perfect View Aerial Media, LLC seeks approval from the U.S.
Bankruptcy Court for the Southern District of Florida to employ
Palermo Landsman and Ross as accountant and bookkeeper.
The firm will provide these services:
(a) perform regular bookkeeping;
(b) prepare and file the Debtor's 2024 federal tax return;
(c) prepare and file a DR405 tangible personal property return
for Florida;
(d) prepare and file the Debtor's annual report with the state
of Florida;
(e) prepare an annual minutes for the Debtor's corporate
records;
(f) store the Debtor's corporate records; and
(g) respond to the Internal Revenue Service (IRS) and Florida
tax notices when received.
The firm would charge the Debtor the following fees for these
services:
Prepare and File Federal Tax Returns $7,495
Prepare Cash Collateral Budget and Plan Projections $1,295
Tangible Personal Property DR405 Return $945
Annual Minutes Meeting and Document Storage Fee $695
Annual Report $595
Respond to IRS and Florida Notices $295 - $595
Monthly Bookkeeping $345/month
Arthur Palermo, Jr., president of Palermo Landsman and Ross,
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:
Arthur Palermo, Jr.
Palermo Landsman and Ross P.A.
9720 Stirling Rd., Ste. 203
Cooper City, FL 33024
Telephone: (954) 252-9622
About Perfect View Aerial Media
Perfect View Aerial Media, LLC sought relief under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. S.D. Fla. Case No. 24-21980) on
November 15, 2024, listing up to $500,000 in assets and up to $10
million in liabilities. Tarek Kiem, Esq., at Kiem Law, PLLC serves
as Subchapter V trustee.
Judge Peter D. Russin oversees the case.
The Debtor tapped John Page, Esq., at Shraiberg Page, PA as counsel
and Arthur Palermo, Jr., at Palermo Landsman and Ross PA as
accountant and bookkeeper.
PERFECTIONS INC: Seeks Approval to Hire TriCPS as Accountant
------------------------------------------------------------
Perfections Inc., of Boca seeks approval from the U.S. Bankruptcy
Court for the Southern District of Florida to employ TriCPS, LLC as
accountant.
The firm will provide these services:
(a) advise the Debtor with respect to the financial aspects of
this case;
(b) prepare financial statements, accounting documents,
monthly operating reports and tax documents; and
(c) prepare necessary financial projections, budgets and
financial analysis for the disclosure statement, plan and other
necessary filings before this court.
The firm will charge the Debtor an hourly rate ranging from $195 to
$295 depending on the level and skill of the professional
assigned.
`
In addition, the firm is requesting a monthly fee of $300 in
relation to all general accounting needed by the Debtor.
Christian Castro, CPA, ABV, 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:
Christian Castro, CPA
TriCPS LLC
100 E. Mcnab Rd.
Pompano Beach, FL 33060
Telephone: (954) 351-0336
About Perfections Inc. of Boca
Perfections, Inc. of Boca sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. S.D. Fla. Case No. 24-20614) on
October 14, 2024, with $100,001 to $500,000 in both assets and
liabilities.
Judge Scott M. Grossman presides over the case.
The Debtor tapped Nicholas G. Rossoletti, Esq., as legal counsel
and Christian Castro, CPA, at TriCPS LLC as accountant.
PRIMAL MATERIALS: Areya Holder Aurzada Named Subchapter V Trustee
-----------------------------------------------------------------
The U.S. Trustee for Region 6 appointed Areya Holder Aurzada, Esq.,
at Holder Law as Subchapter V trustee for Primal Materials, LLC and
Primal Crushing, LLC.
Ms. Aurzada will be paid an hourly fee of $575 for her services as
Subchapter V trustee and will be reimbursed for work-related
expenses incurred.
Ms. Aurzada declared that she is a disinterested person according
to Section 101(14) of the Bankruptcy Code.
The Subchapter V trustee can be reached at:
Areya Holder Aurzada, Esq.
Holder Law
901 Main Street, Ste. 5320
Dallas, TX 75202
Office: 972-438-8800
Mobile: 817-907-4140
About Primal Materials
Primal Materials, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Texas Case No. 24-10217) on
December 12, 2024, with $500,001 to $1 million in assets and
liabilities.
Judge Robert L. Jones presides over the case.
Joseph F. Postnikoff, Esq. at Rochelle Mccullough, LLP represents
the Debtor as legal counsel.
PRIME DEVELOPMENT: Seeks to Use Cash Collateral
-----------------------------------------------
Prime Development Inc. asked the U.S. Bankruptcy Court for the
Eastern District of New York for authority to use cash collateral.
On May 15, 2020, Prime Development executed an Amended Loan
Authorization and Agreement in the principal amount of $500,000,
which was modified by a 1St Modification of Note dated July 12.
2021 in the amount of $350,800 and 2nd Modification Note dated May
4, 2022 in the amount $500,000.
The company has every intention and has made every effort to enter
into a stipulation to use cash collateral with creditor U.S. Small
Business Administration. On September 24, 2024, the company's
budget was provided to creditor's counsel for review, offering a
monthly cash collateral payment of $500. As of October 11, 2024,
the SBA hasn't issued a response.
The company's use of cash collateral in the ordinary course of
business will allow the company to preserve and protect the
incoming income, and thus the company will be protecting the
creditor's collateral.
As adequate protection and as security for the lender, Prime
Development will, assign and pay to lender as and when received,
all net amounts received from the operation, as per the budget
submitted, commencing on the entry of an order issued by the
bankruptcy court authorizing the use of cash collateral.
A hearing on the matter is set for Jan. 22, 2025.
About Prime Development
Prime Development Inc. filed Chapter 11 petition (Bankr. E.D.N.Y.
Case No. 24-41566) on April 11, 2024, with as much as $1 million in
both assets and liabilities. Akmal Muhamatkulov, president of Prime
Development, signed the petition.
Judge Jil Mazer-Marino oversees the case.
The Debtor is represented by the Law Offices of Alla Kachan, P.C.
RAGING BULL: Amends Priority Claims Pay Details
-----------------------------------------------
Jacqueline Calderin, in her capacity as Chapter 11 trustee for
Raging Bull Investments Limited, submitted a Disclosure Statement
in support of the Amended Plan of Liquidation dated December 11,
2024.
The Plan classifies Claims and Equity Interests in various Classes
according to their right to priority of payments as provided in the
Bankruptcy Code. The Plan provides the treatment of each Class
under the Plan.
Class 1 consists of Allowed Priority Claims. On the Effective Date,
after payment of Allowed Administrative Claims, setting aside the
Disputed Claim Reserve and the Liquidation Cost Reserve, the
Disbursing Agent shall pay all sums due for claims under Section
507 of the Bankruptcy Code, if any. Class 1 is not Impaired.
Like in the prior iteration of the Plan, the Disbursing Agent shall
make pro rata distributions from available cash to pay 100% of all
Allowed General Unsecured Claims.
On the Effective Date, property of the Debtor not otherwise
disposed of under the Plan, shall vest with Disbursing Agent.
The Trustee shall disburse all sums collected since her appointment
as set forth in the Plan. As soon as practicable on or after the
Effective Date, and as consideration for payment in full of all
Allowed Administrative Claims, Class 1 and Class 2 as well as the
treatment set forth in Classes 3 and 4, the estate's interest in
the EOG Lease shall be assigned and transferred, free and clear of
all liens, claims and encumbrances to the Debtor Insider Parties as
follows: 51% to Mark Croft and 49% to Maureen Croft.
On or prior to the Confirmation Date, the Trustee shall continue to
operate the Debtor's business and meet current operational
obligations in the ordinary course of business, including payments
related to preservation of the EOG Lease or ordered by the Court.
In addition, the Debtor shall continue to comply with the various
other Orders entered by the Bankruptcy Court during the course of
its Case.
A full-text copy of the Disclosure Statement dated December 11,
2024 is available at https://urlcurt.com/u?l=PmIdA6 from
PacerMonitor.com at no charge.
Attorneys for Chapter 11 Trustee:
Jacqueline Calderin, Esq.
Agentis PLLC
45 Almeria Avenue
Coral Gables, FL 33134
Telephone: (305) 722-2002
Email: jc@agentislaw.com
About Raging Bull Investments Limited
Raging Bull Investments Limited is a limited partnership organized
under the laws of the State of Florida that owns a 1.5% working
interest in and to an oil & gas lease in Loving County, Texas.
Raging Bull Investments filed a petition for relief under Chapter
11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 22-17916) on
Oct. 12, 2022. In the petition filed by Mark S. Croft, as manager
and partner, the Debtor reported assets between $500,000 and $1
million and liabilities between $10 million and $50 million.
The Debtor is represented by Craig I. Kelley, Esq., at Kelley,
Fulton & Kaplan, P.L.
REDLINE METALS: Seeks to Extend Plan Exclusivity to Feb. 28, 2025
-----------------------------------------------------------------
Redline Metals, Inc., asked the U.S. Bankruptcy Court for the
Northern District of Illinois to extend its exclusivity periods to
file a plan of reorganization and obtain acceptance thereof to
February 28, 2025.
The Debtor claims that it is likely proceeding with a sale of all
of its assets to a third party. The Chief Restructuring Officer,
Andrew Cameron ("CRO") has been in process of vetting a stalking
horse bidder and anticipates a sale motion will be filed by the
beginning of January.
The Debtor wishes to preserve exclusivity in the event that a sale
is not possible. Additionally, the Debtor is concerned with a Plan
of Reorganization being filed by a third party which would disrupt
the sale process.
This is the Debtor's first request for an extension of exclusivity
and to extend the date to file a Chapter 11 Plan and Disclosure
Statement.
The Debtor explains that the extension of time will not prejudice
any creditors or the United States Trustee.
Redline Metals, Inc., is represented by:
Paul M. Bach, Esq.
Bach Law Offices, Inc.
P.O. Box 1285
Northbrook, IL 60062
Telephone: (847) 564-0808
Email: paul@bachoffices.com
About Redline Metals
Redline Metals, Inc. is a recycling center in Lombard, Ill.
Redline Metals filed Chapter 11 petition (Bankr. N.D. Ill. Case No.
24-12590) on Aug. 27, 2024, with $10 million to $50 million in both
assets and liabilities.
Judge Jacqueline P. Cox oversees the case.
Paul M. Bach, Esq., at Bach Law Offices, is the Debtor's bankruptcy
counsel.
RICHARDSON CREED: Seeks Bankruptcy Protection in Oregon
-------------------------------------------------------
On December 18, 2024, Richardson Creek LLC filed Chapter 11
protection in the District of Oregon. According to court filing,
the Debtor reports $421,250 in debt owed to 1 and 49 creditors.
The petition states funds will be available to unsecured
creditors.
About Richardson Creek LLC
Richardson Creek LLC is the fee simple owner of a real property
located at 16000 SE Keller Road, Damascus, OR valued at $1.1
million.
Richardson Creek LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Or. Case No. 24-33417) on December 18,
2024. In the petition filed by Connie K. Harrell, as agent/member,
the Debtor reports total assets of $1,104,618 and total liabilities
of $421,250.
Honorable Bankruptcy Judge Teresa H. Pearson handles the case.
The Debtor is represented by:
Theodore J. Piteo, Esq.
MICHAEL D. O'BRIEN & ASSOCIATES, P.C.
12909 SW 68th Parkway, Suite 160
Portland, OR 97223
Tel: 503-786-3800
Fax: 503-272-7796
E-mail: enc@pdxlegal.com
RLK GROUP: Unsecureds to Get Share of Income for 36 Months
----------------------------------------------------------
RLK Group, Inc., filed with the U.S. Bankruptcy Court for the
Southern District of Texas a Plan of Reorganization under
Subchapter V dated December 11, 2024.
The Debtor is a Texas Corporation. The Debtor operates Azul Ultra
Lounge a Restaurant, Bar, and Nightclub located at 400 W Nolana
Ave, McAllen, TX 78501.
The business started on or about October of 2019 under the name of
The Rockwell Tap House. It was subsequently remodeled and rebranded
to its current name. RLK Group is owned by Stacey Robinson, John
Patterson, Ronald Kemnitz, David Lisauckis and the Estate of George
Miller.
RLK Group owns furniture, office equipment, and kitchen equipment.
The Debtor values its assets to be retained at approximately
$11,500. The Debtor has debts of approximately $575,893.20, for
secured, unsecured, and priority claims plus administrative fees
and expenses. The unsecured debts include a loan of $340,000 owed
to John Patterson, one of the owners of the Debtor.
This Plan of Reorganization proposes to pay Debtor's creditors from
the cash flow generated in the ordinary course of the Debtor's
business after confirmation.
Class 8 consists of the non-priority general unsecured claims. The
Debtor believes the aggregate amount of Class 8 claims that should
be allowed are approximately $542,040. This class includes the
creditors that have filed unsecured claims or are listed in the
schedules as unsecured creditors whose claims are not disputed, not
contingent and are liquidated.
The Debtor will pay the projected disposable income for thirty-six
months following the Effective Date to creditors in this class with
allowed claims. Debtor may pay such amounts quarterly starting with
the first full calendar quarter after the Effective Date. Payments
will be approximately as set forth in the projections. This Class
is impaired.
Class 9 consists of the equity security holders of the Debtor. The
equity holders will retain the interests in the Debtor.
The Debtor will retain the property of the bankruptcy estate. The
Debtor will make plan payments with proceeds resulting from its
business operations.
A full-text copy of the Plan of Reorganization dated December 11,
2024 is available at https://urlcurt.com/u?l=RuFzv9 from
PacerMonitor.com at no charge.
Counsel to the Debtor:
Reese W. Baker, Esq.
Baker & Associates
950 Echo Lane Ste. 300
Houston, TX 77024
Telephone: (713) 869-9200
Facsimile: (713) 869-9100
Email: courtdocs@bakerassociates.net
About RLK Group, LLC
RLK Group, LLC, operates Azul Ultra Lounge a Restaurant, Bar, and
Nightclub located at 400 W Nolana Ave, McAllen, TX 78501.
The Debtor sought protection for relief under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Tex. Case No. 24-70217) on Sept. 12,
2024, listing up to $50,000 in assets and $500,001 to $1 million in
liabilities.
Judge Eduardo V Rodriguez presides over the case.
Baker & Associates, led by Reese W Baker, is serving as the
Debtor's counsel.
ROSE AIRCRAFT: Files Chapter 11 Bankruptcy in Arkansas
------------------------------------------------------
On December 15, 2024, Rose Aircraft Services Inc. filed Chapter 11
protection in the Western District of Arkansas. According to court
filing, the Debtor reports $1,130,516 in debt owed to 1 and 49
creditors. The petition states funds will be available to unsecured
creditors.
About Rose Aircraft Services Inc.
Rose Aircraft Services Inc., doing business as Rose Aircraft
Finishes, Rose Aircraft Interiors, Rose Aircraft Upholstery, and
Rose Aircraft Maintenance.
Rose Aircraft Services Inc. sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. W.D. Ark. Case No. 24-72085) on
December 15, 2024. In the petition filed by Brenda Rose Sloan, as
secretary and Brenda Rose Sloan as secretary and treasurer, the
Debtor reports total assets of $1,560,469 and total liabilities of
$1,130,516.
Honorable Bankruptcy Judge Bianca M. Rucker handles the case.
The Debtor is represented by:
Stanley V. Bond, Esq.
BOND LAW OFFICE
525 S. School Ave.
Suite 100
Fayetteville, AR 72701
Tel: 479-444-0255
Fax: 479-235-2827
E-mail: attybond@me.com
RYVYL INC: All Four Proposals Approved at Annual Meeting
--------------------------------------------------------
RYVYL Inc. disclosed in a Form 8-K filed with the Securities and
Exchange Commission that on Dec. 19, 2024, the Company held its
2024 annual meeting of stockholders, at which the stockholders:
(i) elected Ben Errez, Fredi Nisan, Genevieve Baer, David
Montoya and Ezra Laniado to serve as the directors of the Company
for a term expiring at the 2025 annual meeting of stockholders or
until their successors are elected and qualified;
(ii) ratified the appointment of Simon & Edward, LLP as the
Company's independent registered public accounting firm for the
fiscal year ending Dec. 31, 2024;
(iii) approved the issuance of common stock in excess of 20% of
the number of shares of the Company's common stock outstanding, as
required pursuant to Nasdaq Listing Rule 5635(d); and
(iv) approved the amendments to the 2023 equity incentive plan to
increase the number of shares of common stock reserved for issuance
with respect to awards granted under the 2023 EIP from 1,098,262
shares of common stock to 5,098,262 shares of common stock, and to
increase the number of shares that can be issued upon exercise of
Incentive Stock Options under the 2023 EIP from 1,098,262 shares of
common stock to 5,098,262 shares of common stock.
About RYVYL, Inc.
San Diego, Calif.-based RYVYL Inc., together with its subsidiaries,
is a financial technology company that develops, markets, and sells
innovative blockchain-based payment solutions, which offer
significant improvements for the payment solutions marketplace. The
Company's core focus is to develop and monetize disruptive
blockchain-based applications, integrated within an end-to-end
suite of financial products, capable of supporting a multitude of
industries.
Rowland Heights, Calif.-based Simon & Edward, LLP, the Company's
auditor since 2022, issued a "going concern" qualification in its
report dated March 26, 2024, citing that there has been a notable
decrease in processing volume during the first quarter of 2024
subsequently, primarily due to the transition of the QuickCard
product in North America. This transition has resulted in a
significant decline in processing volume and revenue, consequently
affecting the Company's short-term cash flow for operating
activities. The cash flow shortage has jeopardized its ability to
continue as a going concern.
RYVYL INC: Incurs $5.17 Million Net Loss in Third Quarter
---------------------------------------------------------
Ryvyl Inc. filed with the Securities and Exchange Commission its
Quarterly Report on Form 10-Q disclosing a net loss of $5.17
million on $12.61 million of revenue for the three months ended
Sept. 30, 2024, compared to a net loss of $3.12 million on $17.48
million of revenue for the three months ended Sept. 30, 2023.
For the nine months ended Sept. 30, 2024, the Company reported a
net loss of $19.97 million on $41.28 million of revenue compared to
a net loss of $23.10 million on $43.62 million of revenue for the
nine months ended Sept. 30, 2023.
As of Sept. 30, 2024, the Company had $127.31 million in total
assets, $120.99 million in total liabilities, and $6.32 million in
total stockholders' equity.
Ryvyl said, "The decline in revenues has adversely impacted the
Company's liquidity in the short term, within the North America
segment. As a result, management has determined that the Company's
cash and cash equivalents as of September 30, 2024 are not
sufficient to fund the North America segment's operations and
capital needs for the next 12 months from the issuance of this
Report. As a result, substantial doubt exists about the Company's
ability to continue as a going concern. The Company's ability to
continue as a going concern is contingent upon the successful
execution of management's intended plan over the next twelve months
to improve the liquidity of its North America segment, which
includes, without limitation:
* continued execution of its accelerated business development
efforts to drive volumes in diversified business verticals with the
Company's other products, including the recently launched licensing
of the Company's payments processing platform in certain niche
high-risk business verticals;
* continued implementation of cost control measures to more
effectively manage spending in the North America segment and right
sizing the organization, where appropriate;
* the sale of certain noncore assets; and
* repatriation of offshore profits from the Company's European
subsidiaries, whose continued accelerated growth and generation of
positive cash flow have already provided, and will continue to
provide an immediate and viable short-term source of capital during
this product transition. As of the date of the issuance of this
Report, the Company has repatriated approximately $12.8 million
from Europe."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1419275/000118518524001121/ryvyl20240930_10q.htm
About RYVYL, Inc.
San Diego, Calif.-based RYVYL Inc., together with its subsidiaries,
is a financial technology company that develops, markets, and sells
innovative blockchain-based payment solutions, which offer
significant improvements for the payment solutions marketplace. The
Company's core focus is to develop and monetize disruptive
blockchain-based applications, integrated within an end-to-end
suite of financial products, capable of supporting a multitude of
industries.
Rowland Heights, Calif.-based Simon & Edward, LLP, the Company's
auditor since 2022, issued a "going concern" qualification in its
report dated March 26, 2024, citing that there has been a notable
decrease in processing volume during the first quarter of 2024
subsequently, primarily due to the transition of the QuickCard
product in North America. This transition has resulted in a
significant decline in processing volume and revenue, consequently
affecting the Company's short-term cash flow for operating
activities. The cash flow shortage has jeopardized its ability to
continue as a going concern.
SBG BURGER: Affiliate to Sell Business Store to Pattman LLC
-----------------------------------------------------------
Starboard with Cheese, LLC, and each of the other Debtors seek
approval from the U.S. Bankruptcy Court for Middle District of
Florida, Orlando Division, to sell certain assets free and clear of
all liens, liabilities, claims, encumbrances and other interests.
Following the Debtor's engagement of SC&H Group as investment
broker, several prior sale efforts, an analysis of its ongoing
business operations, conferring with its secured creditors, and
other major constituencies in these cases, and in consideration of
the compromises, the Debtor has decided it is in the best interests
of its estate to sell its remaining assets connected to its lone
remaining operating store location in Quincy, Illinois.
The Debtor wants to sell its assets to Pattman LLC.
In connection with the sale, each of the Debtor, Wendy'S
International, Inc., and Quality is Our Recipe, Inc., MidCap
Franchise Funding Trust, PNX Solutions, LLC, and Andrew Levy have
agreed to certain concessions in favor of certain parties to reach
accord and close the sale to the Buyer.
The Debtor'S agreement to sell the Assets to Buyer, whom Wendy'S
has approved as an acceptable assignee of the Debtor'S franchise
agreement with Wendy'S:
-- Wendy'S agreement to a waiver of all of its cure claims
related solely to the Quincy store in exchange for mutual releases
with, and solely with, the Debtor, which releases will be effective
upon closing of the Sale;
-- MidCap'S agreement to a $490,000 bankruptcy professional
carveout from the sale proceeds as set forth herein;
-- PNX, MidCap, and Levy'S tri- party agreement whereby they
will each release each other and PNX will receive a reduced (50%)
payout on its post-petition loan secured by a priming lien.
The Debtors hire Michael Fixler and SC&H Group as Investment
Banker.
The Buyer is not an insider or affiliate of the Debtor, though the
Buyer is affiliated with Bridgeman Foods II, Inc., a prior
interested party in the Assets brought to the Debtor through
Wendy'S.
The Buyer has timely submitted a $100,000 deposit, as required by
the agreement.
The Debtor and those parties are reaching a final resolution of any
such disputes, effectuating a transfer of the Assets that is
acceptable to the secured lender, and involves the compromise and
release of various parties' certain rights, including the Debtor'S,
MidCap'S, Wendy'S, and PNX'S.
MidCap, the secured lender, has consented to the sale free and
clear of its lien, with its lien to attach to the net sale
proceeds, subject to the compromises.
The Debtor has already assumed the real property lease at the
Quincy location and paid any applicable cure payment at that time.
Further, Wendy'S consents to the assignment of the Debtor'S
franchise agreement to Buyer.
About SBG Burger
SBG Burger Opco, LLC and affiliates operate 73 Wendy's, 6
McAlister's Deli, 15 Subway, 5 Fuzzy's Taco Shop and 22 CiCi's
Pizza restaurants across Alabama, Florida, Illinois, Missouri,
Louisiana, Wisconsin and Texas. The Debtors sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. M.D. Fla. Lead Case
No. 23-04797) on November 14, 2023.
The Debtors are Starboard Group of Space Coast, LLC; Starboard
Group of Southeast Florida, LLC; Starboard Group of Tampa, LLC;
Starboard Group of Tampa II, LLC; Starboard Group of Alabama, LLC;
7 S & M Foods, LLC; 9 S & M Foods, LLC; 10 S & M Foods, LLC;
Starboard with Cheese, LLC; and SBG Burger Opco, LLC.
In the petition signed by Andrew Levy, manager, lead Debtor SBG
Burger Opco, LLC disclosed up to $50,000 in both assets and
liabilities. SBG Alabama listed $1 billion to $10 billion in
estimated assets and $1 billion to $10 billion in estimated
liabilities. SBG Spacecoast listed $10 million to $50 million in
estimated assets and $1 million to $10 million in estimated
liabilities. SBG Cheese listed $1 million to $10 million in
estimated assets and $1 million to $10 million in estimated
liabilities. SBG Tampa listed $1 million to $10 million in
estimated assets and $1 million to $10 million in estimated
liabilities. SBG SE Florida listed $1 million to $10 million in
estimated assets and $1 million to $10 million in estimated
liabilities.
Judge Tiffany P. Geyer oversees the cases.
Scott A. Underwood, Esq., at Underwood Murray, PA, is the Debtors'
legal counsel.
On January 23, 2024, the U.S. Trustee for Region 21 appointed an
official committee of unsecured creditors in these Chapter 11
cases. The committee tapped Bast Amron, LLP as its legal counsel.
SICHEM INC: Files Chapter 11 Bankruptcy Protection in Texas
-----------------------------------------------------------
On December 17, 2024, Sichem, Inc. filed Chapter 11 protection in
the Northern District of Texas. According to court filing, the
Debtor reports between $1 million and $10 million in debt owed to 1
and 49 creditors. The petition states funds will not be available
to unsecured creditors.
About Sichem Inc.
Sichem Inc. provides anti-bacterial coatings, anti-virus coatings
and anti-fungi coatings and help prevent the spread of harmful
microorganisms.
Sichem Inc. sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Tex. Case No. 24-44555) on December
17, 2024. In the petition filed by Ademola Oyerokun, as president,
the Debtor reports estimated assets between $100,000 and $500,000
and estimated liabilities between $1 million and $10 million.
Honorable Bankruptcy Judge Ademola Oyerokun handles the case.
The Debtor is represented by:
Robert T DeMarco, Esq.
DEMARCO MITCHELL, PLLC
500 N. Central Expressway Suite 500
Plano, TX 75074
Tel: (972) 991-5591
Email: robert@demarcomitchell.com
SILVERGATE CAPITAL: Milbank & Potter Update List of Stockholders
----------------------------------------------------------------
The law firms of Milbank LLP and Potter, Anderson & Corroon LLP
filed a supplemental statement pursuant to Rule 2019 of the Federal
Rules of Bankruptcy Procedure to disclose that in the Chapter 11
cases of Silvergate Capital Corp. and affiliates, the firms
represent the Ad Hoc Preferred Stockholder Group.
The Ad Hoc Group is comprised of certain holders of Series A 5.375%
Fixed Rate Non-Cumulative Perpetual Preferred Stock, (the
"Preferred Stock") of Silvergate Capital Corporation (together with
its direct and indirect subsidiaries, the "Debtors") issued
pursuant to articles supplementary (the "Preferred Stockholders
Agreement"), dated August 4, 2021.
Counsel represents the Ad Hoc Preferred Stockholder Group and does
not represent or purport to represent any entities other than the
Ad Hoc Preferred Stockholder Group in connection with the Debtors'
cases. In addition, neither the Ad Hoc Preferred Stockholder Group
nor any member of the Ad Hoc Preferred Stockholder Group represents
or purports to represent any other entities in connection with
these cases.
On October 11, 2024, Counsel filed the Verified Statement Pursuant
to Bankruptcy Rule 2019. Since then, the members of the Ad Hoc
Preferred Stockholder Group, and the disclosable economic interests
in relation to the Debtors that such members hold or manage, have
changed. Accordingly, pursuant to Bankruptcy Rule 2019, Counsel
submits this Supplement.
The Ad Hoc Group members' address and the nature and amount of
disclosable economic interests held in relation to the Debtors
are:
1. Aristeia Capital LLC
One Greenwich Plaza
Suite 300
* 2,797,689
2. Bluefin Capital Management LLC
41 Madison Avenue
36th Floor
New York, NY 10010
* 50,800
3. Jefferies Leveraged Credit Products, LLC
520 Madison Avenue
New York, NY 10022
* 403,230
4. Murchinson Ltd.
145 Adelaide Street
West 4th Floor
Toronto, Canada M5H 4E5
* 775,000 7. Scoggin Management L.P.
660 Madison Avenue
New York, NY 10065
* 975,000
5. Scoggin Management L.P.
660 Madison Avenue
New York, NY 10065
* 602,896
Counsel to the Ad Hoc Preferred Stockholder Group:
POTTER, ANDERSON & CORROON LLP
L. Katherine Good, Esq.
Christopher M. Samis, Esq.
Gregory J. Flasser, Esq.
1313 N. Market St., 6th Floor
Wilmington, DE 19801-6108
Telephone: (302) 984.6049
Email: kgood@potteranderson.com
csamis@potteranderson.com
gflasser@potteranderson.com
-and-
MILBANK LLP
Dennis F. Dunne, Esq.
Lauren C. Doyle, Esq.
55 Hudson Yards
New York, NY 10001-2163
Telephone: (212) 530-5000
Facsimile: (212) 530-5219
Email: ddunne@milbank.com
ldoyle@milbank.com
Andrew M. Leblanc, Esq.
John Estep, Esq.
1850 K Street, NW
Suite 1100
Washington, D.C. 20006
Telephone: (202) 835-7500
Facsimile: (202) 263-7586
Email: aleblanc@milbank.com
jestep@milbank.com
About Silvergate Capital
Silvergate Capital operates as a bank holding company. The Company,
through its subsidiary Silvergate Bank provides a banking platform
for innovators, especially in the digital currency industry, and
developing product and service solutions addressing the needs of
entrepreneurs. Silvergate Capital serves customers in the United
States.
On Sept. 17, 2024, Silvergate Capital and two affiliates sought
Chapter 11 protection (Bankr. D. Del. Case No. 24-12158) on Sept.
17, 2024. In its petition, Silvergate Capital estimated assets
between $100 million and $500 million and estimated liabilities
between $10 million and $50 million.
The Debtors tapped CRAVATH, SWAINE & MOORE LLP as counsel;
RICHARDS, LAYTON & FINGER, P.A., as local bankruptcy counsel; and
ALIXPARTNERS, LLP, as financial advisor. STRETTO, INC. is the
claims agent.
SMARTFOODS INC: Wilson Sues Over Mislabeled Popcorn Products
------------------------------------------------------------
RAJEEYAH WILSON; STALIN JAVIER EUSEBIO; and NANCY L. PATNUDE,
individually and on behalf of all others similarly situated,
Plaintiffs v. SMARTFOODS, INC.; and PEPSICO, INC., Defendants, Case
No. 1:24-cv-12814 (N.D. Ill., Dec. 13, 2024) seeks to challenge
Defendants' false and deceptive practices in the marketing and sale
of two of its "Smartfood" popcorn products: (1) Smartfoods White
Cheddar Popcorn, and (2) Smartfoods Movie Theater Butter Popcorn
(collectively, the "Products").
The Plaintiffs allege in the complaint that the use of the phrases
"No Artificial Flavors" and "No Artificial Preservatives" on the
front label of the Products, leads reasonable consumers to believe
that the Products contain no ingredients which are artificial
flavors or preservatives. However, these practices are false and
misleading because the Products contain maltodextrin, a highly
processed and synthetic ingredient, which is both a preservative
and a flavoring agent.
The Plaintiffs and Class members purchased the Products and paid a
premium price based on Defendants' advertising of the Products as
made with "No Artificial Flavors" and "No Artificial
Preservatives," which is seen as a premium as consumers seek to
avoid artificial flavors and preservatives in their foods. Had
Plaintiffs and Class members been aware of the truth about the
Products, they would not have purchased them, or would have paid
significantly less for them, alleges the suit.
Smartfoods, Inc. produces ready to eat popcorn food products in the
U.S. [BN]
The Plaintiff is represented by:
Robert Abiri, Esq.
CUSTODIO & DUBEY, LLP
445 S. Figueroa Street, Suite 2520
Los Angeles, CA 90071
Telephone: (213) 593-9095
Facsimile: (213) 785-2899
Email: abiri@cd-lawyers.com
SOVEREIGN CAPITAL: Seeks Chapter 11 Bankruptcy Protection
---------------------------------------------------------
On December 20, 2024, Sovereign Capital Holdings LLC filed Chapter
11 protection in the District of New Jersey. According to court
filing, 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.
About Sovereign Capital Holdings LLC
Sovereign Capital Holdings LLC owns and operates a healthcare
business.
Sovereign Capital Holdings LLC sought relief under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. D.N.J. Case No. 24-22500) on
December 20, 2024. In the petition filed by John H. Hajjar, MD, as
CEO., the Debtor reports estimated assets up to $50,000 and
estimated liabilities between $10 million and $50 million.
Honorable Bankruptcy Judge Stacey L. Meisel handles the case.
The Debtor is represented by:
Anthony Sodono, III, Esq.
MCMANIMON, SCOTLAND & BAUMANN, LLC
75 Livingston Avenue
Suite 201
Roseland, NJ 07068
Tel: 973-622-1800
E-mail: asodono@msbnj.com
STEPHENS GARAGE: Sec. 341(a) Meeting of Creditors on January 21
---------------------------------------------------------------
On December 18, 2024, Stephens Garage Building LLC filed Chapter 11
protection in the Eastern District of Louisiana. According to
court filing, 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 Sec. 341(a) to be held on 1/21/2025 at
01:00 PM by Telephone Conference Line: 866-790-6904. Participant
Passcode: 3156784.
About Stephens Garage Building LLC
Stephens Garage Building LLC sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D. La. Case No. 24-12467) on
December 18, 2024. In the petition filed by Marcel Wisznia, as
manager and managing member, the Debtor reports estimated assets
and liabilities between $10 million and $50 million each.
Honorable Bankruptcy Judge Meredith S. Grabill handles the case.
The Debtor is represented by:
Stewart F. Peck, Esq.
LUGENBUHL, WHEATON, PECK, RANKIN & HUBBARD
601 Poydras Street, Suite 2775
New Orleans, LA 70130
Tel: (504) 568-1990
STEWARD HEALTH: Cain & Skarnulis Revises Rule 2019 Statement
------------------------------------------------------------
The law firm of Cain & Skarnulis PLLC (C&S) filed an amended
verified statement pursuant to Rule 2019 of the Federal Rules of
Bankruptcy Procedure to disclose that in the Chapter 11 cases of
Steward Health Care System LLC and affiliates, the firm represents
Denise Grogg, individually and as Administrator of the Estate of
Terence E. Grogg.
Grogg is a personal injury claimant with claims pending against
Debtors Steward Easton Hospital, Inc., Steward Medical Group, Inc.,
Steward Health Care System LLC, Steward Health Care Network, Inc.,
Steward Emergency Physicians of Pennsylvania, Inc., and Steward
Emergency Physicians, Inc., in Grogg, et al. v. Easton Hospital, et
al., No. C-48-CV-2022-03084, in the Court of Common Pleas of
Northampton County, Pennsylvania.
Denise Grogg's address and the nature and amount of disclosable
economic interests held in relation to the Debtors are:
1. Denise Grogg, Administrator of the Estate of Terence Grogg
c/o Kline & Specter, P.C.
1525 Locust Street
Philadelphia, PA 19102
* Claims for medical professional negligence, negligence,
vicarious liability, battery causing
personal injury
2. Denise Grogg, Individually
c/o Kline & Specter, P.C.
1525 Locust Street,
Philadelphia, PA 19102
* Claims for medical professional negligence, negligence,
vicarious liability, negligent
infliction of emotional distress, battery, loss of consortium
causing personal injury
Attorney for Denise Grogg:
Ryan E. Chapple
CAIN & SKARNULIS PLLC
303 Colorado Street, Suite 2850
Austin, Texas 78701
Phone: 512-477-5000
Facsimile: 512-477-5011
Email: rchapple@cstrial.com
About Steward Health Care
Steward Health Care System LLC owns and operates the largest
private physician-owned for-profit healthcare network in the U.S.
Headquartered in Dallas, Texas, Steward's operations include 31
hospitals in eight states, approximately 400 facility locations,
4,500 primary and specialty care physicians, 3,600 staffed beds,
and nearly 30,000 employees. Steward Health Care provides care to
more than two million patients annually.
Steward and 166 affiliated debtors filed chapter 11 petitions
(Bankr. S.D. Texas Lead Case No. 24-90213) on May 6, 2024, in the
U.S. Bankruptcy Court for the Southern District of Texas, and the
Honorable Christopher M. Lopez oversees the proceeding.
Weil, Gotshal & Manges LLP is serving as the Company's legal
counsel. AlixPartners, LLP is providing financial advisory services
to the Company, and John Castellano of AlixPartners is serving as
the Company's Chief Restructuring Officer. Lazard Freres & Co. LLC,
Leerink Partners LLC, and Cain Brothers, a division of KeyBanc
Capital Markets Inc. are providing investment banking services to
the Company. McDermott Will & Emery is special corporate and
regulatory counsel for the company. Kroll is the claims agent.
STOLI GROUP: Hires Hilco Valuation Services as Appraisal Agent
--------------------------------------------------------------
Stoli Group (USA), LLC and Kentucky Owl, LLC seek approval from the
U.S. Bankruptcy Court for the Northern District of Texas to employ
the Hilco Valuation Services, LLC as appraisal agent.
Hilco's services include:
(a) analyze and assess the Debtors' financial documents and
inventory reports;
(b) complete walkthroughs of the Debtors' existing inventory;
(c) review and analyze management reports and systems; and
(d) complete on-site visits and inspections of their
inventory.
The firm will be compensated at a flat fee of $70,000 plus
out-of-pocket expenses incurred.
Eric Kaup, an executive vice president at Hilco Valuation Services,
disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached through:
Eric Kaup
Hilco Valuation Services LLC
5 Revere Dr., Ste. 300
Northbrook, IL 60062
About Stoli Group (USA) LLC
Stoli Group (USA) LLC is a producer, manager, and distributor of a
global portfolio of spirits and wines.
Stoli Group (USA) LLC and its Kentucky Owl American sought relief
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Tex. Case
No. 24-80146) on November 27, 2024. In the petition filed by Chris
Caldwell, president and global chief executive officer, the Debtor
reports estimated assets between $100 million and $500 million and
estimated liabilities between $10 million and $50 million.
Judge Scott W. Everett handles the case.
Foley & Lardner LLP represents the Debtor as legal counsel.
STOLI GROUP: LA Dodgers Earns Seat on Creditors' Committee
----------------------------------------------------------
Jonathan Randles of Bloomberg News reports that the Los Angeles
Dodgers have secured a position on the creditors' committee
established in the bankruptcy case of Stoli Group (USA) LLC, the
owner of the Stoli vodka brand.
The Major League Baseball team is one of three entities appointed
by the U.S. Justice Department's bankruptcy watchdog to serve on
the committee for the Chapter 11 proceedings. Other members include
the advertising agency Fold 7 Ltd. and the National Alcohol
Beverage Control Association, according to a court filing on
Monday, December 24, 2024.
Stoli Group owed the Dodgers $539,583 at the time it filed for
bankruptcy protection in November.
About Stoli Group (USA) LLC
Stoli Group (USA) LLC is a producer, manager, and distributor of a
global portfolio of spirits and wines.
Stoli Group (USA) LLC and its Kentucky Owl American sought relief
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Tex. Case
No. 24-80146) on November 27, 2024. In the petition filed by Chris
Caldwell, as president and global chief executive officer, the
Debtor reports estimated assets between $100 million and $500
million and estimated liabilities between $10 million and $50
million.
Honorable Bankruptcy Judge Scott W. Everett handles the case.
FOLEY & LARDNER LLP represents the Debtor as legal counsel.
SURGEM LLC: Files Bare-Bones Bankruptcy Petition in New Jersey
--------------------------------------------------------------
On December 20, 2024, Surgem LLC filed Chapter 11 protection in
the District of New Jersey. According to court filing, 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.
About Surgem LLC
Surgem LLC is a limited liability company.
Surgem LLC sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. D.N.J. Case No. 24-22501) on December 20, 2024. In
the petition filed by John H. Hajjar, MD, as CEO., the Debtor
reports estimated assets up to $50,000 and estimated liabilities
between $10 million and $50 million.
Honorable Bankruptcy Judge John K. Sherwood handles the case.
The Debtor is represented by:
Anthony Sodono, III, Esq.
MCMANIMON, SCOTLAND & BAUMANN, LLC
75 Livingston Avenue, Suite 201
Roseland, NJ 07068
Tel: 973-622-1800
Email: asodono@msbnj.com
TIMELESS AESTHETICS: Gets Final OK to Use Cash Collateral
---------------------------------------------------------
Timeless Aesthetics, LLC received final approval from the U.S.
Bankruptcy Court for the Northern District of Texas, Dallas
Division to use cash collateral to pay the company's operating
expenses.
The final order authorized the company to use cash collateral for
operating expenses set forth in its budget and any other
unforeseeable expenses, which are necessary to maintain its
operations.
Timeless may exceed individual expenses by up to 110% as long as
the total cash collateral spent during the month does not exceed
10% of the total budget.
The budget shows total operating expenses of $31,640 for December,
$33,338 for January, $32,438 for February, $32,438 for March and
$32,438 for April.
As adequate protection, secured creditor Wallis Bank was granted
replacement liens on the company's post-petition property and cash
collateral, excluding Chapter 5 causes of action or their
proceeds.
Wallis Bank was also granted superpriority administrative expense
claims in the amount of its "adequate protection claim" under
Sections 503 and 507 of the Bankruptcy Code.
About Timeless Aesthetics LLC
Timeless Aesthetics, LLC filed Chapter 11 bankruptcy petition
(Bankr. N.D. Texas. Case No. 24-33709) on Nov. 15, 2024, with
$100,001 to $500,000 in assets and $500,001 to $1 million in
liabilities.
Judge Scott W. Everett oversees the case.
The Lane Law Firm, PLLC is the Debtor's bankruptcy counsel.
UPLIFT RX: Former Counsel Loses Bid to Dismiss Civil RICO Claims
----------------------------------------------------------------
Judge Marvin Isgur of the United States Bankruptcy Court for the
Southern District of Texas denied Baker & Hostetler, LLP's motion
to dismiss the civil RICO claims in the case captioned as YVETTE
AUSTIN, et al., Plaintiffs, VS. BAKER & HOSTETLER, LLP, Defendant,
ADVERSARY NO. 22-3275 (Bankr. S.D. Tex.).
Yvette Austin, trustee of the Alliance Health Liquidating Trust,
filed this adversary proceeding against the Debtors' former chapter
11 attorneys in this chapter 11 case. The complaint brings a wide
variety of claims ranging from legal malpractice to fraud and
federal RICO
offenses.
Baker & Hostetler, LLP is an Ohio-formed national law firm which
represented and provided advice for various debtor and non-debtor
Alliance entities. The Baker Hostetler attorneys involved in
Alliance's fraudulent scheme were based in Washington D.C.
Alliance operated a nationwide network of over 100 entities and
pharmacies that specialized in providing prescription medication to
patients suffering from chronic health conditions, such as
diabetes. The Debtors in the chapter 11 case include over 60
Alliance-affiliated entities. Austin asserts that Baker Hostetler's
representation covered the entire Alliance network because its
billing entries do not distinguish between Alliance entities.
The law firm filed a motion to dismiss the complaint for failure to
state a claim.
Alliance's fraud involved purchasing low-cost "not for retail sale"
strips from a secondary market and distributing them as retail
strips.
Austin alleges that Baker Hostetler was aware of Alliance's
fraudulent practices. She also alleges that the firm assisted
Alliance's efforts in furthering and actively concealing the
fraudulent scheme.
The Complaint further alleges that Baker Hostetler lied to pharmacy
benefit managers and stonewalled any inquiries about Alliance's
business practices.
The Complaint brings claims on behalf of the Estate for legal
malpractice/professional negligence (Count I), aiding and
abetting/knowing participation in breach of fiduciary duty (Count
II), avoidance and recovery of fraudulent transfers (Count III),
and disgorgement of post-petition fees/turnover (Count IV). Baker
asserts that Counts I–II are contribution claims, artfully pled
as direct actions. Austin contends that the causes of actions are
not contribution claims because they seek damages independent of
Manufacturers' settlements.
The assigned claims include reformation of tolling agreement (Count
X), aiding and abetting/ knowing participation in negligent
misrepresentation (Count V), fraud-based claims (Counts V–VII),
and federal RICO offenses (Counts VIII–IX). Baker Hostetler
raises various affirmative defenses against the claims.
Austin asserts Estate claims and the Manufacturers' assigned claims
against Baker Hostetler. The claims are brought under District of
Columbia, Delaware, and Utah law. According to the Court, a choice
of law determination is not appropriate at this stage. The Court
must instead analyze whether the Complaint plausibly pleads enough
facts to survive a motion to dismiss.
It is undisputed that a Baker Hostetler partner, Lee Rosebush,
served on Alliance's board of directors. The Court does not
disagree that the attorney immunity doctrine extends to attorneys
that "routinely practice and advise clients in nonlitigation
matters." As the Complaint alleges, Baker Hostetler has
"significant national reputation" in compliance and regulatory
matters in the healthcare industry. The allegations in the
Complaint and billing records undisputedly show that certain Baker
Hostetler actions pertained to legal matters that "involve the
unique office, training, skills, and authority of an attorney." But
the allegations, if proven true, show that Baker Hostetler, through
Rosebush, assisted Alliance on extra-legal matters like business
decisions that do not involve the traditional skills of an
attorney. Most importantly, Baker Hostetler's motion to dismiss
wants the Court to disregard the fact that Rosebush served on
Alliance's board of directors during the scheme. Baker Hostetler
billed Alliance at Rosebush's hourly rate for his work on the
board. His role as a board member obscures whether all, or just
some, of Baker Hostetler conduct deserves protection of the
attorney immunity doctrine.
These allegations and Baker Hostetler's failure to define its scope
of representation create a factual issue on whether all, or some,
of Baker Hostetler's conduct fall within the attorney immunity
doctrine. The Court will not dismiss the assigned claims on this
basis.
RICo Claims
The Court finds taken as a whole and accepting the allegations in
the Complaint as true, the firm is a plausible RICO person under
Sec. 1962(c).
The Complaint also brings a claim for conspiracy to violate federal
RICO.
According to the Court, RICO conspiracy claims may be sufficient
when the attorney-client "arrangement involves more than standard
legal representation."
Baker Hostetler argues that the conspiracy claim must fail as a
matter of law because an attorney-client relationship is akin to a
principal-agent relationship, which cannot be a conspiracy of two
or more defendants. However, RICO conspiracy claims may be
sufficient when the attorney-client "arrangement involves more than
standard legal representation." Rosebush's alleged conduct, if
proven at trial, involved far more than typical legal
representation. The motion to dismiss the RICO conspiracy claim is
denied.
This is Austin's second attempt to plead plausible claims after the
Court determined that there were several deficiencies with the
original complaint. Even so, the amended complaint fails to cure
the deficiencies. The parties are represented by sophisticated
counsel. The Court will not give Austin another opportunity to
replead. The motion to dismiss the civil RICO claims is denied. All
other claims for relief are dismissed with prejudice.
A copy of the Court's decision dated December 11, 2024, is
https://urlcurt.com/u?l=oVrU37
About Uplift RX
Uplift Rx, LLC, owned and operated a network of pharmacies across
the United States that specialized in providing prescriptions to
patients with chronic health conditions, including diabetes. Uplift
Rx, along with other affiliated entities together make up the
Alliance Healthcare family, a group of privately held companies
headquartered in South Jordan, Utah. The Alliance network consists
of 20 pharmacies across the country, including three pharmacies in
Texas. Since 2006, the Alliance Healthcare companies have been
working to improve the well-being of those with chronic health
conditions such as diabetes.
Uplift Rx, LLC and certain of its affiliates sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Lead Case
No. 17-32186) on April 7 and 8, 2017. In the petitions signed by
CEO Jeffrey C. Smith, the Debtors estimated assets of less than $1
million and liabilities of $50 million to $100 million. The cases
were assigned to Judge Marvin Isgur. The Debtors tapped Baker &
Hostetler LLP as legal counsel.
On May 3, 2017, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. The committee tapped
Fox Rothschild LLP as its legal counsel.
In May 2017, Ronald L. Glass was appointed as the Debtors' Chapter
11 trustee. The trustee hired BakerHostetler LLP as his legal
counsel, and GlassRatner Advisory & Capital Group LLC as his
financial advisor.
The U.S. Trustee for Region 7 on May 3, 2019, appointed five
creditors to serve on an official committee of unsecured creditors
in the Chapter 11 cases of Uplift Rx, LLC, and its affiliates.
Foley & Lardner LLP, replacing Fox Rothschild LLP, served as
counsel to the committee. FTI Consulting, Inc., served as its
financial advisor and forensic accountant.
US NUCLEAR: Michael Pope Reinstated to Board After Miscommunication
-------------------------------------------------------------------
US Nuclear Corp. disclosed in a Form 8-K Report filed with the U.S.
Securities and Exchange Commission that on effective October 6,
2023, Michael Pope was appointed as a director of the Company.
On December 9, 2024, the Board voted to revoke Mr. Pope's board
membership due to a temporary inability to communicate.
Due to miscommunication by the Company, Mr. Pope's position on the
Board has been reinstated, effective December 17, 2024.
About US Nuclear
US Nuclear Corp. is engaged in developing, manufacturing, and
selling radiation detection and measuring equipment. The Company
markets and sells its products to consumers throughout the world.
As of December 31, 2023, the Company had $2,856,876 in total
assets, $4,839,495 in total liabilities, and $1,982,619 in total
stockholders' deficit.
Spokane, Washington-based Fruci & Associates II, PLLC, the
Company's auditor since 2019, issued a "going concern"
qualification in its report dated May 7, 2024, citing that the
Company has an accumulated deficit and net losses. These factors,
among others, raise substantial doubt about the Company's ability
to continue as a going concern.
VERITAS HOLDINGS: S&P Upgrades ICR to 'CCC', On Watch Positive
--------------------------------------------------------------
S&P Global Ratings raised our issuer credit rating on Veritas
Holdings Ltd. and its debt issuing subsidiaries (Veritas NL
Intermediate Holdings B.V.) to 'CCC' from 'SD' (selective default)
and placed it on CreditWatch with positive implications.
S&P said, "At the same time, we withdrew all our issue-level and
recovery ratings on the old debt because it is no longer
outstanding.
"The CreditWatch placement indicates we may raise the rating, which
may be limited to one notch. Over the coming weeks, we expect to
meet with the new management team to review the company's
go-forward business strategy, earnings and cash flow profile,
financial policy, and longer-term capital structure plans among
others.
"We raised our rating on Veritas following the completion of the
debt exchange that addressed the 2025 maturity under the old
capital structure. Additionally, we believe there is minimal
downside risk to the rating given there is no imminent risk of
another exchange. The transaction also helped reduce debt to
EBITDA. We estimate pro forma debt to EBITDA will be about 4.6x
through the term loan B and 9.3x through the pay-in-kind (PIK)
margin loans. While the PIK margin loans do not have direct credit
support from Veritas or Cohesity, we include it in our calculation
of debt because of a potential limited recourse guarantee by
Veritas in the event the special purpose entity loan borrowers file
for bankruptcy.
"We may raise the 'CCC' issuer rating once we review the new
company's credit profile with management. Veritas has reduced cash
interest bearing debt, but we view its free cash flow profile as
unclear. We expect the company will likely incur meaningful
stand-up and restructuring expenses following the spin-off of the
data protection business. This may pressure earnings and free cash
flow for a period, but it has prospects to turn positive
thereafter. We expect the company will have access to a $140
million revolver and cash on hand to manage liquidity needs in the
near term. The company will have somewhat of a shorter dated
capital structure with the nearest maturity in three years.
"The sale of the data protection business significantly reduces the
company's business scale. This may reduce its ability to withstand
demand cyclicality or unexpected underperformance. Revenue of the
remaining assets represents about 30% of the pre-spin company's
revenue base in fiscal 2024. Additionally, we believe Infoscale,
Data Compliance, and Backup Exec had growth challenges historically
and lower client retention rates than the corporate average. We
believe the company may need to increase investments because most
of the recent developments were focused on the core enterprise data
protection businesses. We view Veritas's reduced business scale and
diversity, and its short track history operating as a stand-alone
entity as increasing its business risk.
"The CreditWatch placement indicates we may raise the rating, which
may be limited to one notch. We expect to meet with the new
management team to review Veritas' go-forward business strategy,
earnings and cash flow profile, financial policy, and longer-term
capital structure plans among others. We expect to reassess our
go-forward issuer credit rating on Veritas as soon as practical."
VIO FRANCHISE: Web Site Not Accessible to Blind, Gaspa Says
-----------------------------------------------------------
VERONICA GASPA, individually and on behalf of all others similarly
situated, Plaintiff v. VIO FRANCHISE GROUP, LLC, Defendant, Case
No. 3:24-cv-11120 (D.N.J., Dec. 13, 2024) alleges violation of the
Americans with Disabilities Act.
The Plaintiff alleges in the complaint that the Defendant's Web
site, https://viomedspa.com, is not fully or equally accessible to
blind and visually-impaired consumers, including the Plaintiff, in
violation of the ADA.
The Plaintiff seeks a permanent injunction to cause a change in the
Defendant's corporate policies, practices, and procedures so that
the Defendant's Web site will become and remain accessible to blind
and visually-impaired consumers.
Vio Franchise Group, LLC specializes in aesthetic medicine and
wellness. The Company provides elevated and innovative aesthetic
services for both men and women that empower, enhance natural
beauty, and inspire confidence. [BN]
The Plaintiff is represented by:
Uri Horowitz, Esq.
14441 70th Road
Flushing, NY 11367
Telephone: (718) 705-8706
Facsimile: (718) 705-8705
VISION PAINTING: Seeks Cash Collateral Access
---------------------------------------------
Vision Painting & Decorating Services, Inc. asked the U.S.
Bankruptcy Court for the Northern District of Illinois, Eastern
Division, for authority to use cash collateral.
The company requires use of its post-petition receipts to pay rent,
employees, supplies, materials, union and related contribution
payments, insurance, and other necessary expenses associated with
and necessary for the operation of its business.
The Illinois Department of Employment Security, the Internal
Revenue Service and the Illinois Department of Revenue assert an
interest in the company's cash collateral.
As adequate protection for the interests of the IDES, IRS and other
lien claimants in the collateral, the company proposed that:
(a) The IDES, IRS and any other lien claimants will be granted
valid and perfected replacement liens in and to post-petition cash
collateral and all post-petition property of the company of the
same type or kind substantially equivalent to the pre-petition
collateral (excepting avoidance actions of the estate) to the same
extent and with the same priority as held pre-bankruptcy;
(b) The IRS will receive monthly adequate protection payments in
the amount of $900;
(c) The IDES will receive monthly adequate protection payments in
the amount of $450; and,
(d) Insurance will be maintained on the collateral.
A hearing on the matter is set for Jan. 29, 2025.
About Vision Painting & Decorating Services
Vision Painting & Decorating Services Inc. is a specialty
contractor that serves the Calumet Park, Illionois area and
specializes in specialty ceilings, plaster and gypsum board,
acoustic treatment, flooring, painting and coatings, wall finishes
and tile.
Vision Painting & Decorating Services sought relief under
Subchapter V of Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D.
Ill. Case No. 24-17620) on November 22, 2024, with estimated assets
up to $50,000 and estimated liabilities between $1 million and $10
million. Edward T. McKinnie, Jr., president of Vision Painting &
Decorating Services, signed the petition.
Judge Janet S. Baer handles the case.
The Debtor is represented by Gregory K. Stern, Esq. at Gregory K.
Stern, P.C.
VISION PAINTING: Seeks Court Approval to Hire Bankruptcy Counsel
----------------------------------------------------------------
Vision Painting & Decorating Services, Inc. seeks approval from the
U.S. Bankruptcy Court for the Northern District of Illinois to
employ Gregory K. Stern, Esq., Dennis E. Quaid, Esq., Monica C.
O'Brien, Esq., and Rachel S. Sandler, Esq., attorneys practicing in
Chicago, Illinois, as its counsel.
The firm will provide these services:
(a) review assets, liabilities, loan documentation, account
statements, executory contracts and other relevant documentation;
(b) prepare list of creditors, list of twenty largest
unsecured creditors, schedules and statement of financial affairs;
(c) advise the Debtor with respect to its powers and duties;
(d) assist the Debtor in the preparation of schedules,
statement of affairs and other necessary documents;
(e) prepare applications to employ attorneys, accountants or
other professional persons, motions for turnover, motion for use of
cash collateral, motions for use, sale or lease of property, motion
to assume or reject executory contracts, plan, applications,
motions, complaints, answers, orders, reports, objections to
claims, legal documents and any other necessary pleading in
furtherance of reorganizational goals;
(f) negotiate with creditors and other parties in interest,
attend court hearings, meet creditors and other parties in
interest;
(g) review proofs of claim and solicitation of creditors'
acceptances of plan; and
(h) perform all other legal services for the Debtor which may
be necessary or in furtherance of its reorganizational goals.
The attorneys will be paid at these hourly rates:
Gregory Stern $650
Dennis Quaid $550
Monica O'Brien $550
Rachel Sandler $450
In addition, the attorneys will seek reimbursement for expenses
incurred.
The attorneys disclosed in court filings that they are
"disinterested persons" as the term is defined in Section 101(14)
of the Bankruptcy Code.
The attorneys can be reached at:
Gregory K. Stern, Esq.
Dennis E. Quaid, Esq.
Monica C. O'Brien, Esq.
Rachel S. Sandler, Esq.
53 West Jackson Boulevard, Suite 1442
Chicago, IL 60604
Telephone: (312) 427-1558
Facsimile: (312) 427-1289
About Vision Painting & Decorating Services
Vision Painting & Decorating Services Inc. is a specialty
contractor that serves the Calumet Park, Illionois area and
specializes in specialty ceilings, plaster and gypsum board,
acoustic treatment, flooring, painting and coatings, wall finishes
and tile.
Vision Painting & Decorating Services sought relief under
Subchapter V of Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D.
Ill. Case No. 24-17620) on November 22, 2024, with estimated assets
up to $50,000 and estimated liabilities between $1 million and $10
million. Edward T. McKinnie, Jr., president, signed the petition.
Judge Janet S. Baer handles the case.
Gregory K. Stern, Esq., Dennis E. Quaid, Esq., Monica C. O'Brien,
Esq., and Rachel S. Sandler, Esq., serve as the Debtor's counsel.
WEBSTERNT LLC: Commences Subchapter V Bankruptcy Proceeding
-----------------------------------------------------------
On December 19, 2024, WebsterNT LLC filed Chapter 11 protection in
the Western District of New York. According to court filing, the
Debtor reports $3,690,218 in debt owed to 1 and 49 creditors. The
petition states funds will be available to unsecured creditors.
A meeting of creditors under Sec. 341(a) to be held on January 21,
2025 at 2:00 PM by Telephonic Meeting. Call-In Number:
866-527-0448, Passcode: 9516322#.
About WebsterNT LLC
WebsterNT LLC is the fee simple owner of a two-story mixed use
building containing approximate area of 26,841 square feet, located
at 54 Webster Street, North Tonawanda, New York having an appraised
value of $3 million.
WebsterNT LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D.N.Y. Case No. 24-11436) on December 19,
2024. In the petition filed by Ralph Dailey, as member, the Debtor
reports total assets of $3,013,220 and total liabilities of
$3,690,218.
The Debtor is represented by:
Scott J. Bogucki, Esq.
GLEICHENHAUS, MARCHESE & WEISHAAR, P.C.
930 Convention Tower
43 Court Street
Buffalo, NY 14202
Tel: (716) 845-6446
Fax: (716) 845-6475
WELLFUL INC: Moody's Lowers CFR to Caa2 & Alters Outlook to Stable
------------------------------------------------------------------
Moody's Ratings downgraded the ratings of Wellful Inc. including
the Corporate Family Rating to Caa2 from Caa1, the Probability of
Default Rating to Caa2-PD/LD from Caa1-PD, and the existing first
lien senior secured facility ratings (revolver and term loans) to
Caa3 from B3 following the announcement that the company completed
a discounted debt exchange concurrent with the acquisition of
Ancient Nutrition. Concurrently, Moody's assigned a B2 rating to
the new $50 million senior secured first lien revolver expiring in
April 2029, a B2 rating to the new $230.8 million first lien
tranche A term loan due April 2030, and a Caa3 rating to the new
$405 million tranche B second lien term loan due October 2030. The
ratings on the existing first lien senior secured revolver and term
loan facilities will be withdrawn since those instruments were
exchanged or retired in connection with the transaction closing.
Moody's will remove the (/LD) designation from the company's PDR in
approximately three business days. The rating outlook is stable and
was previously negative.
The rating actions follow Wellful's announcement that it agreed
with a majority of its lender group to exchange existing first lien
term loan instruments into a new first-out tranche A term loan and
a tranche B second lien term loan at a discounted price of 83.5%.
The previous second lien term loan lenders agreed to exchange their
existing debt into a new unrated tranche C third lien term loan at
a discounted price of 71%. The company has the option to
pay-in-kind interest on the new third lien term loan until March
2026, following which the interest will be paid in cash, subject to
a fixed charge covenant ratio covenant. Other debts were exchanged
as part of the transaction as well. First lien term loan holders
who elected not to participate in the exchange offer were able to
cash out at a discounted price of 49.4%. A portion of the revolving
credit facility was converted into the new tranche B second lien
term loan and the remaining balance was repaid at par, while the
company extended the revolver maturity to April 2029 from April
2026. Moody's appended a /LD to the PDR to reflect Moody's view
that Moody's consider the discounted debt exchanges as a distressed
exchange because debt holders are receiving new instruments at less
than par.
The debt exchanges were completed concurrent with Wellful's
acquisition of Ancient Nutrition, an operator within the Vitamin
Minerals and Supplements (VMS) division focused primarily on
collagen/protein related products. The combination of these
companies is expected to diversify Wellful's product portfolio and
retail presence. Wellful's private equity sponsor, Kainos Capital,
is investing significant new equity and the lender group is
injecting roughly $128 million via the new priming first lien term
loan to help fund the Ancient Nutrition acquisition, the small debt
repurchase, the revolver paydown and transaction fees and expenses.
In addition, the lender group agreed to a number of concessions,
including interest rate reduction, principal discount, maturity
extension and collateral/priority re-allocation, as well as
contributing new money to help fund the acquisition.
The net 18% debt reduction and addition of earnings through the
Ancient Nutrition acquisition will favorably reduce debt-to-EBITDA
leverage to 8.5x pro forma from an estimated 10x as of the end of
2024 and will result in annual interest expense savings. In
addition, the extended term loan maturity profile to 2030 from 2027
provides Wellful with some additional room to improve its operating
performance and expand its VMS segment.
However, Moody's downgraded the CFR to Caa2 because Wellful's
operating performance is being pressured by ongoing weakness within
the Nutrisystem segment, the VMS industry is highly competitive,
the company's leverage remains high despite the debt reduction, and
restoring sustainable positive free cash flow will require good
execution of growth and synergy initiatives. Moody's also consider
the financial strategies to be aggressive with a second distressed
exchange in roughly a year and believe there is forecast
uncertainty given the potential for rapid erosion in Nutrisystem
earnings with a planned pullback in marketing investment and
competition in the VMS industry. Recent operating underperformance
is largely attributed to weak and declining trends in the
Nutrisystem weight management segment, which accounted for
approximately 65% of revenue and 42% of EBITDA in 2023, and
continues to face significant headwinds. In recent years, the
company faced challenges in attracting and retaining customers, as
well as securing repeat orders, primarily due to the high costs
associated with purchases, along with macroeconomic and
inflationary pressures impacting consumer spending. Moody's
anticipate Nutrisystem earnings could decline at an accelerated
pace over the next two years as marketing investment is reduced.
The VMS market is highly fragmented, with a number of larger,
better capitalized competitors with well-known branded products
that could pose a challenge to Wellful's growth and market share
initiatives. There is execution risk to successfully integrating
Ancient Nutrition and realizing synergies and anticipated cost
savings.
Governance considerations were a key driver of this rating action.
The company's financial policies have contributed to operating with
very high leverage and earnings have lagged budgeted results due to
challenges turning around Nutrisystem. These factors contributed to
multiple distressed exchanges.
RATINGS RATIONALE
Wellful's Caa2 CFR reflects the company's small scale, elevated
debt-to-EBITDA leverage of 9.4x and negative free cash flow of $11
million for the 12 month period ended September 30, 2024. Similar
to its peers, Wellful's consumer base is burdened by high
inflationary costs and the rise of new weight loss medications is
intensifying competition in the weight management space. Wellful's
December 2024 acquisition of Ancient Nutrition, discounted debt
exchange and equity contribution reduced leverage and improved
liquidity. The acquisition also furthers the company's pivot toward
a focus on the VMS segment, and Moody's project that debt-to-EBITDA
leverage, on a Moody's adjusted basis, will decline below 8x by
2025 driven by higher margin contribution from the VMS division and
reduced costs associated with the weight management division. The
adjusted EBITDA margin will improve to the mid-teens percentage
driven by cost reduction initiatives, including streamlining
operations. Moody's also forecast for free cash flow to return to
positive in 2025, in the $10 to $14 million range due to the lower
interest costs and the benefit of pay-in-kind interest on the third
lien term loan until March 2026.
While the VMS segment has been a positive contributor to Wellful's
operating performance and has helped mitigate challenges in the
weight management segment, the company faces considerable execution
risk in integrating Ancient Nutrition into its portfolio. Consumers
in the VMS market often have strong attachments to certain brands
and products, influenced by perceived health benefits and personal
outcomes. Successfully navigating these established loyalties and
preferences to position Ancient Nutrition and the rest of the VMS
portfolio to grow will be crucial and serve as a key indicator of
Wellful's success. Furthermore, the rapid pace at which the VMS
market evolves, driven by emerging health trends and shifting
consumer demands, underscores the need for continuous innovation.
Wellful's investment to align its VMS products with current market
and consumer preferences and adapt to future changes consumes cash
and will require good execution to ensure that its offerings remain
relevant and competitive.
Liquidity is adequate, reflecting Wellful's $20 million cash
balance pro forma for the transactions, expectations of modestly
positive free cash flow over the next 12 months and $17.5 million
of availability under the new $50 million revolving credit
facility. Moody's believe these cash sources provide adequate
coverage for the required annual term loan amortization of
approximately $4 million and operational needs. There are no
financial maintenance covenants for the term loans. The new
revolver is subject to a springing first lien net leverage covenant
(6.05x in the fourth quarter and 5.8x in any other quarter) that is
triggered when the revolver draw exceeds 35% of the committed
amount or about $17.5 million. Moody's expect the covenant to
spring in 2025. The company should remain in compliance if the
covenant is triggered due in part to a highly adjusted EBITDA
calculation. The new maturity profile includes the revolver
expiring in April 2029, tranche A term loan maturing in April 2030,
tranche B term loan maturing in October 2030, and tranche C term
loan maturing in November 2030.
Wellful partially hedges its interest rate risk by utilizing an
interest rate swap. Moody's forecast interest expense to decline
due to the lower rates within the new capital structure in the next
12-18 months and anticipate that EBITDA-to-interest coverage will
be sustained below 1.5x.
The B2 ratings on the new revolver and tranche A first lien term
loan due in April 2029 and April 2030, respectively, are three
notches above the Caa2 CFR given the instruments' senior most
ranking in the capital structure, and first loss support provided
by the tranche B second lien term loan and the tranche C third lien
term loan, as well as unsecured claims. The tranche A term loan is
secured on a first lien basis by substantially all assets. The Caa3
rating on the new tranche B second lien term loan is one notch
below the CFR and reflects the ranking within the new capital
structure. The rating reflects the subordination of the lien and
significant amount of secured debt ahead of it in the debt
structure. The tranche B term loan is secured on a second lien
basis by the same collateral as the priming term loan. Neither term
loan is subject to financial maintenance covenants.
Marketing terms for the new credit facilities (final terms may
differ materially) include the following:
There is no pari passu incremental capacity. The credit agreement
prohibits the designation of unrestricted subsidiaries, preventing
collateral "leakage" to such subsidiaries. No credit party may make
any transfer of material property to any non-credit party;
non-credit parties cannot own or hold exclusive licenses to any
material property.
The credit agreement is expected to provide some limitations on
up-tiering transactions against subordination of debt and liens
unless all New 1L Lenders may ratably participate in such priming
debt and the majority of all New 1L Lenders and 100% of all
revolving lenders consents. Amendments authorizing the incurrence
of additional debt for the purpose of influencing voting thresholds
require 100% of the revolving lenders and 85% of all lenders
consent.
All intercompany loans or guarantees owed to non-credit parties
must be subordinated.
The company cannot incur debt, grant liens, make investments or
dispositions in connection with certain liability management
exercises.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable outlook reflects that Wellful's adequate liquidity
including a revolver that is currently partially drawn but is
anticipated to be undrawn over the next 12 months, reduced interest
burden, and longer maturity profile provide the company some
flexibility to execute its growth and cost saving initiatives.
The ratings could be upgraded if Wellful is able to sustainably
improve profitability and fully offset anticipated earnings
declines of the weight management segment. Sustained positive free
cash flow, reduced reliance on the revolver, and lower leverage
would also be necessary for an upgrade.
The ratings could be downgraded if Wellful is unable to
successfully execute its revenue and earnings growth initiatives,
free cash flow remains negative, or liquidity deteriorates, or if
recovery values weakens.
The principal methodology used in these ratings was Consumer
Packaged Goods published in June 2022.
Wellful Inc. (based in Fort Washington, Pennsylvania) is a provider
of weight management products and services through the Nutrisystem
brand, as well as vitamins, minerals and supplements (VMS)
products. Through the merger with Direct Digital, LLC dba "Adaptive
Health", New Vitality, and most recently the December 2024 purchase
Ancient Nutrition, the company's VMS segment markets and
manufactures branded condition-specific science-based nutrition
supplements that address conditions such as men's health, joint
health, sleep management, collagen, protein, greens and gut health
products. Kainos Capital acquired Nutrisystem in December 2020 and
began building the VMS segment through the acquisition of Direct
Digital, LLC's Adaptive Health business in April 2021. Revenue pro
forma for the Ancient Nutrition acquisition is anticipated to be
approximately $725 million in 2025.
WESTCHESTER COUNTY HEALTH CARE: S&P Cuts Rev. Bond Rating to 'BB+'
------------------------------------------------------------------
S&P Global Ratings lowered its long-term and rating underlying
rating (SPUR) to 'BB+' from 'BBB-' on health care revenue bonds
issued for Westchester County Health Care Corp. (WCHCC), N.Y., and
on Bon Secours Charity Health System's taxable series 2015 health
care revenue bonds. WCHCC guarantees Bon Secours Charity Health
System's bonds. The outlook is negative.
"The rating action reflects our view of WCHCC's extremely thin
unrestricted reserves and lower-than-expected operating results for
fiscal 2024," said S&P Global Ratings credit analyst Anne
Cosgrove.
The negative outlook reflects S&P's expectation of operating
pressure over the outlook period as well as its view as extremely
thin unrestricted reserves that provide little if any cushion for
unforeseen events.
WOM SA: Benesch Friedlander Represents Ad Hoc Group of Noteholders
------------------------------------------------------------------
In the Chapter 11 cases of WOM S.A.., et al., the Benesch Ad Hoc
Group of Noteholders filed a verified statement pursuant to Rule
2019 of the Federal Rules of Bankruptcy Procedure.
The Benesch Ad Hoc Group of Noteholders is comprised of holders of
(or investment managers to holders of) (i) 6.875% senior unsecured
notes due 2024 (the "2024 Notes") issued by Kenbourne Invest S.A.
and (ii) 4.7% senior unsecured notes due 2028 (the "2028 Notes" and
together with the 2024 Notes, the "Unsecured Notes") issued by
Kenbourne (the "Benesch Ad Hoc Group of Noteholders").
Benesch does not represent the interests of any creditor, party in
interest or other entity in connection with the Debtors' chapter 11
cases other than the Benesch Ad Hoc Group of Noteholders. No member
of the Benesch Ad Hoc Group of Noteholders represents or purports
to represent any other member in connection with the Chapter 11
Cases.
In addition, no member of the Benesch Ad Hoc Group of Noteholders
(i) assumes any fiduciary or other duties to any other member of
the Benesch Ad Hoc Group of Noteholders and (b) does not purport to
act or speak on behalf of any other member of the Benesch Ad Hoc
Group of Noteholders in connection with the Chapter 11 Cases.
The names, addresses, and disclosable economic interests of all the
members of Benesch Ad Hoc Group of Noteholders, are as follows:
1. Certain funds managed or advised by: ACR Alpine Capital Research
LLC, in its capacity as
investment manager
190 Carondelet Plaza, Suite 1300,
St Louis, MO 63105
Attn: Mark Unferth & Credit Legal
* 2024 Notes: $5,724,000
* 2028 Notes: $2,000,000
2. Certain funds managed or advised by: Livello Capital Management
LP, in its capacity as
investment manager
104 West 40th Street, 19th Floor
New York, NY 10018
Attn: Joseph Salegna
* 2024 Notes: $300,000
* 2028 Notes: $7,050,000
3. Certain funds managed or advised by: Mirabella Financial
Services LLP, in its capacity as
investment manager
50 Pall Mall, Floor 1
London, SW1Y 5JH United Kingdom
Attn: William Moreno & Beshar Jabbar
* 2024 Notes: $18,659,000
* 2028 Notes: $0
Counsel for the Benesch Ad Hoc Group of Noteholders:
BENESCH, FRIEDLANDER, COPLAN & ARONOFF LLP
Michael J. Barrie, Esq.
Steven L. Walsh, Esq.
1313 N. Market Street, Suite 1201
Wilmington, Delaware 19801
Telephone: (302) 442-7010
Email: mbarrie@beneschlaw.com
swalsh@beneschlaw.com
-and-
Sven T. Nylen, Esq.
71 S. Wacker Drive, Suite 1600
Chicago, Illinois 60606
Telephone: (312) 212-4949
Email: snylen@beneschlaw.com
About WOM SA
WOM is a Chilean telecommunications provider, focused on offering
mobile voice, data, and broadband services, along with a rapidly
expanding "Fiber to the Home" broadband offering, to consumers and
businesses in Chile. Since the acquisition of Nextel Chile in 2015
through Novator Partners LLP's investment vehicle NC Telecom AS,
WOM has expanded from having virtually no market share to
establishing itself as the second-largest mobile network operator
in Chile.
WOM sought relief under Chapter 11 of the Bankruptcy Code (Bankr.
D. Del. Lead Case No. 24-10628) on April 1, 2024. In the petition
filed by Timothy O'Connoer, as independent director, the Debtor
estimated assets and liabilities between $1 billion and $10 billion
each.
The Honorable Bankruptcy Judge Karen B. Owens oversees the case.
The Debtors tapped White & Case, LLP as general bankruptcy counsel;
Richards, Layton & Finger, P.A. as local bankruptcy counsel;
Riveron Consulting, LLC, as financial advisor; and Rothschild & Co
US Inc. as investment banker. Kroll Restructuring Administration,
LLC, is the claims agent.
WOM SA: Gets Court Nod to Exit Chapter 11 Bankruptcy
----------------------------------------------------
Carolina Gonzalez of Bloomberg News reports that Chile's WOM
secured court approval to exit bankruptcy after agreeing to a
takeover and restructuring proposal from a creditor group, eight
months after filing for Chapter 11.
A U.S. bankruptcy judge rejected an objection to the bid from a
competing creditor group, according to a company statement. The
court ruled the offer as the only viable path for WOM to emerge
from Chapter 11 proceedings, according to Bloomberg News.
"This decision represents a significant milestone in the Chapter 11
process and highlights the efforts of our team to achieve the
financial restructuring of the company," said Martín Vaca Narvaja,
CEO of WOM.
About WOM SA
WOM is a Chilean telecommunications provider, focused on offering
mobile voice, data, and broadband services, along with a rapidly
expanding "Fiber to the Home" broadband offering, to consumers and
businesses in Chile. Since the acquisition of Nextel Chile in 2015
through Novator Partners LLP's investment vehicle NC Telecom AS,
WOM has expanded from having virtually no market share to
establishing itself as the second-largest mobile network operator
in Chile.
WOM sought relief under Chapter 11 of the Bankruptcy Code (Bankr.
D. Del. Lead Case No. 24-10628) on April 1, 2024. In the petition
filed by Timothy O'Connoer, as independent director, the Debtor
estimated assets and liabilities between $1 billion and $10 billion
each.
The Honorable Bankruptcy Judge Karen B. Owens oversees the case.
The Debtors tapped White & Case, LLP as general bankruptcy counsel;
Richards, Layton & Finger, P.A. as local bankruptcy counsel;
Riveron Consulting, LLC, as financial advisor; and Rothschild & Co
US Inc. as investment banker. Kroll Restructuring Administration,
LLC, is the claims agent.
YELLOW CORP: Contests Government's $2-Bil. Pollution Cleanup Claim
------------------------------------------------------------------
Alex Wolf of Bloomberg Law reports that Yellow Corp. has urged a
bankruptcy court to dismiss over $2 billion in cleanup claims filed
by the U.S. government for a polluted New York City creek,
asserting there is no evidence tying the company to the
contamination.
In a filing with the U.S. Bankruptcy Court in Delaware, Yellow
argued that claims by the Environmental Protection Agency (EPA) and
other federal agencies to hold it accountable for cleaning up
Newtown Creek -- a tributary of the East River between Brooklyn and
Queens -- should be denied or significantly reduced.
About Yellow Corporation
Yellow Corporation -- http://www.myyellow.com/-- operates
logistics and less-than-truckload (LTL) networks in North America,
providing customers with regional, national, and international
shipping services throughout. Yellow's principal office is in
Nashville, Tenn., and is the holding company for a portfolio of LTL
brands including Holland, New Penn, Reddaway, and YRC Freight, as
well as the logistics company Yellow Logistics.
Yellow Corporation and 23 affiliates concurrently filed voluntary
petitions for relief under Chapter 11 of the Bankruptcy Code
(Bankr. D. Del. Lead Case No. 23-11069) on August 6, 2023, before
the Hon. Craig T. Goldblatt. As of March 31, 2023, Yellow
Corporation had $2,152,200,000 in total assets against
$2,588,800,000 in total liabilities. The petitions were signed by
Matthew A. Doheny as chief restructuring officer.
The Debtors tapped Kirkland & Ellis, LLP as restructuring counsel;
Pachulski Stang Ziehl & Jones, LLP as Delaware local counsel;
Kasowitz, Benson and Torres, LLP as special litigation counsel;
Goodmans, LLP as special Canadian counsel; Ducera Partners, LLC, as
investment banker; and Alvarez and Marsal as financial advisor.
Epiq Bankruptcy Solutions is the claims and noticing agent.
Milbank LLP serves as counsel to certain investment funds and
accounts managed by affiliates of Apollo Capital Management, L.P.
while White & Case, LLP and Arnold & Porter Kaye Scholer, LLP serve
as counsels to Beal Bank USA and the U.S. Department of the
Treasury, respectively.
On Aug. 16, 2023, the U.S. Trustee for Region 3 appointed an
official committee of unsecured creditors in the Chapter 11 cases.
The committee tapped Akin Gump Strauss Hauer & Feld, LLP and
Benesch, Friedlander, Coplan & Aronoff, LLP as counsels; Miller
Buckfire as investment banker; and Huron Consulting Services, LLC,
as financial advisor.
ZAYO GROUP: Lenders Ink Cooperation Deal After Talks Falter
-----------------------------------------------------------
Reshmi Basu of Bloomberg News reports that First-lien lenders of
Zayo Group Holdings Inc., a fiber-network company, have signed a
cooperation agreement to act collectively after the company was
unable to finalize a deal to extend its debt maturities, according
to sources who requested anonymity due to the confidential nature
of the matter.
Recent private negotiations between Zayo and some of its first-lien
lenders over amending and extending term loans ended without an
agreement, as previously reported by Bloomberg. These discussions
took place as the company works on issuing an asset-backed deal to
manage its significant debt load.
About Zayo Group
Zayo Group is a privately held company headquartered in Boulder,
Colorado, with European headquarters in London, England. The
company provides communications infrastructure services.
The Troubled Company Reporter reported on May 21, 2024, that S&P
Global Ratings affirmed all its ratings on U.S.-based fiber
infrastructure provider Zayo Group Holdings Inc. (Zayo), including
the 'B-' issuer-credit rating.
ZUMIEZ INC: Web Site Not Accessible to Blind, Dalton Says
---------------------------------------------------------
JULIE DALTON, individually and on behalf of all others similarly
situated, Plaintiff v. ZUMIEZ INC., Defendant, Case No.
0:24-cv-04479-JMB-DTS (D. Minn., Dec. 13, 2024) alleges violation
of the Americans with Disabilities Act.
The Plaintiff alleges in the complaint that the Defendant's Web
site, www.zumiez.com, is not fully or equally accessible to blind
and visually-impaired consumers, including the Plaintiff, in
violation of the ADA.
The Plaintiff seeks a permanent injunction to cause a change in the
Defendant's corporate policies, practices, and procedures so that
the Defendant's Web site will become and remain accessible to blind
and visually-impaired consumers.
Zumiez Inc. operates as a specialty online retailer. The Company
offers apparel, footwear, accessories, and hardgoods for men and
women. [BN]
The Plaintiff is represented by:
Chad A. Throndset, Esq.
Patrick W. Michenfelder, Esq.
Jason Gustafson, Esq.
THRONDSET MICHENFELDER, LLC
80 South 8th Street, Suite 900
Minneapolis, MN 55402
Telephone: (763) 515-6110
Email: chad@throndsetlaw.com
pat@throndsetlaw.com
jason@throndsetlaw.com
ZURVITA INC: Zinzino Acquire Assets in Ch. 11, Provides $4.5M DIP
-----------------------------------------------------------------
Zinzino has in a press release dated June 17, 2024 and announced
that a letter of intent to acquire 100% of the shares in the North
American direct selling company Zurvita Inc. was signed. Since
then, Zinzino has negotiated with the owners of Zurvita Inc. and
instead concluded that the purchase of Zurvita's assets in a
Chapter 11 proceeding for the Company is in Zinzino's best
interest.
Zinzino is providing a debtor-in-possession (DIP) financing to
Zurvita, which filed for Chapter 11 bankruptcy proceedings on the
20th December 2024. By entering as a financier in Zurvita's Chapter
11 with loans totaling USD 4.5 million, Zinzino simultaneously
makes an offer to acquire the company's assets via a so-called
stalking horse bid. If the bid is accepted, the DIP loan will be
converted into part of a debt-settled purchase price, which will be
determined after Zurvita has completed the sale process that is
subject to higher and better offers in accordance with the
applicable terms of Chapter 11. Other bidders have the right to
submit bids for Zurvita during the process and if another bid is
accepted, Zinzino's loan will be repaid and certain of its costs
associated with the process will be reimbursed.
Zurvita is a direct selling health company with operations in the
United States, Canada and Mexico. The brand portfolio offers a
range of innovative health and wellness products. The business has
total annual sales of approximately USD 30 million with good gross
margins. A potential transaction with Zinzino is expected to add
growth through the synergies arising from the joint networks,
combined with Zinzino's test-based product concept. The
profitability of the Company will thus be able to develop well by
utilizing Zinzino's existing technical platform and organization.
A visionary mindset, tech first perspective, test-based nutrition
at the cellular level and a strong position to capitalize on
current trends will form the basis of the new partnership.
Following the acquisitions of VMA Life in 2020, Enhanzz in 2022,
the strategic partnership with ACN and the recently completed asset
acquisition of Xelliss, Zinzino has been looking for further strong
investments to maintain its sustainable, profitable growth,
strengthen its distribution power, expand into new markets and
leverage the product portfolio in new consumer areas.
- "Individualized advice and tailored solutions are the future, and
not just in health and wellness," says Dag Bergheim Pettersen, CEO
of Zinzino. "Together, we have years of combined industry
experience and everything it takes to drive the modern,
personalized shopping experience through direct sales". Jay Shafer,
CEO and co-founder of Zurvita, states "After considering multiple
options for the company and under the guidance of our attorneys and
third-party advisors, we feel this presents the best opportunity to
continue Zurvita's mission, deliver the highest quality products,
and provide continuity for our staff and consultants. We are
excited to see what the future holds for Zurvita."
About Zurvita, Inc.
Zurvita, a health and wellness company that provides simple,
plant-based nutrition for real people with real results.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
TCR subscribers have free access to our on-line news archive.
Point your Web browser to http://TCRresources.bankrupt.com/and use
the e-mail address to which your TCR is delivered to login.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Philadelphia, Pa., USA.
Randy Antoni, Jhonas Dampog, Marites Claro, Joy Agravante,
Rousel Elaine Tumanda, Joel Anthony G. Lopez, Psyche A. Castillon,
Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and
Peter A. Chapman, Editors.
Copyright 2024. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $975 for 6 months delivered via
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Peter A.
Chapman at 215-945-7000.
*** End of Transmission ***