/raid1/www/Hosts/bankrupt/TCR_Public/250317.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, March 17, 2025, Vol. 29, No. 75
Headlines
143 COURT ST: Seeks Chapter 11 Bankruptcy in New York
2809 W. 8TH ST: Seeks Chapter 11 Bankruptcy in California
527 EDILIDO: Seeks Chapter 11 Bankruptcy in Florida
74 04 ROOSEVELT: Case Summary & Three Unsecured Creditors
90 NASSAU STREET: Seeks Chapter 11 Bankruptcy in New York
ACCURIDE CORP: Davis Polk Advised ABL Agent in Chapter 11 Case
ACME ASPHALT: Seeks Chapter 11 Bankruptcy in Montana
ADVANTACLEAN OF METRO: Case Summary & 11 Unsecured Creditors
ALC ENGINEERED: Case Summary & Eight Unsecured Creditors
ALL CRAFT: Court OKs Zephyrhills Property Sale to American Nautical
ALVOGEN PHARMA: Moody's Appends 'LD' Designation to 'Caa2-PD' PDR
AMERICAN CANNABIS: Board Won't Accept E. Smith's Resignation Recall
ARCADIUM LITHIUM: KPMG LLP Raises Going Concern Doubt
ARCHDIOCESE OF SAN FRANCISCO: Calls for Abuse Cases Mediation
ARIS WATER: Moody's Upgrades CFR to B1 & Alters Outlook to Stable
ARTISTIC HOLIDAY: U.S. Trustee Appoints Creditors' Committee
ASMC LLC: Court Extends Cash Collateral Access to May 19
AVALARA INC: S&P Assigns 'B-' ICR on Proposed Debt Issuance
B&B OUTDOOR: Case Summary & Seven Unsecured Creditors
BALLISTIC FABRICATION: Gets Final OK to Use Cash Collateral
BENCH ACCOUNTING: Chapter 15 Case Summary
BEVERLY COMMUNITY: To Sell Assigned Rights to RC Pioneer Fund
BIA SEPARATIONS: Chapter 15 Case Summary
BIG LOTS: Administrative Claims Filing Deadline on April 3, 2025
BIOSIG TECHNOLOGIES: Sells 758K Shares of Stock for $818K
BNG GROUP: Seeks Chapter 11 Bankruptcy in Virginia
BRIGHTLINE EAST: S&P Lowers $1.119BB 144A Notes Rating to 'B-'
BYJU'S ALPHA: Official Appeals Lenders' Concealed Funds Decision
CARVANA CO: S&P Upgrades ICR to 'B', Outlook Positive
CC 1400 ALICEANNA: Case Summary & 20 Largest Unsecured Creditors
CHARLES & COLVARD: Delays Q2 Filing, Cites Going Concern Doubt
CLIFFWOOD DEVELOPMENT: Seeks Chapter 11 Bankruptcy in California
COASTAL GROWERS: Court OKs Vehicle Sale to Johnson Ford
COHNREZNICK ADVISORY: S&P Assigns 'B' ICR, Outlook Stable
CORTO II LLC: Seeks Chapter 11 Bankruptcy in California
COWTOWN BUS: To Sell Bus Business to CanTex Real Estate for $1.8MM
CROWN CASTLE: Reaches Definitive Deal to Sell Units to Pay Debt
CTF CHICAGO: Court Extends Cash Collateral Access to March 31
DAATS COMPANIES: Case Summary & Nine Unsecured Creditors
DECO GROUP: Gets Interim OK to Use Cash Collateral Until March 31
DEREK L. MARTIN DMD: Case Summary & 20 Top Unsecured Creditors
DH ENCHANTMENT: Raises Going Concern Doubt Amid $793K Deficit
DRIVEHUB AUTO: Court Extends Cash Collateral Access to May 13
DZS INC: Seeks Chapter 7 Bankruptcy, Stops Operations
EAGLE HIGHLAND: Gets Final OK to Use Cash Collateral
EASTSIDE DISTILLING: CEO Increases Ownership to 98K Shares
EGZIT CORPORATION: Court Extends Cash Collateral Access to April 11
ELEGANT TENTS: Seeks Subchapter V Bankruptcy in Pennsylvania
ELEMENTS UES: Court Extends Cash Collateral Access
ELETSON HOLDINGS: Reed Smith Oppose Removal in $102MM Shipping Suit
ELMWOOD CLO IX: S&P Assigns Prelim. B-(sf) Rating on Cl. F-R Notes
ENDEAVOR GROUP: Deloitte & Touche Raises Going Concern Doubt
EQM MIDSTREAM: Fitch Affirms 'BB+' LongTerm IDR, Outlook Stable
ESSENTIAL MINERALS: Seeks Subchapter V Bankruptcy in Delaware
EYM PIZZA: Seeks to Extend Plan Exclusivity to May 5
FENDER MUSICAL: Moody's Cuts CFR to B3 & Alters Outlook to Negative
FIREPAK INC: Court Extends Cash Collateral Access to April 30
FOREVER 21: Considers Liquidation as Bankruptcy Looms
FRANCO HAULING: Seeks Subchapter V Bankruptcy in Illinois
FREE SPEECH: Sandy Hook Families Contest Renewed Infowars Sale Bid
FTX TRADING: Three Arrows Wins $1.5B Bankruptcy Claim Bid
FUTURE FINTECH: To Appeal Denial of New Trial Bid in FT Global Suit
GUARDIAN ELDER: No Resident Complaints, 3rd PCO Report Says
GUARDIAN HEALTHCARE: PCO Reports No Resident Care Complaints
HALL LABS: Seeks Chapter 11 Bankruptcy in Utah
HEART 2 HEART: Gets Interim OK to Use Cash Collateral
HEAVY METAL: DBRS Gives BB(high) LongTerm Issuer Rating
HOOPERS DISTRIBUTING: Gets Extension to Access Cash Collateral
HUDSON'S BAY: Ragini Bhalla at Creditsafe Explains What Went Wrong
HYPERSCALE DATA: Granted NYSE Listing Extension Until June 18
IMMANUEL SOBRIETY: No Patient Care Concern, 8th PCO Report Says
IMMANUEL SOBRIETY: No Patient Care Concern, 9th PCO Report Says
INFINITE GLOW: Seeks Cash Collateral Access
IROBOT CORP: Issues Going Concern Warning
J&P FLASH: Court OKs Properties Sale to Triple Net Properties
JJ BADA: Gets Extension to Access Cash Collateral
JOE'S SPORTS: Files Emergency Bid to Use Cash Collateral
JORIKI USA INC: Gets Court Okay for $10.3MM Chapter 7 Asset Sale
KARYOPHARM THERAPEUTICS: Ernst & Young Raises Going Concern Doubt
KATE QUINN: Case Summary & 20 Largest Unsecured Creditors
KIPP JACKSONVILLE: S&P Lowers 'BB+' ICR on Weakened Finances
L4L INVESTMENT: FRESB Seeks to Prohibit Cash Collateral Access
LAKEVIEW VILLAGE: Fitch Affirms 'BB+' IDR, Outlook Stable
LAVIE CARE: No Complaints at Pa. Facilities, PCO Report Says
LEFEVER MATTSON: Court Extends Cash Collateral Access to May 7
LIKELIHOOD LLC: Gets OK to Use Cash Collateral Until April 11
LONG RIDGE: S&P Assigns 'B' Rating on Term Loan B and Secured Notes
LONGSHORE MIDCO: S&P Upgrades ICR to 'B' on Improving Performance
LOVING KINDNESS: Plan Filing Exclusivity Widened to June 23, 2025
LUCAS CONSTRUCTION: Seeks Chapter 11 Bankruptcy in New Jersey
M & M BUCKLEY: Court Extends Cash Collateral Access to March 27
MAPRAGENCY INC: Seeks to Use Cash Collateral
MARIN SOFTWARE: Commences 2025 Organizational Restructuring Plan
MARTIN MIDSTREAM: Moody's Alters Outlook on 'B3' CFR to Stable
MCCLAIN FAMILY: Seeks Chapter 11 Bankruptcy in California
MIRAMAR TOWNHOMES: Gets Extension to Access Cash Collateral
MITCHELL ROCK: Seeks Chapter 11 Bankruptcy in Alabama
MJD ENGINEERING: Gets Final OK to Use Cash Collateral
MOORE HOLDINGS: Seeks to Use Cash Collateral Until Sept 30
NAPC DEFENSE: Raises Going Concern Doubt Amid Cash Shortfall
NATGASOLINE LLC: Moody's Affirms B3 CFR & Alters Outlook to Pos.
NEWS DIRECT: Court Extends Cash Collateral Access to April 9
NORTH EASTERN INDUSTRIES: Gets Final OK to Use Cash Collateral
NORTHSTARR BUILDERS: Gets Final OK to Use Cash Collateral
NOVA CHEMICALS: Fitch Puts 'BB-' Long-Term IDR on Watch Positive
ODEBRECHT ENGENHARIA: Chapter 15 Case Summary
ONONTIO LANDSCAPING: Court OKs Final Use of Cash Collateral
ORION SECURITY: Seeks Chapter 11 Bankruptcy in Puerto Rico
PACIFIC DENTAL: Moody's Cuts CFR to B2, Outlook Stable
PALWAUKEE HOSPITALITY: Gets Interim OK to Use Cash Collateral
PARAMOUNT INTERMODAL: Case Summary & 11 Unsecured Creditors
PARTY EMPORIUM: To Dispose Fixtures to Jenkins Fixtures for $1000
PERFORMANCE MOBILE: Case Summary & Seven Unsecured Creditors
PHCV4 HOMES: 31-Vacant Lots Sale to Chips Amberley OK'd
PHCV4 HOMES: Court OKs 26-Vacant Lots Sale to Adams Homes
PHUNWARE INC: Board Names Q. Du as Director, Audit Committee Member
PHUNWARE INC: Board Sets May 6 as Annual Stockholders' Meeting
PHVC4 HOMES: Amends Motion to Change Purchase Amount of 31-Lots
PHVC4 HOMES: To Sell 26-Vacant Lots to Adams Homes for $1.1MM
PICCARD PETS: Court Extends Cash Collateral Access to March 24
PINSTRIPES HOLDINGS: NYSE Delisting Prevents Chapter 11 Filing
POLARIS NEWCO: Moody's Lowers CFR to 'Caa1', Outlook Stable
PREDICTIVE ONCOLOGY: Renovaro Acquires 467K Shares for $500K
PRIME CORE: Pursues $26.6MM Clawback from Crypto Finance Co.
PRIMO WATER: Moody's Cuts Rating on Senior Unsecured Notes to B3
RAYONIER ADVANCED: Incurs $38.7MM Net Loss in 2024
REFRIGERATION TECHNOLOGIES: Gets Extension to Use Cash Collateral
RHODIUM ENCORE: Seeks to Extend Plan Exclusivity to June 23
ROCKET MORTGAGE: Moody's Affirms 'Ba1' CFR, Outlook Remains Stable
ROCKIES EXPRESS: Fitch Affirms 'BB' LongTerm IDR, Outlook Negative
ROCKIES EXPRESS: Moody's Rates New $500MM Sr. Unsecured Notes 'Ba2'
SANTA PAULA HAY: Case Summary & 19 Unsecured Creditors
SBLA INC: Cosmetic Brand Seeks Subchapter 11 Bankruptcy
SEABIRDS KITCHEN: Gets Interim OK to Use Cash Collateral
SEASONAL LANDSCAPE: Gets Extension to Access Cash Collateral
SEMILEDS CORP: Repays $1.6MM of Loans With Shares of Stock
SGZ GROUP: Court Extends Cash Collateral Access to May 27
SHERMAN/GRAYSON: PCO Reports No Change in Patient Care Quality
SHUBREW LLC: Beer and Brewery Brand Seeks Chapter 11 Bankruptcy
SILVER LINING: Case Summary & 20 Largest Unsecured Creditors
SNP ENTERPRISES: Case Summary & Six Unsecured Creditors
SOFT PACKAGING: Gets OK to Use Cash Collateral Until May 31
SOLID BIOSCIENCES: Incurs $124.6MM Net Loss in 2024
SOLO BRANDS: Issues Going Concern Warning, Finds Refinancing
SOPHIA HOSPITALITY: Court Extends Cash Collateral Access to April 5
SOUTHERN CUTTERS: Files Emergency Bid to Use Cash Collateral
SPIRIT AEROSYSTEMS: Ernst & Young Raises Going Concern Doubt
STAR TRANSPORTATION: Seeks to Extend Plan Exclusivity to May 2
STEWARD HEALTH: PCO Files Fifth Supplemental Report
SUNSHINE PEDIATRICS: Seeks Subchapter V Bankruptcy in Arizona
SWC INDUSTRIES: Seeks to Extend Plan Exclusivity to June 30
TALLGRASS ENERGY: Fitch Affirms BB- LongTerm IDR, Outlook Negative
TEXAS WHEEL: Gets Final OK to Use Cash Collateral
UNITED AIRLINES: Fitch Hikes IDR to 'BB', Outlook Positive
UNITI GROUP: Files Amendment No. 1 to 2024 Form 10-K
US 24 TRUCK: Seeks Chapter 11 Bankruptcy in Indiana
VIEWSTAR LLC: To Sell New Jersey Property at Auction
VISION PAINTING: Gets OK to Use Cash Collateral Until March 27
WAYFAIR INC: Fitch Affirms 'B' LongTerm IDR, Outlook Stable
WELCH & WELCH: Case Summary & Seven Unsecured Creditors
WELCOME GROUP: Court Extends Use of Cash Collateral to June 15
WELLPATH HOLDINGS: Gets Court Okay to Solicit Bankruptcy Plan Votes
WIN WASTE: S&P Raises ICR to 'B-' on Extended Maturities
WINDWARD DESIGN: To Sell Furniture Business to Superior Plastic
YJ SIMCO: Seeks Chapter 11 Bankruptcy in New York
Z BRAND: Gets Court OK to Use Cash Collateral
[] 7 Healthcare Companies That File Bankruptcy Protection in 2025
[] Fitch Affirms 'B+' LongTerm IDRs on Arxis Co-Borrowers
[] John Murphy III Joins Paul Hastings' Structured Credit Practice
[] Manhattan Real Properties Up for Sale on March 27
*********
143 COURT ST: Seeks Chapter 11 Bankruptcy in New York
-----------------------------------------------------
On March 4, 2025, 143 Court St. Associates LLC filed Chapter 11
protection in the U.S. Bankruptcy Court for the Eastern District
of New York. According to court filing, the
Debtor reports $3,745,332 in debt owed to 1 and 49 creditors.
The petition states funds will be available to unsecured
creditors.
About 143 Court St. Associates LLC
143 Court St. Associates LLC is a real estate debtor holding a
single asset, as outlined in 11 U.S.C. Section 101(51B). The Debtor
owns the property at 143 Court Street, Brooklyn, NY, in fee simple,
and the property's current value is $4 million.
143 Court St. Associates LLC sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D.N.Y. Case No. 25-41056) on March
4, 2025. In its petition, the Debtor reports total assets of
$4,000,000 and total liabilities of $3,745,332.
Honorable Bankruptcy Judge Nancy Hershey Lord handles the case.
The Debtor is represented by:
Jonathan S. Pasternak, Esq.
DAVIDOFF HUTCHER & CITRON LLP
605 Third Avenue, 34th Floor
New York, NY 10158
Tel: 212-557-7200
Fax: 212-286-1884
2809 W. 8TH ST: Seeks Chapter 11 Bankruptcy in California
---------------------------------------------------------
On March 10, 2025, 2809 W. 8th St. LLC filed Chapter 11 protection
in the U.S. Bankruptcy Court for the Central District of
California. According to court filing, the
Debtor reports $3,040,000 in debt owed to 1 and 49 creditors.
The petition states funds will be available to unsecured
creditors.
About 2809 W. 8th St. LLC
2809 W. 8th St. LLC is a debtor with a single real estate asset, as
outlined in 11 U.S.C. Section 101(51B).
2809 W. 8th St. LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Case No. 25-11886) on March 10,
2025. In its petition, the Debtor reports total assets of
$3,729,300 and total liabilities of $3,040,000.
Honorable Bankruptcy Judge Barry Russell handles the case.
The Debtor is represented by:
Denise Moore, Esq.
THE LAW OFFICES OF DENISE MOORE
4735 W. Washington Blvd.
Los Angeles, CA 90016
Tel: (213) 706-9759
E-mail: atty.d.mo1978@gmail.com
527 EDILIDO: Seeks Chapter 11 Bankruptcy in Florida
---------------------------------------------------
On March 10, 2025, 527 Edilido LLC filed Chapter 11 protection in
the U.S. Bankruptcy Court for the Southern District of Florida.
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 527 Edilido LLC
527 Edilido LLC is a Miami Beach-based real estate holding
company.
527 Edilido LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Fla. Case No. 25-12527) on March 1,
2025. In its petition, the Debtor reports estimated assets and
liabilities between $1 million and $10 million each.
Honorable Bankruptcy Judge Corali Lopez-Castro handles the case.
The Debtor is represented by:
Thomas Zeichman, Esq.
BEIGHLEY MYRICK UDELL LYNNE AND ZEICHMAN
2385 NW Executive Center Drive Suite 300
Boca Raton, FL 33431
Tel: (561) 549-9036
Email: tzeichman@bmulaw.com
74 04 ROOSEVELT: Case Summary & Three Unsecured Creditors
---------------------------------------------------------
Debtor: 74 04 Roosevelt Corp.
74-04 Roosevelt Ave
Woodside, NY 11377
Business Description: 74-04 Roosevelt Corp. is the owner of a two-
level multi-purpose structure located at 74-
04 Roosevelt Ave, Woodside, NY 11377, with
an estimated worth of $1.4 million.
Chapter 11 Petition Date: March 13, 2025
Court: United States Bankruptcy Court
Eastern District of New York
Case No.: 25-41224
Judge: Hon. Jil Mazer-Marino
Debtor's Counsel: Charles Higgs, Esq.
THE LAW OFFICE OF CHARLES A. HIGGS
2 Depot Plaza First Floor, Office 4
Bedford Hills, NY 10507
Tel: (917) 673-3768
E-mail: charles@freshstartesq.com
Total Assets: $1,403,000
Total Liabilities: $2,631,450
The petition was signed by Victorina Dominguez sa president.
A full-text copy of the petition, which includes a list of the
Debtor's three unsecured creditors, is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/7UZZU6Q/74_04_Roosevelt_Corp__nyebke-25-41224__0001.0.pdf?mcid=tGE4TAMA
90 NASSAU STREET: Seeks Chapter 11 Bankruptcy in New York
---------------------------------------------------------
On March 6, 2025, 90 Nassau Street LLC filed Chapter 11 protection
in the U.S. Bankruptcy Court for the Eastern District of New York.
According to court filing, the Debtor reports $18,543,196 in
debt owed to 1 and 49 creditors. The petition states funds will be
available to unsecured creditors.
About 90 Nassau Street LLC
90 Nassau Street LLC is a debtor with one real estate asset, as
defined under 11 U.S.C. Section 101(51B). The Debtor owns the
property at 90 Nassau Street, New York, NY 10038, in fee simple,
which has a current value of $10.5 million, according to the sale
contract.
90 Nassau Street LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D.N.Y. Case No. 25-41126) on March 6,
2025. In its petition, the Debtor reports estimated assets of
$10,521,777 and total liabilities of $18,543,196.
Honorable Bankruptcy Judge Nancy Hershey Lord handles the case.
The Debtor is represented by:
Kevin Nash, Esq.
GOLDBERG WEPRIN FINKEL GOLDSTEIN LLP
125 Park Ave
New York, NY 10017-5690
E-mail: knash@gwfglaw.com
ACCURIDE CORP: Davis Polk Advised ABL Agent in Chapter 11 Case
--------------------------------------------------------------
Davis Polk advised the administrative agent and collateral agent
under an asset-based revolving credit agreement among Accuride
Corporation and other parties, in connection with Accuride's
chapter 11 restructuring. On October 9, 2024, Accuride Corporation
and its affiliated debtors filed voluntary chapter 11 petitions in
the United States Bankruptcy Court for the District of Delaware.
The Bankruptcy Court confirmed Accuride's plan of reorganization on
February 12, 2025, and Accuride emerged from chapter 11 on March 7,
2025. In connection with the plan, the prepetition revolving
lenders received an approximately $40.2 million paydown of
outstanding prepetition ABL obligations and agreed to provide a new
$70 million exit ABL facility at emergence.
Accuride is a diversified manufacturer and supplier of commercial
vehicle components in North America. Based in Livonia, Michigan,
the company designs, manufactures and markets commercial vehicle
components. Accuride's brands are Accuride Wheels, Gunite Wheel End
Components and KIC Wheel End Components. Its products include
commercial vehicle wheels, wheel-end components and assemblies.
The Davis Polk restructuring team included partner Eli J. Vonnegut,
counsel Stephanie Massman and associate Motty (Mordechai) Rivkin.
The finance team included partner Kenneth J. Steinberg, counsel
Demian von Poelnitz and associates Matthew Vallade and Maggie Li.
All members of the Davis Polk team are based in the New York
office.
Davis Polk refers to Davis Polk & Wardwell LLP, a New York limited
liability partnership, and its associated entities.
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, and Perella Weinberg Partners LP as
investment banker. Alvarez & Marsal North America, LLC is the CRO
provider. Omni Agent Solutions is the claims agent.
The U.S. Trustee for Region 3 appointed an official committee to
represent unsecured creditors in the Debtors' Chapter 11 cases.
ACME ASPHALT: Seeks Chapter 11 Bankruptcy in Montana
----------------------------------------------------
On March 10, 2025, Acme Asphalt Industries Inc. filed Chapter 11
protection in the U.S. Bankruptcy Court for the District of
Montana. 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 Acme Asphalt Industries Inc.
Acme Asphalt Industries Inc. is a small business based in Southwest
Montana, established in 1997, specializing in all phases of site
work, including excavation, grading, utilities, and asphalt
construction and maintenance. The Company's services cater to
residential, commercial, and municipal projects. ACME Asphalt
operates in Montana, Idaho, Oregon, Washington, and Wyoming,
focusing on delivering projects with high-quality standards, on
time, and within budget.
Acme Asphalt Industries Inc. sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. D. Mont. Case No. 25-20045) on March
10, 2025. In its petition, the Debtor reports estimated assets and
liabilities between $1 million and $10 million each.
The Debtor is represented by:
Matt Shimanek, Esq.
SHIMANEK LAW PLLC
317 East Spruce Street
Missoula, MT 59802
Tel: 406-544-8049
Email: matt@shimaneklaw.com
ADVANTACLEAN OF METRO: Case Summary & 11 Unsecured Creditors
------------------------------------------------------------
Debtor: AdvantaClean of Metro New Orleans, LLC
1515 South Salcedo Street, Suite 130
New Orleans, LA 70125-2832
Business Description: AdvantaClean of Metro New Orleans is a
provider of mold remediation, water damage
restoration, air duct cleaning, and moisture
management services for both homes and
businesses. With an emphasis on fostering
healthier living spaces, the Company offers
solutions for problems such as flooding,
mold issues, and crawl space sealing. As a
locally owned and managed business,
AdvantaClean is dedicated to offering
professional, dependable, and top-quality
services to the New Orleans area.
Chapter 11 Petition Date: March 13, 2025
Court: United States Bankruptcy Court
Eastern District of Louisiana
Case No.: 25-10439
Judge: Hon. Meredith S Grabill
Debtor's Counsel: Ryan J. Richmond, Esq.
STERNBERG, NACCARI & WHITE, LLC
450 Laurel Street, Suite 1450
Baton Rouge, LA 70801
Tel: (225) 412-3667
Email: ryan@snw.law
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Jonathan Porter as manager.
A copy of the Debtor's list of 11 unsecured creditors is available
for free on PacerMonitor at:
https://www.pacermonitor.com/view/BQHZCBQ/AdvantaClean_of_Metro_New_Orleans__laebke-25-10439__0003.0.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/BJECKNY/AdvantaClean_of_Metro_New_Orleans__laebke-25-10439__0001.0.pdf?mcid=tGE4TAMA
ALC ENGINEERED: Case Summary & Eight Unsecured Creditors
--------------------------------------------------------
Debtor: ALC Engineered Solutions LLC
d/b/a Kluhsman Machine
478 W Dade 142
Lockwood, MO 65682
Business Description: Founded in 1983, ALC Engineered Solutions
LLC (doing business as Kluhsman Machine) is
a custom machining company based in
Lockwood, Missouri, specializing in precise
manufacturing across a variety of sectors.
The Company offers CNC machining for
materials such as aluminum, steel, plastics,
and tool steel, along with custom design
services using CAD/CAM 3D modeling.
Additionally, Kluhsman Machine provides
anodizing and plating options, including
hard chrome and zinc finishes. Serving
industries like aerospace, automotive,
energy, and food processing, the Company is
ISO 9001 certified and HUBZone certified,
focusing on delivering high-quality,
customized solutions for its clients.
Chapter 11 Petition Date: March 14, 2025
Court: United States Bankruptcy Court
Western District of Missouri
Case No.: 25-60147
Judge: Hon. Brian T Fenimore
Debtor's Counsel: Ryan A. Blay, Esq.
WM LAW, PC
15095 West 116th Street
Olathe, KS 66062
Tel: (913) 422-0909
Fax: (913) 428-8549
Email: blay@wagonergroup.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Ryan Wheeler as co-owner/CEO.
A full-text copy of the petition, which includes a list of the
Debtor's eight unsecured creditors, is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/6PLELGQ/ALC_Engineered_Solutions_LLC__mowbke-25-60147__0001.0.pdf?mcid=tGE4TAMA
ALL CRAFT: Court OKs Zephyrhills Property Sale to American Nautical
-------------------------------------------------------------------
All Craft Marine Holdings LLC received the green light from the
U.S. Bankruptcy Court for the Middle District of Florida, Tampa
Division, to sell substantially all of its Assets, free and clear
of all liens, claims, and encumbrances.
All Craft Marine Holdings LLC and All Craft Marine LLC have assets
or operations located in Zephyrhills, Florida (Zephyrhills
Location) and Palmetto, Florida (Palmetto Location).
The Court determined that the Debtors have entered into an Asset
Purchase Agreement with the American Nautical Holdings LLC to
purchase the Assets, subject to higher or better offers, with the
purchase value of $6,000,000.
The Assets to be sold include, but are not limited to the real
property, building, and equipment at 40047 County Road 54 East,
Zephyrhills, Pasco County, Florida, Tax Parcel ID Number 06-26-
22-0000-01500-0000. The Assets further include the personal
property located at the Palmetto Location.
The Court found that notice of the Sale Motion, the Bid Procedures
Order, the Bid Deadline, the Bid Procedures, the Sale Objection
Deadline, the Stalking Horse APA, and the Hearing to creditors of
the Debtors and other parties in interest, including any potential
bidders for the purchase of the Assets, was adequate and
sufficient, was reasonably calculated to provide all interested
parties with timely and proper notice of the Sale and the Hearing.
The Court considered the sale motion and the successful bidder,
together with the record and the arguments of the its counsel, and
found that the relief requested is necessary and appropriate and is
in the best interests of the Debtors, their creditors and estates,
and all parties in interest.
The Court authorized the Debtor to sell substantially all of its
Assets, free and clear of all liens, claims, and encumbrances.
The Court further held that the offer by the Purchaser to purchase
the Assets is the highest and best offer and represents fair and
adequate consideration for the Assets.
In the event the Purchaser fails to timely close on the sale of the
Assets by the closing date, then Greater Nevada Credit Union
(GNCU), the Debtors' primary and senior secured lender, may in its
sole discretion, elect to close on the sale as backup purchaser by
credit bit without the need for any further authorization.
About All Craft Marine Holdings LLC
All Craft Marine Holdings, LLC, a company in Zephyrhills, Fla.,
filed Chapter 11 petition (Bankr. M.D. Fla. Case No. 25-00129) on
January 10, 2025. In its petition, the Debtor reported between $1
million and $10 million in both assets and liabilities.
Judge Roberta A. Colton oversees the case.
Daniel R. Fogarty, Esq., at Stichter, Riedel Blain & Postler, P.A.
represents the Debtor as legal counsel.
ALVOGEN PHARMA: Moody's Appends 'LD' Designation to 'Caa2-PD' PDR
-----------------------------------------------------------------
Moody's Ratings has appended a limited default (/LD) designation to
Alvogen Pharma US, Inc. ("Alvogen") probability of default rating,
revising it to Caa2-PD/LD from Caa2-PD. There is no change to the
company's Caa2 Corporate Family Rating or the ratings on its debt
instruments. The outlook is stable.
On March 6, 2025, Alvogen completed the exchange of its $727
million first lien term loan due June 2025 through the issuance of
a new privately placed $553 million first lien term loan due 2028,
as well as new $116 million second lien term loan due 2029. Moody's
considers the restructuring involving an exchange of debt into new
subordinated loans to be a distressed exchange default. A
distressed exchange is considered a form of default under Moody's
criteria. The "/LD" designation will be removed in approximately
three business days.
Alvogen Pharma US, Inc. ("Alvogen") is a subsidiary of Alvogen Lux
Holdings S.a.r.l. ("LuxCo"). Alvogen Pharma US, Inc. comprises the
US generic and branded pharmaceuticals divisions and contract
manufacturing operations of LuxCo. For the twelve months ended
September 30, 2024, Alvogen Pharma US, Inc. reported revenues of
approximately $911 million. Alvogen Pharma US, Inc. is owned by a
consortium of private equity firms including CVC Capital and
Temasek. The company's Chairman Robert Wessman also owns a
significant stake in the company.
AMERICAN CANNABIS: Board Won't Accept E. Smith's Resignation Recall
-------------------------------------------------------------------
American Cannabis Company, Inc. disclosed in a Form 8-K Report
filed with the U.S. Securities and Exchange Commission that on
March 2, 2025, the Company held a meeting of the Board of
Directors, called by the sole director, CEO and chairman of the
Board, Joseph Cleghorn. The February 27, 2025, resignation of Ellis
Smith was accepted by the Board at this meeting.
Subsequent to the Board meeting held on March 2, 2025, Ellis Smith
notified the Company on March 3, 2025, of his interest in
rescinding his resignation of February 27, 2025. The board has not
accepted nor intends to accept Mr. Ellis' resignation rescission.
About American Cannabis
American Cannabis Company, Inc. is based in Colorado Springs,
Colorado, and operates alongside its subsidiary as a publicly
listed company on the OTC Markets OTCQB Trading Tier under the
symbol "AMMJ." The company utilizes a fully integrated business
model that offers end-to-end solutions for businesses in the
regulated cannabis industry, serving states and countries where
cannabis is regulated, decriminalized for medical use, or
legalized
for recreational use.
Houston, Texas-based Hudgens CPA, the company's auditor since
2022,
issued a "going concern" qualification in its report dated May 8,
2024. This report, attached to American Cannabis' Form 10-K filed
with the U.S. Securities and Exchange Commission for the fiscal
year ended December 31, 2023, noted that the company has a working
capital deficit, has incurred net losses since its inception, and
is expected to continue experiencing further losses. The auditor
highlighted that the company requires additional funds to meet its
obligations and operational costs, which raises substantial doubt
about its ability to continue as a going concern.
American Cannabis Company reported a net loss of $3,660,416 for
the
year ended December 31, 2023, as compared to $633,192 for the year
ended December 31, 2022. As of March 31, 2024, American Cannabis
Company had $2,628,487 in total assets, $2,759,498 in total
liabilities, and $131,001 in total stockholders' deficit.
ARCADIUM LITHIUM: KPMG LLP Raises Going Concern Doubt
-----------------------------------------------------
Arcadium Lithium plc disclosed in a Form 10-K Report filed with the
U.S. Securities and Exchange Commission for the fiscal year ended
December 31, 2024, that its auditor expressed an opinion that there
is substantial doubt about the Company's ability to continue as a
going concern.
Philadelphia, Pennsylvania-based KPMG LLP, the Company's auditor
since 2017, issued a "going concern" qualification in its report
dated February 27, 2025, citing that the Company has incurred
negative cash flows from operating and investing activities and
projects insufficient liquidity in its future cash flows due to
various restrictions under the Rio Tinto Transaction Agreement that
raise substantial doubt about its ability to continue as a going
concern.
According to the Company, it is limited to ordinary course working
capital strategies under the Rio Tinto Transaction Agreement.
The Company has incurred negative cash flow from operating and
investing activities of $176 million and $445.3 million,
respectively, for the year ended December 31, 2024. "Our
prospective success in funding our cash needs will depend on the
strength of the lithium market and our continued ability to
generate cash from operations and raise capital from other
sources," the Company explained.
The Company’s ability to continue developing its portfolio of
expansion projects is dependent on, among other factors, whether
the Company can obtain the necessary financing through a
combination of, but not limited to, the issuance of debt financing,
equity, government funding, and financing and/or prepayments from
existing or future customers. Pursuant to the Rio Tinto Transaction
Agreement, while the Rio Tinto Transaction is pending, as is
standard, we are restricted or prohibited from certain non-ordinary
course capital expenditures without the consent of Rio Tinto and
are required to use commercially reasonable efforts to continue our
existing expansion plans.
"Additionally, during that same time, we are subject to various
restrictions under the Rio Tinto Transaction Agreement on
non-ordinary course raising of additional capital, issuing
additional equity or debt, and pursuing certain activities that
could use significant amounts of our liquidity, including assuming
or incurring additional debt, repurchasing equity, and entering
into certain acquisition and disposition transactions, among other
restrictions without the consent of Rio Tinto, which is not to be
unreasonably withheld. We are permitted to continue to borrow under
our Revolving Credit Facility, under existing project financing
arrangements, and in connection with letters of credit entered into
in the ordinary course of business. Rio Tinto has agreed to
cooperate with the Company to facilitate any necessary or
appropriate actions and arrangements with respect to the Company's
indebtedness in anticipation of the Rio Tinto Transaction. The Rio
Tinto Transaction Agreement also contains standard prohibitions on
the Company’s ability to pursue working capital financing
strategies outside the ordinary course that otherwise may be
available to us before Closing, and the Pari Passu Term Loan limits
our ability to manage the timing and amount of certain capital
expenditures. If the transaction does not close, limitations would
cease on the Company’s ability to manage its working capital
strategies. In that case, there is no assurance that the Company
will be successful in attracting additional funding. Even if
additional financing is available, it may not be available on terms
favorable to the Company. Failure to secure additional financing on
favorable terms when it becomes required would have an adverse
effect on the Company’s financial position and on its ability to
execute its business plan. Our ability to continue as a going
concern is dependent upon our generating cash flow sufficient to
fund operations and reducing operating expenses. Our business
strategy may not be successful in addressing these issues. If we
cannot continue as a going concern, our stockholders may lose their
entire investment."
A full-text copy of the Company's Form 10-K is available at:
https://tinyurl.com/yr8zdpn4
About Arcadium Lithium
Arcadium Lithium plc -- https://arcadiumlithium.com/ -- is a
leading global lithium chemicals producer committed to safely and
responsibly harnessing the power of lithium to improve people’s
lives and accelerate the transition to a clean energy future. We
collaborate with our customers to drive innovation and power a more
sustainable world in which lithium enables exciting possibilities
for renewable energy, electric transportation and modern life.
Arcadium Lithium is vertically integrated, with industry-leading
capabilities across lithium extraction processes, including
hard-rock mining, conventional brine extraction and direct lithium
extraction (DLE), and in lithium chemicals manufacturing for high
performance applications. The Company has operations around the
world, with facilities and projects in Argentina, Australia,
Canada, China, Japan, the United Kingdom and the United States.
As of December 31, 2024, the Company has $10.2 billion in total
assets, $3 billion in total liabilities, and total stockholders'
deficit of $7.2 billion.
ARCHDIOCESE OF SAN FRANCISCO: Calls for Abuse Cases Mediation
-------------------------------------------------------------
Alex Wolf of Bloomberg Law reports that the San Francisco
Archdiocese has requested that a bankruptcy court prevent two
clergy abuse cases from going to trial, arguing that the litigation
would undermine ongoing efforts to mediate hundreds of similar
claims under Chapter 11.
The Roman Catholic Archbishop of San Francisco stated that
resolving more than 500 child sex abuse cases through mediation
remains a priority and that allowing "test" cases to proceed to
trial would disrupt that process. The request was filed with the
U.S. Bankruptcy Court for the Northern District of California on
Thursday, March 13, 2025.
About San Francisco Archdiocese
The Roman Catholic Archbishop of San Francisco, Archdiocese of San
Francisco, is a tax exempt religious organisation. The Archdiocese
of San Francisco is a Latin Church ecclesiastical territory or
diocese of the Catholic Church in the northern California region of
the United States. The Archdiocese of San Francisco was erected on
July 29, 1853, by Pope Pius IX and its cathedral is the Cathedral
of Saint Mary of the Assumption.
The Archdiocese sought relief under Chapter 11 of the Bankruptcy
Code (Bankr. N.D. Cal. Case No. 23-30564) on Aug. 21, 2023. In the
petition filed by Fr. Patrick Summerhays as vicar general and
moderator of the Curia, the Archdiocese reported $100 million to
$500 million in assets and liabilities.
The Hon. Dennis Montali oversees the case.
The Debtor tapped Feldserstein Fitzgerald Willoughby as counsel.
ARIS WATER: Moody's Upgrades CFR to B1 & Alters Outlook to Stable
-----------------------------------------------------------------
Moody's Ratings upgraded Aris Water Holdings, LLC's (Aris)
(formerly known as Solaris Midstream Holdings, LLC) Corporate
Family Rating to B1 from B2, Probability of Default Rating to B1-PD
from B2-PD, and senior unsecured notes rating to B2 from B3. The
Speculative Grade Liquidity rating was upgraded to SGL-2 from
SGL-3. The rating outlook was changed to stable from positive.
Moody's concurrently assigned a B2 rating to Aris' proposed $400
million senior unsecured notes due 2030. The notes proceeds will be
used to redeem the company's existing 7.625% notes due 2026,
including accrued interest.
"The upgrade acknowledges Aris' increased scale and EBITDA, reduced
financial leverage, and improved ability to generate free cash
flow, according to Sajjad Alam, Moody's Ratings Vice President.
"Moody's anticipates continued conservative financial policies and
disciplined allocation of capital towards growth and shareholder
distributions."
RATINGS RATIONALE
The B1 CFR is supported by Aris' long-term fee-based water services
contracts with large investment-grade oil and gas producers in the
Permian Basin; minimal direct commodity price exposure; fee-based
revenue; and low financial leverage. The company has successfully
grown over time, with most of its revenue backed by long-term
acreage dedications or contracted minimum volume commitments
(MVCs). The CFR is constrained by the company's limited scale and
operating history compared to higher-rated midstream companies;
significant customer and geographic concentration; exposure to
volatile upstream drilling and development cycles; and the inherent
business risks associated with water handling, recycling, and
disposal operations that face high competition and are subject to
extensive environmental regulations.
The new notes will be fully and unconditionally guaranteed on a
senior unsecured basis by all of the Aris' existing subsidiaries.
The senior unsecured notes are rated B2, one notch below Aris' B1
CFR, reflecting their subordinated claim to the company's assets
behind the first-lien senior secured revolving credit facility
(unrated).
Moody's anticipates that the company will continue investing in
high-return organic growth projects and seek opportunistic bolt-on
acquisitions to further expand its scale and scope of operations.
However, Moody's don't expect leverage to increase meaningfully
from current levels. After a period of significant investments in
2022-23, capital spending moderated in 2024, and management plans
to spend $85-$105 million in 2025. Moody's expects at least $200
million of EBITDA and over $40 million of free cash flow in 2025,
which will help further reduce leverage and enhance overall
financial flexibility.
Aris should maintain good liquidity through mid-2026, as indicated
by the SGL-2 rating. Moody's expects the company to successfully
refinance the existing notes and use free cash flow to repay any
remaining revolver debt balance. As of December 31, 2024, the
company had $29 million in cash and $44 million outstanding on its
$350 million committed revolving credit facility, which expires on
October 12, 2027. With lower projected capital spending, the
company should be able to generate significant free cash flow and
easily cover the recently increased quarterly dividend of
$0.14/share (~$34 million annually). Financial covenants under the
credit agreement have ample headroom.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Aris' CFR could be upgraded if the company significantly increases
scale, diversifies its revenue stream with long-term fee-based
contracts, and maintains debt/EBITDA below 1.5x. The CFR could be
downgraded if debt/EBITDA rises above 3x, liquidity weakens, or the
company debt-funds shareholder distributions.
The principal methodology used in these ratings was Midstream
Energy published in February 2022.
ARTISTIC HOLIDAY: U.S. Trustee Appoints Creditors' Committee
------------------------------------------------------------
The U.S. Trustee for Region 21 appointed an official committee to
represent unsecured creditors in the Chapter 11 cases of Artistic
Holiday Designs, LLC and Holiday Creations Pro, Inc.
The committee members are:
1. OL USA, LLC
c/o Angel N. Espinoza
265 Post Avenue, Suite 333
Westbury, NY 11590
2. Petal and Company Productions, LLC
c/o Michael Gurl
909 3rd Ave, #1851
New York, NY 10150
3. Peoplelink, LLC
c/o Jackie Pezzuto
431 E. Colfax Ave, Suite 200
South Bend, IN 46617
Official creditors' committees serve as fiduciaries to the general
population of creditors they represent. They may investigate the
debtor's business and financial affairs. Committees have the right
to employ legal counsel, accountants and financial advisors at a
debtor's expense.
About Artistic Holiday Designs
Artistic Holiday Designs, LLC is a company in Cape Coral, Fla.,
which specializes in creating holiday lighting displays for both
commercial and public spaces. Its affiliate, Holiday Creations Pro,
Inc., is a full-service holiday lighting company specializing in
the design, installation, maintenance, takedown, and storage of
lighting displays. Holiday Creations Pro caters to both residential
and commercial clients, offering customized solutions.
Artistic Holiday Designs and Holiday Creations Pro filed Chapter 11
petitions (Bankr. M.D. Fla. Lead Case No. 25-00153) on January 29,
2025. At the time of the filing, Artistic Holiday Designs reported
between $1 million and $10 million in assets and between $10
million and $50 million in liabilities.
Judge Caryl E. Delano oversees the cases.
Michael Dal Lago, Esq., at Dal Lago Law, represents the Debtor as
bankruptcy counsel.
MEP Capital Holdings III, L.P., as secured creditor, is represented
by:
Luis E. Rivera II, Esq.
GrayRobinson, P.A.
1404 Dean Street, Suite 300
Fort Myers, Florida 33901
Phone: 239.254.8460
Email: luis.rivera@gray-robinson.com
ASMC LLC: Court Extends Cash Collateral Access to May 19
--------------------------------------------------------
ASMC, LLC received sixth interim approval from the U.S. Bankruptcy
Court for the Northern District of Illinois, Eastern Division to
use cash collateral.
The interim order authorized the company to use cash collateral
from March 10 to May 19 in accordance with its budget, with a 10%
variance allowed.
Secured creditors were granted replacement liens on their
collateral and its proceeds until further order of the court.
ASMC was ordered to maintain and pay premiums for insurance to
cover the secured creditors' collateral; properly maintain and
manage the collateral; and make available to the secured creditors
evidence of the collateral or proceeds upon request.
The next hearing is scheduled for May 14. Objections are due by May
12.
About ASMC LLC
ASMC, LLC is a fastener distributor headquartered in Libertyville,
Ill. It sells anchors, bolts and screws, nuts, washers, pins and
clips, and bearings.
ASMC sought protection under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. N.D. Ill. Case No. 24-14067) with $100,000 to $500,000 in
assets and $1 million to $10 million in liabilities. Anthony J.
King, managing member, signed the petition.
Judge David D. Cleary oversees the case.
The Debtor is represented by:
Scott R. Clar, Esq.
Crane, Simon, Clar & Goodman
135 South LaSalle Street, Suite 3950
Chicago, IL 60603-4297
Tel: 312-641-6777
Fax: 312-641-7114
Email: sclar@cranesimon.com
AVALARA INC: S&P Assigns 'B-' ICR on Proposed Debt Issuance
-----------------------------------------------------------
S&P Global Ratings assigned its 'B-' issuer credit rating to
U.S.-based Avalara Inc., a provider of tax compliance automation
software.
At the same time, S&P assigned its 'B-' issue-level rating and '3'
recovery rating to the company's proposed revolving credit facility
and first-lien term loan.
S&P said, "The stable outlook reflects our expectation that Avalara
will increase its revenue and EBITDA by about 15% annually over the
next few years, reflecting continued strong adoption of its tax
compliance products. We also expect the company to turn free cash
flow positive in fiscal 2025 due to lower projected interest
expense and RSU cash payments."
S&P views Avalara as one of the leaders in the Tax and E-invoicing
end markets. Avalara is a prominent player in the crowded sales tax
compliance space, recognized as a leader in the Tax and E-invoicing
markets. Over the past five years, the company has experienced
impressive growth, with its customer base more than doubling to
over 43,000 in 2024 from 18,000 in 2018, while revenues have
increased more than fourfold since its 2018 IPO. This rapid revenue
growth aligns with the performance of high-growth, Rule of 40+
companies. Avalara's cloud-based products business, primarily
offered on a subscription basis, integrate seamlessly with major
enterprise resource planning (ERP) solutions, helping businesses
navigate complex tax regulations on both domestic and global
levels. The core tax compliance solutions are considered
recession-resilient, as tax compliance is essential for all
businesses, making it a necessity even during economic downturns.
Avalara serves both SMEs and large corporations, though its pricing
model and support limitations have led to mixed feedback.
Ultimately, the company aims to evolve into a comprehensive tax
compliance platform.
Despite experiencing strong growth metrics and improving
profitability, Avalara's cash flow metrics constrain our ratings.
Avalara has shown impressive growth, but its focus on expansion has
led to negative free cash flow in each of the past three years. The
company's high sales-and-marketing expenses, which exceed 60% of
revenue, are notably higher than a typical software-as-a service
(SaaS) company. Avalara is also investing significantly in building
new partnerships. S&P said, "Nonetheless, we anticipate
profitability will improve over the next two years, driven by its
focus on increasing headcount in lower-cost regions, notably in
Pune, India, which has already resulted in a more than 10%
improvement in S&P Global Ratings-adjusted EBITDA margins over the
past two years, with the company forecasting additional savings of
$78 million from the restructuring. Our base case projects S&P
adjusted EBITDA margins to reach the mid-20% range within the next
two years driven by operating leverage and cost saving
initiatives."
S&P said, "We expect financial metrics to improve and free cash
flow to turn positive in 2025 due to lower projected interest
expense and RSU payments. Avalara paid more than $80 million in
cash RSU payments in fiscal 2024. These are likely to be under $50
million in 2025 with these payments ending in 2026. We also expect
the company to lower its cost of capital on the new term loan,
resulting in annual cash interest expense of less than $200
million. In addition, free cash flow will improve due to top-line
growth and with more of the company's workforce in India. As such,
we expect free cash flow to turn positive in 2025 and free cash
flow to debt to improve to above 5% in fiscal 2026.
"The stable outlook reflects our expectation that Avalara will
increase its revenue and EBITDA by about 15% annually over the next
few years, driven by continued strong adoption of its tax
compliance products. We also expect the company to turn free cash
flow positive in fiscal 2025 due to lower projected interest
expense and RSU cash payments.
"Although unlikely given our expectation for revenue growth and
positive free cash flow generation, we would lower our rating on
Avalara if it faces growth challenges such that it causes its free
cash flow to be sustained after debt service to be break-even with
no prospects for improvement. In such a scenario, we would view the
company's capital structure to be unsustainable."
S&P would consider upgrading Avalara over the next 12 to 24 months
if it is able to sustain its revenue and EBITDA growth such that
-- S&P Global Ratings-adjusted leverage is sustained under 7.5x;
-- S&P Global Ratings-adjusted free cash flow to debt improves to
4%; and
-- S&P believes the company would sustain its deleveraged capital
structure while pursuing its acquisitions and shareholder-return
objectives.
B&B OUTDOOR: Case Summary & Seven Unsecured Creditors
-----------------------------------------------------
Debtor: B&B Outdoor LLC
117 W Palmetto Avenue
Pierson, FL 32180-2069
Business Description: B & B Outdoor, LLC is a site development and
asset maintenance company based in Pierson,
Florida. With over 10 years of experience
in Central Florida, the Company offers a
range of services, including site
demolition, preparation, development,
subgrade stabilization, base rock
installation, road grading, underground
utilities, concrete and curb work,
stormwater drainage, road maintenance,
litter control, washout repairs, emergency
storm response, pond excavation, and the
sale and distribution of dirt, sand, and
stone.
Chapter 11 Petition Date: March 13, 2025
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 25-01414
Judge: Hon. Lori V Vaughan
Debtor's Counsel: Jeffrey S. Ainsworth, Esq.
BRANSONLAW, PLLC
1501 E. Concord Street
Orlando, FL 32803
Tel: 407-894-6834
Email: jeff@bransonlaw.com
Total Assets: $93,252
Total Liabilities: $1,527,035
The petition was signed by Robert L. Becker as authorized member.
A full-text copy of the petition, which includes a list of the
Debtor's seven unsecured creditors, is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/W6U4JDI/BB_Outdoor_LLC__flmbke-25-01414__0001.0.pdf?mcid=tGE4TAMA
BALLISTIC FABRICATION: Gets Final OK to Use Cash Collateral
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Arizona issued a
final order granting Ballistic Fabrication, LLC's renewed motion to
use cash collateral from Feb. 1 to March 31.
The final order authorized the company to use cash collateral to
pay the expenses set forth in its projected budget, which shows
revised total projected expenses of $48,678 for February and
$6,607.00 for March.
Each creditor with a security interest in cash collateral was
granted a post-petition lien on cash collateral to the same extent
and with the same validity and priority as its pre-bankruptcy
lien.
The order is without prejudice to any subsequent request by any
party for modified adequate protection or restrictions on the
company's use of cash collateral.
About Ballistic Fabrication
Ballistic Fabrication, LLC, a company in Tucson, Ariz., filed a
petition under Chapter 11, Subchapter V of the Bankruptcy Code
(Bankr. D. Ariz. Case No. 24-06403) on August 4, 2024, with up to
$50,000 in assets and up to $1 million in liabilities.
Judge Brenda Moody Whinery oversees the case.
The Debtor is represented by Charles R. Hyde, Esq., at the Law
Offices of C.R. Hyde, PLC.
BENCH ACCOUNTING: Chapter 15 Case Summary
-----------------------------------------
Two affiliates that simultaneously submitted voluntary petitions
for relief under Chapter 15 of the Bankruptcy Code:
Bench Accounting, Inc. (Lead Case)
717 W. Pender Street, #200
Vancouver, BC, A1 V6C1G9
Canada
- and -
10Sheet Services Inc.
Business Description: Prior to Jan. 7, 2025, the Debtors operated
a unified business under the "Bench" brand,
offering accounting, bookkeeping, tax, and
various financial services to more than
10,000 clients across North America, mainly
small business owners. The Debtors provided
their clients with user-friendly financial
software combined with in-house bookkeepers
to simplify year-round small business
bookkeeping. Due to a lack of funds to
sustain operations, the Debtors halted their
business activities and laid off all
employees on Dec. 27, 2024.
Foreign Proceeding: Proceeding under Canada's Bankruptcy and
Insolvency Act, R.S.C. 1985, c. B-3,
pending before the Supreme Court of
British Columbia in Bankruptcy and
Insolvency, Action No. B-250050,
Vancouver Registry
Chapter 15 Petition Date: March 13, 2025
Court: United States Bankruptcy Court
District of Delaware
Case numbers of two affiliates that simultaneously submitted
voluntary petitions for relief under Chapter 15 of the Bankruptcy
Code:
Case No.
--------
Bench Accounting, Inc. (Lead Case) 25-10463
10Sheet Services Inc. 25-10464
Judge: Hon. Laurie Selber Silverstein
Foreign Representative: KSV Restructuring Inc., in its capacity
as trustee of Bench Accounting, Inc. and
10Sheet Services Inc.
220 Bay Street, 13th Floor
P.O. Box 20
Toronto, Ontario M5J2W4
Canada
Foreign
Representative's
Counsel: Matthew B. Lunn, Esq.
Michael R. Nestor, Esq.
Elizabeth S. Justison, Esq.
Daniel Trager, Esq.
YOUNG CONAWAY STARGATT & TAYLOR, LLP
1000 North King Street
Wilmington DE 19801
Tel: (302) 571-6600
Fax: (302) 571-1253
Email: mlunn@ycst.com
mnestor@ycst.com
ejustison@ycst.com
dtrager@ycst.com
Estimated Assets: Unknown
Estimated Debt: Unknown
A full-text copy of the Chapter 15 petition is available for free
on PacerMonitor at:
https://www.pacermonitor.com/view/XRZDFCA/KSV_Restructuring_Inc_in_its_capacity__debke-25-10463__0001.0.pdf?mcid=tGE4TAMA
BEVERLY COMMUNITY: To Sell Assigned Rights to RC Pioneer Fund
-------------------------------------------------------------
Howard M. Ehrenberg, Chapter 11 Trustee of Beverly Community
Hospital Association dba Be Beverly Hospital and and Montebello
Community Health Services, Inc., seeks permission from the U.S.
Bankruptcy Court for the Central District of California, Los
Angeles Division, to sell right title and interest in its Assigned
Rights, free and clear of liens, interests, and encumbrances.
The Debtors have potential claims (Assigned Rights) against Blue
Cross Blue Shield Association (BCBS) for alleged violations of
Sections 1 and 2 of the Sherman Antitrust Act, by illegally
entering into a geographic market allocation agreement prohibiting
competition in the market for the sale of commercial healthcare
financing services and the market for the purchase of goods and
services from healthcare providers.
The Trustee proposes to sell the Debtors' claims to the proposed
buyer, RC Pioneer Fund LLC, for $160,000 plus 10% of the buyer's
ultimate net recovery on the Assigned Rights.
The Debtors' assets referred to as the Assigned Rights, which
include all claims, demands, rights and causes of action that
Debtors had now have, or may in the future have: against or with
respect to any potential future judgement against Blue Cross Blue
Shield Association and its members that may established in
connection with a settlement of claims or judgement for the alleged
violations of Sherman Antitrust Act.
The Trustee proposes the sale to be free and clear of all liens,
claims, encumbrances, or other interests, but not limited to any
lien held by the U.S. Bank Trust Company, National Association, as
Master Trustee, who holds a blanket lien on substantially all
assets of the Debtors.
The sale is subject to higher and better bid pursuant to the
Overbid Procedures.
The Trustee recommends that the first overbid be no less than
$185,000.00 cash plus at least 10% of the net proceeds of the
Assigned Claims, which is $25,000.00 higher than the sales price in
the current Minimum Qualified Overbid.
The Trustee further proposes that the subsequent overbids be made
in increments of no less than $10,000 so the first subsequent
overbid is $195,000.
In the event that the Proposed Buyer is not the Successful Bidder,
and the sale of the Assigned Rights to another Qualified Bidder
actually closes, the Proposed Buyer will be entitled to a break-up
fee in the amount of $10,000.00, payable within 5 business days
after the closing of the Sale.
About Beverly Community Hospital Association
Beverly Community Hospital Association and affiliates operate
general medical and surgical hospitals.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Lead Case No. 23-12359) on April
19, 2023. In the petition signed by its chief executive officer,
Alice Cheng, Beverly Community disclosed $1 million to $10 million
in assets and $100 million to $500 million in liabilities.
Judge Sandra R. Klein oversees the cases.
The Debtors tapped Sheppard, Mullin, Richter and Hampton, LLP as
bankruptcy counsel; Orrick, Herrington & Sutcliffe, LLP as special
and conflicts counsel; and Triple P RTS, LLC, a wholly owned
subsidiary of Portage Point Partners, LLC, as restructuring
advisor.
The U.S. Trustee for Region 16 appointed an official committee to
represent unsecured creditors in these Chapter 11 cases. The
committee is represented by Tania Moyron, Esq.
Tamar Terzian is the patient care ombudsman appointed in the
Debtors' Chapter 11 cases.
Howard M. Ehrenberg was appointed as trustee appointed in these
Chapter 11 cases. The trustee tapped Greenspoon Marder, LLP as
counsel and Stretto, Inc. as financial analysis and litigation
support services provider.
BIA SEPARATIONS: Chapter 15 Case Summary
----------------------------------------
Chapter 15 Debtor: BIA Separations Gesellschaft fur
Separationstechnologie mbH
Victor Kaplan Allee 12
7023 Pottelsdorf
Austria
Case No.: 25-10465
Business Description: BIA Separations Gesellschaft fur
Separationstechnologie mbH is a
developer and manufacturer of CIM
(Convective Interaction Media) monolithic
chromatographic columns, primarily used
in the production and purification of
biopharmaceuticals, including monoclonal
antibodies and vaccines. The Company's
proprietary CIM technology offers
efficient and scalable solutions for
bioseparation processes.
Chapter 15 Petition Date: March 14, 2025
Court: United States Bankruptcy Court
District of Delaware
Judge: Hon. Craig T Goldblatt
Foreign Representative: Mag. Michael Wagner
Blumengasse 5
7000 Eisenstdt
Austria
Foreign Proceeding: Insolvency proceeding commenced pursuant
to the Bankruptcy Act of Austria and
Article 3 of EU Regulation 2015/848 of
the European Parliament and the Council
of the European Union, pending before
the Austrian Insolvency Court of
Eisenstadt
Eisenstadt Regional Court, 49 S 30/15f
Foreign
Representative's
Counsel: Jeffrey J. Lyons, Esq.
BAKER & HOSTETLER LLP
1201 Market Street, Suite 1407
Wilmington DE 19801
Tel: (302) 407-4222
Email: jjlyons@bakerlaw.com
Estimated Assets: Unknown
Estimated Debt: Unknown
A full-text copy of the Chapter 15 petition is available for free
on PacerMonitor at:
https://www.pacermonitor.com/view/MU6YAUA/Mag_Michael_Wagner_and_BIA_Separations__debke-25-10465__0001.0.pdf?mcid=tGE4TAMA
BIG LOTS: Administrative Claims Filing Deadline on April 3, 2025
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware set April 3,
2025, at 5:00 p.m. (Prevailing Eastern Time) as the last date and
time for all persons or entities with administrative expense claim
against Big Lots Inc. and its debtor-affiliate arising from the
Debtors' petition date through including Jan. 3, 2025.
A Proof of Pre-Closing Administrative Expense Claim may be filed
electronically at
https://cases.ra.kroll.com/BigLots using the interface available
after clicking the link entitled "Submit a Claim." A Proof of
Pre-Closing Administrative Expense Claim must be submitted so as to
be actually received on or before the Pre-Closing Administrative
Expense Claims Bar Date or Outstanding Lease Pre-Closing
Administrative Expense Claims Bar Date, as applicable.
An original, signed copy of the Proof of Pre-Closing Administrative
Expense Claim must be sent so as to be actually received on or
before the Pre-Closing Administrative Expense Claims Bar Date or
Outstanding Lease Pre-Closing Administrative Expense Claims Bar
Date, as applicable, as follows:
If by first class mail:
Big Lots, Inc. Claims Processing Center
c/o Kroll Restructuring Administration LLC
Grand Central Station, PO Box 4850
New York, NY 10163-4850
If by hand delivery, or overnight courier:
Big Lots, Inc. Claims Processing Center
c/o Kroll Restructuring Administration LLC
850 3rd Avenue, Suite 412
Brooklyn, NY 11232
Copies of the pre-closing administrative expense claims procedures
order, the Debtors' schedule of post-petition liabilities and other
documents and information regarding the Debtors' Chapter 11 cases
are available for free at https://cases.ra.kroll.com/BigLots or by
calling at (844) 217-1398 (toll free) or +1 (646) 809-2073
(international).
About Big Lots
Big Lots (NYSE: BIG) -- http://www.biglots.com/-- is one of the
nation's largest closeout retailers focused on extreme value,
delivering bargains on everything for the home, including
furniture, decor, pantry and more.
On Sept. 9, 2024, Big Lots, Inc. and each of its subsidiaries
initiated voluntary Chapter 11 proceedings (Bankr. D. Del. Lead
Case No. 24-11967). The case is being administered by the Honorable
J. Kate Stickles.
Davis Polk & Wardwell LLP is serving as legal counsel, Guggenheim
Securities, LLC is serving as financial advisor, AlixPartners LLP
is serving as restructuring advisor, and A&G Real Estate Partners
is serving as real estate advisor to the Company. Kroll is the
claims agent.
Kirkland & Ellis is serving as legal counsel to Nexus Capital
Management LP.
PNC Bank, National Association, the DIP ABL Agent and Prepetition
ABL Agent, is represented by Choate, Hall & Stewart, LLP; and Blank
Rome, LLP. 1903P Loan Agent, LLC, the DIP Term Agent, and the
Prepetition Term Loan Agent are represented by Otterbourg, P.C. and
Richards, Layton & Finger, P.A.
BIOSIG TECHNOLOGIES: Sells 758K Shares of Stock for $818K
---------------------------------------------------------
BioSig Technologies, Inc., disclosed in a Form 8-K filed with the
U.S. Securities and Exchange Commission that on March 5, 2025, the
Company entered into a Securities Purchase Agreement with certain
accredited investors pursuant to which the Company sold to the
Investors an aggregate of 758,514 shares of the Company's common
stock, par value $0.001 per share at a purchase price of $1.07974
per share, and warrants to purchase up to 758,514 shares of Common
Stock, at an exercise price of $0.95474 per share, that will become
exercisable six months after the date of issuance and will expire
three and one-half years following the date of issuance, in
exchange for aggregate consideration of $818,997.91.
As previously disclosed, on December 18, 2024, the Company entered
into an At The Market Offering Agreement with H.C. Wainwright &
Co., LLC, as sales agent or principal, pursuant to which the
Company may offer and sell, from time to time in transactions that
are deemed to be "at the market" offerings as defined in Rule 415
under the Securities Act of 1933, as amended, the Company's common
stock, par value $0.001 per share, through or to the Agent. The
Sales Agreement, among other things, provides for the issuance and
sale of up to an aggregate of $8,500,000 of shares of the Company's
common stock.
From January 17, 2025 through March 5, 2025, the Company has sold
4,413,807 ATM Shares at an average offering price of $0.912704 per
share for aggregate gross proceeds of $4,028,498.73.
About BioSig Technologies
Westport, Conn.-based BioSig Technologies, Inc. was initially
incorporated on February 24, 2009, under the laws of the State of
Nevada and subsequently re-incorporated in the state of Delaware
in
2011. The Company is principally devoted to improving the standard
of care in electrophysiology with its PURE EP System's enhanced
signal acquisition, digital signal processing, and analysis during
ablation of cardiac arrhythmias.
As of September 30, 2024, the Company had $1.4 million in total
assets, $1.7 million in total liabilities, $105,000 in Commitments
and contingencies, and $388,000 in total deficit.
As of September 30, 2024, the Company had cash of $0.6 million and
working capital deficit of $0.9 million. During the nine months
ended September 30, 2024, the Company used net cash in operating
activities of $4.3 million. These balances create a liquidity
concern, which in turn raises substantial doubt about the
Company's
ability to continue as a going concern.
BNG GROUP: Seeks Chapter 11 Bankruptcy in Virginia
--------------------------------------------------
On March 10, 2025, BNG Group LLC filed Chapter 11 protection in
the U.S. Bankruptcy Court for the Eastern District of Virginia.
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 BNG Group LLC
BNG Group LLC is a single asset real estate debtor, as defined in
11 U.S.C. Section 101(51B).
BNG Group LLC sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. E.D. Va. Case No. 25-10463) on March 10, 2025. In its
petition, the Debtor reports estimated assets and liabilities
between $1 million and $10 million each.
The Debtor is represented by:
Lawrence A. Katz, Esq.
HIRSCHLER FLEISCHER PC
1676 International Drive Suite 1350
Tysons, VA 22102
Tel: 703-584-8362
E-mail: lkatz@hirschlerlaw.com
BRIGHTLINE EAST: S&P Lowers $1.119BB 144A Notes Rating to 'B-'
--------------------------------------------------------------
S&P Global Ratings lowered the rating on Brightline Trains Florida
LLC (Opco) $1.119 billion of 144A notes to 'B-' from 'B' and
assigned a negative outlook. The recovery rating remains '4',
indicating an average recovery (rounded estimate: 35%) in the event
of a payment default.
The negative outlook reflects the increased risk that Parent might
not receive distributions from Opco before the reserves at Parent
are exhausted in 2027.
S&P said, "Our downgrade reflects OpCo's material cash flow
deficits, and the growing risk that Parent might not receive
distributions from Opco before its reserves at Parent are exhausted
in 2027. For Opco to distribute cash to Parent, it is subject to a
distribution test of 1.3x (backward and forward), and importantly,
certain reserves must be filled to specified amounts. As of Dec.
31, 2024, OpCo's reserve balances are about $60 million lower than
we expected due to the OpCos persistent operating deficits well in
excess of our base-case forecast. For example, we estimate that
OpCo generated $50.3 million deficit in S&P Global
Ratings-calculated cash flow available for debt service (CFADS)
year-to-date third quarter 2024, as compared with our prior
base-case forecast of a deficit of about $12.5 million. Ticket
revenue is ramping slower than we anticipated, causing year-to-date
revenues as of third-quarter 2024 to lag our base-case forecast by
20%. Notably, for the same period average long-distance fares were
19% lower than our forecast, long distance ridership revenue
accounts for about 70% of total ticket revenues in 2024 under our
base case. OpCo expenses reported through the third quarter of 2024
are higher than our base case by 7%. We understand additional costs
have been incurred in fourth quarter 2024, impairing the balance of
the reserves. While OpCo is trending below our expectations, its
reserves are currently sufficient to support a weaker-than-expected
ramp-up and any replenishment of reserves will benefit OpCo debt
first.
"Over the next year, we see elevated execution risks for the OpCo
to become cash flow positive and begin making distributions to
Parent. As a result of underperformance in 2024, the liquidity gap
to allow distributions is significant thereby heightening the risk
of the Parent's potential default. Still, OpCo could become cash
flow positive and begin making distributions later in 2025 if its
performance improves toward our base-case forecast. Specifically,
we expect a ramp up in ticket revenue and a reduction in
nonrecurring legal and other operational costs supporting
improvement in CFADS, which we expect to be above $200 million in
2026 (this amount replenishes reserves) and if realized would allow
OpCo distributions to begin flowing to Parent.
"In a scenario where OpCo does not distribute, we think the Parent
will default in 2027 unless the Parent accesses other sources of
liquidity. The documents allow the reserves earmarked for the
second phase (starting 2029) to be used in the first phase if
needed. This would allow the Parent to continue meeting debt
service requirements until 2027. Nevertheless, downside rating
momentum could intensify, especially if performance fails to
improve in line with our base-case forecast in 2025. In our view,
further material underperformance could cause the project to become
reliant on favorable business conditions to generate positive cash
flow. Our project finance methodology does not count on any parent
support, which if provided could mitigate the default risk in
2027.
"The negative outlook reflects that we could lower the rating
within the next 12 months if performance continues to fall short of
our base-case expectation such that we believe there is a greater
likelihood that Parent might not receive distributions from Opco
before the reserves at Parent are exhausted in 2027. Given the
project is ramping up, this introduces some uncertainly into the
forecasting of whether the distribution tests (1.3x and reserve
balances) necessary to be met to allow parent distributions at OpCo
can be met. However, as time progresses when OpCo adds additional
train capacity and there is more clarity on costs, we expect to
have a more definitive view of when OpCo will distribute.
"We could lower the rating if we view Parent as dependent upon
favorable improvement in the performance at Opco to avoid a default
in 2027 when we estimate the reserves at Parent will be depleted.
We would lower the rating by one or more notches over the next six
to 12 months if the performance at Opco remains at current levels
(revenues about 20% beneath our base-case forecast) and if there is
no material improvement in the shortfall of reserves (currently
about $60 million below our expectations) at Opco.
"While unlikely within the next year or so, we would change the
outlook to stable if performance at Opco starts to approach our
base-case assumptions, reserves at Opco are increased to amounts in
line with our expectations and we expect the possibility of debt
service shortfall in 2027 at Brightline East to be remote."
BYJU'S ALPHA: Official Appeals Lenders' Concealed Funds Decision
----------------------------------------------------------------
Angelica Serrano-Roman of Bloomberg Law reports that an executive
from Indian tech company Byju's Alpha Inc. is challenging a U.S.
court ruling that found he played a role in concealing $533 million
from lenders, violating fiduciary duties.
Riju Ravindran and hedge fund Camshaft Capital Fund LP filed an
appeal on Thursday, March 13, 2025, in the U.S. Bankruptcy Court
for the District of Delaware. The appeal comes after Judge John T.
Dorsey ruled on February 27, 2025 that they fraudulently
transferred funds to the hedge fund to hide them from lenders, the
report states.
Ravindran is the brother of Byju Raveendran, the founder of
Byju's.
About BYJU's Alpha
BYJU's Alpha, Inc., designs and develops education software
solutions.
The Debtor sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Del. Case No. 24-10140) on Feb. 1, 2024. In the
petition signed by Timothy R. Pohl, chief executive officer, the
Debtor disclosed up to $1 billion in assets and up to $10 billion
in liabilities.
Judge John T. Dorsey oversees the case.
Young Conaway Stargatt & Taylor, LLP and Quinn Emanuel Urquhart &
Sullivan, LLP serve as the Debtor's legal counsel.
GLAS Trust Company LLC, as DIP Agent and Prepetition Agent, is
represented in the Debtor's case by Kirkland & Ellis LLP, Pachulski
Stang Ziehl & Jones, and Reed Smith.
CARVANA CO: S&P Upgrades ICR to 'B', Outlook Positive
-----------------------------------------------------
S&P Global Ratings raised its issuer credit rating on U.S.-based
Carvana Co. to 'B' from 'B-'.
S&P said, "At the same time, we raised our unsolicited issue-level
rating on Carvana's senior secured debt to 'B' from 'B-' with a '4'
recovery rating (30%-50%; rounded estimate: 40%). We also raised
our issue-level rating on its senior unsecured debt to 'CCC+' from
'CCC' with a '6' recovery rating (0%-10%; rounded estimate: 0%).
"The positive outlook reflects our view that we could upgrade
Carvana over the next 12 months if the company continues improving
its operating performance while maintaining leverage below 5x and
FOCF to debt above 5%."
The upgrade reflects Carvana's continued business growth while
sustaining stronger EBITDA margins and improving credit metrics.
Carvana continues to improve its profitability and top line,
growing its EBITDA margins to 10.6% in fiscal 2024 compared with
3.9% in 2023 and achieving sales of $13.7 billion in 2024 compared
with $10.8 billion in 2023. Carvana has enhanced its unit
economics, raising retail gross profit per unit (GPU) to $3,312
from $2,385 in 2023 while expanding unit sales volume by 33.1%.
This is attributed to streamlined operations, standardized
reconditioning processes, and reduced operating costs. The company
also leveraged its overhead expense to improve selling, general,
and administrative (SG&A) costs per unit. Other gross profit also
increased due to higher spreads between origination interest rates
and benchmark rates, and improvement in product penetration like
warranty products. These profitability improvements and some gross
debt paydown resulted in S&P Global Ratings-adjusted leverage
improving to about 5x in 2024 from about 17.8x in 2023.
S&P said, "We forecast revenue growth of about 14.9% in 2025,
primarily due to an increase in unit sales. Sales growth will be
supported by the opening of 10 to 12 ADESA mega sites in 2025 to
expand its inventory offering and reconditioning capacity. We
forecast its EBITDA margins will slightly contract to 10.5% in 2025
from 10.6% in 2024 due to a small drop in GPUs, somewhat offset by
improved overhead expense leveraging. While Carvana's retail GPUs
have strengthened considerably, it may be difficult to source
increasing units of vehicles at the same level of profit,
particularly this year because the number of vehicles coming off
lease will be quite low. This could result in increased competition
from franchise dealers for sourcing directly from customers. We do
note that Carvana has managed to grow units over the past few years
despite a challenging landscape for used vehicle supply. If the
company were to rely more on auctions or sourcing older vehicles
that require more reconditioning, this would be a drag on retail
GPUs.
"We believe Carvana will maintain disciplined cost control even as
it continues scaling units sold and growing revenue. Although we
expect a slight contraction in retail GPU as the company invests in
improving the customer experience, we believe it can improve its
fixed expense leveraging. Carvana currently has unused lots,
equipment, and reconditioning capacity on its ADESA sites. Fully
integrating all 56 ADESA mega sites (eight of which have already
been integrated) could enable the company to expand its current
volumes by 8x. To bring the planned remaining 8-10 sites online
this year, we believe it will step up its capital expenditure
(capex) investment year over year. Given its current EBITDA
generation, we believe the company will be able to more than
sufficiently fund this expansion and make its mandatory cash
interest payments while also maintaining strong FOCF generation.
"Key risks we will continue to observe include Carvana's ability to
maintain a strong inventory turn and control SG&A spending as unit
sales increase. The company has managed SG&A well over the past few
years, but historically when it expanded too aggressively, SG&A
also expanded too quickly. We believe it will follow a more
disciplined growth approach, expanding into markets rationally to
maintain reasonable inventory turn times, and keep advertising and
headcount costs under control. Additionally, Carvana must maintain
high standards in its reconditioning process even as unit growth
expands by keeping returns consistent with historical levels.
"Carvana's other GPU has been improving; however, we believe
further diversification of loan sale channels would enhance its
risk profile. Other GPU has continued to rise from the previous
year, reaching $2,771 compared with $1,945 last year. We adopt a
conservative forward outlook, modeling slight moderation in other
GPU due to ongoing consumer pressure and an assumed normalization
in spreads between origination rates and benchmark rates. Loan
sales have generally aligned with unit sales growth, and we expect
this trend to persist. In the second quarter of 2024, the company
added another third-party loan buyer, creating an additional
channel for loan sales alongside asset-backed securities (ABS) and
the Ally Master Purchase and Sale Agreement. Additionally, the
company has expanded the number of buyers of the residual
certificates in their ABS transactions. This diversification
reduces the risk associated with any channel temporarily downsizing
or closing.
"To account for any potential disruptions in the company's ability
to sell loans to third parties or through ABS, we assume an average
intraquarter draw on the warehouse lines based on the volume of
loans sold in the quarter. While this is a conservative adjustment
that we make and we acknowledge the company's current cash flow
generation is sufficient to fund loan originations without large
draws on the warehouse, we believe in a more volatile economic
period, there could be greater reliance on the warehouse facility.
Over the past three quarters, the company ended the period with $0
drawn on the warehouse facilities. However, during a more troubled
performance period at the end of first quarter 2023 it had reported
a $1.2 billion draw. Carvana has grown the size of the warehouse
facility as its units have grown, and we expect it to continue to
grow the warehouse capacity with growing loan volumes despite more
robust cash flows.
"Further ratings upside will depend on Carvana's continued
deleveraging path and financial policy. Our positive outlook
indicates potential for a ratings upgrade in the near term if the
company can demonstrate its ability to maintain more conservative
financial metrics. While we forecast leverage to drop below 5x and
FOCF to debt to exceed 5% in 2025, we prefer to see a consistent
track record of maintaining these metrics before considering an
upgrade. Additionally, we are interested in understanding the
company's strategy for deploying its FOCF and substantial cash
balance. Carvana has a $1 billion at-the-market facility to raise
additional equity, after raising $1.3 billion through its prior
at-the-market facility in 2024. The company redeemed $470 million
of principal amount of the 2028 senior secured notes in 2024. We
haven't factored additional debt prepayment into our base case,
though gross debt reduction would accelerate deleveraging and
improve FOCF to debt.
"The positive outlook reflects our view that we could upgrade
Carvana over the next 12 months if it continues growing its top
line and EBITDA while maintaining leverage below 5x and FOCF to
debt above 5%."
S&P could revise its outlook back to stable if S&P expects the
company to manage leverage above 5x and FOCF to debt below 5% over
the longer term. This could happen if:
-- Operating performance deteriorates such that margins decline
materially; or
-- The company adopts a more aggressive financial policy and
issues debt to fund acquisitions, growth initiatives, or
shareholder returns.
S&P could raise its ratings on Carvana if it maintains leverage
below 5x and FOCF to debt above 5% and demonstrates a track record
of maintaining these more conservative metrics. This could happen
if:
-- Unit sales and operating performance continues to improve,
driving stronger EBITDA;
-- Carvana utilizes FOCF or cash on the balance sheet to reduce
its gross debt position; and
-- The company commits to maintaining leverage below 5x and FOCF
to debt above 5% longer term and the risk of releveraging is low.
CC 1400 ALICEANNA: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: CC 1400 Aliceanna Street LLC
1400 Aliceanna Street
Baltimore, MD 21231
Business Description: CC 1400 Aliceanna Street LLC is a real
estate development company based in
Baltimore, Maryland.
Chapter 11 Petition Date: March 13, 2025
Court: United States Bankruptcy Court
District of Maryland
Case No.: 25-12153
Debtor's Counsel: Brent C. Strickland, Esq.
WHITEFORD, TAYLOR & PRESTON L.L.P.
8830 Stanford Blvd., Suite 400
Columbia, MD 21045
Tel: (410) 347-9402
E-mail: bstrickland@whitefordlaw.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Brandon M. Chasen, Sr. as managing
member.
A full-text copy of the petition is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/JWKPSUY/CC_1400_Aliceanna_Street_LLC__mdbke-25-12153__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
1. Absolute Fire Trade Debt $120,000
Protection, Inc.
445 Defense
Highway, Suite C
Annapolis, MD 21401
Debbie Hall,
Operations Manager
Email: dhall@absolutefp.com
Phone: 410-544-7771 (ext 105)
2. Air Flow Trade Debt $228,000
Technology LLC
6026 Archstone
Court, Unit #402
Alexandria, VA 22310
Priscila De Faria,
Office Manager
Email: info@airflowtech.net
Phone: 703-223-1443
3. Cahill Services Trade Debt $35,092
1101 E Admiral
Doyle Drive
Suite 301-1
New Iberia, LA 70560
Lynette Smith
Email: lsmith@cahillservices.com
Phone: 732-850-6115
4. Capital Electric Trade Debt $8,206
8511 Pepco Place
Upper Marlboro, MD 20772
Patrick Horine
Email: patrick.horine@cap
italelectricsupply.com
Tel: 301-909-6500
5. Crimpco, LLC Trade Debt $69,100
2545 Lord Baltimore Drive
Windsor Mill, MD 21244
Chris Graham
Email: cgraham@crimpcosecurity.com
Phone: 410-484-0363
6. David L Cohen Loan $500,000
Revocable Trust
338 S Beach Road
Hobe Sound, FL 33455
7. DeVere Insulation Company Trade Debt $252,307
7501 Resource Court
Curtis Bay, MD 21226
Christina Pollikof
Email: cpollikof@devereinsulation.com
Phone: 443-517-7336
8. Donald Excavating Inc Trade Debt $17,947
7831 Philadelphia Road
Rosedale, MD 21237
Renee
Email: renee@donaldexcavating.com
Phone: 410-866-3701
9. Duque Construction LLC Trade Debt $905,186
3107 Hewitt Avenue, Apt 439
Silver Spring, MD 20906
10. Ed Bradley Loan $500,000
600 Wood Glenn Court
Lutherville
Timonium, MD 21093
11. Keith Flaum Loan $250,000
Flaum-Liberman Trust
325 Amber Way
Menlo Park, CA 94025
12. Otis Elevators Company Trade Debt $154,215
1705 Twin Spring
Road, Suite 110
Baltimore, MD 21224
Seymour, Matthew
Email: Matthew.Seymour@otis.com
Phone: 410-737-6200
13. Pando Alliance LLC Trade Debt $11,229
3454 Ellicott Mills
Drive, Suite A2
Ellicott City, MD 21043
Sandra Childs
Email: accounting@pandoalliance.com
14. Renee Honig 2019 Loan $5,000,000
Irrevocable Trust
DTD July 19, 2019
5815 Windsor Court
Boca Raton, FL 33496
15. SFO Ventures LLC Loan $6,160,000
4100 Rosemary Street
Chevy Chase, MD 20815
16. Shepherd Electric Supply Trade Debt $92,214
7401 Pulaski Highway
Rosedale, MD
21237-2529
Jenifer Denk
Email: jldenk@shepherdelec.com
17. SSMC GST Trust Loan $500,000
11109 Piney Meeting
House Road
Potomac, MD 20854
18. Supplies Unlimited, Inc. Trade Debt $43,038
2201 Halethorpe
Farms Road
Halethorpe, MD 21227
Rick Schmitt
Email: rbs@baltimoredoor.com
Phone: 410.247.9090 Ext: 207
19. Thomas Clute Loan $75,000
3203 Rolling Road
Chevy Chase, MD
20815
20. United Rentals Trade Debt $23,547
PO Box 100711
Atlanta, GA
30384-0711
Tel: 410-918-9770
CHARLES & COLVARD: Delays Q2 Filing, Cites Going Concern Doubt
--------------------------------------------------------------
Charles & Colvard, Ltd. filed a Notification of Late Filing on Form
12b-25 with respect to its Quarterly Report on Form 10-Q for the
fiscal quarter ended December 31, 2024 with the U.S. Securities and
Exchange Commission stating that it was unable to file its Q2
FY2025 Form 10-Q within the prescribed time period without
unreasonable effort or expense because it requires additional time
to complete procedures relating to its year-end financial
statements and subsequent quarterly financial statements and the
settlement agreement between the Company and Wolfspeed, Inc.
entered into on February 10, 2025, which was the outcome of the
confidential arbitration against the Company initiated by Wolfspeed
on July 28, 2023, as disclosed on the Company’s Current Report on
Form 8-K filed on February 14, 2025.
While the Company intends to file the Q2 FY2025 Form 10-Q as soon
as practicable, the Company does not anticipate being able to file
its Q2 FY2025 Form 10-Q within the five-day grace period provided
by Rule 12b-25 under the Securities Exchange Act of 1934, as
amended.
Based on the currently available information, and consistent with
the Company’s disclosure in its Quarterly Report on Form 10-Q for
the fiscal quarter ended March 31, 2024, the Company expects to
disclose in its Annual Report on Form 10-K for the fiscal year
ending June 30, 2024, its Quarterly Report on Form 10-Q for the
fiscal quarter ending September 30, 2024, and its Q2 FY2025 Form
10-Q, that certain factors raise substantial doubt about the
Company’s ability to continue as a going concern. In response to
this and the continued challenging economic environment, in the
three months ended June 30, 2024, and September 30, 2024, and
continuing in the three months ended December 31, 2024, the Company
reduced spend across the board in order to stabilize and right-size
its business. The Company implemented a cost reduction strategy
that included a decrease in headcount, reevaluation of its supplier
base, inventory repurposing and a completion of its investment
strategy in its studio infrastructure and next generation website
in FY2024, so that certain of the Company’s significant capital
expenditures and operating expenses are behind the Company.
About Charles & Colvard Ltd.
Charles & Colvard, Ltd., a North Carolina corporation, was founded
in 1995. The Company manufactures, markets, and distributes Charles
& Colvard Created Moissanite and finished jewelry featuring
moissanite, including Forever One, the Company's premium moissanite
gemstone brand, for sale in the worldwide fine jewelry market. The
Company also markets and distributes Caydia lab-grown diamonds and
finished jewelry featuring lab grown diamonds and created color
gems for sale in the worldwide fine jewelry market.
CLIFFWOOD DEVELOPMENT: Seeks Chapter 11 Bankruptcy in California
----------------------------------------------------------------
On March 1, 2025, Cliffwood Development Partners LLC filed Chapter
11 protection in the U.S. Bankruptcy Court for the Central
District of California. 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 Cliffwood Development Partners LLC
Cliffwood Development Partners LLC is a Los Angeles-based property
owner and developer involved in a variety of real estate projects,
focusing on development and investment in residential and
commercial properties.
Cliffwood Development Partners LLC sought relief under Chapter 11
of the U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No. 25-11786) on
March 1, 2025. In its petition, the Debtor reports estimated assets
and liabilities between $10 million and $50 million each.
Honorable Bankruptcy Judge Julia W. Brand handles the case.
The Debtor is represented by:
Gary E. Klausner, Esq.
LEVENE, NEALE, BENDER, YOO & GOLUBCHIK L.L.P.
2818 La Cienega Ave.
Los Angeles, CA 90034
Tel: (310) 229-1234
Email: GEK@lnbyg.com
COASTAL GROWERS: Court OKs Vehicle Sale to Johnson Ford
-------------------------------------------------------
Coastal Growers LLC received the greenlight from the U.S.
Bankruptcy Court for the Southern District of Alabama, to sell
certain vehicles.
The Debtor is authorized to sell the following vehicles to Johnson
Ford Inc.
a. 2021 Ford F350 XL (VIN: 08002) with 44,500 miles, for
$29,000.00;
b. 2021 Ford F150 XLT (VIN: 31023) with 85,941 miles, for
$25,000.00.
In addition, the Debtor is also directed to sell its third vehicle,
a 2021 Ford F150 for at least $12,000.00 to interested buyer.
The Court held that the sale transaction is "as is, where is" and
without any representations or warranties.
The Debtor is authorized to take all actions necessary or
appropriate to effectuate the relief granted.
About Coastal Growers LLC
Coastal Growers, LLC is a company that helps peanut farmers achieve
higher returns by sharing in farming and shelling profits and
operates a shelling facility in Atmore. Since its launch in 2021,
the facility has served as a key center for peanut shelling,
storage, and shipping, contributing to regional agricultural growth
and economic development, the report relays.
Coastal Growers filed Chapter 11 petition (Bankr. S.D. Ala. Case
No. 24-13034) on November 27, 2024, with total assets of $10
million to $50 million and total liabilities of $100 million to
$500 million. Holly Johnson, chief financial officer of Coastal
Growers, signed the petition.
Judge Henry A. Callaway presides over the case.
The Debtor tapped Edward J. Peterson, III at Johnson Pope Bokor
Ruppel & Burns, LLP as counsel and Porter White Capital Advisors,
Inc. as investment banker.
COHNREZNICK ADVISORY: S&P Assigns 'B' ICR, Outlook Stable
---------------------------------------------------------
S&P Global Ratings assigned its 'B' issuer credit rating to New
York-based professional services firm CohnReznick Advisory LLC. At
the same time, S&P assigned its 'B' issue-level rating and '3'
recovery rating to the proposed senior secured credit facility. The
recovery rating indicates S&P's expectation for meaningful recovery
(50%-70%; rounded estimate: 50%) for lenders in the event of a
payment default.
The stable outlook reflects S&P's expectation that CohnReznick will
organically grow revenue at 3%-5% per year and maintain S&P Global
Ratings-adjusted leverage of approximately 5x in fiscal year 2026
(ending June 2026).
S&P said, "The rating reflects our view that CohnReznick operates
in the highly competitive and mature tax, advisory, and assurance
services business. CohnReznick has a middle-market focus and
competes with regional firms in the accounting space. We expect the
company to produce approximately $1 billion in sales in fiscal
2025. Our rating is constrained by the company's limited scale and
geographical diversity, as it generates a majority of its revenue
in the U.S."
Funds advised by private-equity sponsor Apax Partners LLP and an
independent co-investor have entered into an agreement to fund a
strategic growth investment in New York-based professional services
firm CohnReznick Advisory LLC.
In conjunction with the transaction, the company will issue a new
$790 million senior secured credit facility comprised of a $540
million initial term loan due 2032, a $125 million delayed draw
term loan due 2032, and a $125 million revolver due 2030. The
revolving credit facility will be available at close subject to
limitations on use of proceeds available to finance the strategic
growth investment. The delayed draw term loan will be fully
available at close.
S&P said, "We believe CohnReznick has limited pricing power due to
the competitive pricing environment that constrains its ability to
significantly raise billing rates and, therefore, restricts organic
growth. Additionally, 16% of the company's billable hours are
offshored, and we expect management to continue to grow its
offshore capabilities, which we believe can modestly grow margins.
We expect EBITDA margins to be 11%-13% in fiscal year 2026 and
2027.
"The company generates approximately one-third of its revenue from
the real estate industry, which we view as an increased risk given
the uncertainty in interest rates. However, it contracts a majority
of its real estate revenue in the assurance and tax services space,
which we view as nondiscretionary and highly reoccurring.
Therefore, we believe there is strong revenue visibility.
"We relied on unaudited financial statements that CohnReznick
provided. However, we expect the company will provide audited
financial statements for full-year 2025. Additionally, CohnReznick
is in the process of amending its fiscal year-end from January to
June.
"Our 'B' issuer credit rating reflects our expectation that
CohnReznick will have S&P Global Ratings-adjusted leverage of
approximately 5X in fiscal year 2026 while generating sufficient
free operating cash flow (FOCF). We expect continued long-term
EBITDA growth to be supported by consistent organic revenue
expansion as the company outperforms GDP growth in an economic
downtown. Additionally, as part of the transaction, partners of the
firm are receiving increased equity in the firm in exchange for
reduced cash compensation. Therefore, we expect this to support
CohnReznick's EBDITA generation starting in fiscal 2026. The
company also benefits from its asset-lite and low capital
expenditure (capex) business model, which allows for good FOCF
(free operating cash flow) generation.
"We view APAX Partner ownership as an increased risk because we
believe financial sponsors are more likely to engage in
debt-financed acquisitions and shareholder returns. While our
base-case scenario does not include any acquisitions, we believe it
is likely the company will draw on its $125 million delayed draw
term loan to fund acquisitions, which could entail higher leverage
and integration risk. Any operational missteps could lead to
increased leverage above our downside scenario of 6.5x.
"We relied on unaudited financial statements that CohnReznick
provided. Although audited statements for the entity were
unavailable, we expect the company to provide them for full-year
2025. Additionally, the company is in the process of amending its
fiscal year-end from January to June.
"The stable outlook reflects our expectation that CohnReznick will
maintain prudent financial policy that leads to S&P Global
Ratings-adjusted leverage of approximately 5x in fiscal year 2026
(Ending June 2026). We also expect the company to organically grow
revenue 3%-5% in Fiscal Year 2026."
S&P could lower its rating on CohnReznick if its leverage exceeds
6.5x or its FOCF to debt declines below 5% on a sustained basis.
This could occur if:
-- The company undertakes debt-financed shareholder returns or
large acquisitions that increase its leverage, which we believe
could occur if the sponsor chooses to pursue a more aggressive
financial policy; or
-- Operating performance is significantly weaker compared with our
base-case scenario.
S&P views an upgrade as unlikely in the next 12 months given
CohnReznick's financial-sponsor ownership and our expectation that
the company will use the delayed draw term loan to fund
acquisitions. However, S&P could raise its rating on the company
over the longer term if:
-- It materially expands its business and improves EBITDA margins
such that we take a more favorable view of its competitive
position; and
-- S&P expects it to commit to a conservative financial policy
that allows leverage to remain below 5x on a sustained basis, even
after accounting for potential leveraging transactions.
CORTO II LLC: Seeks Chapter 11 Bankruptcy in California
-------------------------------------------------------
On March 8, 2025, Corto II LLC filed Chapter 11 protection in the
U.S. Bankruptcy Court for the Central District of California.
According to court filing, the Debtor reports $2,006,400 in
debt owed to 1 and 49 creditors. The petition states funds will be
available to unsecured creditors.
About Corto II LLC
Corto II LLC owns the property located at APN: 149-160-32-00,
149-160-33-00 Corto St., Oceanside, CA 92054, with a current value
of $2.7 million based on a broker's opinion.
Corto II LLC sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. C.D. Cal. Case No. 25-10597) on March 8, 2025. In its
petition, the Debtor reports total assets of $2,700,000 and total
liabilities of $2,006,400
Honorable Bankruptcy Judge Theodor Albert handles the case.
The Debtor is represented by:
James Mortensen, Esq.
SOCAL LAW GROUP, PC
2855 Michelle Drive 120
Irvine CA 92606
Tel: 213-387-7414
E-mail: pimmsno1@aol.com
COWTOWN BUS: To Sell Bus Business to CanTex Real Estate for $1.8MM
------------------------------------------------------------------
Cowtown Bus Charters Inc. and its affiliate, Cowtown Transportation
Company LLC, seek approval from the U.S. Bankruptcy Court for the
Northern District of Texas, Forth Worth Division, to sell Real
Property, free
The Cowtown Bus has already sold its operating assets to Avalon
Motorcoach, LLC. Cowtown Bus sought and received authority to sell
real property held in the name of Cowtown Transportation, but was
unable to close the transaction because secured claims exceeded the
purchase price.
The Debtors maintained corporate headquarters in Fort Worth, Texas
and employed approximately 29 employees. To provide prompt,
efficient service to its customers, Cowtown Bus maintained its own
fleet complete with the repair shop and mechanics.
Brenda Cross is the Cowtown Bus' sole officer and director. She
assumed the position after the death of her brother Bill Pippin.
Cowtown Transportation is an entity separately recognized by the
state of Texas. William Pippen, deceased, acting as a principal
caused both Debtors to enter transactions with the Small Business
Administration (SBA) and with First Savings Bank in which those
transactions recognize a distinction between the two entities.
Due to financial challenges and the passing of William “Bill”
Pippin, the current management and ownership of Cowtown Bus
believed that it was in the best interest of the creditors to offer
and sell substantially all of the operating assets of the business
as a going concern.
The lienholders of the Assets are First Savings Bank, SBA, and
Tarrant County Tax Assessor.
The Debtors received an offer from CanTex Real Estate Holdings, LLC
to purchase the Assets popularly described as 5504 & 5508 Forest
Hill, Fort Worth, Texas 76119, with a summary legal description of
Duncan A E Subdivision Lots 11, 12, 13, 14, 15, and 16, with the
sale price of $1,800,000.00.
The Debtors request to be allowed to pay the ordinary costs of
closing, including expense of the title commitment, title
documents, and give a credit of $5,000 for the new survey.
The Debtors further propose to pay 3% broker fee to purchaser's
broker at closing.
The Debtors seeks to sell the Assets free and clear of any and all
liens, claims, and encumbrances, except those expressly assumed by
the buyer attaching to the proceeds of the sale.
About Cowtown Bus Charters Inc.
Cowtown Bus Charters, Inc. is a full service bus charter company
providing local to national transportation.
Cowtown Bus Charters, Inc. filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex. Case No.
24-10161) on Sept. 6, 2024. In the petition signed by Brenda Cross,
president and director, the Debtor disclosed $1,237,132 in assets
and $4,370,485 in liabilities as of Aug. 22, 2024.
Judge Mark X. Mullin presides over the case.
The Debtor tapped Mark J. Petrocchi, Esq., at Griffith, Jay &
Michel, LLP as counsel.
CROWN CASTLE: Reaches Definitive Deal to Sell Units to Pay Debt
---------------------------------------------------------------
Dale Quinn of Bloomberg News reports that Crown Castle has signed a
definitive agreement to sell its fiber segment units, including
certain supporting assets and personnel, to EQT Active Core
Infrastructure fund and Zayo Group Holdings for a total of $8.5
billion.
As part of the deal, EQT will acquire the small cells business,
while Zayo will take over the fiber solutions unit. The transaction
is expected to close in the first half of 2026. according to
Bloomberg News.
Proceeds from the sale will be used to repay debt and fund planned
share repurchases. In conjunction with the closing, Crown Castle
will implement a share repurchase program valued at approximately
$3 billion. Zayo reportedly pursued the Crown Castle unit as TPG
talks slowed, the report states.
About Crown Castle Inc.
Crown Castle Inc. (NYSE: CCI) owns, operates and leases more than
40,000 cell towers and approximately 80,000 route miles of fiber
supporting small cells and fiber solutions across every major U.S.
market. This nationwide portfolio of communications infrastructure
connects cities and communities to essential data, technology and
wireless service - bringing information, ideas and innovations to
the people and businesses that need them.
CTF CHICAGO: Court Extends Cash Collateral Access to March 31
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois,
Eastern Division extended CTF Chicago, Inc.'s authority to use cash
collateral through March 31.
The interim order authorized CTF Chicago to use the cash collateral
of Wintrust Bank, a pre-bankruptcy secured lender, to pay the
expenses set forth in its budget.
The budget shows projected expenses of $128,336 for the period
commencing on March 5 and ending at the close of business on March
31.
Wintrust Bank holds a senior lien on the company's assets valued at
$781,571.93, with a subordinate lien by the U.S. Small Business
Administration.
As adequate protection, Wintrust Bank was granted a replacement
lien on substantially all of the company's assets, including cash
collateral equivalents, cash and accounts receivable, to the same
extent and with the same validity as its pre-bankruptcy lien.
In addition, Wintrust Bank was granted an administrative expense
claim under Section 507(b) of the Bankruptcy Code, subordinate only
to the administrative claim of the Subchapter V trustee.
The next hearing is scheduled for March 26.
About CTF Chicago
CTF Chicago, Inc. operates within a framework that requires
substantial capital and resources. The company is structured to
provide specific services or products, likely in a competitive
market, given its presence in Chicago.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ill. Case No. 24-15580) with up to
$50,000 in assets and up to $10 million in liabilities. Charles
Graff, managing member, signed the petition.
Judge Janet S. Baer oversees the case.
The Debtor is represented by Richard G. Larsen, Esq., at Springer
Larsen, LLC.
Wintrust Bank, as lender, is represented by:
Andrew H. Eres, Esq.
Dickinson Wright PLLC
55 W. Monroe, Suite 1200
Chicago, IL 60603
Tel: 312-377-7891
aeres@dickinson-wright.com
DAATS COMPANIES: Case Summary & Nine Unsecured Creditors
--------------------------------------------------------
Debtor: DAATS Companies, Inc.
2665 Villa Creek Dr.
Dallas, TX 75234
Business Description: Daats Companies Inc. is a comprehensive
trucking firm located in Dallas, Texas,
providing nationwide transport services,
including dry-van and refrigerated product
shipments. The Company focuses on urgent,
same-day, and scheduled deliveries,
prioritizing safety and punctuality across
the continental United States.
Chapter 11 Petition Date: March 14, 2025
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 25-40894
Judge: Hon. Edward L Morris
Debtor's Counsel: Joyce W. Lindauer, Esq.
JOYCE W. LINDAUER ATTORNEY, PLLC
1412 Main St. Suite 500
Dallas TX 75202
Tel: (972) 503-4033
E-mail: joyce@joycelindauer.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by George Wainaina Muiruri as CEO.
A copy of the Debtor's nine unsecured creditors is available for
free on PacerMonitor at:
https://www.pacermonitor.com/view/RCSGYTA/DAATS_Companies_Inc__txnbke-25-40894__0002.0.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/BRXTNSA/DAATS_Companies_Inc__txnbke-25-40894__0001.0.pdf?mcid=tGE4TAMA
DECO GROUP: Gets Interim OK to Use Cash Collateral Until March 31
-----------------------------------------------------------------
Deco Group, LLC received interim approval from the U.S. Bankruptcy
Court for the Southern District of Texas to use cash collateral
until March 31.
The company needs to use cash collateral for essential business
operations, such as payroll, maintenance, supplies, and general
operating expenses.
Deco Group listed several secured creditors, which include the U.S.
Small Business Administration, Washington Business Bank, North Star
Leasing, a division of Peoples Bank, and Retail Capital, LLC, doing
business as Credibly. These secured creditors hold claims over
certain assets of the company, including the business's equipment
and revenues.
As protection, secured creditors were granted a replacement lien on
the company's post-petition cash collateral and property to the
same extent and with the same priority as their pre-bankruptcy
liens.
A final hearing is scheduled for April 1.
About Deco Group LLC
Deco Group, LLC runs and oversees both a quick-service restaurant
and a full-service restaurant business in Bryan, Texas.
Deco Group sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Texas Case No. 25-31252) on March 4,
2025, listing $106,682 in assets and $2,238,074 in debts. John
Mathews, Deco Group manager, signed the petition.
Judge Jeffrey P. Norman oversees the case.
Robert C. Lane, Esq., at the Lane Law Firm, represents the Debtor
as bankruptcy counsel.
DEREK L. MARTIN DMD: Case Summary & 20 Top Unsecured Creditors
--------------------------------------------------------------
Debtor: Derek L. Martin, DMD, Inc.
1231 Elfin Forest Rd. W. Ste. 112
San Marcos CA 92078
Business Description: Derek L. Martin, DMD, Inc. is a dental
clinic providing a variety of treatments,
from standard fillings to aesthetic services
such as digitally-designed dental veneers.
Chapter 11 Petition Date: March 14, 2025
Court: United States Bankruptcy Court
Southern District of California
Case No.: 25-01018
Debtor's Counsel: Bernard Hansen, Esq.
LAW OFFICES OF BERNARD M. HANSEN
3465 Camino del Rio, South #250
San Diego, CA 92108
Tel: 619-283-3371
E-mail: bernardmhansen@sbcglobal.net
Total Assets: $365,636
Total Liabilities: $1,530,365
The petition was signed by Shelly Martin as CFO.
A full-text copy of the petition, which includes a list of the
Debtor's 20 largest unsecured creditors, is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/UHPBTKA/Derek_L_Martin_DMD_Inc__casbke-25-01018__0001.0.pdf?mcid=tGE4TAMA
DH ENCHANTMENT: Raises Going Concern Doubt Amid $793K Deficit
-------------------------------------------------------------
DH Enchantment Inc. disclosed in a Form 10-Q Report filed with the
U.S. Securities and Exchange Commission for the quarterly period
ended December 31, 2024, that there is substantial doubt about its
ability to continue as a going concern.
According to DH, as of December 31, 2024, the Company suffered from
an accumulated deficit of $793,832. For the three and nine months
ended December 31, 2024, the company reported net losses of
$124,882 and $525,765, respectively, compared to net losses of
$44,722 and $71,607 for the same periods in 2023. The Company has
not yet established an ongoing source of revenue sufficient to
cover its operating costs and allow it to continue as a going
concern. The continuation of the Company as a going concern is
dependent upon improving the profitability and the continued
financial support from its stockholders. Management believes the
existing stockholders will provide the additional cash to meet with
the Company’s obligations as they become due. However, there is
no assurance that the Company will be successful in securing
sufficient funds to sustain the operations.
A full-text copy of the Company's Form 10-Q is available at:
https://tinyurl.com/2k2xpsa5
About DH Enchantment
DH Enchantment Inc. is a Nevada holding company with no operations
of its own. DH Enchantment Inc. operates through its wholly owned
subsidiaries OLS APAC Corporation, a British Virgin Island
corporation, Online Logistics Services Limited, a Hong Kong private
limited company and Online Logistics Services Limited Taiwan
Branch, a registered foreign branch of OLSL in Taiwan. OAC is
engaged primarily in the logistics business. OAC’s operations are
located in Hong Kong and Taiwan and are solely conducted through
OLSL and OLTW.
As of December 31, 2024, the Company has $2,258,610 in total
assets, $3,936,715 in total liabilities, and total stockholders'
deficit of $1,678,105.
DRIVEHUB AUTO: Court Extends Cash Collateral Access to May 13
-------------------------------------------------------------
DriveHub Auto, Inc. received interim approval from the U.S.
Bankruptcy Court for the Middle District of Florida, Orlando
Division, to use cash collateral until May 13, marking the third
extension since the company's Chapter 11 filing.
The court's previous interim order issued on March 5 allowed the
company to access cash collateral until March 13 only.
The March 5 order granted XL Funding, LLC and other creditors,
which assert a security interest in the company's cash and cash
equivalents, a post-petition lien on cash collateral to the same
extent and with the same validity and priority as their
pre-bankruptcy lien.
The next hearing is set for May 13.
About DriveHub Auto Inc.
DriveHub Auto Inc. is a used car dealership located in Orlando,
Fla., offering pre-owned vehicles to customers.
DriveHub Auto filed Chapter 11 petition (Bankr. M.D. Fla. Case No.
25-00594) on January 27, 2025, listing between $1 million and $10
million in both assets and liabilities.
Judge Grace E. Robson handles the case.
The Debtor is represented by Daniel A. Velasquez, Esq., at Latham,
Luna, Eden & Beaudine, LLP.
XL Funding, LLC, as secured creditor, is represented by:
Eric B. Zwiebel, Esq.
Emanuel & Zwiebel, PLLC
7900 Peters Road
Building B, Suite 100
Plantation, FL 33324
eric.zwiebel@emzwlaw.com
DZS INC: Seeks Chapter 7 Bankruptcy, Stops Operations
-----------------------------------------------------
Investing.com reports that DZS Inc., a telecommunications equipment
company, has filed for Chapter 7 bankruptcy and ceased operations
immediately. The company, along with its subsidiaries DZS Services
Inc. and DZS California Inc., voluntarily submitted petitions in
the U.S. Bankruptcy Court for the Eastern District of Texas.
The filing comes after DZS Inc. explored various strategic options
to address its financial and operational difficulties, including
pursuing additional financing, out-of-court restructuring, asset
sales, and debtor-in-possession financing for reorganization. After
none of these efforts proved viable, the company opted for
liquidation.
A Chapter 7 trustee will be appointed to manage the liquidation of
assets and distribution of payments in accordance with the
Bankruptcy Code. As a result, the company's board of directors and
executive officers will lose authority and control over its
affairs.
Shareholders of DZS Inc. are unlikely to receive any distributions
for their shares during the bankruptcy proceedings. Additionally,
the filing may trigger defaults on various obligations, potentially
accelerating debts, although these defaults may be stayed under the
Bankruptcy Code.
DZS Inc. also disclosed that its financial audit for the fiscal
year ending December 31, 2024, was not completed, and it will not
be able to file its Annual Report on Form 10-K for that period or
any future periodic reports.
This update is based on a press release statement.
About DZS Inc.
DZS Inc. is a developer of Networking and Connectivity systems and
Cloud Edge software solutions enabling broadband everywhere. The
Company provides a wide array of reliable, cost-effective access
and optical networking technologies and cloud software to a diverse
customer base.
DZS Inc. sought relief under Chapter 7 of the U.S. Bankruptcy Code
(Bankr. E.D. Tex. Case No. 25-40712) on March 14, 2025.
Honorable Bankruptcy Judge Brenda T. Rhoades handles the case.
The Debtor is represented by:
Travis A. McRoberts, Esq.
Baker Botts L.L.P.
1001 Page Mill Road, Suite 200
Palo Alto, CA 94304
Phone: (650) 739-7500
Facsimile: (650) 739-7699
EAGLE HIGHLAND: Gets Final OK to Use Cash Collateral
----------------------------------------------------
Eagle Highland Pharmacy Inc. received final approval from the U.S.
Bankruptcy Court for the Southern District of Indiana, Indianapolis
Division, to use cash collateral.
The final order authorized the company to use cash collateral to
cover expenses set forth in its budget.
As protection for the use of their cash collateral, the lenders,
including Fifth Third Bank, National Association, were granted
replacement liens on the company's post-petition assets.
In addition, Fifth Third Bank will receive a monthly payment of
$3,000 starting this month.
If the order is later modified, terminated, or vacated, any liens,
protections, or priorities granted before the modification remain
valid and enforceable.
Fifth Third Bank is represented by:
Jeffrey M. Hendricks, Esq.
Bricker Graydon LLP
312 Walnut Street, Suite 1800
Cincinnati, OH 45202
Phone: (513) 621-6464
Fax: (513) 651-3836
Email: jhendricks@brickergraydon.com
About Eagle Highland Pharmacy Inc.
Eagle Highland Pharmacy Inc. located in Indianapolis, provides a
wide range of pharmacy services, including prescription
medications, compounded prescriptions, medical equipment, and
wellness products like vitamins and CBD items. The pharmacy also
offers specialized products such as compression stockings, ostomy
care supplies, and mobility aids to support patient health and
well-being.
Eagle Highland Pharmacy Inc. sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. S.D. Ind. Case No. 25-00691) on
February 17, 2025. In its petition, the Debtor reports total assets
of $147,900 and total liabilities of $1,037,805.
Honorable Bankruptcy Judge James M. Carr handles the case.
The Debtor is represented by Harley K. Means, Esq. at Kroger Gardis
Regas, LLP.
EASTSIDE DISTILLING: CEO Increases Ownership to 98K Shares
----------------------------------------------------------
Eastside Distilling, Inc. disclosed in a Form 8-K Report filed with
the U.S. Securities and Exchange Commission that on February 27,
2025, Mr. Nicholas Liuzza, Jr., the principal shareholder of
Eastside Distilling, Inc., d/b/a Beeline Holdings, and Chief
Executive Officer of the Company's wholly-owned subsidiary, Beeline
Financial Holdings, Inc. increased his ownership of the Company's
securities by purchasing $100,000 of units comprised of a total of
196,078 shares of Series G Convertible Preferred Stock and
five-year Warrants to purchase a total of 98,039 shares. The
purchase was pre-approved by the Company's Audit Committee. The
purchase prices were on the same terms as paid by other
unaffiliated investors.
In addition, on February 27, 2025, an accredited investor purchased
$75,000 of units comprised of a total of 147,059 shares of series G
and five-year Warrants to purchase a total of 73,529 shares.
The offers and sales described above are part of the Company's
offering of a total of up to 13,878,040 shares of Series G and
Warrants to purchase up to 6,939,020 shares of Common Stock for
total gross proceeds of up to $7,077,800, which offering was
increased from its previous amount of up to $5,037,800 following
approval by the Company's Board of Directors on February 27, 2025.
Since the offering of Series G shares and Warrants originally
commenced on November 26, 2024, the Company has sold to accredited
investors a total of 10,254,416 shares of Series G and Warrants to
purchase 5,127,208 shares of Common Stock for total gross proceeds
of $5,054,752. The Company intends to use the net proceeds, after
deducting offering expenses and related costs, for working capital
and general corporate purposes.
In connection with the foregoing, the Company entered into a
Securities Purchase Agreement and Registration Rights Agreement
with the investors. The terms of the Securities Purchase Agreement,
Series G, Warrants, and related Registration Rights Agreement were
previously disclosed in the Current Report on Form 8-K filed on
December 3, 2024.
The offers and sales of the units were exempt from registration
Section 4(a)(2) of the Securities Act of 1933 and Rule 506(b)
promulgated thereunder.
On February 27, 2025, the Board of Directors of the Company filed a
Certificate of Amendment to the Series G Certificate of
Designations increasing the authorized shares of Series G from
11,000,000 shares to 15,000,000 shares.
About Eastside Distilling
Headquartered in Portland, Oregon, Eastside Distilling, Inc.
(d/b/a
Beeline Holdings) has been producing craft spirits in Portland,
Oregon since 2008. The Company is distinguished by its highly
decorated product lineup that includes Azunia Tequilas, Burnside
Whiskeys, Hue-Hue Coffee Rum, and Portland Potato Vodkas. All
Eastside spirits are crafted from natural ingredients for the
highest quality and taste. Eastside's Craft Canning + Printing
subsidiary is one of the Northwest's leading independent mobile
canning, co-packing, and digital can printing businesses.
The Woodlands, Texas-based M&K CPAS, PLLC, the Company's former
auditor, issued a "going concern" qualification in its report
dated
April 1, 2024, citing that the Company suffered a net loss from
operations and used cash in operations, which raises substantial
doubt about its ability to continue as a going concern.
Eastside Distilling incurred a net loss of $7.5 million during the
year ended December 31, 2023. As of June 30, 2024, Eastside
Distilling had $16,589,000 in total assets, $18,523,000 in total
liabilities, and $1,934,000 in total stockholders' deficit.
EGZIT CORPORATION: Court Extends Cash Collateral Access to April 11
-------------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
extended Egzit Corporation's authority to use cash collateral to
April 11.
The sixth interim order signed by Judge Deborah Thorne authorized
the company to use cash collateral in accordance with its budget,
which outlines the company's projected monthly operational costs of
$227,191.12.
The next hearing is set for April 9.
About Egzit Corporation
Egzit Corporation is a provider of general freight trucking
services in Darien, Ill.
Egzit Corporation filed Chapter 11 petition (Bankr. N.D. Ill. Case
No. 24-13990) on Sept. 20, 2024, with $1 million to $10 million in
both assets and liabilities. Neema Varghese of NV Consulting
Services serves as Subchapter V trustee.
Judge Deborah L. Thorne oversees the case.
The Debtor is represented by:
Peter C. Nabhani, Esq.
Law Office Of Peter C. Nabhani
Tel: 312-219-9149
Email: pcnabhani@gmail.com
ELEGANT TENTS: Seeks Subchapter V Bankruptcy in Pennsylvania
------------------------------------------------------------
On March 7, 2025, Elegant Tents and Catering Inc. filed Chapter 11
protection in the U.S. Bankruptcy Court for the Western District
of Pennsylvania. 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 Elegant Tents and Catering Inc.
Elegant Tents and Catering Inc. is a family-owned business based in
Youngwood, PA, offering event rental services and catering for
various occasions, including weddings, birthdays, and corporate
events. The Company provides tent rentals, linens, furniture, and
other event equipment, along with a variety of catering menus, made
from family recipes and tailored to meet dietary needs. The Company
serves the Tri-State area and prides itself on delivering
personalized service.
Elegant Tents and Catering Inc. sought relief under Subchapter V of
Chapter 11 of the U.S. Bankruptcy Code (Bankr. W.D. Pa. Case No.
25-20594) on March 7, 2025. In its petition, the Debtor reports
estimated assets between $500,000 and $1 million and estimated
liabilities between $1 million and $10 million.
Honorable Bankruptcy Judge John C. Melaragno handles the case.
The Debtor is represented by:
Justin P. Schantz, Esq.
LAW CARE
David A. Colecchia and Associates
324 South Maple Ave.
Greensburg, PA 15601-3219
Tel: (724) 837-2320
Fax: (724) 837-0602
E-mail: jschantz@my-lawyers.us
ELEMENTS UES: Court Extends Cash Collateral Access
--------------------------------------------------
Elements UES, LLC received another extension from the U.S.
Bankruptcy Court for the Southern District of New York to use cash
collateral.
The third interim order authorized the company to use cash
collateral in accordance with its budget pending entry of a further
interim or final order.
A final hearing is scheduled for April 8.
As protection for the use of their cash collateral, Fund-Ex
Solutions Group and the U.S. Small Business Administration were
granted replacement liens on the company's assets, including cash
collateral, to the same extent, validity, priority, and nature as
their pre-bankruptcy liens.
As additional protection, Fund-Ex and SBA will receive monthly
payments of $6,500 and $455.25, respectively, beginning this
month.
About Elements UES
Elements UES, LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 25-10033) on January 12,
2025, listing between $1 million and $10 million in both assets and
liabilities. Andrea Fornarola Hunsberger, president and chief
executive officer of Elements UES, signed the petition.
Judge Michael E. Wiles presides over the case.
Ralph E. Preite, Esq., at Cullen and Dykman, LLP represents the
Debtor as legal counsel.
Fund-Ex Solutions Group, as secured creditor, is represented by:
Michele K. Jaspan, Esq.
Chuhak & Tecson, P.C.
265 Sunrise Highway, Suite 50
Rockville Centre, NY 11570
Phone: (646) 532-4636 / (646) 532-4621
Fax: (516) 599-0889
mjaspan@chuhak.com
ELETSON HOLDINGS: Reed Smith Oppose Removal in $102MM Shipping Suit
-------------------------------------------------------------------
Caroline Simson of Law360 Bankruptcy Authority reports that a New
York federal judge has temporarily halted his order disqualifying
Reed Smith LLP as counsel for the former owners of reorganized
international shipping group Eletson Holdings in a $102 million
arbitral award dispute while the firm appeals the decision to the
Second Circuit.
About Eletson Holdings
Eletson Holdings Inc. is a family-owned international shipping
company, which touts itself as having a global presence with
headquarters in Piraeus, Greece as well as offices in Stamford,
Connecticut, and London.
At one time, Eletson claimed to own and operate one of the world's
largest fleets of medium and long-range product tankers and boasted
a fleet consisting of 17 double hull tankers with a combined
capacity of 1,366,497 dwt, 5 LPG/NH3 carriers with a combined
capacity of 174,730 cbm and 9 LEG carriers with capacity of 108,000
cbm.
Eletson Holdings, a Liberian company, is Eletson's ultimate parent
company and is the direct parent and owner of 100% of the equity
interests in the two other debtors, Eletson Finance (US) LLC, and
Agathonissos Finance LLC.
Eletson and its two affiliates were subject to involuntary Chapter
7 bankruptcy petitions (Bankr. S.D.N.Y. Case No. 23-10322) filed on
March 7, 2023 by creditors Pach Shemen LLC, VR Global Partners,L.P.
and Alpine Partners (BVI), L.P. The petitioning creditors are
represented by Kyle J. Ortiz, Esq., at Togut, Segal & Segal, LLP.
On Sept. 25, 2023, the Chapter 7 cases were converted to Chapter 11
cases.
The Honorable John P. Mastando, III is the case judge.
Derek J. Baker, Esq., represents the Debtors as bankruptcy
counsel.
The U.S. Trustee for Region 2 appointed an official committee of
unsecured creditors. The committee tapped Dechert, LLP as its legal
counsel.
ELMWOOD CLO IX: S&P Assigns Prelim. B-(sf) Rating on Cl. F-R Notes
------------------------------------------------------------------
S&P Global Ratings assigned its preliminary ratings to the class
A-L-R, A-R, B-R, C-R, D-1-R, D-2-R, and E-R replacement debt and
proposed new class F-R debt from Elmwood CLO IX Ltd./Elmwood CLO IX
LLC, a CLO originally issued in 2021 that is managed by Elmwood
Asset Management LLC.
The preliminary ratings are based on information as of March 11,
2025. Subsequent information may result in the assignment of final
ratings that differ from the preliminary ratings.
On the March 21, 2025, refinancing date, the proceeds from the
replacement debt will be used to redeem the original debt. S&P
said, "At that time, we expect to withdraw our ratings on the
original debt and assign ratings to the replacement debt. However,
if the refinancing doesn't occur, we may affirm our ratings on the
original debt and withdraw our preliminary ratings on the
replacement debt."
The replacement debt will be issued via a proposed supplemental
indenture, which outlines the terms of the replacement debt.
According to the proposed supplemental indenture:
-- The non-call period will be extended to March 21, 2027.
-- The reinvestment period will be extended to April 20, 2030.
-- The legal final maturity dates (for the replacement debt and
the existing subordinated notes) will be extended to April 20,
2038.
-- Additional assets will be purchased on the March 21, 2025,
refinancing date, and the target initial par amount will increase
to $500 million from $450 million. There will be no additional
effective date or ramp-up period, and the first payment date
following the refinancing is July 20, 2025.
-- The required minimum overcollateralization and interest
coverage ratios will be amended.
-- An additional $6.25 million of subordinated notes will be
issued on the refinancing date.
S&P said, "Our review of this transaction included a cash flow
analysis, based on the portfolio and transaction data in the
trustee report, to estimate future performance. In line with our
criteria, our cash flow scenarios applied forward-looking
assumptions on the expected timing and pattern of defaults and the
recoveries upon default under various interest rate and
macroeconomic scenarios. Our analysis also considered the
transaction's ability to pay timely interest and/or ultimate
principal to each of the rated tranches. The results of the cash
flow analysis (and other qualitative factors, as applicable)
demonstrated, in our view, that the outstanding rated classes all
have adequate credit enhancement available at the rating levels
associated with the rating actions.
"We will continue to review whether, in our view, the ratings
assigned to the debt remain consistent with the credit enhancement
available to support them and take rating actions as we deem
necessary."
Preliminary Ratings Assigned
Elmwood CLO IX Ltd./Elmwood CLO IXLLC
Class A-L-R loans(i), $161.00 million: AAA (sf)
Class A-R, $159.00 million: AAA (sf)
Class B-R, $60.00 million: AA (sf)
Class C-R (deferrable), $30.00 million: A (sf)
Class D-1-R (deferrable), $30.00 million: BBB- (sf)
Class D-2-R (deferrable), $4.50 million: BBB- (sf)
Class E-R (deferrable), $15.50 million: BB- (sf)
Class F-R (deferrable), $5.00 million: B- (sf)
Other Debt
Elmwood CLO IX Ltd./Elmwood CLO IX LLC
Subordinated notes(ii), $51.85 million: Not rated
(i)Class A-L-R loans will be issued and can be converted to class
A-R notes at a future date. Class A-R notes cannot be converted to
class A-L-R loans.
(ii)This includes an additional $6.25 million in subordinated notes
issued in connection with this refinancing and extension.
ENDEAVOR GROUP: Deloitte & Touche Raises Going Concern Doubt
------------------------------------------------------------
Endeavor Group Holdings, Inc. disclosed in a Form 10-K Report filed
with the U.S. Securities and Exchange Commission for the fiscal
year ended December 31, 2024, that its auditor expressed an opinion
that there is substantial doubt about the Company's ability to
continue as a going concern.
New York, N.Y.-based Deloitte & Touche LLP, the Company's auditor
since 2014, issued a "going concern" qualification in its report
dated February 27, 2025, citing that the Company has not secured
additional liquidity to repay, or extended the maturity of or
refinanced, the outstanding borrowings on its First Lien Term Loan
that is scheduled to mature on May 18, 2025, which raises
substantial doubt about the Company's ability to continue as a
going concern.
Historically, the Company has relied principally on liquidity
generated from operating activities to fund the Company’s
day-to-day operations and routine capital expenditures, invest in
revenue-generating activities, and service its long-term debt. As
of December 31, 2024, the Company had an aggregate of $5.7 billion
outstanding indebtedness, of which $2.2 billion is a term loan
scheduled to mature on May 18, 2025. Endeavor said, "We expect that
the term loan then outstanding will be repaid as part of the
Merger-Related Transactions or will otherwise be refinanced prior
to its maturity. Absent the Company’s ability to secure
additional liquidity, extend the maturity of or refinance such term
loan, the Company’s operations may be adversely impacted in the
event the lenders declare an event of default and exercise their
rights and remedies under the first lien credit agreement"
As a result of the upcoming maturity of the term loan on May 18,
2025, the Company has evaluated plans over the next 12 months
beyond the date the accompanying consolidated financial statements
are issued to secure additional liquidity which include, but are
not limited to,
(i) repayment or refinancing of the term loan as part of the
Merger-Related Transactions
(ii) reducing discretionary capital and operating expenses
(iii) obtaining additional facilities from banks and renewal of
existing bank borrowings and
(iv) proceeds from asset sales. While the Company has had a
history of being able to secure additional liquidity or refinance
its outstanding indebtedness, the feasibility of some of these
plans is contingent upon factors outside of the control of the
Company, and as such, this uncertainty raises substantial doubt
about the Company's ability to continue as a going concern.
A full-text copy of the Company's Form 10-K is available at:
https://tinyurl.com/59w6jhhk
About Endeavor Group Holdings
Beverly Hills, Calif.-based Endeavor Group Holdings, Inc. is a
global sports and entertainment company. It owns and operates
premium sports and entertainment properties, including UFC and WWE
through our majority ownership of TKO, produce and distribute
sports and entertainment content, own and manage exclusive live
events and experiences, and represent top sports, entertainment and
fashion talent, as well as blue chip corporate clients.
As of December 31, 2024, the Company has $20.6 billion in total
assets, $10.5 billion in total liabilities, and total stockholders'
equity of $9.9 billion.
EQM MIDSTREAM: Fitch Affirms 'BB+' LongTerm IDR, Outlook Stable
---------------------------------------------------------------
Fitch Ratings has affirmed EQT Corporation's (EQT) Long-Term Issuer
Default Ratings (IDR) at 'BBB-'. Fitch has also affirmed EQM
Midstream Partners, LP's (EQM) ratings at 'BB+'. The Rating
Outlooks are Stable.
EQT's rating reflects the company's debt reduction efforts, strong
FCF generation, enhanced liquidity, large production scale,
high-quality inventory and improved overall operating costs per
unit. EQM's rating reflects the rating linkage with its parent,
EQT. The exchange of EQM notes into new EQT notes, which will be
pari passu with existing EQT notes, does not affect the ratings at
EQT.
The rating is supported by the scale, strong cost position and the
clear line of sight to deleveraging from expected FCF and asset
sales proceeds.
The Stable Outlook reflects Fitch's expectation of debt reduction,
improved leverage and continued reduction in operating costs.
Key Rating Drivers
Debt Reduction Management: Fitch views EQT's debt reduction targets
as achievable and supportive of the rating. The company has a good
track record of post-acquisition debt reduction. EQT has closed the
Equitrans Midstream Corporation (ETRN) acquisition more quickly
than expected and has already closed on the non-operated asset
sales at a valuation in line with Fitch's forecast. The closing of
the of the transmission and storage joint venture with Blackstone
accelerated that asset sale process and represents a strong
valuation with $3.5 billion of proceeds for a 49% ownership
interest.
Improved Netbacks: By bringing a large portion of EQT's gathering
needs in-house the company will improve its already low-cost
position by removing margin from unit gathering costs. This will
improve netbacks, allow EQT to generate positive FCF at lower gas
prices, and expand the company's low-cost drilling inventory by
lowering the break-even.
Strong FCF Generation: Fitch expects EQT to generate material FCF
through the forecast horizon based on Fitch's base case price deck
and strip pricing scenarios. FCF will be driven by the increased
scale and decreased operating costs derived from the Tug Hill
acquisition. EQT has protected its ability to generated solid
cashflow by having strong hedging in place with around 55% of 2025
volumes at average prices around $3.25. The ETRN acquisition
improves the upstream cost structure and adds stable regulated cash
flow, further protecting downside FCF.
Exposure to Stable Regulated Cash Flow: The transmission and
storage assets of Equitrans enhance EQT's credit strength by adding
a cash flow stream that is more stable than typical upstream cash
flow. The transmission and storage joint venture (JV) does decrease
EQT's exposure to these cashflows; however, EQT will receive
substantial expected distributions from the JV. The addition of
stable, regulated cashflows provides downside protection to EQT
cashflows.
Solid Liquidity: EQT's current liquidity is supported by a $3.5
billion unsecured revolver with $150 million outstanding and about
$1 million of outstanding letters of credit as of Dec. 31, 2024.
The revolver matures in June 2029 and is not subject to semi-annual
borrowing base redeterminations. Fitch expects positive FCF over
the forecast period will limit use of the facility to working
capital swings. Asset sales proceeds will be used to repay revolver
borrowings and prepay near-term maturities. Using Fitch's base
price deck, the forecast results in consistent positive FCF which
is expected to be used for debt repayment.
Joint Venture Structure: Fitch treats the JV investment by
Blackstone Credit & Insurance as equity. The primary drivers of
this conclusion are the arms-length nature of the contracts between
EQT and the JV, the lack of fixed distributions from the JV or a
step-up in the distribution split to the equity sponsors, and the
lack of EQT support agreements protecting the equity sponsors from
increased expenses or declines in EQT volumes above firm volumes.
Rating Linkage between EQT and EQM: Fitch considers EQT to be a
stronger parent for EQM, with low legal incentives but medium
strategic and high operational incentives to support EQM's credit
profile. The absence of debt guarantees indicates low legal
incentives. These factors led Fitch to apply a top-down-minus-one
notching approach, resulting in a 'BB+' IDR for EQM.
Peer Analysis
EQT's 3Q24 production of 6,320 mmcfe/d is lower than that of Expand
Energy Corporation (BBB-/Stable, 6,748 mmcfe/d) and higher than
that of Antero Resources Corporation (BBB-/Stable, 3,402 mmcfe/d),
CNX Resources Corporation (BB+/Stable, 1,462 mmcfe/d), and Hess
Corporation (BBB/Rating Watch Positive, 2,766 mmcfe/d). The
integration of ETRN provides a measure of diversification relative
to peers.
EQT is expected to have slightly higher leverage than peers but
this is offset by the access to more stable midstream cashflows at
EQT.
Even with a very low component of liquids in its production mix,
EQT had solid Appalachian unhedged Fitch-calculated netbacks for
3Q24 at $0.59/mcfe as compared to Chesapeake at $0.46/mcfe, CNX at
$0.54/mcfe and Antero at $0.49/mcfe. EQT's netbacks are expected to
improve with the integration of the Equitrans gathering assets.
Key Assumptions
- Henry Hub natural gas price of $2.50/thousand cubic feet (mcf) in
2025 and $2.75/mcf thereafter;
- West Texas Intermediate oil price of $65/barrel (bbl) in 2025,
$60/bbl in 2026 and 2027, and $57/bbl thereafter;
- Production broadly flat;
- Annual capex of $2.4 billion over the forecast;
- FCF used for debt repayment.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Inability to successfully integrate the ETRN assets;
- Change in financial policies, including acquisitions, stock
buybacks or dividends, that results in deterioration of credit
metrics;
- EBITDA leverage above 2.3x on a sustained basis;
- Sustained erosion in natural gas fundamentals that reduces
liquidity, complicates the capital structure or leads to
operational adjustments resulting in a reduction of long-term
production levels.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Improvement in Fitch-calculated netbacks relative to more
diversified peers;
- EBITDA leverage sustained below 1.8x.
Liquidity and Debt Structure
On Dec. 31, 2024, EQT's liquidity comprised cash on hand of $202
million and availability of about $3.3 billion on the company's
$3.5 billion senior unsecured revolver after accounting for $150
million of outstanding borrowings and LCs of around $1 million. The
revolver is due June 2029 and has a one-time expansion option up to
$3.0 billion, subject to lender approval. The only financial
covenant on EQT's revolver is a maximum debt-to-capitalization
ratio of 65%, which has a carve-out for the effects of other
comprehensive income.
Issuer Profile
EQT is the second largest natural gas E&P company in the U.S. with
2024 production of 6,088 bcfe/d. The company's acreage is focused
in the Appalachian basin and comprises approximately 1 million core
net acres in Pennsylvania, West Virginia and Ohio. The company also
owns gas gathering and gas transportation and storage assets in the
Appalachian basin.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
EQT Corporation LT IDR BBB- Affirmed BBB-
senior unsecured LT BBB- Affirmed RR4 BBB-
EQM Midstream
Partners, LP LT IDR BB+ Affirmed BB+
senior unsecured LT BB+ Affirmed RR4 BB+
ESSENTIAL MINERALS: Seeks Subchapter V Bankruptcy in Delaware
-------------------------------------------------------------
On March 10, 2025, Essential Minerals LLC filed Chapter 11
protection in the U.S. Bankruptcy Court for the District of
Delaware. According to court filing, the
Debtor reports $11,962,729 in debt owed to 50 and 99 creditors.
The petition states funds will be available to unsecured
creditors.
About Essential Minerals LLC
Essential Minerals LLC, established in 2017, specializes in the
production of naturally pure calcium products for the food and
pharmaceutical industries. The Company's product line, including
PureCal Calcium Carbonate, Calcium Oxide, and Calcium Hydroxide, is
designed to meet stringent quality standards, offering exceptional
purity and minimal metal content.
Essential Minerals LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del.Case No. 25-10430) on March 10,
2025. In its petition, the Debtor reports total assets of
$5,983,878 and total liabilities of $11,962,729.
Honorable Bankruptcy Judge Thomas M. Horan handles the case.
The Debtor is represented by:
Ronald S. Gellert, Esq.
GELLERT SEITZ BUSENKELL & BROWN, LLC
1201 N. Orange Street Suite 300
Wilmington, DE 19801
Tel: (302) 425-5806
E-mail: rgellert@gsbblaw.com
EYM PIZZA: Seeks to Extend Plan Exclusivity to May 5
----------------------------------------------------
EYM Pizza L.P. and affiliated companies asked the U.S. Bankruptcy
Court for the Eastern District of Texas to extend their exclusivity
periods to file a plan of reorganization and obtain acceptance
thereof to May 5 and July 7, 2025, respectively.
The Debtors have engaged a business broker to sell substantially
all of their assets pursuant to 11 U.S.C. § 363. The sale process
occurred during January 2025 and the sale hearings occurred in
February 2025. Sales are scheduled to close in March 2025.
The Debtors submit that cause exists because they have stabilized
their business, have efficiently and successfully managed their
estates and are well underway in marketing their assets. They have
filed schedules of assets and liabilities and statements of
financial affairs, as well as every monthly operating report; kept
their lease obligations largely current in their operating
entities; obtained the Court's approval for use of cash collateral;
and obtained orders assuming and rejecting all of their outstanding
leases.
The Debtors claim that having made substantial progress to date,
additional, significant work is required before the Debtors can
prepare a meaningful disclosure statement, propose a chapter 11
plan of reorganization and emerge from chapter 11. Importantly, the
sales of the Debtors' assets must close in order for the Debtors to
provide adequate information regarding expected distributions to
creditors in the disclosure statement to be filed by the Debtors.
The Debtors explain that because the nature of the Debtors' plan
and the magnitude of distributions both depend heavily on the
outcome of the sale process, the Debtors request that the Court
extend the exclusive period for (i) filing a plan of reorganization
for approximately sixty days, until May 5; and (ii) soliciting
acceptances until approximately sixty days after that time, i.e.
until July 7, 2025.
Counsel to the Debtors:
Howard Marc Spector, Esq.
Sarah M. Cox, Esq.
SPECTOR & COX, PLLC
12770 Coit Road, Suite 850
Dallas, TX 75251
Telephone: (214) 365-5377
Facsimile: (214) 237-3380
Email: hspector@spectorcox.com
sarah@spectorcox.com
About EYM Pizza LP
EYM Pizza LP is a Pizza Hut franchisee.
EYM Pizza LP and its affiliates sought relief under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. E.D. Tex. Case No. 24-41669) on
president of EYM Group Inc., the Debtor reports estimated assets
under $2.25 million and estimated liabilities more than $21
million.
Howard Marc Spector, Esq. at Spector & Cox, PLLC, is the Debtors'
counsel. National Franchise Sales is the Debtors' financial advisor
for the sale of the assets or businesses of the Debtors.
FENDER MUSICAL: Moody's Cuts CFR to B3 & Alters Outlook to Negative
-------------------------------------------------------------------
Moody's Ratings downgraded Fender Musical Instruments Corporation's
(Fender or FMIC) Corporate Family Rating to B3 from B2 and
Probability of Default Rating to B3-PD from B2-PD. Concurrently,
Moody's downgraded Fender's senior secured term loan rating to Caa1
from B3. The outlook was changed to negative and was previously
stable.
The downgrades reflect Moody's forecasts of very high financial
leverage and deteriorating liquidity in 2025, driven by a
challenging operating environment. Fender's earnings are projected
to decline due to factors such as labor inflation, increased
promotional activity, pricing pressures, currency headwinds from a
strengthening US dollar, and tariffs. As a result, Fender's
debt-to-EBITDA leverage on a Moody's adjusted basis is forecasted
to increase above 7.5x in 2025 from 5.4x as of the last 12 months
ending September 30, 2024. Fender believes its goods satisfy the
US-Mexico-Canada Agreement (USMCA) rules of origin such that the
Mexico tariffs do not currently apply however, a 25% tariff on
products from its Ensenada, Mexico manufacturing facility and an
additional 10% tariff on products manufactured in China and
imported into the US would increase operating costs by
approximately $20 to $25 million. The company is undertaking
several mitigating actions to offset these higher costs including
pricing adjustments, vendor concessions, and rebalancing its
sourcing footprint. While these measures are anticipated to
mitigate some costs in the short term, prolonged imposition of
tariffs will likely be highly disruptive and costly for both
Fender. China remains the largest global manufacturer of guitars by
unit volume, and the musical instruments industry is already facing
challenges such as weakening consumer confidence in the US and an
economic slowdown in China.
Moody's believes there are limited opportunities to relocate the
manufacturing of Fender Squier and Fender Mexico guitars to the US
in the near term. Manufacturing plants are specialized for specific
models, and investments are made based on new product launches and
product cycles. Significant alterations to existing facilities and
supply chains would be required for production relocation, leading
to higher manufacturing costs and necessitating additional
investments.
With limited options to quickly mitigate costs, tariffs are
expected to significantly impact earnings, particularly in the
entry and mid-tier segments of the market where competition is
intense and the ability to pass on costs to consumers is
constrained in an already high-priced market.
Fender's adequate liquidity position is supported by good
availability under its $183.8 million asset-based lending (ABL)
revolving credit facility, which expires in December 2026, as well
as $26 million in balance sheet cash. However, this liquidity is
constrained by Moody's projections of negative free cash flow in
the range of $15 to $20 million for 2025. Greater reliance on the
ABL will reduce availability, though Moody's anticipates sufficient
capacity to fund seasonal working capital requirements that peak
during the third quarter of 2025. Moody's anticipates that Fender
will return to modest positive free cash flow generation in 2026.
The company's debt maturity profile provides some flexibility to
navigate the 2025 operating challenges with the term loan due in
December 2028. Liquidity will deteriorate if the company does not
proactively address the revolver expiration.
RATINGS RATIONALE
Fender's B3 CFR reflects its strong brand recognition and market
position in the acoustic and electric guitar categories. The
company benefits from good geographic diversity and a long-standing
reputation for high-quality products, supported by a
well-diversified retail distribution network. However, these
strengths are offset by the company's narrow product focus and
earnings volatility, which stem from the discretionary nature of
demand for musical instruments. This volatility is further
exacerbated by the current challenging economic environment and
exposure to new US tariffs. Fender has been moving production from
China for a number of years but still manufactures a meaningful
share of its lower-end guitars in the country with about half
shipped to the US. Fender also has a significant manufacturing
presence in Mexico of which roughly half is shipped to the US.
Fender's debt-to-EBITDA leverage, on a Moody's adjusted basis, is
projected to increase and exceed 7.5x in 2025 due to earnings
pressures from lower unit sales and increased costs including from
tariffs. The company's scale remains relatively small with annual
net sales under $900 million and high product concentration in
guitars, amplifiers and other musical equipment. There is some
distribution concentration with Guitar Center Inc. (NEW) (Caa2
Negative) and Sweetwater Borrower, LLC (B2 Stable). The economic
growth challenges add to the headwinds from a slowdown in demand
following pandemic-induced elevated volumes.
Moody's anticipates Fender's EBITDA margin (incorporating Moody's
adjustments) will contract by approximately 400 basis points in
2025, driven by tariffs, labor inflation, foreign exchange-based
pricing pressures, and increased promotional activities. Negative
free cash flow is forecasted in the range of $15 to $20 million for
2025 with the company likely managing working capital strategically
and deferring non-essential capital investments. Fender will rely
on its external facility to cover the free cash shortfall in 2025.
There is seasonality to the business with the revolver balance
peaking during the third quarter and partially paid down during the
fourth quarter when a large portion of accounts receivables is
collected.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The negative outlook reflects the uncertainty created by tariff
policies and the company's ability to mitigate the adverse effects
of tariffs and consumer selectivity for more discretionary
spending. Such factors create uncertainty about Fender's earnings
and free cash flow levels, as well as the level of reliance on its
ABL facility.
The ratings could be upgraded if the company is able to mitigate
the effect of tariffs to generate organic revenue growth and
consistent and comfortably positive free cash flow. An upgrade
would also require confidence that consumer demand for Fender's
products will improve and that the industry slowdown has
stabilized. The company would also need to maintain good liquidity
and sustain debt-to-EBITDA below 6x to be upgraded.
The ratings could be downgraded if earnings decline further than
expected, the company is unable to largely mitigate tariff related
effects, or unit volumes decline, A deterioration in liquidity such
as continued negative free cash flow, increased revolver reliance,
or failure to proactively address maturities could also lead to a
downgrade.
The principal methodology used in these ratings was Consumer
Durables published in September 2021.
Fender Musical Instruments Corporation (Fender or FMIC) was founded
in 1946 and is dual headquartered in Hollywood, California and
Scottsdale, Arizona. Fender develops, manufactures, and sells
musical instruments, accessories, and related products for
distribution to wholesale and retail outlets globally. The
company's product portfolio includes fretted instruments (comprised
of electric, acoustic, and bass guitars), guitar amplifiers, audio
equipment and software, and other accessories. Fender also offers
digital products and services that are centered around musical
education and in-home audio recording or broadcasting. Fender is
well diversified across retail distribution channels including a
growing direct-to-consumer e-commerce segment. The company's
portfolio of brands includes Fender, Fender Custom Shop, Squier,
Gretsch, and high-performance guitars such as Jackson, Charvel and
EVH (the company is a licensee of the Gretsch and Eddie Van Halen
brands), Bigsby and PreSonus. Servco Pacific Capital, a long-term
investor, acquired a majority stake from TPG Growth in February
2020. The company generates annual revenue of approximately $890
million.
FIREPAK INC: Court Extends Cash Collateral Access to April 30
-------------------------------------------------------------
Firepak Inc. received interim approval from the U.S. Bankruptcy
Court for the Southern District of Florida to use cash collateral
until April 30, marking the third extension since the company's
Chapter 11 filing.
The third interim order signed by Judge Robert Mark approved the
use of cash collateral for the period from March 1 to April 30 in
accordance with the company's projected budget, which shows total
monthly expenses of $149,143.50 for March and $148,743.50 for
April.
As adequate protection, Regions Bank and the U.S. Small Business
Administration were granted replacement liens on and security
interests in the company's post-petition cash and cash equivalents
to the same extent and with the same priority and validity as their
pre-bankruptcy liens and security interests.
In addition, Regions Bank and the SBA will receive monthly payments
of $2,637.25 and $2,500, respectively, during the interim period.
A final hearing is set for April 21.
Regions Bank can be reached through its counsel:
Aaron J. Nash, Esq.
Evans Petree, PC
9005 Overlook Blvd
Brentwood, TN 37027
Phone: (615) 567-0168
Fax: (615) 349-3528
anash@evanspetree.co
About Firepak Inc.
Firepak Inc. specializes in the design and layout of fire sprinkler
systems, modifications to existing fire sprinkler systems, new
installations, tenant build outs, retrofit of existing buildings,
and inspections and repairs of all types of fire sprinkler
systems.
Firepak sought relief under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. S.D. Fla. Case No. 24-21725) on November 7, 2024, with
total assets of $1,454,421 and total liabilities of $2,424,737.
Linda Leali, Esq., serves as Subchapter V trustee.
Judge Robert A. Mark handles the case.
The Debtor is represented by:
Carlos L. de Zayas, Esq.
Jessica Ann Less, Esq.
Lydecker LLP
1221 Brickell Avenue, 19th Floor
Miami, FL 33131
Email: cdz@lydecker.com
Telephone: (305) 416-3180
Facsimile: (305) 416-3190
FOREVER 21: Considers Liquidation as Bankruptcy Looms
-----------------------------------------------------
Eliza Ronalds-Hannon and Reshmi Basu of Bloomberg News report that
Forever 21 Inc.'s US-based operator is preparing to possibly close
its stores as part of an imminent bankruptcy filing, according to
sources familiar with the matter.
Attempts to secure a buyer for the fast-fashion retailer and
prevent liquidation have so far been unsuccessful, though
negotiations with one potential bidder are still ongoing, the
sources said.
At its peak, Forever 21 had more than 500 US locations and at least
800 worldwide. The retailer's domestic footprint has since shrunk
to approximately 350 stores.
About Forever 21 Inc.
Founded in 1984 by South Korean husband and wife team Do Won Chang
and Jin Sook Chang and headquartered in Los Angeles, Calif.,
Forever 21, Inc. -- http://www.forever21.com/-- is a fast-fashion
retailer of women's, men's and kids clothing and accessories and is
known for offering the hottest, most current fashion trends at a
great value to consumers. Forever 21 delivers a curated assortment
of new merchandise brought in daily.
Forever 21, Inc. and seven of its U.S. subsidiaries each filed a
voluntary petition for relief under Chapter 11 of the United States
Bankruptcy Code (Bankr. D. Del. Lead Case No. 19-12122) on Sept.
29, 2019. According to the petition, Forever 21 has estimated
liabilities on a consolidated basis of between $1 billion and $10
billion against assets of the same range.
As of the bankruptcy filing, the Debtors operated 534 stores under
the Forever 21 brand in the U.S. and 15 stores under beauty and
wellness brand, Riley Rose.
The Debtors tapped Kirkland & Ellis LLP as legal advisor; Alvarez &
Marsal as restructuring advisor; and Lazard as investment banker;
and Pachulski Stang Ziehl & Jones LLP as local bankruptcy counsel.
Prime Clerk is the claims agent.
Andrew Vara, acting U.S. trustee for Region 3, appointed a
committee of unsecured creditors on Oct. 11, 2019. The committee is
represented by Kramer Levin Naftalis & Frankel LLP and Saul Ewing
Arnstein & Lehr LLP.
Counsel to the administrative agent under the Debtors' prepetition
revolving credit facility and the Debtors' DIP ABL financing
facility are Morgan, Lewis & Bockius LLP and Richards, Layton &
Finger, PA.
Counsel to the administrative agent under the Debtors' DIP term
loan facility is Schulte Roth & Zabel LLP.
* * *
In February 2020, the company was purchased by a consortium that
includes Authentic Brands Group, Simon Property Group and
Brookfield Property Partners for $81.1 million. As part of the
deal, ABG and Simon will each own 37.5% of the fast-fashion
retailer, while Brookfield controls the remaining 25% of Forever
21's operating and intellectual property businesses.
FRANCO HAULING: Seeks Subchapter V Bankruptcy in Illinois
---------------------------------------------------------
Caleb Revill of FreightWaves reports that Franco Hauling LLC, a
service-disabled veteran-owned construction hauling company based
in Bensenville, Illinois, has filed for Chapter 11 bankruptcy
protection in the Northern District of Illinois.
According to a 42-page bankruptcy filing obtained by FreightWaves,
the company -- owned by July Franco -- has estimated assets between
$50,000 and $100,000, with liabilities ranging from $500,000 to $1
million. The filing lists up to 49 creditors.
The largest unsecured creditors include the Trustees of the
Suburban Teamsters Northern III Welfare Pension Funds, owed
$349,439; Schaumburg Bank & Trust, owed $84,508; and Graciela
Franco, owed $40,000. The Trustees of the Suburban Teamsters
Northern III are seeking dues under a collective bargaining
agreement, while Teamsters Local 673 in West Chicago, Illinois, is
claiming $15,150 in union dues.
Franco Hauling LLC provides construction hauling services
throughout the Chicago metropolitan area. The company filed for
bankruptcy under Subchapter V of Chapter 11, which offers a
streamlined reorganization process for small businesses.
About Franco Hauling LLC
Franco Hauling LLC is a service-disabled veteran-owned construction
hauling company based in Bensenville, Illinois.
Franco Hauling LLC sought relief under Subchapter V of Chapter 11
of the U.S. Bankruptcy Code (Bankr. N.D. Ill. Case No. 25-bk-03520)
on March 7, 2025. In its petition, the Debtor reports estimated
assets between $50,000 and $100,000, with liabilities ranging from
$500,000 to $1 million.
Honorable Bankruptcy Judge Janet S. Baer handles the case.
The Debtor is represented by:
O Allan Fridman, Esq.
Law Office Of O. Allan Fridman
555 Skokie Blvd, Suite 500
Northbrook, IL 60062
Telephone: (847) 412-0788
Facsimile: (847) 412-0898
Email: allanfridman@gmail.com
FREE SPEECH: Sandy Hook Families Contest Renewed Infowars Sale Bid
------------------------------------------------------------------
MJ Koo of Law360 reports that the families of victims from the 2012
Sandy Hook Elementary School shooting have urged a Texas bankruptcy
judge to reject a renewed attempt by an Alex Jones-affiliated
company to acquire his Infowars platform, arguing that it would
prolong the related bankruptcy cases that have been ongoing for
over three years.
About Free Speech Systems
Free Speech Systems LLC is a broadcast media production and
distribution company that provides broadcasting aural programs by
radio to the public. Free Speech Systems is a family-run business
founded by Alex Jones.
FSS is presently engaged in the business of producing and
syndicating Jones' radio and video talk shows and selling products
targeted to Jones' loyal fan base via the Internet. Today, FSS
produces Alex Jones' syndicated news/talk show (The Alex Jones
Show) from Austin, Texas, which airs via the Genesis Communications
Network on over 100 radio stations across the United States and via
the internet through websites including Infowars.com.
Due to the content of Alex Jones' shows, Jones and FSS have faced
an all-out ban of Infowars from mainstream online spaces. Shunning
from financial institutions and banning Jones and FSS from major
tech companies began in 2018.
Conspiracy theorist Alex Jones has been sued by victims' family
members over Jones' lies that the 2012 Sandy Hook Elementary School
shooting was a hoax.
Jones' InfoW LLC and affiliates, IWHealth, LLC and Prison Planet
TV, LLC, filed petitions under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 22-60020) on April
18, 2022.
FTX TRADING: Three Arrows Wins $1.5B Bankruptcy Claim Bid
---------------------------------------------------------
Angelica Serrano-Roman of Bloomberg Law reports that a bankruptcy
judge has approved a $1.53 billion amended claim from the collapsed
cryptocurrency hedge fund Three Arrows Capital Ltd., despite
opposition from bankrupt FTX Trading Ltd., which argued the claim
was filed too late.
Judge John T. Dorsey of the U.S. Bankruptcy Court for the District
of Delaware dismissed FTX's objections on Thursday, March 13, 2025,
determining that the original $120 million claim from Three Arrows
was "not sufficient" to adequately inform Sam Bankman-Fried's
defunct crypto exchange of the nature and scope of the amended
claims.
About FTX Trading Ltd.
FTX is the world's second-largest cryptocurrency firm. FTX is a
cryptocurrency exchange built by traders, for traders. FTX offers
innovative products including industry-first derivatives, options,
volatility products and leveraged tokens.
Then CEO and co-founder Sam Bankman-Fried said Nov. 10, 2022, that
FTX paused customer withdrawals after it was hit with roughly $5
billion worth of withdrawal requests.
Faced with liquidity issues, FTX on Nov. 9 struck a deal to sell
itself to its giant rival Binance, but Binance walked away from the
deal amid reports on FTX regarding mishandled customer funds and
alleged US agency investigations.
At 4:30 a.m. on Nov. 11, Bankman-Fried ultimately agreed to step
aside, and restructuring vet John J. Ray III was quickly named new
CEO.
FTX Trading Ltd (d/b/a FTX.com), West Realm Shires Services Inc.
(d/b/a FTX US), Alameda Research Ltd. and certain affiliated
companies then commenced Chapter 11 proceedings (Bankr. D. Del.
Lead Case No. 22-11068) on an emergency basis on Nov. 11, 2022.
Additional entities sought Chapter 11 protection on Nov. 14, 2022.
FTX Trading and its affiliates each listed $10 billion to $50
million in assets and liabilities, making FTX the biggest
bankruptcy filer in the US this year. According to Reuters, SBF
shared a document with investors on Nov. 10 showing FTX had $13.86
billion in liabilities and $14.6 billion in assets. However, only
$900 million of those assets were liquid, leading to the cash
crunch that ended with the company filing for bankruptcy.
The Hon. John T. Dorsey is the case judge.
The Debtors tapped Sullivan & Cromwell, LLP as bankruptcy counsel;
Landis Rath & Cobb, LLP as local counsel; and Alvarez & Marsal
North America, LLC as financial advisor. Kroll is the claims agent,
maintaining the page https://cases.ra.kroll.com/FTX/Home-Index
The official committee of unsecured creditors tapped Paul Hastings
as bankruptcy counsel; Young Conaway Stargatt & Taylor, LLP as
Delaware and conflicts counsel; FTI Consulting, Inc. as financial
advisor; and Jefferies, LLC as investment banker.
Montgomery McCracken Walker & Rhoads LLP, led by partners Gregory
T. Donilon, Edward L. Schnitzer, and David M. Banker, is
representing Sam Bankman-Fried in the Chapter 11 cases. White
collar crime specialist Mark S. Cohen has reportedly been hired to
represent SBF in litigation. Lawyers at Paul Weiss previously
represented SBF but later renounced representing the entrepreneur
due to a conflict of interest.
FUTURE FINTECH: To Appeal Denial of New Trial Bid in FT Global Suit
-------------------------------------------------------------------
Future FinTech Group Inc. disclosed in a Form 8-K filing with the
U.S. Securities and Exchange Commission that as previously
disclosed, FT Global Capital, Inc., a former placement agent of the
Company, filed a lawsuit against the Company in the Superior Court
of Fulton County, Georgia in January 2021, relating to alleged
breaches of an exclusive placement agent agreement between FT
Global and the Company in July 2020.
The Company timely removed the case to the United States District
Court for the Northern District of Georgia on February 9, 2021
based on diversity of jurisdiction. On April 11, 2024, the Court
entered a judgment awarding FT Global $8,875,265.31 and on April
16, 2024, the Court issued an amended judgment, awarding FT Global
$10,598,379.93, which includes $7,895,265.31 in damages,
$1,723,114.62 in prejudgment interest, and $980,000.00 in
attorney's fees.
On May 9, 2024, the Company filed a post-trial motion to set aside
the jury verdict and for a new trial and the Court denied the
motion on March 3, 2025.
The Company will continue to vigorously defend the action against
FT Global and will appeal the judgment to the United States Court
of Appeals for the Eleventh Circuit.
About Future FinTech Group
New York, N.Y.-based Future FinTech Group Inc. is a holding
company
incorporated under the laws of the State of Florida. The Company
historically engaged in the production and sale of fruit juice
concentrates (including fruit purees and fruit juices) and fruit
beverages (including fruit juice beverages and fruit cider
beverages) in the PRC. Due to drastically increased production
costs and tightened environmental laws in China, the Company
transformed its business from fruit juice manufacturing and
distribution to financial technology-related service businesses.
The main business of the Company includes supply chain financing
services and trading in China, asset management business in Hong
Kong, and cross-border money transfer service in the UK.
Orange, Calif.-based Fortune CPA, Inc., the Company's auditor
since
2023, issued a "going concern" qualification in its report dated
April 16, 2024, citing that the Company has suffered losses from
operations, which raise substantial doubt about its ability to
continue as a going concern.
As of Sept. 30, 2024, Future FinTech Group had $53.40 million in
total assets, $17.65 million in total liabilities, and $35.75
million in total stockholders' equity.
GUARDIAN ELDER: No Resident Complaints, 3rd PCO Report Says
-----------------------------------------------------------
Margaret Barajas, the patient care ombudsman, filed with the U.S.
Bankruptcy Court for the Western District of Pennsylvania her third
report regarding the quality of patient care provided by Guardian
Elder Care at Johnstown, LLC and affiliates.
The Ombudsman conducted monitoring visits on January 23 and
February 18. During these visits, the ombudsman spoke with as many
residents who were willing and able to communicate. No issues or
problems were reported during these visits.
The Ombudsman cited one case involving two complaints
(dignity/respect and medication administration) was received by the
Regional Ombudsman Program in early February. The regional
ombudsman continues to work with the involved resident and Fairmont
Healthcare and Rehabilitation Center (FHRC) administration to
resolve the complaint to the resident's satisfaction.
Ms. Barajas noted that Administration reports no outstanding issues
with staffing, aside from the nationwide staffing challenges
impacting the long-term care industry. Active efforts to recruit a
permanent activity director continue. Interviews with both
long-standing and newly hired yielded no bankruptcy related
staffing concerns. No residents reported any new staffing-related
concerns.
The Ombudsman interviewed various staff, including but not limited
to, nurses, aides, maintenance and kitchen staff. All report having
adequate supplies to perform their duties with no change
post-filing. Meal service was observed. Resident medical records
are maintained electronically. Medical, linen, kitchen, and
emergency supplies are well stocked.
In general, FRHC's physical plant, equipment and property appears
clean and well maintained. Residents appear clean and cared for. No
residents and staff report significant concerns.
A copy of the ombudsman report is available for free at
https://urlcurt.com/u?l=c7V9Bh from Omni Agent Solutions, Inc.,
claims agent.
About Guardian Elder Care at Johnstown
Guardian Elder Care at Johnstown, LLC (doing business as Richland
Healthcare and Rehabilitation Center), its affiliates, and their
non-debtor affiliates are a private, family-owned organization that
has provided inpatient and outpatient services to predominately
small and/or rural communities through a network of skilled nursing
facilities and personal care homes since 1995. Guardian Healthcare
maintains 19 skilled nursing facilities, with one facility in West
Virginia and the remaining facilities located in Pennsylvania.
Through its facilities, Guardian Healthcare maintains more than
1,700 skilled nursing, personal care, and independent living beds,
providing long-term care and rehabilitation services.
Guardian Elder Care at Johnstown and its affiliates sought
protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr.
W.D. Pa. Lead Case No. 24-70299) on July 29, 2024. In the petitions
signed by Allen Wilen, chief restructuring officer, Guardian Elder
Care at Johnstown disclosed up to $10 million in assets and up to
$50 million in liabilities.
Judge Jeffery A. Deller oversees the cases.
The Debtors tapped Saul Ewing, LLP as legal counsel, Eisner
Advisory Group, LLC as financial advisor, and Omni Agent Solutions,
Inc. as claims and noticing agent.
The U.S. Trustee for Region 3 appointed an official committee to
represent unsecured creditors in the Debtors' Chapter 11 cases.
Margaret Barajas is the patient care ombudsman appointed in the
Debtors' Chapter 11 cases.
GUARDIAN HEALTHCARE: PCO Reports No Resident Care Complaints
------------------------------------------------------------
Margaret Barajas, the patient care ombudsman, filed her third
report regarding the quality of patient care provided by Guardian
Healthcare.
Local ombudsmen have continued to conduct regular visits to these
facilities. There are no resident concerns directly related to the
bankruptcy proceedings.
The ombudsman cited a complaint received at William Penn Nursing
and Rehab in Mifflin County. At Resident Council meeting on January
15, 2025, residents reported the facility's business office has not
been giving cash out to the residents since the new administration
took over. The local ombudsman requested a meeting with the new
administrator to resolve.
The local ombudsman opened a case on behalf of residents on January
28, 2025 at Oak Hill Healthcare and Rehabilitation Center in
Westmoreland County. It was reported that there is no staff in the
dining room during dinner to service residents. Upon speaking to
the administrator, the ombudsman was told there was enough staff
scheduled, and the NHA did not know why there was no staff in the
dining room.
According to residents at Beaver Valley Healthcare and
Rehabilitation Center facility, call lights are still not answered
in a timely manner. There was COVID and influenza in the building
as of February 6, 2025. There were no deficiencies reported in the
most recent Department of Health survey.
In a February 8 visit at Havencrest Healthcare and Rehabilitation
Center facility, Nursing Home Administrator Julie Pattison reported
that the facility's purchase by Core Healthcare may not be
finalized until June. The local ombudsman reported no complaints
from residents. The rooms appeared clean without odor, and
activities were plentiful. There were no deficiencies reported in
the most recent Department of Health survey.
A copy of the ombudsman report is available for free at
https://urlcurt.com/u?l=LAus7P from Omni Agent Solutions, Inc.,
claims agent.
About Guardian Healthcare
Guardian Healthcare LLC, doing business as Richland Healthcare and
Rehabilitation Center, provides healthcare services. The Company
offers services including case management, nursing, wound care,
residential healthcare, occupational therapy, speech therapy, and
mental health care. Guardian Healthcare serves patients in the
United States.
Guardian Elder Care at Johnstown, LLC, doing business as Richland
Healthcare and Rehabilitation Center, along with 19 affiliated
entities sought relief under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. W.D. Pa. Case No. 24-70299) on July 29, 2024. In its
petition, the Lead Debtor reports estimated assets and liabilities
between $1 million and $10 million.
The Debtors tapped Saul Ewing, LLP as legal counsel and Eisner
Advisory Group, LLC as financial advisor. Omni Agent Solutions is
the claims agent.
HALL LABS: Seeks Chapter 11 Bankruptcy in Utah
----------------------------------------------
On March 5, 2025, Hall Labs LLC filed Chapter 11 protection in the
U.S. Bankruptcy Court for the District of Utah. According to court
filing, the Debtor reports between $50 million and $100
million in debt owed to 1 and 49 creditors. The petition states
funds will be available to unsecured creditors.
About Hall Labs LLC
Hall Labs LLC focuses on developing and monetizing intellectual
property across various industries by bringing together scientists
and engineers to solve complex problems. After prototyping and
market validation, Hall Labs licenses its technologies to
newly-formed entities, which then commercialize and further develop
the innovations. The Company generates revenue through the sale of
technologies, patents, and company interests, while its portfolio
companies become self-sustaining and progress toward an exit.
Hall Labs LLC sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. D. Utah Case No. 25-21038) on March 5, 2025. In its
petition, the Debtor reports estimated assets between $100 million
and $500 million and estimated liabilities between $50 million and
$100 million.
Honorable Bankruptcy Judge Joel T. Marker handles the case.
The Debtor is represented by:
Andres Diaz, Esq.
DIAZ & LARSEN
757 East South Temple, Suite 201
Salt Lake City, UT 84102
Tel: (801) 596-1661
Fax: (801) 359-6803
Email: courtmail@adexpresslaw.com
HEART 2 HEART: Gets Interim OK to Use Cash Collateral
-----------------------------------------------------
Heart 2 Heart Volunteers, Inc. received interim approval from the
U.S. Bankruptcy Court for the Northern District of West Virginia to
use cash collateral.
As adequate protection for the use of their cash collateral, the
lenders were granted replacement liens on the company's
post-petition assets.
As of the petition date, the Debtor's primary lender is the United
States Department of Agriculture. On May 21, 2018, the Debtor and
Lender entered into a Loan Agreement wherein Lender agreed to make
a loan to the Debtor in the principal amount of $2.979 million.
As of the petition date, the Debtor believes that the balance due
under the Loan Agreement is $3.144 million.
The Loan is secured by substantially all of the Debtor's tangible
and intangible assets, including the Debtor's cash collateral and
property located at 667 Stone Shannon Road, Wheeling, WV 26003.
Corporation Service Company filed a UCC Financing Statement on July
12, 2024 on behalf of a client, but does not identify the secured
party. On July 11, 2024, the Debtor and Candy Capital Corporation
executed a Standard Merchant Cash Advance Agreement by which Candy
Capital purports to have a security interest on all accounts.
As of the Petition Date, based on information and belief, the
Debtor maintains approximately $4 to 5 million in equity in the
Property.
A final hearing set for March 25.
About Heart 2 Heart Volunteers Inc.
Heart 2 Heart Volunteers Inc., d/b/a Serenity Hills Life Center,
operates three addiction recovery centers and treatment facilities.
The Debtor sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. N.D.W. Va. Case No. 25-00087) on February 27, 2025.
In its petition, the Debtor reports estimated assets and
liabilities
between $1 million and $10 million each.
The Debtor is represented by Kirk B. Burkley, Esq. at
Bernstein-Burkley, P.C.
HEAVY METAL: DBRS Gives BB(high) LongTerm Issuer Rating
-------------------------------------------------------
DBRS Limited assigned a Long-Term Issuer Rating of BB (high) with a
Stable trend to Heavy Metal Equipment & Rentals (2122256 Alberta
Ltd.; HME or the Company), reflecting an Intrinsic Assessment of BB
(high) and a Support Assessment of SA3. Morningstar DBRS also
assigned a provisional credit rating of (P) BB with a Stable trend
to the Company's Long-Term Senior Debt. This one-notch differential
reflects HME's substantial balance sheet encumbrance.
HME intends to issue senior unsecured notes (the Notes) of
approximately $250 million, and the proceeds will be used to
refinance existing indebtedness and for general corporate purposes.
The Notes will be effectively subordinated to all secured
indebtedness, including the asset-based revolving credit facility
(the ABL Facility), to the extent of the value of the assets
securing such indebtedness.
KEY CREDIT RATING CONSIDERATIONS
The credit ratings reflect HME's position as the largest provider
of ultra-class heavy equipment rentals to Alberta's oil sands, a
niche market with high barriers to entry. HME's earnings have been
solid, with strong revenue growth driven by increased demand from
its largest customers; however, the Company's significant
concentration by business line, customer, and geography is a
constraint on the credit ratings. HME has a sound risk profile,
with concentration risk moderated by the strength of its customer
base, while asset risk and operational risk have been well managed.
Morningstar DBRS views the Company's funding and liquidity profile
as weak, with heavy reliance on secured facilities. HME's tangible
common equity ratio is good, and internal capital generation
ability is solid, while cash flow leverage is around 3.0 times
(x).
CREDIT RATING DRIVERS
Over the longer term, Morningstar DBRS would upgrade HME's credit
ratings if the Company were able to lessen its dependence on oil
sands-related revenues while maintaining similar risk-adjusted
returns. The Long-Term Senior Debt credit rating would be equalized
with the Long-Term Issuer Rating if asset encumbrance levels were
reduced.
Morningstar DBRS would downgrade the Company's credit ratings if
its earnings deteriorated significantly or if cash flow leverage
increased materially. Over the longer term, the credit ratings
would be downgraded should the North American economy materially
transition away from the use of fossil fuels at a pace faster than
expected, affecting demand for the Company's equipment.
CREDIT RATING RATIONALE
Franchise Building Block (BB) Assessment: Moderate
Founded (in its current form) in 2009, HME specializes in the
rental of earth-moving equipment, including haul trucks,
excavators, bulldozers, loaders, and graders, primarily to the
Canadian mining industry. The Company's business is highly
concentrated in the rental of ultra-class heavy equipment to
companies operating in Alberta's oil sands. Within this niche
market, HME enjoys a majority share that benefits from high
barriers to entry given the long manufacturing lead times for heavy
equipment and the technical expertise required to maintain the
equipment. HME provides full support for its customers through the
lifecycle of the equipment, including sourcing, maintenance,
rebuilding, and disposal. The Company's management team has
significant industry experience, although ownership by the
executive team and the lack of an independent board of directors
results in weaker corporate governance.
Earnings Building Block (BB) Assessment: Good/Moderate
HME's earnings have been solid, with strong revenue growth driven
by increased demand from its largest customers. Revenues are
concentrated by business line, customer, and geography. Net income
for the fiscal year ended July 31, 2024 (F2024) was down 35% from a
record-high F2023 because of lower gross profit margins and higher
expenses, including amortization and interest. Expenses grew across
nearly all categories in F2024, on par with revenue growth as the
efficiency ratio remained stable at a strong 37%, as calculated by
Morningstar DBRS. Meanwhile, EBITDA increased 22% year over year in
F2024. In Morningstar DBRS' view, earnings are sufficient to cover
credit or other losses, which have historically been low.
Risk Building Block (BB) Assessment: Moderate
HME maintains a sound risk profile. The Company's credit risk is
heightened by customer concentration, but this risk is moderated by
the investment-grade nature of HME's largest customers and its
longstanding relationships with these customers. Modest credit risk
is evidenced by low levels of charged-off receivables, which were
just one basis point (bp) of income before provisions and taxes in
F2024 and have averaged just 85 bps over the past five years. Asset
risk is well managed as HME maintains strong relationships with the
primary heavy equipment manufacturers/dealers in Canada and the
Company is among the largest customers of each of these dealers.
Additionally, the Company employs a conservative depreciation
approach, resulting in a fleet fair-market value above net book
value, and the equipment is independently appraised twice per year.
Operational risk is moderated by management's extensive industry
experience, various insurance policies, telematics fleet coverage,
and safe work procedures.
Funding and Liquidity Building Block (BB) Assessment: Weak
Morningstar DBRS views HME's funding and liquidity profiles as
weak. Although offered by a diverse group of providers, funding is
narrow in scope with a high reliance on secured funding. Funding
sources include the ABL Facility, equipment term loans and capital
leases, and mortgages, supplemented by nominal amounts from
shareholders and related parties. Liquidity is also highly reliant
on these secured facilities, with some undrawn capacity available
on the equipment lines from various financial institutions and
equipment dealers while the ABL Facility is nearly fully drawn.
Morningstar DBRS notes that the proceeds from the unsecured debt
offering would be used to partially pay down these facilities,
creating additional liquidity. The Company generates good net cash
inflows from operating activities, and it does not hold a cash
balance as all cash collections are used to pay down the ABL
Facility.
Capitalization Building Block (BB) Assessment: Moderate/Weak
The tangible common equity ratio was solid at 18.4% in F2024, down
from 21.6% in F2023 as asset growth outpaced retained earnings.
Given the lack of substantial credit risk, the Company's cash flows
provide an acceptable absorption capacity for unexpected charges
and internal capital generation ability is solid. Cash flow
leverage (i.e., debt/EBITDA) has been relatively steady over the
past five years around HME's target of 3.0x. Leverage was 3.4x as
of July 31, 2024, as calculated by Morningstar DBRS. The Company
has limited flexibility to improve its capital position given its
private ownership and lack of access to equity capital markets.
Notes: All figures are in Canadian dollars unless otherwise noted.
HOOPERS DISTRIBUTING: Gets Extension to Access Cash Collateral
--------------------------------------------------------------
Hoopers Distributing, LLC received another extension from the U.S.
Bankruptcy Court for the Eastern District of North Carolina to use
cash collateral.
The second interim order authorized the company to use cash
collateral for its operating expenses in accordance with its
budget.
The budget shows the company's projected expenses of $111,388.86
for the period from March 1 to April 2.
As protection for the use of their cash collateral, the liens
asserted by secured creditors, Kapitus, LLC and Kalamata Capital
Group, LLC, will extend to the company's post-petition cash
generated from sales and all other assets against which the secured
creditors held liens, according to the order signed by Judge Joseph
Callaway.
As additional protection, Kapitus will receive a cash payment of
$1,334.17.
The interim order will remain in full force and effect until April
1; the replacement of or termination of the second interim order by
a subsequent order; or the filing of a notice of default, whichever
comes first.
The next hearing is scheduled for April 1.
About Hoopers Distributing
Hoopers Distributing, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D.N.C. Case No. 25-00447) on
February 7, 2025, listing between $500,001 and $1 million in both
assets and liabilities. J.M. Cook serves as Subchapter V trustee.
Judge Joseph N. Callaway presides over the case.
Benjamin E.F.B. Waller, Esq., at Hendren, Redwine & Malone, PLLC is
the Debtor's legal counsel.
Kapitus, LLC, as secured creditor, is represented by:
Byron L. Saintsing, Esq.
Smith Debnam Narron Drake Saintsing & Myers, LLP
P.O. Box 176010
Raleigh, NC 27619-6010
Telephone: (919) 250-2000
bsaintsing@smithdebnamlaw.com
HUDSON'S BAY: Ragini Bhalla at Creditsafe Explains What Went Wrong
------------------------------------------------------------------
By Ragini Bhalla, Head of Brand and Spokesperson, Creditsafe
Cash flow issues have been prevalent for the last six months,
driving Hudson's Bay Company to pay suppliers nearly two months
late. Late payments were more of the norm than the exception at
Hudson's Bay Company. This was evident when we looked at their Days
Beyond Terms (DBT) trends over the most recent 12-month period. DBT
refers to the number of days past payment terms that a company pays
its bills, or how late their payments are. As Creditsafe data
reveals, HBC's DBT was 33 in March 2024, which was nearly three
times higher than the industry average of 10.86. Although the DBT
dropped to 13 in July 2024, it then consistently rose every month
for the next six months -- rising to 17 in August, to 23 in
September, to 37 in October, to 45 in November, to 50 in December
and then to 57 in January 2025. When a company's DBT rises for a
prolonged period and so significantly, like it has for HBC, it's
often a strong indicator of deteriorating financial health and cash
flow issues.
Hudson's Bay had a high number of outstanding bills that were
91+ days past due in 2024. We looked at the company's outstanding
bills and their corresponding aging periods -- i.e. 1-30 days,
31-60 days, 61-90 days, 91+ days -- to identify trends and patterns
in their payment behaviors in 2024. As Creditsafe data reveals, a
large portion of the company's outstanding bills have been
excessively past due. Between March and July 2024, for example,
more than 98% of HBC's outstanding bills were 91+ days past due.
While that improved slightly in August and September 2024, a large
portion (over 91%) of its outstanding bills were again 91+ days
past due between October and December 2024. When a company's
outstanding obligations move from short-term lateness (1-30 days
overdue) into the critical 91+ day overdue category, it suggests
the business is either unable or unwilling to meet its supplier
obligations, likely prioritizing other financial commitments.
As a response to industry and internal challenges, HBC is now
restructuring the business. Hudson's Bay Company has now officially
initiated restructuring proceedings under Canada's Companies'
Creditors Arrangement Act (CCAA), confirming that financial
distress has reached a breaking point. According to reports from
Business Wire and CBC News, HBC cited ongoing retail industry
struggles in Canada, coupled with its own liquidity issues, as the
driving forces behind this decision. The restructuring move follows
similar patterns seen in other major retailers that have faced cash
flow constraints and mounting debt. With suppliers already facing
non-payments and a prolonged period of DBT volatility, the
company's ability to maintain vendor relationships and sustain
operations under its current model remains uncertain. While the
CCAA process provides Hudson's Bay with temporary relief from
creditor demands, it remains to be seen whether the retailer can
implement an effective turnaround strategy that restores cash flow
stability and improves its trade payment practices. If DBT levels
continue to remain high post-restructuring, it could indicate
deeper operational challenges that extend beyond short-term
financial restructuring.
More Information
The above commentary reflects the current opinion of
Creditsafe and may differ from or be contrary to those expressed by
other entities or individuals. Creditsafe's opinion is based upon
data derived from selected public and licensed sources, which
Creditsafe believes to be reliable. Creditsafe cannot guarantee the
accuracy or completeness of the information. The above commentary
does not constitute and should not be construed as investment
advice or recommendations by Creditsafe.
About the Data Shared in Press Commentary
Trade Payment data is collected through our global network of
partners and trade payment contributors. We then match this data to
our universe to provide a deeper level of insights into a
particular company's payment behaviors and to assess their credit
risk.
It's important to note that received Trade Payment data does
not represent a company's total trading profile. So, while trade
payment data is a critical component used within our credit risk
algorithm to assess and define a company's financial health, we
consider many other factors. For example, we also look at
information related to legal filings, compliance and sanctions
violations and financial earnings reports (i.e. revenue, sales,
total debt, assets and liabilities, etc.). Even though Trade
Payment data doesn't represent a company's total trading behavior,
analysis has proven that it is hugely predictive of a company's
financial health and creditworthiness.
Because there is no centralized system for reporting trade
payment data, different trade payment data is often reported to
different credit bureaus. This means that each credit bureau is
likely to assess the risk and creditworthiness of a business
differently. That is why credit bureaus will have different credit
scores and information on the same business (or person in the case
of consumer credit reporting).
HYPERSCALE DATA: Granted NYSE Listing Extension Until June 18
-------------------------------------------------------------
Hyperscale Data, Inc. disclosed in a Form 8-K Report filed with the
U.S. Securities and Exchange Commission that as previously
reported, on December 18, 2024, the Company was notified by the
NYSE American, LLC, that due to the Company's disclosure in its
Form 10-Q filed for the fiscal period ended September 30, 2024,
which reported stockholders' equity of approximately $2.2 million,
it no longer meets the requirement that it must have no less than
$6 million or more in stockholders' equity pursuant to the listing
standard set forth under Section 1003(a)(ii) and (iii) of the NYSE
American Company Guide because the Company has reported losses from
continuing operations and/or net losses in five of its most recent
fiscal years ended December 31, 2023.
Under the applicable rules of the Exchange, the Company was
required to submit a compliance plan by January 17, 2025 that
demonstrates how it intends to regain compliance with the Listing
Standards within 18 months of the receipt of the notice, or June
18, 2026. The Company submitted the compliance plan by that date,
and subsequently submitted certain supplements thereto.
On March 4, 2025, the Exchange notified the Company that it has
been granted a listing extension until June 18, 2026 on the basis
of the compliance plan recently submitted by the Company to regain
compliance with the Listing Standards. The Company will be subject
to periodic review by the Exchange during the extension period.
Failure to make progress consistent with the compliance plan or to
regain compliance with the continued Listing Standards by the end
of the extension period could result in the Company being delisted
from the Exchange.
About Hyperscale Data
Headquartered in Las Vegas, NV, Hyperscale Data, Inc., formerly
known as Ault Alliance, Inc., is transitioning from a diversified
holding company pursuing growth by acquiring undervalued
businesses
and disruptive technologies with a global impact to becoming
solely
an owner and operator of data centers to support high performance
computing services. Through its wholly and majority-owned
subsidiaries and strategic investments, Hyperscale Data owns and
operates a data center at which it mines digital assets and offers
colocation and hosting services for the emerging artificial
intelligence ecosystems and other industries. It also provides,
through its wholly owned subsidiary, Ault Capital Group, Inc.,
mission-critical products that support a diverse range of
industries, including an artificial intelligence software
platform,
social gaming platform, equipment rental services,
defense/aerospace, industrial, automotive, medical/biopharma and
hotel operations. In addition, Hyperscale Data is actively engaged
in private credit and structured finance through a licensed
lending
subsidiary.
New York, New York-based Marcum LLP, the Company's auditor since
2016, issued a "going concern" qualification in its report dated
April 16, 2024, citing that the Company has a working capital
deficiency, has incurred net losses, and needs to raise additional
funds to meet its obligations and sustain its operations. These
conditions raise substantial doubt about the Company's ability to
continue as a going concern.
IMMANUEL SOBRIETY: No Patient Care Concern, 8th PCO Report Says
---------------------------------------------------------------
Tamar Terzian, the court-appointed patient care ombudsman, filed
with the U.S. Bankruptcy Court for the Central District of
California her eighth report for the period September 1 to November
1, 2024 regarding Immanuel Sobriety Inc.'s healthcare facility.
The PCO physically conducted visits to all facilities in addition
to verification of licensing, staffing and assuring compliance with
the Department of Health Care Services. She observed generally at
each location that all medication was properly labeled and stored
for the participants. For each location, there is a designated
staff area that had the medication and files for each participant.
The PCO finds that all medication logs at the Male Detox Facility
(Winton location) are properly maintained by staff and executed by
staff after supervising the participants taking of the medication.
The safety binders are properly updated, and the office was locked
only available for staff. The medications are properly labeled with
two participants only on medication.
Ms. Terzian conducted a tour of the Male Sober Living Facility
(Anira location). Medication was properly labeled and stored with
only access by the staff. At the time of the site visit, there were
5 participants present. There was one house manager and an
administrator present at the time of the tour. No concerns noted.
The PCO visited the Sober Living Facility (Richmond location) with
six participants present at the time of her visit. The home was
clean and fully supplied in the kitchen for participants to prepare
their own meals. There is a large outdoor space where participants
can spend time. There was no medication on site. No concerns
noted.
The PCO observed staff being trained and reviewed employee records.
She finds that the healthcare provider has sufficient staff.
A copy of the ombudsman report is available for free at
https://urlcurt.com/u?l=r77J1W from PacerMonitor.com.
The ombudsman may be reached at:
Tamar Terzian, Esq.
Terzian Law Group
1122 E. Green Street
Pasadena, CA 91106
Telephone: (818) 242-1100
Facsimile: (818) 242-1012
Email: tterzian@terzlaw.com
About Immanuel Sobriety
Immanuel Sobriety Inc. provides drug and alcohol rehabilitation
programs and treatment services.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. C.D. Calif. Case No. 23-10806) on March 2,
2023. In the petition signed by its chief executive officer,
Elizabeth Reid, the Debtor disclosed up to $500,000 in assets and
up to $1 million in liabilities.
Judge Wayne Johnson oversees the case.
The Law Office of Crystle J. Lindsey represents the Debtor as legal
counsel.
Tamar Terzian is the patient care ombudsman appointed in the
Debtor's Chapter 11 case.
IMMANUEL SOBRIETY: No Patient Care Concern, 9th PCO Report Says
---------------------------------------------------------------
Tamar Terzian, the court-appointed patient care ombudsman, filed
with the U.S. Bankruptcy Court for the Central District of
California her ninth report for the period November 1, 2024 to
February 1, 2025 regarding Immanuel Sobriety Inc.'s healthcare
facility.
The PCO physically conducted visits to all facilities in addition
to verification of licensing, staffing and assuring compliance with
the Department of Health Care Services. She observed generally at
each location that all medication was properly labeled and stored
for the participants. For each location, there is a designated
staff area that had the medication and files for each participant.
The PCO finds that all medication logs at the Male Detox Facility
(Winton location) are properly maintained by staff and executed by
staff after supervising the participants taking of the medication.
The safety binders are properly updated, and the office was locked
only available for staff. The medications are properly labeled with
two participants only on medication.
Ms. Terzian conducted a tour of the Male Sober Living Facility
(Anira location). Medication was properly labeled and stored with
only access by the staff. At the time of the site visit, there were
8 participants present. There was one house manager and an
administrator present at the time of the tour. No concerns noted.
The PCO visited the Sober Living Facility (Richmond location) with
six participants present at the time of her visit. The home was
clean and fully supplied in the kitchen for participants to prepare
their own meals. There is a large outdoor space where participants
can spend time. There was no medication on site. No concerns
noted.
The PCO observed staff being trained and reviewed employee records.
She finds that the healthcare provider has sufficient staff.
A copy of the ombudsman report is available for free at
https://urlcurt.com/u?l=N6bRrh from PacerMonitor.com.
The ombudsman may be reached at:
Tamar Terzian, Esq.
Terzian Law Group
1122 E. Green Street
Pasadena, CA 91106
Telephone: (818) 242-1100
Facsimile: (818) 242-1012
Email: tterzian@terzlaw.com
About Immanuel Sobriety
Immanuel Sobriety Inc. provides drug and alcohol rehabilitation
programs and treatment services.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. C.D. Calif. Case No. 23-10806) on March 2,
2023. In the petition signed by its chief executive officer,
Elizabeth Reid, the Debtor disclosed up to $500,000 in assets and
up to $1 million in liabilities.
Judge Wayne Johnson oversees the case.
The Law Office of Crystle J. Lindsey represents the Debtor as legal
counsel.
Tamar Terzian is the patient care ombudsman appointed in the
Debtor's Chapter 11 case.
INFINITE GLOW: Seeks Cash Collateral Access
-------------------------------------------
Infinite Glow, LLC asked the U.S. Bankruptcy Court for the Northern
District of California, San Jose Division, for authority to use
cash collateral and provide adequate protection.
The Debtor needs to use cash collateral to pay the expenses of
operating the apartment building.
The bankruptcy filing was caused in part by difficulties the Debtor
has with tenants due to (and in the wake of) Covid 19 and with a
pending foreclosure by the lender JP Morgan Chase Bank, N.A.
During the proposed period, the Debtor believes total income will
be $93,709, expenses will total $40,343 with a positive net income.
Chase Bank holds the senior lien in the building. In 2018, Chase
made a loan to the Debtor in the principal amount of $3.2 million.
Chase alleged in a complaint filed on July 3, 2024, that its claim
consists of principal of $2.972 million, accrued interest of
$185,011, default interest of $148,226, prepayment premium of
$59,455, late charges of $2,463 and other charges. The charges
alleged in its July, 2024, complaint amount to approximately $3.4
million. Property taxes, disputed, may be an additional $532,754.
The Debtor believes it enjoys $1 million or more in equity in the
apartment building.
Chase Bank holds a security interest in the property. There are
delinquent property taxes - due in part to a dispute between the
Debtor and the County - so the County could have a lien as to real
property for taxes.
The Debtor is offering a replacement lien to Chase Bank. Its
position is protected by approximately $1 million in equity in the
property.
A copy of the motion is available at https://urlcurt.com/u?l=8qG8Ed
from PacerMonitor.com.
About Infinite Glow LLC
Infinite Glow LLC has an equitable interest in the property
situated at 2912 14th Ave, Oakland, CA 94606, which is valued at
$4.7 million.
Infinite Glow LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Cal.Case No. 25-50253) on February
27, 2025. In its petition, the Debtor reports estimated assets and
liabilities between $1 million and $10 million each.
Honorable Bankruptcy Judge Stephen L. Johnson handles the case.
The Debtor is represented by Steven R. Fox, Esq. at THE FOX LAW
CORPORATION INC.
IROBOT CORP: Issues Going Concern Warning
-----------------------------------------
Rishi Kant of Reuters reports that iRobot, the maker of Roomba
vacuum cleaners (IRBT.O), raised alarms on Wednesday, March 12,
2025, about its ability to remain in business, with the company
warning of significant uncertainty regarding its future. Shares of
iRobot tumbled more than 30% in afternoon trading, continuing a
decline from its peak during the pandemic. The company stated,
"Given macroeconomic and tariff-related uncertainties, there is
substantial doubt about iRobot's ability to continue as a going
concern."
Once valued at $3.56 billion in 2021 due to a surge in demand
during the pandemic, iRobot is now worth less than $200 million.
For the fourth quarter ending December 28, 2024, iRobot's net loss
widened to $77.1 million, up from $63.6 million in the same period
the previous year. Its revenue also dropped by 44%.
The company's cash reserves have fallen to $134.3 million in 2024,
down from $185.1 million in 2023, while its debt stood at $200.6
million as of December 28, 2024. iRobot is struggling to compete
against Chinese rivals like Ecovacs Robotics, which offer advanced
features at more affordable prices.
To address its financial challenges, iRobot is considering various
options, including a potential sale or debt refinancing, just one
day after launching eight new Roomba models in its largest product
rollout yet.
In August 2022, iRobot had agreed to a $61-per-share acquisition
offer from Amazon, a deal that was seen as a potential lifeline for
the company and a way for Amazon to enhance its smart home
division. However, the acquisition was blocked in January 2023 due
to antitrust concerns and privacy issues related to the data
collected by Roombas.
Following the deal's collapse, iRobot founder Colin Angle stepped
down as CEO in January 2023, suggesting the need for a leader with
expertise in business turnarounds. In May 2023, Gary Cohen was
appointed CEO to guide the company’s efforts to recover.
About iRobot Corp.
Based in Bedford, MA, iRobot is a Delaware corporation that
designs, builds, and sells robots and home innovation products in
the U.S., Europe, the Middle East, Africa, Japan, and
internationally. Its common stock trades in an efficient market on
the NASDAQ under the ticker symbol "IRBT". [BN]
J&P FLASH: Court OKs Properties Sale to Triple Net Properties
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Tennessee,
Western Division, has approved J&P Flash Inc. to sell properties,
free and clear of liens, interests, and encumbrances.
The Debtor's Properties that are up for sale are located at 301
Glen Bailey Dr, West Memphis, AR 72301; 809 E. Barton Ave, West
Memphis, AR 72301; 120 South First Street, West Memphis, Arkansas;
110 West Polk Ave, West Memphis, AR 72301; 120 S Woods St, West
Memphis, AR 72301; and 121 West Polk Ave, West Memphis, AR 72301.
The Court acknowledged that the agreement entered by the Debtor
with Triple Net Properties, LLC to sell the Property for a purchase
price of $2,000,000 subject to the terms of the Real Estate
Purchase Agreement (REPA) and the agreement to purchase all of the
personal property located at the Property, other than Excluded
Assets under the Purchase Agreement, for the price of $750,000 or
the Personalty Purchase Agreement (PPA) are proper and prudent
exercise of the Debtor's business judgment.
The Court authorized the Debtor to executive, deliver, file, and
record all documents and take all actions necessary and appropriate
to implement and consummate the sale of the properties.
The proceeds of the sale will be subject to and impressed with the
duly perfected first priority security interests and liens of the
secured lenders/creditors, and after payment of regular regular and
customary closing costs, commissions and taxes, including customary
and usual closing attorneys' fees.
Cowling Title Company is also authorized to distribute the net sale
proceeds after payment of customary and usual closing costs, real
estate taxes, attorneys' fees and real estate commissions to
creditors including Estate of Buddy Suiter, Southern Bancorp Bank,
Arkansas Department of Finance and Administration, Department of
Treasury, JNHLM, Jerry Bell Stephens and Whyneele E. Stephens
Family Trust, Core-Mark Distributors, and FNBC Bank.
In the event that a secured claim or lien is disputed by the
Debtor, there shall be escrowed with Cowling Title Insurance
Company, an amount equal to the disputed claim pending further
orders of the Court or resolution by the parties.
About J&P Flash Inc.
J&P Flash, Inc., a company in West Memphis, Ariz., filed a petition
under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. W.D.
Tenn. Case No. 21-23968) on Dec. 1, 2021, with up to $50,000 in
assets and up to $10 million in liabilities. Dwayne Jones, vice
president of J&P Flash, signed the petition.
Judge Denise E. Barnett oversees the case.
Glankler Brown, PLLC serves as the Debtor's legal counsel.
JJ BADA: Gets Extension to Access Cash Collateral
-------------------------------------------------
JJ Bada 464 Operating Corp. received second interim approval from
the U.S. Bankruptcy Court for the District of New Jersey to use
cash collateral.
The second interim order signed by Judge Stacey Meisel authorized
the company to use cash collateral to pay the expenses set forth in
its 30-day budget, which shows total operating expenses of
$174,827.
Il Yeon Kwon and the U.S. Small Business Administration assert an
interest in the cash collateral, including cash and cash
equivalents. These secured creditors will be granted a replacement
lien on the cash collateral as protection for any diminution in
value of their interest in the collateral.
As additional protection, Kwon and the SBA will receive monthly
payments of $1,000 and $189, respectively.
On January 13, 2020, JJ entered into a promissory note with Kwon in
the principal amount of $270,000, with a fixed interest rate of
5.5%, a monthly principal and interest payments of $5,157, and a
maturity date of February 1, 2025. In order to secure payment of
the note, JJ executed a security agreement which granted Kwon a
lien on the collateral. As of the petition date, approximately
$50,000 is due and owing on the note.
On May 26, 2020, JJ entered into an Economic Injury Disaster Loan
with the SBA in the principal amount of $38,600, with a fixed
interest rate of 3.75% and monthly principal and interest payments
of $189, commencing on May 1, 2021, and payable over 30 years from
the date of the note. The company executed a security agreement in
order to secure payment of the note, which granted the SBA a lien
on the collateral. As of the petition date, JJ owed approximately
$35,000 on the note.
A final hearing is set for April 1.
About JJ Bada 464 Operating Corp.
JJ Bada 464 Operating Corp. owns and operates Bada Story
Restaurant, a Korean and Japanese Sushi Restaurant located at 464
Sylvan Avenue, Englewood Cliffs, N.J.
JJ Bada 464 Operating sought protection under Chapter 11 of the
U.S. Bankruptcy Court (Bankr. D. N.J. Case No. 25-11078) on
February 1, 2025, listing between $500,001 and $1 million in both
assets and liabilities. Brandon Park, president of JJ Bada 464
Operating, signed the petition.
Judge Stacey L. Meisel oversees the case.
The Debtor is represented by:
Rosemarie E. Matera
Kirby Aisner & Curley LLP
Tel: 914-401-9500
Email: law@kmpclaw.com
JOE'S SPORTS: Files Emergency Bid to Use Cash Collateral
--------------------------------------------------------
Joe's Sports Bar, Inc. asked the U.S. Bankruptcy Court for the
Western District of North Carolina, Charlotte Division, for
authority to use cash collateral and provide adequate protection.
The parties that assert an interest in the cash collateral are
Joseph Guza, the U.S. Small Business Administratoin, CHTD Company,
Financial Agent Services, Sysco Charlotte, LLC, Corporation Service
Company, and WebBank.
The Debtor's pre-petition depository bank of Wells Fargo Bank, N.A.
and Fifth Third Bank, N.A. do not have secured claims against the
Debtor. Moreover, certain food providers may have a lien in certain
perishable goods that it provided to the Debtor within 28 days
pursuant to the Perishable Agriculture Commodities Act.
The Debtor proffers that the Creditors have adequate protection
against the diminution in value of their pre-petition collateral.
Preliminarily, the use of cash collateral in the ordinary course of
business, in and of itself, provides adequate protection in that it
preserves the going concern value of the Debtor's business and
consequently the value of the pre-petition collateral.
Moreover, to protect against diminution in the value of the
pre-petition collateral, the Debtor proposes to provide the
Creditors with replacement liens in post-petition assets to the
same extent and priority as existed pre-petition, for all cash
collateral actually expended during the duration of the interim
cash collateral Order.
A copy of the motion is available at https://urlcurt.com/u?l=JvYRf6
from PacerMonitor.com.
About Joe's Sports Bar Inc.
Joe's Sports Bar Inc., (also known as Village Corner) is a member
of the Scratch Made Hospitality Group, located in Concord, NC. The
restaurant serves a diverse range of breakfast and lunch dishes,
including options like "Biscuit Bennys," "Scrambles," "Handhelds,"
and "Plates/Bowls," with special dishes such as fried chicken,
pulled pork, and shrimp & grits.
Joe's Sports Bar Inc. sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. N.C. Case No. 25-30207) on March 4,
2025. In its petition, the Debtor reports estimated assets up to
$50,000 and estimated liabilities between $1 million and $10
million.
Honorable Bankruptcy Judge George R. Hodges handles the case.
The Debtor is represented by John C. Woodman, Esq. at ESSEX
RICHARDS PA.
JORIKI USA INC: Gets Court Okay for $10.3MM Chapter 7 Asset Sale
----------------------------------------------------------------
Vince Sullivan of Law360 Bankruptcy Authority reports that Joriki
USA Inc., a drink packaging company, received approval from the
Delaware bankruptcy court on Friday, March 14, 2025, to sell its
assets for $10.3 million.
About Joriki USA Inc.
Joriki -- https://www.jorikiinc.com/ -- has been servicing the
beverage contract packaging needs of North America for over 20
years.[BN]
Joriki USA Inc. sought relief under Chapter 7 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 25-10034) on January 12,
2025.
Honorable Bankruptcy Judge Laurie Selber Silverstein handles the
caes.
The Debtor is represented by:
Domenic E. Pacitti, Esq.
Klehr Harrison Harvey Branzburg LLP
919 Market Street Suite 1000
Wilmington, DE 19801
302-426-1189
Fax : 302-426-9193
Email: dpacitti@klehr.com
-- and --
Michael W. Yurkewicz, Esq.
Klehr Harrison Harvey Branzburg LLP
919 Market St., Suite 1000
Wilmington, DE 19801
302.426.1189
Fax : 302.426.9193
Email: myurkewicz@klehr.com
KARYOPHARM THERAPEUTICS: Ernst & Young Raises Going Concern Doubt
-----------------------------------------------------------------
Karyopharm Therapeutics Inc. disclosed in a Form 10-K Report filed
with the U.S. Securities and Exchange Commission for the fiscal
year ended December 31, 2024, that its auditor expressed an opinion
that there is substantial doubt about the Company's ability to
continue as a going concern.
Boston, Massachusetts-based Ernst & Young LLP, the Company's
auditor since 2014, issued a "going concern" qualification in its
report dated February 19, 2025, citing that the Company has
incurred significant operating losses since inception, expects to
incur significant operating losses for the foreseeable future, and
has stated that substantial doubt exists about the Company’s
ability to continue as a going concern.
Karyopharm said, "We will require substantial funds to maintain our
research and development programs, including as we continue to
develop and seek regulatory approval of selinexor for multiple
cancer indications, and to support our continued operations. We
have incurred significant operating losses since our inception. As
of December 31, 2024, we had approximately $108.7 million in cash,
cash equivalents and investments and an accumulated deficit of $1.6
billion. We anticipate that we will continue to incur significant
operating losses as we continue to develop and seek regulatory
approval of selinexor for multiple cancer indications. As a result,
our continued operations are dependent on our ability to raise
additional funding and marketing XPOVIO in its currently approved
indications."
"We plan to address the conditions that raise substantial doubt
regarding our ability to continue as a going concern by, among
other things, obtaining additional funding through equity
offerings, debt financings and refinancings, collaborations,
strategic alliances and/or licensing arrangements. However, there
is no assurance that such additional funding will be available on
terms acceptable to us or at all. We may also be required to reduce
our current spending requirements where possible."
"If we utilize our capital resources more quickly than anticipated
or are unable to obtain additional funding, we may have to
significantly curtail, delay, reduce or eliminate one or more of
our research and development programs or any current or future
commercialization efforts for one or more of our products or
product candidates, which could materially adversely affect our
business, financial condition, and results of operations. If we are
unable to continue as a going concern, we may have to liquidate our
assets and may receive less than the value at which those assets
are carried on our financial statements, and it is likely that
investors will lose all or part of their investment. If we seek
additional financing to fund our business activities in the future
and there remains substantial doubt about our ability to continue
as a going concern, investors or other financing sources may be
unwilling to provide funding to us on commercially reasonable
terms, if at all."
Since inception, Karyopharm incurred significant operating losses.
Its net loss was $76.4 million for the year ended December 31,
2024. As of December 31, 2024, it had an accumulated deficit of
$1.6 billion.
A full-text copy of the Company's Form 10-K is available at:
https://tinyurl.com/jfrj6a3f
About Karyopharm Therapeutics
Karyopharm Therapeutics Inc. is a commercial-stage pharmaceutical
company pioneering novel cancer therapies and dedicated to the
discovery, development and commercialization of first-in-class
drugs directed against nuclear export for the treatment of cancer.
As of December 31, 2024, the Company has $164.4 million in total
assets, $350.4 million in total liabilities, and total
stockholders' deficit of $186 million.
KATE QUINN: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Kate Quinn Organics, Inc.
16531 13th Ave W
Suite A102
Lynnwood, WA 98037-8500
Business Description: Established in 2006, Kate Quinn is a
sustainable clothing brand that focuses on
eco-friendly apparel for babies, toddlers,
children, and adults. The brand utilizes
premium organic cotton and bamboo textiles
to produce fashionable, comfortable, and
environmentally responsible clothing. Kate
Quinn offers a variety of items, such as
tops, bottoms, dresses, shirts, and
accessories, emphasizing distinctive designs
and exclusive collections. The Company runs
an online shop at: www.katequinn.com.
Chapter 11 Petition Date: March 14, 2025
Court: United States Bankruptcy Court
Eastern District of Washington
Case No.: 25-00445
Judge: Hon. Frederick P Corbit
Debtor's Counsel: Jason Wax, Esq.
BUSH KORNFELD LLP
601 Union St., Suite 5000
Seattle, WA 98101-2373
Tel: 206-292-2110
Fax: 206-292-2104
E-mail: jwax@bskd.com
Total Assets: $593,790
Total Liabilities: $8,319,282
The petition was signed by Katherine Quinn as CEO.
A full-text copy of the petition, which includes a list of the
Debtor's 20 largest unsecured creditors, is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/DWVTJHI/Kate_Quinn_Organics_Inc__waebke-25-00445__0001.0.pdf?mcid=tGE4TAMA
KIPP JACKSONVILLE: S&P Lowers 'BB+' ICR on Weakened Finances
------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating (ICR) on KIPP
Jacksonville Inc., Fla., to 'BB+' from 'BBB-'. The outlook is
negative.
"The downgrade and negative outlook reflect the school's weakened
financial performance in the past few years, in addition to a
material decline in liquidity," said S&P Global Ratings credit
analyst Chase Ashworth. "Furthermore, the negative outlook is
supported by the school's weakened academic performance, which
could affect future state revenues or charter contract renewals, if
not improved in the near term," Mr. Ashworth added.
An ICR reflects the obligor's general creditworthiness, focusing on
its capacity and willingness to meet financial commitments when
they come due. It does not apply to any specific financial
obligation because it does not account for the obligation's nature
and provision, standing in bankruptcy or liquidation, statutory
preferences, or legality and enforceability.
The school was not in compliance with its covenants on loans
outstanding for fiscal 2023 (it was below annual debt service
coverage and days' cash on hand [DCOH] covenant levels) and remains
below required DCOH covenant levels for fiscal 2024. S&P said, "We
understand that all loan payments have been made on time and in
full, and there are no expectations for missing future loan
payments. According to management, there has been no remedies
pursued from the loan providers regarding the noncompliance with
loan covenants. However, we were unable to receive confirmation
from the bank that holds one of the school's existing loans. We
note, in the event an action is taken, including the pursuit of
remedies as a result of not meeting loan covenants, this would
likely cause negative rating pressure."
S&P said, "We view KIPP Jacksonville's demand profile as adequate,
characterized by its high enrollment growth and sizable student
body, despite its weakened academic performance in recent years. We
view KIPP Jacksonville's financial profile as vulnerable,
demonstrated by deteriorated MADS coverage levels (albeit with a
rebound in MADS coverage for fiscal 2024), as well as material
declines in DCOH, which have been sustained at lower levels. The
school's debt profile continues to improve due to enrollment growth
and subsequent revenue base growth. We assessed the network's
enterprise profile as adequate and its financial profile as
vulnerable, and these credit factors lead to an anchor of 'bb'. As
our criteria indicates, the final rating can be within one notch of
the anchor. The final 'BB+' rating better reflects our view of KIPP
Jacksonville's large and growing enrollment base, as well as its
manageable debt burden, both of which provide support at the
current rating level.
"The downgrade and negative outlook reflects our view of the
elevated governance risk surrounding the school's risk management,
culture, and oversight, as reflected in its multiple years of
covenant violations and the school's significant deterioration in
financial resources. While the new management team is taking
actions to remedy the situation, we will continue to monitor its
progress and whether these actions will result in the maintenance
of improved financial performance over the longer term."
Environmental, social, and governance (ESG) credit factors for this
change in credit rating/outlook and/or CreditWatch status:
-- Governance: Risk management, culture, and oversight
L4L INVESTMENT: FRESB Seeks to Prohibit Cash Collateral Access
--------------------------------------------------------------
FRESB 2023-SB105 Harris Drive, LLC, owner, asked the U.S.
Bankruptcy Court for the Northern District of Georgia, Atlanta
Division, to prohibit L4L Investment Inc. from using cash
collateral during its Chapter 11 bankruptcy proceedings.
Specifically, FRESB is seeking an order compelling the Debtor to
segregate all rents, proceeds, and other cash collateral derived
from the Oliver Point Apartments in Atlanta, Georgia, and to turn
over those funds to FRESB.
FRESB asserted that the Debtor has not requested permission to use
cash collateral, nor has the court authorized such use. FRESB also
asserts that the debtor does not have a valid interest in the
property or its rents, thus preventing them from using the cash
collateral.
FRESB argued that it has a right to prevent the debtor from using
the cash collateral, as the debtor has not provided any adequate
protection to the owner's interest in the property.
The owner also sought the segregation of cash collateral under
Section 363(c)(4).
A copy of the motion is available at https://urlcurt.com/u?l=5iUK3c
from PacerMonitor.com.
About L4L Investment
L4L Investment Inc. sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ga. Case No. 25-51137) on February 3,
2025. In its petition, the Debtor disclosed estimated assets and
liabilities between $1 million and $10 million each. Judge James R.
Sacca oversees the case.
The Debtor tapped William A. Rountree, Esq., at Rountree, Leitman,
Klein & Geer, LLC as counsel.
LAKEVIEW VILLAGE: Fitch Affirms 'BB+' IDR, Outlook Stable
---------------------------------------------------------
Fitch Ratings has affirmed the following City of Lenexa, Kansas
Health Care Facility revenue bonds issued on behalf of Lakeview
Village, Inc. (Lakeview) at 'BB+':
- $16.3 million series 2017A;
- $49 million series 2018A.
Fitch has also affirmed Lakeview's Issuer Default Rating (IDR) at
'BB+'.
The Rating Outlook is Stable.
Entity/Debt Rating Prior
----------- ------ -----
Lakeview Village,
Inc. (KS) LT IDR BB+ Affirmed BB+
Lakeview Village,
Inc. (KS) /General
Revenues/1 LT LT BB+ Affirmed BB+
The affirmation of the 'BB+' rating reflects Fitch expectation that
Lakeview Village will be able to sustain balance sheet stability.
The community effectively utilizes cost containment strategies to
uphold adequate profitability, despite persistently low independent
living unit (ILU) occupancy, which typically falls below 85%. In
response, management is proactively renovating aging ILUs and
introducing new cottages to reposition the campus. Lakeview
Village's overall profile is characterized by satisfactory
profitability and balance sheet stability balanced against limited
revenue defensibility. It aligns with the upper end of the 'BB'
rating category.
SECURITY
The bonds are secured by a pledge of unrestricted receivables, a
leasehold interest on the existing facility and a debt service
reserve fund (DSRF).
KEY RATING DRIVERS
Revenue Defensibility - 'bb'
Lakeview's assessment of weak revenue defensibility is primarily
influenced by ILU occupancy consistently falling below 86%. Fitch
anticipates that occupancy levels will remain near their current
rate, with potential for gradual improvement as management
transitions older, less desirable four-plex cottage units into more
attractive single-family and duplex structures. As of Dec. 31,
2024, ILU occupancy was 83%. Additionally, occupancy in assisted
living units (ALUs) and skilled nursing facilities (SNF) has been
subdued, with rates at 73% and 84%, respectively, by the end of
December 2024.
Lakeview's strong partnerships with a neighboring acute care
provider may improve AL and SNF census over the Outlook period. The
community operates in a highly competitive region, with new
inventory emerging throughout Johnson County.
Operating Risk - 'bbb'
Lakeview, a type-A community, consistently delivers core operating
results that align with a 'bbb' assessment of its operational risk.
Over the past five years, it has maintained average metrics with an
operating ratio of 99.5%, a net operating margin (NOM) of 5.4%, and
an adjusted NOM of 21%. Fitch anticipates that Lakeview's operating
results will continue to align with these historical averages in
the coming years.
The average age of plant is high at approximately 17.2 years.
Management is proactively addressing this by focusing capital
expenditure plans on renovating and repositioning the community to
cater to increasing demand for larger, more modern units.
Lakeview's capital-related metrics suggest that its long-term
liabilities are manageable, supported by its consistent operating
performance. The five-year averages for Fitch-calculated
revenue-only maximum annual debt service (MADS), Fitch-calculated
MADS as a percentage of revenue, and debt to net available are
0.7x, 11.4%, and 5.3x, respectively.
Financial Profile - 'bb'
Lakeview's unrestricted cash and investments totaled about $43.5
million as of fiscal 2024, representing 81.7% cash-to-adjusted
debt. Fitch expects Lakeview to maintain a stable balance sheet
above 65% throughout the period of economic and operational
volatility assumed in Fitch's stress case scenario. Lakeview's
five-year average Fitch-calculated MADS is solid at 2x also
displaying stability during Fitch's stress case. As of FYE 2024,
Fitch calculated 321 days cash on hand (DCOH) for Lakeview, which
is neutral to Fitch's assessment of the community's financial
profile.
Asymmetric Additional Risk Considerations
No asymmetric risk considerations were relevant to the rating
determination.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- ILU occupancy to decline to sustained levels below 80%;
- Sustained weakness in core operating metrics, resulting in net
operating margin (NOM) and operating ratio maintained at levels of
about 12%-15% and 103%-105%, respectively.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Improved ILU occupancy consistently at or above 90%;
- Net operating margin adjusted (NOMA) at or above 28%, leading to
commensurate growth in liquidity.
PROFILE
Lakeview is located on a 96-acre campus in Lenexa, Kansas. The
community consists of 533 ILUs, 26 ALUs, a 120-bed SNF and 38
short-term rehab beds. Lakeview calculates all occupancy statistics
on a marketable unit basis.
Lakeview has three affiliated entities outside the obligated group
(OG), including a foundation and two independent living U.S.
Department of Housing and Urban Development properties. Fitch uses
OG financials for its analysis and all figures cited in this press
release. Lakeview had approximately $58 million in total revenues
in 2024.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
LAVIE CARE: No Complaints at Pa. Facilities, PCO Report Says
------------------------------------------------------------
Margaret Barajas, the patient care ombudsman, filed her fourth
report regarding the quality of patient care provided at the
Pennsylvania nursing facilities operated by LaVie Care Centers,
LLC's affiliates.
Local ombudsmen have made regular visit at Pennknoll Village
facility. Local ombudsmen observed that call bells are generally
answered promptly. Snacks and beverages are available to residents.
The facility and resident rooms appear clean and odor free; the
temperature is comfortable. No cases have been opened on behalf of
residents since November 2024.
In a facility visit on January 13 at Locust Grove Retirement
Village facility, the local ombudsman saw only three staff members.
The local ombudsman visited with an average of five residents per
visit. There were no significant concerns reported, and no cases
have been opened on behalf of residents since 2022.
In a February 11 visit at St. Luke Village facility, the local
ombudsman reported that residents were confined to their rooms due
to sickness in the building. Noted that several residents had since
passed away since the previous visit. No implication or inference
that it is a result of communicable illness, simply an observation.
The local ombudsman visited with an average of 10 residents and two
staff per visit. There were no outstanding concerns.
In a visit on February 20 at Luther Ridge at Seiders Hill facility,
the local ombudsman met with the administrator and regional
director, who reported that Avartis will be assuming operations of
the facility on May 1. Individual rooms are comfortable, with heat
controlled by P-TAC units. There were no significant concerns
reported, and no casework has been instituted for residents since
October 2024.
A copy of the ombudsman report is available for free at
https://urlcurt.com/u?l=MvLblB from Kurtzman Carson Consultants,
LLC, claims agent.
About Lavie Care Centers
LaVie Care Centers, LLC, is the parent company of skilled nursing
facility operators and providers, with facilities primarily located
in Mississippi, North Carolina, Pennsylvania and Virginia. The
company operates 43 licensed facilities, with 4,300 beds, providing
short-term rehabilitation, comprehensive post-acute care, and
long-term care to its residents.
On June 2 and 3, 2024, LaVie Care Centers and 281 affiliates filed
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. N.D. Ga. Lead Case No. 24-55507), before Judge Paul
Baisier in Atlanta.
The Debtors tapped McDermott Will & Emery, LLP as legal counsel;
Stout Capital, LLC as investment banker; and Ankura Consulting as
financial advisor. M. Benjamin Jones, senior managing director at
Ankura, serves as the Debtors' chief restructuring officer.
Kurtzman Carson Consultants, LLC is the claims agent, and maintains
the page http://www.kccllc.com/LaVie
The U.S. Trustee for Region 21 appointed an official committee to
represent unsecured creditors in the Debtors' Chapter 11 cases.
The U.S. Trustee also appointed Joani Latimer as patient care
ombudsman for patients at the Debtors' Virginia facilities; Victor
Orija for North Carolina facilities; Lisa Smith for the Mississippi
facilities; Margaret Barajas for the Pennsylvania facilities; and
Terri Cantrell for the Florida facility.
Margaret Barajas is the patient care ombudsman appointed in the
Debtors' cases.
LEFEVER MATTSON: Court Extends Cash Collateral Access to May 7
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of California,
Santa Rosa Division, extended LeFever Mattson and Valley Oak
Investments, L.P.'s authority to use cash collateral until May 7.
The order authorizes only payments that are intended and necessary
to preserve the companies' rental properties and does not authorize
payment of overhead or restructuring costs.
The order does not also authorize the use of cash collateral of
Nationstar without its consent.
A continued hearing for Nationstar-related matters is scheduled for
March 28.
About LeFever Mattson
LeFever Mattson, a California corporation, manages a large real
estate portfolio. Timothy LeFever and Kenneth W. Mattson each owns
50% of the equity in the company. Based in Citrus Heights, Calif.,
LeFever Mattson manages a portfolio of more than 200 properties,
comprised of commercial, residential, office, and mixed-use real
estate, as well as vacant land, located throughout Northern
California, primarily in Sonoma, Sacramento, and Solano Counties.
It generates income from the properties through rents and use the
proceeds to fund its operations.
LeFever Mattson and its affiliates filed voluntary Chapter 11
petitions (Bankr. N.D. Calif. Lead Case No. 24-10545) on September
12, 2024. At the time of the filing, LeFever Mattson listed $100
million to $500 million in assets and $10 million to $50 million in
liabilities.
Judge Charles Novack oversees the cases.
Thomas B. Rupp, Esq., at Keller Benvenutti Kim LLP represents the
Debtors as counsel. Kurtzman Carson Consultants, LLC is the
Debtors' claims and noticing agent.
The U.S. Trustee for Region 17 appointed an official committee to
represent unsecured creditors in the Debtors' Chapter 11 cases.
LIKELIHOOD LLC: Gets OK to Use Cash Collateral Until April 11
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Washington
issued a second interim order allowing Likelihood LLC to use cash
collateral until April 11.
The interim order authorized the company to use cash collateral
pursuant to the interim budget pending the next hearing.
Secured lenders, including KeyBank, National Association and CFT
Clear Finance Technology Corp. were granted replacement liens on
all post-petition collateral and proceeds thereof, with the same
priority as their pre-bankruptcy liens.
As additional protection, Likelihood was ordered to pay $1,280 per
week to KeyBank and $250 per week to CFT.
The next hearing is set for April 8.
KeyBank, National Association, as secured lender, is represented
by:
Michael M. Sperry, Esq.
575 S. Michigan Street
Seattle, WA 98108
Phone: 206-381-0133
michaels@shweetlaw.com
About Likelihood LLC
Likelihood, LLC is a retail company in Seattle, Wash., specializing
in footwear, apparel, accessories, and home goods. Some of its
products include Maison Mihara Yasuhiro, Black Comme des Garcons,
Converse, Martine Rose, Crystal Haze, Reebok, and Teddy Vonranson.
Likelihood filed Chapter 11 petition (Bankr. E.D. Wash. Case No.
25-00202) on January 31, 2025, listing total assets of $382,721 and
total liabilities of $5,058,663.
The Debtor is represented by:
Jason Wax, Esq.
Bush Kornfeld, LLP
601 Union St., Suite 5000
Seattle, WA 98101-2373
Tel: 206-292-2110
Email: jwax@bskd.com
LONG RIDGE: S&P Assigns 'B' Rating on Term Loan B and Secured Notes
-------------------------------------------------------------------
S&P Global Ratings assigned its 'B' rating to the $600 million
senior secured notes due 2032 and $400 million term loan B due
2032, issued by Long Ridge Energy LLC. This is a finalization of
the preliminary rating S&P issued in January 2025 following review
of all final documentation, including legal opinions. Since the
January preliminary rating, S&P has updated its capacity price
assumptions slightly upward, and its rating also integrates changed
final debt breakout and interest rates, although the total debt
amount is unchanged from prospective amount at time of preliminary
rating.
The project used these funds to:
-- Refinance an existing term loan,
-- Break existing out of the money swaps (three have been closed
out and the other two slated to be terminated shortly),
-- Fund a gas capital expenditure reserve,
-- Fund a six-month debt service reserve for each new tranche of
debt,
-- Cover transaction costs, and
-- Add around $13 million of cash to the balance sheet.
The project is well hedged during the initial seven-year life of
the term loan B and note, and generally stronger in that period
than after the hedges expire. In the initial years, the project has
gas from already producing wells and avoids most exposure to the
energy market through floating to fixed hedges on 325MW of plant
production. After seven years, the project is then exposed to
market pricing (unless the project enters new hedges, although
pricing for those hedges is uncertain), as well as the ongoing cost
of additional drilling and refinancing interest rate risk. S&P
assumes the term loan B and note are refinanced after seven years,
and that the project will refinance into amortizing debt that is
fully repaid within a useful life of 30 years from COD (by 2051).
The project plans to maintain a drilling program to ensure
self-supply of all gas required by the CCGT through the 30-year
life based on management dispatch expectations. S&P's expectations
of dispatch are similar to management, starting at 87% and
declining to just below 60% by 2051. This need for ongoing
investment in gas drilling leads to relatively high and somewhat
uneven capital spending, but maintains a high spark spread through
the 30-year assumed life of the project. The project also will fund
an initial drilling reserve of $85 million that is forecast to
cover drilling costs through 2025 and 2026. The forecast capital
expenditures (capex) vary year by year, and the minimum debt
service coverage ratio (DSCR) is during one of the peaks of capex
spending (and after the full draw down of the initial drilling
reserve account). As the minimum DSCR is similar during the term
loan B and in the post-refinancing period, S&P has chosen to assess
the life of the project as a single operations period rather than
in phases.
The project's asset class operations stability (ACOS) of '5'
reflects the projects' use of commercially proven natural gas-fired
turbine technology with sound operating and maintenance support
that should enable the plant to meet our expectation of what S&P
considers strong operational performance and high reliability. Most
power technologies generally fall within the '5' category. In some
rarer situations, higher risk assessments are possible (i.e.,
nuclear), which reflect much higher sophistication and the
potential for lengthy outages.
S&P said, "Market exposure measures the expected volatility of a
project's cash flow available for debt service (CFADS) from our
projected base-case to the market downside case due to price
changes or volume fluctuations, or both. As such, for purposes of
our rating analysis, we decreased Long Ridge's capacity factor,
compressed the spark spreads, and reduced the capacity prices for
uncleared periods. Under these stressful conditions, we would
expect the project's cash flows to decline to the lower end of the
30%-50% range from our base-case, which falls at the lower end of
what we consider to be a high market exposure category. This
results in a market exposure score of high (3)
"We assess the project's competitive position as neutral, which
reflects the tradeoff between positive factors such as its secured
fuel supply and sustained cost competitiveness, offset by our view
that its geographic position in the PJM market and chance of
curtailment are similar to other CCGT plants we rate.
"We have determined the operation phase business assessment (OPBA)
at '9', which is largely a combination of the project's asset class
operations stability ('5') and its market risk ('3') assessments.
With a minimum DSCR of 1.10x and a median of 1.24x under our base
case, we see the preliminary operations stand-alone credit profile
(SACP) at the lower end of the 'B' category DSCR range of less than
1.50x for an OPBA of '9'. The preliminary SACP is therefore 'b-'."
However, the project benefits from low gas cost due to ownership of
producing gas leases, expected future addition to gas production
due to an ongoing gas drilling program, and hedging for the next
seven years of the project life. These strengths together with
liquidity in the project let it survive around seven years under
our downside assumptions, although coverage does fall below 1x at
times. This is what S&P considers a modest resilience and leads to
one notch uplift to 'b'.
Although the project does have a strong operating profile compared
to many comparable projects, S&P sees this reflected in its base
and downside assumptions, and this is offset by high relative
leverage. As such, S&P does not make any holistic adjustment.
Without other adjustments, under this scenario S&P Global Ratings
would likely assign a 'B' issue level rating, with a stable
outlook, provided the scenario is implemented in accordance with
information and representations provided by Long Ridge to S&P
Global Ratings.
S&P said, "The stable outlook reflects our expectation of high
levels of availability and dispatch, as well as average spark
spreads in the $24-$32/MWh range through the term loan B life. We
project DSCRs in the 1.1x-1.2x area throughout the project life. We
expect the project will have around $710 million outstanding at
maturity on its term loan B and note.
We could lower the rating if factors such as lower-than-expected
"capacity factors, material reductions in project gas production
requiring gas purchases in the market, increases in gas drilling
costs or operational outages lead to coverage falling below 1.10x
on a sustained basis.
"Although we consider it unlikely within the next year or so, we
could raise the rating if the project is able to significantly
deleverage, reaching a projected minimum DSCR above 1.20x. This
could occur if the project revenues are well above our
expectations--potentially due to factors like higher capacity cash
flows, excess gas sales, or project costs such as gas drilling end
up lower than we expect, allowing the project to substantially
increase the sweep payments on the term loan B and de-lever the
project faster than in our base case expectations."
LONGSHORE MIDCO: S&P Upgrades ICR to 'B' on Improving Performance
-----------------------------------------------------------------
S&P Global Ratings raised its long-term issuer credit ratings on
Longshore Midco LLC and its borrowing subsidiary Bella Holding LLC
(collectively MedRisk) to 'B' from 'B-'. The outlook is stable. S&P
also raised its issue ratings on its $125 million revolver due 2028
and $1.318 billion first-lien term loan due May 2028 to 'B' from
'B-', with recovery ratings of '3', indicating its expectation of a
meaningful recovery (50%-70%; rounded estimate: 50%).
S&P said, "We expect MedRisk's revenue to increase meaningfully
through 2025, driven by a mix of organic and acquired growth. For
the for the 12 months ended third-quarter 2024, total revenue grew
14% to $892 million and EBITDA margins modestly improved to 19.6%.
In turn, pro forma adjusted financial leverage and EBITDA interest
coverage improved to 6.5x and 2.0x, respectively. We believe the
company is benefitting from net new business development
(supporting sustained organic growth) and expanding the scale and
scope of its operations, which is strengthening its competitive
position. We forecast 20% revenue growth in 2024 and 25% in 2025
driven by the full-year and synergistic effects of acquisitions
completed in 2024.
"We expect adjusted EBITDA margins will modestly improve through
2025. We forecast an increase in cash flow, with EBITDA margins
sustained at 19%-20% as the company's scale and scope of services
continue to grow. The improvement will result from a better
absorption of fixed costs, given higher topline growth.
Furthermore, we expect incremental topline synergistic benefits
from the cross-selling of products from recently acquired (in 2024)
software-based solutions and services companies Medata Inc. and
StrataCare to its core physical therapy customer base.
"We expect adjusted financial leverage and EBITDA interest coverage
to sustainably improve to near 5.5x and 2.5x through 2025. We
attribute this to growing scale and improved operational
efficiency, driving higher absolute cash flow to support the
company's growth and operations. We also forecast that funds from
operations (FFO) to debt will meaningfully strengthen to about 8%
in 2025 versus the 4% forecast for 2024 given the above combined
with a moderately lower debt service burden.
"The stable outlook indicates the rating is unlikely to change. It
also reflects our expectation that MedRisk will achieve robust
topline growth of 20%-25%, with EBITDA margins near 20%, per our
calculations, through 2025. If the company achieves our
expectations, we'd expect financial leverage and EBITDA interest
coverage to be about 5.5x and about 2.5x through 2025.
"We could lower our rating within 12 months if leverage exceeds
7.0x or EBITDA interest coverage falls materially below 2x on a
sustained basis. This could happen via a combination of customer
attrition and elevated operating expenses, constraining revenue
growth and reducing margins through 2025. We could also lower the
rating if liquidity becomes constrained such that we expect
liquidity sources to fall to less than 1.2x expected uses.
"An upgrade is unlikely in 2025 based on our assessment of
financial policy and expectations for credit metric development. We
believe this makes a sustained reduction in debt unlikely given the
potential for re-leveraging--notwithstanding a liquidity event (an
IPO) that leads to financial leverage sustainably below 5x."
Environmental, Social, And Governance
S&P said, "Governance is a moderately negative consideration in our
rating, as it is for most rated entities owned by private-equity
sponsors. We believe the company's high leverage points to
corporate decision-making that prioritizes the interests of the
controlling owners." This also reflects private-equity sponsors'
generally finite holding periods and focus on maximizing
shareholder returns.
LOVING KINDNESS: Plan Filing Exclusivity Widened to June 23, 2025
-----------------------------------------------------------------
Judge Jeffery A. Deller of the U.S. Bankruptcy Court for the
Western District of Pennsylvania extended Loving Kindness
Healthcare Systems, LLC's exclusive periods to file a plan of
reorganization and obtain acceptance thereof to June 23 and August
22, 2025, respectively.
As shared by Troubled Company Reporter, the Debtor explains that
the extension of the Exclusivity Periods will allow the Bar Date to
pass, providing the Debtor time to assess all creditors in this
case and generate an inclusive plan addressing all claims.
The Debtor notes that the majority of the currently asserted debt
is tax debt, mostly calculated on estimates due to the failure of
the prepetition debtor to file tax returns. The delinquent tax
returns are being filed presently, and it is hoped that will allow
the taxing authorities to recalculate the proper tax, penalty, and
interest.
The Debtor claims that it is critical for the company to finalize
the proper calculation of all outstanding tax obligations before
filing a plan. This will allow the Debtor to properly assess the
amount owed and properly reorganize.
The Debtor asserts that its creditors will not be prejudiced by the
requested extension; on the contrary, the Debtor's creditors will
be best served with an extension of the Exclusivity Periods, as it
will help determine the precise amount due to each creditor.
Loving Kindness Healthcare Systems, LLC, is represented by:
Robert S. Bernstein, Esq.
Gwenyth A. Ortman, Esq.
Bernstein-Burkley P.C.
601 Grant Street, 9th Floor
Pittsburg, PA 15219
Telephone: (412) 456-8100
Facsimile: (412) 456-8135
Email: rbernstein@bernsteinlaw.com
About Loving Kindness Healthcare Systems
Loving Kindness Healthcare Systems LLC is a state-licensed Home
Health Care Agency.
Loving Kindness Healthcare Systems sought relief under Chapter 11
of the U.S. Bankruptcy Code (Bankr. W.D. Pa. Case No. 24-22610) on
Oct. 25, 2024, with up to $50,000 in assets and up to $10 million
in liabilities. Copa Davis, member, signed the petition.
The Debtor tapped Robert S. Bernstein, Esq., at Bernstein-Burkley
PC as counsel and Gloria J. Besley as accountant.
LUCAS CONSTRUCTION: Seeks Chapter 11 Bankruptcy in New Jersey
-------------------------------------------------------------
On March 7, 2025, Lucas Construction Group Inc. filed Chapter 11
protection in the U.S. Bankruptcy Court for the District of New
Jersey. According to court filing, the
Debtor reports $16,950,049 in debt owed to 100 and 199
creditors. The petition states funds will not be available to
unsecured creditors.
About Lucas Construction Group Inc.
Lucas Construction Group Inc. is a construction company based in
Morganville, New Jersey, specializing in heavy highway and road
construction as well as site redevelopment projects for both public
and private sectors. With over 15 years of experience, the Company
has worked with various federal, state, and local agencies,
handling complex construction tasks.
Lucas Construction Group Inc. sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. D.N.J. Case No. 25-12404) on March 7,
2025. In its petition, the Debtor reports total assets of
$5,181,262 and total liabilities of $16,950,049.
The Debtor is represented by:
Andrew J. Kelly, Esq.
THE KELLY FIRM, P.C.
1011 Highway 71, Suite 200
Spring Lake, NJ 07762
Tel: 732-449-0525
Fax: 732-449-0592
E-mail: akelly@kbtlaw.com
M & M BUCKLEY: Court Extends Cash Collateral Access to March 27
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
extended M & M Buckley Management, Inc.'s authority to use cash
collateral until March 27.
The interim order signed by Judge Janet Baer approved the use of
cash collateral to pay the expenses set forth in the company's
budget, with a 10% variance allowed. The budget projects total
operational expenses of $18,898.21 for March.
Community Loan Servicing, LLC was granted post-petition replacement
liens on the cash collateral and post-petition property of M & M to
the same extent and with the same priority as its pre-bankruptcy
lien. As additional protection, Community Loan Servicing will
receive payment of $12,500.
M & M was ordered to maintain insurance on its real property,
listing Community Loan Servicing as the lien holder.
The next hearing is set for March 26.
About M & M Buckley Management Inc.
M & M Buckley Management, Inc. is a professional property
management company based in Richton Park, IL. It specializes in
managing residential and commercial properties.
M & M sought relief under Subchapter V of Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ill. Case No. 24-19108) on December
23, 2024, with $1 million to $10 million in both assets and
liabilities. Melvin T. Buckely, Jr., president of M & M, 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.
Secured creditor Community Loan Servicing is represented by:
Jill Sidorowicz, Esq.
Noonan & Lieberman, Ltd.
33 N. LaSalle Street, Suite 1150
Chicago, IL 60602
Phone: (312) 605-3500
MAPRAGENCY INC: Seeks to Use Cash Collateral
--------------------------------------------
MAPRagency, Inc. asked the U.S. Bankruptcy Court for the District
of Colorado for authority to use cash collateral and provide
adequate protection to secured creditor, U.S. Small Business
Administration.
The Debtor needs to use cash collateral to pay expenses and make
payroll.
The SBA has a perfected security interest in all tangible and
personal property of the Debtor in the approximate amount of
$898,295 by virtue of a UCC Financing Statement recorded on June
11, 2020. Specifically, the Debtor entered into a COVID EIDL loan
agreement with the SBA for the original principal balance of
$900,000. The Debtor is not currently in arrears on this loan.
The additional entities that may claim an interest in the Debtor's
cash collateral and equipment are Rapid Finance, Alpine Bank,
IDEA247, Inc., Kapitus LLC, and United First LLC.
As adequate protection, the Debtor will provide replacement liens
to the SBA for all postpetition cash and accounts receivable to the
same extent and priority as existed pre-petition and to the extent
that the use of cash collateral results in the decrease in the
secured lenders' interests in the cash collateral pursuant to 11
U.S.C. Section 361(2).
The Debtor will make monthly payments to the SBA of $1,500,
commencing with the March 2025 payment.
A copy of the motion is available at https://urlcurt.com/u?l=9AeFpN
from PacerMonitor.com.
About MAPRagency, Inc.
MAPRagency, Inc. now known as Comprise, is a Boulder-based public
relations and marketing agency that specializes in creative
services, digital marketing, web design, and public relations. The
Company focuses on delivering innovative strategies and solutions
for businesses to enhance their brand visibility and engagement.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Colo. Case No. 25-11092) on March 4,
2025. In the petition signed by Doyle Albee, CEO, the Debtor
disclosed up to $100,000 in assets and up to $10 million in
liabilities.
Judge Thomas B. McNamara oversees the case.
Jeffrey A. Weinman, Esq., at Allen Vellone Wolf Helfrich & Factor,
P.C., represents the Debtor as legal counsel.
MARIN SOFTWARE: Commences 2025 Organizational Restructuring Plan
----------------------------------------------------------------
Marin Software Incorporated reported in a Form 8-K filed with the
Securities and Exchange Commission that on March 4, 2025, it
commenced implementing an organizational restructuring and
reduction in force plan to reduce its operating costs, which is
expected to result in the reduction of the Company’s global
employees by approximately 22 employees, representing approximately
28% of the Company's global employees as of December 31, 2024.
In addition, the Company expects to release approximately three
independent contractors. The Company expects to substantially
complete the 2025 Restructuring Plan by the end of the quarter
ending March 31, 2025.
The Company estimates that it will incur between approximately $1.2
million and $1.4 million of cash expenditures in connection with
the 2025 Restructuring Plan, substantially all of which relates to
severance costs. The Company expects to recognize the majority of
the pre-tax restructuring charges by the end of the quarter ending
March 31, 2025.
About Marin Software
Marin Software Incorporated is a provider of digital marketing
solutions for search, social, and eCommerce advertising channels,
offered as a unified SaaS, advertising management platform for
performance-driven advertisers and agencies. The Company's
platform
is an analytics, workflow, and optimization solution for marketing
professionals, enabling them to maximize the performance of their
digital advertising spend. The Company markets and sells its
solutions to advertisers directly and through leading advertising
agencies, and its customers collectively manage billions of
dollars
in advertising spend on its platform globally across a wide range
of industries.
San Jose, California-based Grant Thornton LLP, the Company's
auditor since 2018, issued a "going concern" qualification in its
report dated Feb. 23, 2024, citing that the Company incurred a net
loss of $22 million during the year ended Dec. 31, 2023, and as of
that date, the Company had an accumulated deficit of approximately
$344 million and negative operating cash flows. These conditions,
along with other matters, raise substantial doubt about the
Company's ability to continue as a going concern.
Marin Software incurred a net loss of $22 million during the year
ended December 31, 2023.
MARTIN MIDSTREAM: Moody's Alters Outlook on 'B3' CFR to Stable
--------------------------------------------------------------
Moody's Ratings changed Martin Midstream Partners L.P.'s (MMLP)
outlook to stable from negative. The B3 Corporate Family Rating,
B3-PD Probability of Default Rating, and Caa1 senior secured 2nd
lien notes ratings were affirmed. The SGL-3 Speculative Grade
Liquidity rating is unchanged.
"The change in Martin Midstream's outlook to stable reflects the
company's more conservative financial policies." said Jake Leiby,
Moody's Ratings Senior Analyst. "The company will continue to focus
on debt reduction in the aftermath of the terminated buyout
proposal from Martin Resource Management Corporation."
RATINGS RATIONALE
The change in MMLP's outlook to stable, from negative previously,
reflects the more conservative financial policies that Moody's
expects the company to adhere to following the terminated buyout
proposal from Martin Resource Management Corporation (MRMC). The
MRMC buyout proposal would have created an implicit burden on MMLP
to distribute sufficient cash to service the debt that MRMC would
have taken on in the transaction. After terminating the buyout
proposal, MMLP has enacted more conservative financial policies
that should result in a more stable credit profile.
MMLP's B3 CFR reflects its asset diversification, long-standing
customer relationships, and fee-based EBITDA generation,
counterbalanced by its small scale and concentrated geographic
footprint on the US Gulf Coast. The company's regional focus does,
however, position it well to serve large oil refiner customers.
MMLP is somewhat insulated from direct commodity price exposure
because most of its EBITDA is generated by fee-based contracts but
still faces volumetric risk. MMLP pays only a nominal distribution
to limited partners because its secured notes restrict its ability
to pay distributions until leverage is below 3.75x. Moody's expects
the company to continue to pay a nominal distribution once leverage
is below 3.75x as it works to reduce leverage further. The
company's debt is expected to decline in the coming years, as free
cash flow is used to reduce outstanding borrowings under the senior
secured first-lien revolving credit facility.
MMLP's SGL-3 rating reflects Moody's expectations for the company
to maintain adequate liquidity into at least mid-2026. Moody's
expects MMLP to generate sufficient cash flow to fund its required
spending needs, including servicing its debt, making capital
investments, and paying a nominal distribution. As of December 31,
2024, the company had a minimal cash balance but $81 million of
available borrowing capacity under its $150 million secured first
lien credit facility due February 2027. The revolver's financial
covenants require MMLP to maintain interest coverage of no less
than 1.75x through September 30, 2025 and of no more than 2.00x
thereafter and first lien leverage of no more than 1.25x through
September 30, 2025 and of no more than 1.50x thereafter. Moody's
expects MMLP to remain in compliance with its covenants.
MMLP's $400 million 11.5% senior secured second-lien notes due
February 2028 are rated Caa1, one notch below the CFR, reflecting
their second-lien claim to the company's assets. The revolver
(unrated) has a first-lien priority claim on assets, ahead of the
second-lien notes.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to an upgrade of MMLP include improved and
more consistent operating performance, debt reduction and sustained
adequate liquidity. Maintenance of leverage below 4.0x and interest
coverage rising towards 2.5x would be supportive of a ratings
upgrade.
Factors that could lead to a downgrade of MMLP include interest
coverage falling below 2.0x, increases in debt and a weakening in
liquidity.
MMLP, headquartered in Kilgore, Texas, is a publicly traded master
limited partnership with primary operations in the US Gulf Coast
region. Martin Resource Management Corporation controls Martin
Midstream GP LLC, which is MMLP's general partner, and owns 15.7%
of MMLP's outstanding limited partner units.
The principal methodology used in these ratings was Midstream
Energy published in February 2022.
MCCLAIN FAMILY: Seeks Chapter 11 Bankruptcy in California
---------------------------------------------------------
On March 7, 2025, McClain Family Cellars Inc. filed Chapter 11
protection in the U.S. Bankruptcy Court for the Central District
of California. 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 McClain Family Cellars Inc.
McClain Family Cellars Inc. is a Black-owned winery based in the
Santa Ynez Valley, California. The winery is known for producing
luxury, award-winning wines and emphasizes four core pillars:
Family, Friends, Faith, and Freedom, offering a range of wines from
both red and white varieties. The Company provides experiences like
private events, in-home tastings, and barrel blending.
Additionally, McClain Cellars operates multiple locations,
including in Laguna Beach, Irvine, Solvang, and Buellton, and
offers a wine club with various membership options. The Company is
a proud member of the African-American Vintners Association.
McClain Family Cellars Inc. sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No. 25-10589) on March
1, 2025. In its petition, the Debtor reports estimated assets
between $100,000 and $500,000 and estimated liabilities between $1
million and $10 million.
Honorable Bankruptcy Judge Theodor Albert handles the case.
The Debtor is represented by:
Marc C. Forsythe, Esq.
GOE FORSYTHE & HODGES LLP
17701 Cowan
Lobby D. Suite 210
Irvine, CA 92614
Tel: (949) 798-2460
E-mail: mforsythe@goeforlaw.com
MIRAMAR TOWNHOMES: Gets Extension to Access Cash Collateral
-----------------------------------------------------------
Miramar Townhomes SWNG 2, LLC and its affiliates received fourth
interim approval from the U.S. Bankruptcy Court for the Southern
District of Texas to use the cash collateral of Fannie Mae.
The fourth interim order authorized the companies to use cash
collateral to pay the expenses set forth in their budget.
As protection, Fannie Mae was granted replacement liens on all
property of the companies whether acquired before or after their
Chapter 11 filing.
In addition, on or before the 15th day of December 2025 and the
10th day of each month thereafter, each company will remit to the
secured lender a cash payment equal to the amount by which such
company's remaining cash balance at the end of the prior month
exceeded the following: $20,000 for Miramar, $40,000 for Toro
Place, LLC, and $40,000 for The Avenue SWNG TIC 1, LLC and The
Avenue SWNG TIC 2, LLC.
In case of any diminution in the value of its interests in the
collateral, the secured lender will be granted a superpriority
claim.
Fannie Mae's cash collateral consists of accounts receivable and
rents generated from three multifamily properties owned by the
companies.
The properties include The Avenue apartment complex, the Miramar
Townhomes and the Toro Place apartment complex in Houston, Texas.
These properties, along with the rents and accounts receivable,
secure the loans, which the companies obtained from the secured
lender.
A final hearing is set for April 2.
About Miramar Townhomes SWNG 2
Miramar Townhomes SWNG 2, LLC is owned by Miramar Townhomes SWNG
GP, LLC and Miramar Townhomes LP SWNG, LLC. Avenue SWNG TIC, 1 and
Avenue SWNG TIC, 2 are both owned by The Avenue SWNG, LLC while
Toro Place, LLC is owned by Toro Place Holdings, LLC.
Miramar owns the Miramar Townhomes located at 2380 Bering Drive,
Houston, Texas, while Toro owns the Toro Place Apartments located
at 12101 Fondren Road, Houston, Texas. The Avenue SWNG TIC
companies own The Avenue Apartments located at 5050 Yale Street,
Houston, Texas.
On November 27, 2024, the Debtors filed Chapter 11 petitions
(Bankr. S.D. Texas Lead Case No. 24-90608). At the time of the
filing, each Debtor reported $10 million to $50 million in assets
and liabilities.
Judge Christopher M. Lopez handles the cases.
The Debtors are represented by Elyse M. Farrow, Esq., and Melissa
Anne Haselden, Esq., at Haselden Farrow, PLLC.
Fannie Mae is represented by:
Keith M. Aurzada, Esq.
Michael P. Cooley, Esq.
Dylan T.F. Ross, Esq.
Reed Smith, LLP
2850 N. Harwood Street #1500
Dallas, TX 75201
Telephone: (469) 680-4200
Facsimile: (469) 680-4299
Email: kaurzada@reedsmith.com
mpcooley@reedsmith.com
dylan.ross@reedsmith.com
MITCHELL ROCK: Seeks Chapter 11 Bankruptcy in Alabama
-----------------------------------------------------
On March 7, 2025, Mitchell Rock Inc. filed Chapter 11 protection
in the U.S. Bankruptcy Court for the Northern District of Alabama.
According to court filing, the Debtor reports $4,586,374 in
debt owed to 1 and 49 creditors. The petition states funds will be
available to unsecured creditors.
About Mitchell Rock Inc.
Mitchell Rock Inc. is a mining and aggregate processing company
with locations in McCool, Mississippi, and Autaugaville, Alabama.
Mitchell Rock Inc. sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ala. Case No. 25-00701) on March 7,
2025. In its petition, the Debtor reports total assets of
$5,454,450 and total liabilities of $4,586,374.
Honorable Bankruptcy Judge Tamara O. Mitchell handles the case.
The Debtor is represented by:
Frederick M. Garfield, Esq.
SPAIN & GILLON, LLC
505 North 20th Street
Suite 1200 The Financial Center
Birmingham, AL 35203
Tel: (205) 328-4100
Fax: (205) 324-8866
E-mail: fgarfield@spain-gillon.com
MJD ENGINEERING: Gets Final OK to Use Cash Collateral
-----------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of California,
Sacramento Division, granted MJD Engineering, Inc.'s motion to use
cash collateral on a final basis.
The final order signed by Judge Fredrick Clement authorized MJD
Engineering to use cash collateral to pay its expenses from March
to August in accordance with its budget.
As protection for the use of their cash collateral, the U.S. Small
Business Administration and other secured creditors were granted
replacement liens on assets of the company with the same priority
as their pre-bankruptcy liens.
MJD Engineering was ordered to make a monthly payment of $3,500 to
SBA during the six-month period.
About MJD Engineering Inc.
MJD Engineering, Inc. is a company in Marysville, Calif., which is
engaged in the construction of utility systems.
MJD Engineering sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. Cal. Case No. 25-20487) on February 3,
2025, listing between $500,000 and $1 million in assets and between
$1 million and $10 million in liabilities.
Judge Fredrick E. Clement handles the case.
The Debtor is represented by:
Michael Jay Berger, Esq.
Law Offices of Michael Jay Berger
9454 Wilshire Boulevard, 6th Floor
Beverly Hills, CA 90212
Tel: (310) 271-6223
Fax: (310) 271-9805
Email: michal.berger@bankruptcypower.com
MOORE HOLDINGS: Seeks to Use Cash Collateral Until Sept 30
----------------------------------------------------------
Moore Holdings, LLC asks the U.S. Bankruptcy Court for the Eastern
District of California, Sacramento Division, for authority to use
cash collateral and provide adequate protection, through September
30.
Specifically, the Debtor needs to use cash collateral, consisting
of rents collected from tenants at their property, to cover
necessary expenses for the property. The funds will be used to pay
property-related expenses such as HOA dues, property taxes,
maintenance, insurance, and employee health insurance.
Poppy Bank has a deed of trust with an assignment of rents on the
property at 2151 Professional Dr., Roseville, CA. There is also a
county tax lien from Placer County on the same property.
The Debtor expects a modest surplus of rents over expenses each
month. This surplus will be reflected in the Debtor’s Monthly
Operating Reports and will be retained in the Rental Account.
This surplus serves as further protection for the secured
creditors, ensuring their interests are safeguarded during the
bankruptcy process.
A hearing on the matter is set for March 27.
A copy of the motion is available at https://urlcurt.com/u?l=kkPXVZ
from PacerMonitor.com.
About Moore Holdings LLC
Moore Holdings LLC a single asset real estate company headquartered
in Roseville, California.
Moore Holdings LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. Cal. Case No. 25-20053) on January 8,
2025. In its petition, the Debtor reports estimated assets and
liabilities between $1 million and $10 million each.
Honorable Bankruptcy Judge Ronald H. Sargis handles the case.
Stephan M. Brown, Esq. of The Bankruptcy Group, P.C. represents the
Debtor as counsel.
NAPC DEFENSE: Raises Going Concern Doubt Amid Cash Shortfall
------------------------------------------------------------
NAPC Defense, Inc. disclosed in a Form 10-Q Report filed with the
U.S. Securities and Exchange Commission for the quarterly period
ended October 31, 2024, that there is substantial doubt about its
ability to continue as a going concern.
According to NAPC, it has incurred net losses since inception. For
the three and six months ended October 31, 2024, the company
reported net losses of $453,921 and $889,784, respectively,
compared to net losses of $161,489 and $19,968 for the same periods
in 2023. Based on its historical rate of expenditures, the Company
expects to expend its available cash in less than one month from
February 26, 2025. Management’s plans include raising capital
through the equity markets to fund operations and the generation of
revenue through its business. The Company does not expect to
generate any significant revenues for the foreseeable future. At
October 31, 2024, the Company had a net working capital deficit of
$990,136. The Company is in immediate need of further working
capital and is seeking options, with respect to financing, in the
form of debt, equity or a combination thereof.
Failure to raise adequate capital and generate adequate revenues
could result in the Company having to curtail or cease operations.
The Company’s ability to raise additional capital through the
future issuances of the common stock is unknown. Additionally, even
if the Company does raise sufficient capital to support its
operating expenses and generate adequate revenues, there can be no
assurances that the revenue will be sufficient to enable it to
develop to a level where it will generate profits and cash flows
from operations. These matters raise substantial doubt about the
Company’s ability to continue as a going concern; however, the
accompanying condensed consolidated financial statements have been
prepared on a going concern basis, which contemplates the
realization of assets and satisfaction of liabilities in the normal
course of business.
A full-text copy of the Company's Form 10-Q is available at:
https://tinyurl.com/2w4z8h8m
About NAPC Defense
NAPC Defense, Inc. (formerly Treasure & Shipwreck Recovery, Inc.)
was incorporated in the State of Nevada on October 24, 2016 as
Beliss Corp. The Company changed its name to Treasure & Shipwreck
Recovery Inc. on June 26, 2019. The Company is in the colonial era
treasure shipwreck recovery business operating salvage crews on the
east coast of Florida. On April 1, 2024, the Company changed its
name to NAPC Defense, Inc. with the State of Nevada, for an
additional direction in the military arms and law enforcement
field.
As of October 31, 2024, the Company has $1,628,919 in total assets,
$1,003,055 in total liabilities, and total stockholders' equity of
$625,864.
NATGASOLINE LLC: Moody's Affirms B3 CFR & Alters Outlook to Pos.
----------------------------------------------------------------
Moody's Ratings affirmed Natgasoline LLC's B3 corporate family
rating and the B3-PD probability of default rating. Moody's also
affirmed the B3 rating on the senior secured bank credit facilities
due in 2025 and assigned B3 ratings to the proposed new senior
secured bank credit facilities. The proceeds of the new term loan
will be used to refinance the existing term loan. The transaction
is leverage neutral and will extend the maturities, reducing the
refinancing risk. The rating outlook was changed to positive from
negative.
RATINGS RATIONALE
Natgasoline's B3 corporate family rating reflects the company's
small scale as measured by revenue, limited operational and product
diversity with a single site location along the Gulf Coast and a
track record of operational challenges that prevented the company
from running at full capacity and generating consistent earnings
and cash flow. Leverage has fluctuated between 4.3x and 24.9x in
the last five years as the company's performance was affected by
operational difficulties and volatile pricing for methanol, its
single product, and natural gas prices, its main raw material. The
company restarted methanol production in December after a shutdown
caused by a fire on September 29 and has been running around the
nameplate capacity level for 2.5 months. The company has already
received insurance proceeds to cover business interruption and
repairs following the inlet failure at the end of September 2024.
The insurance proceeds have improved liquidity and the company's
proposed credit facility refinancing removes the near-term
refinancing risk. However, given the short period of operating at
nameplate capacity and the track record of operational
difficulties, the company needs to demonstrate consistent improved
performance for a longer period of time.
The rating benefits from the company's access to low-cost natural
gas, positioning the plant on the low end of the global cost curve
when it runs consistently. If the company can operate the plant at
nameplate capacity it generates strong free cash flow at mid-cycle
methanol prices of $350/ton. Moody's expects leverage to improve
from about 10x at the end of 2024 (excluding insurance proceeds) to
about 4.7x in 2025, assuming prices below the mid-cycle average and
a 85% utilization rate. Methanol prices are very volatile and
currently are above the mid-cycle long-term average due to a number
of unplanned outages. Slowing global growth and increased
uncertainty due to tariffs imposed or planned by the US government
raise concerns about methanol demand in the near-term.
The credit profile is also constrained by the ratings of the
company's shareholders. The plant is 50%/50% owned by Proman USA
that operates through Consolidated Energy Limited (B2, negative)
and OCI N.V. (Ba1, RUR Down). OCI. N.V is in the process of selling
its share in Natgasoline to Methanex Corporation (Ba1, RUR down),
which operates a number of methanol plants globally. On March 10,
OCI announced that its dispute with Proman over shareholder rights
has been resolved and OCI's 50% interest in Natgasoline will be
included as part of Methanex's acquisition of OCI Methanol.
Methanex expects the transaction, which is subject to regulatory
review, to close in the first half of 2025. Moody's views ownership
by Methanex as credit positive due to its expertise in operaing
methanol plants.
Under the current ownership and existing agreements, the
shareholder sponsors provide offtake and marketing responsibilities
through OCI Methanol Marketing LLC and Valenz and are obligated to
purchase all Natgasoline's production volumes at a discount to
market-based US contract prices and to sell the offtake into the
regional and global methanol markets. Each sponsor has 3 board
seats, with the board Chairman from Proman casting a tie-breaking
vote on non-reserve matters. Moody's would expect Methanex to enter
into similar offtake agreements with Natgasoline. The shareholders
do not guarantee the debt of Natgasoline.
Moody's expects Natgasoline to have adequate liquidity under
Moody's operating assumptions in 2025. The company had a cash
balance of $57 million at the end of December and restricted cash
of $16 million. When the company operates consistently at mid-cycle
prices, it generates strong free cash flow. The proposed $45
million revolver due in 2028 will be undrawn. The company has to
meet a maximum first lien net leverage of 4.75x if it borrows more
than 45% of the committed amount. The company was in compliance at
the end of the fourth quarter (as insurance proceeds are included
in EBITDA calculations). The proposed $525 million term loan is due
in 2030. The term loan has no maintenance covenants. The company
has $336 million of revenue bonds that mature in 2031. The bonds
start amortizing in the third quarter of 2025. The company needs to
either refinance the revenue bonds or operate consistently to
generate strong cash flow to be able to make revenue bond
amortization payments. The company intends to refinance its revenue
bonds this year.
The positive rating outlook reflects the reduction in near-term
refinancing risk and the successful restart of the facility. The
positive rating outlook also reflects expectations that credit
metrics and liquidity will improve if the plant continues to
operates near its nameplate capacity in 2025.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could upgrade the rating if the company can demonstrate
consistent operating rates and credit metrics improve with
debt/EBITDA below 5x. Completion of the ownership change and could
also support the upgrade.
Moody's could downgrade the rating if liquidity deteriorates as a
result of another outage. Moody's also could downgrade the rating
if debt/EBITDA remains above 6.0x, EBITDA to Interest is below 1.5x
and free cash flow is consistently negative.
Natgasoline LLC, headquartered in Delaware, is a leading producer
of methanol, jointly owned by OCI N.V. (50%, Ba1, RUR Down) and
Proman USA through Consolidated Energy Limited (50%, B2 negative).
Natgasoline's sole product is methanol, an intermediate product
used in the manufacture of formaldehyde, acetic acid, methyl
tertiary butyl ether (MTBE, a gasoline oxygenate no longer used in
the US), and as a fuel additive, fuel alternative, and feedstock to
MTO facilities in China. The company generated sales of $306
million in the twelve months ended September 2024.
The principal methodology used in these ratings was Chemicals
published in October 2023.
NEWS DIRECT: Court Extends Cash Collateral Access to April 9
------------------------------------------------------------
News Direct Corp. received third interim approval from the U.S.
Bankruptcy Court for the District of Connecticut, Bridgeport
Division, to use $117,660.60 in cash collateral to pay its
operating expenses.
The order signed by Judge Julie Manning authorized the company to
use cash collateral for the period from March 8 to April 9 in
accordance with its budget, with a permitted line-item variance of
up to 10%.
Old National Bank, a secured creditor, was granted a replacement
lien on the company's post-petition assets to protect the bank's
interests in the cash collateral.
As additional protection, the bank will receive the sum of $20,000,
payable in bi-weekly installments on the eighth and 22nd of each
month.
A final hearing is scheduled for April 1.
About News Direct Corp.
News Direct Corp. is a news and content distribution platform in
Norwalk, Conn.
News Direct sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. D. Conn. Case No. 25-50005) on January 3, 2025, with
up to $50,000 in assets and $1 million to $10 million in
liabilities.
Judge Julie A. Manning handles the case.
The Debtor is represented by Scott M. Charmoy, Esq., at Charmoy &
Charmoy.
Old National Bank, as secured creditor, is represented by:
Kristin B. Mayhew, Esq.
Pullman & Comley, LLC
850 Main Street
P.O. Box 7006
Bridgeport, CT 06601-7006
Phone: 203-330-2000
Fax: 203-576-8888
kmayhew@pullcom.com
NORTH EASTERN INDUSTRIES: Gets Final OK to Use Cash Collateral
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Massachusetts issued
a proceeding memorandum and order authorizing North Eastern
Industries, Inc. to use cash collateral on a final basis.
The order allowed North Eastern Industries to use cash collateral
under the same terms and conditions until May 22.
A further hearing is scheduled for May 22.
About North Eastern Industries
North Eastern Industries, Inc. filed its voluntary petition for
relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Mass.
Case No. 24-40824) on August 9, 2024, listing between $500,001 and
$1 million in both assets and liabilities.
Judge Elizabeth D. Katz oversees the case.
The Debtor is represented by James L. O'Connor, Jr., Esq., at
Nickless, Phillips and O'Connor.
NORTHSTARR BUILDERS: Gets Final OK to Use Cash Collateral
---------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Michigan
issued a final order granting Northstarr Builders, LLC
authorization to use its secured creditors' cash collateral.
The final order granted secured creditors, Lendr and the U.S. Small
Business Administration, replacement liens on post-petition assets
to the same extent and with the same priority as their
pre-bankruptcy liens.
Northstarr Builders was ordered to carve out $2,000 per month for
placement in a debtor-in-possession account to be held in escrow
for the payment of administrative expenses.
The authority to use cash collateral terminates upon dismissal or
conversion of the company's Chapter 11 case into one under Chapter
7; the company's failure to abide by the terms and conditions of
the order; or cessation of business operations.
About Northstarr Builders
Northstarr Builders, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D. Mich. Case No. 24-32419) on
December 23, 2024, with up to $100,000 in assets and up to $1
million in liabilities. Marty Johnson, company owner, signed the
petition.
Judge Joel D. Applebaum represents the Debtor as legal counsel.
The Debtor is represented by:
George E. Jacobs, Esq.
Bankruptcy Law Office
2425 S. Linden Rd., Suite C
Flint, MI 48532
Tel: 810-720-4333
Email: george@bklawoffice.com
NOVA CHEMICALS: Fitch Puts 'BB-' Long-Term IDR on Watch Positive
----------------------------------------------------------------
Fitch Ratings has placed the 'BB-' Long-Term Issuer Default Ratings
(IDRs) and all issue-level ratings of NOVA Chemicals Corporation
(NOVA) on Rating Watch Positive (RWP).
The RWP placement follows the announcement that NOVA is to be
acquired by Borouge Group International, itself the result of a
merger between Borouge plc and Borealis AG, and reflects the credit
quality of the joint owners OMV AG (A-/Stable) and ADNOC, for whom
the central debt-capital market funding vehicle is ADNOC Murban RSC
LTD (AA/Stable). Fitch expects to resolve the Rating Watch upon the
close of the transaction, currently expected in Q1 2026. Fitch will
continue to monitor the transaction for insight into the final
post-transaction capital structure as well as the strength of
linkages between the ultimate parents and NOVA.
The 'BB-' IDR also reflects NOVA's position as a low-cost ethylene
and polyethylene producers globally, sufficient liquidity and
relatively moderate maintenance capital requirements. This is
offset by an elevated debt burden, exposure to commodity prices,
and an uncertain macroeconomic environment including rising trade
tensions.
Key Rating Drivers
Pending Acquisition by Borouge: On March 4, 2025, Borouge plc and
Borealis AG announced an intention to combine into Borouge Group
International, which will acquire NOVA for $13.4 billion. Borouge
Group International will be jointly controlled as an equal
partnership between ADNOC (AA/ROS) and OMV AG (A-/ROS). Although
Borouge Group International's ultimate capital structure remains
unclear, the transaction is expected to be debt-financed. The
post-transaction company will be the world's fourth-largest
polyolefins producer by nameplate production capacity.
Improving Operations Drives Deleveraging: NOVA's operations
improved significantly in 2024, despite lingering industry
overcapacity. In 2023, the company suffered unplanned outages at
its Corunna ethylene production facility due to a mechanical issue
within a third-party proprietary technology. Fitch believes this
period marked peak leverage for NOVA as the Corunna cracker issues
have been resolved and destocking has largely subsided.
Continued industry overcapacity and the potential impact from the
newly enacted 25% U.S. tariffs on most imports from Canada could
threaten this momentum throughout the ratings horizon. If U.S.
trade relationships with Canada deteriorate, Fitch believes
management could shift a substantial amount of product to Asia,
which would partially mitigate the negative impact on profitability
and cash generation.
Successful Refinancing Efforts: NOVA proactively addressed its
near-term maturity profile in 2023-2024 and extended its $1.5
billion revolving credit facility to April 2028, representing an
important step in the company's management of its debt maturity
profile. Fitch believes that the transactions will afford the
company a degree of financial flexibility and materially lower
refinancing risk throughout the ratings horizon, with its next
significant maturity due in 2027. NOVA's ratings assume the company
will continue to proactively address maturities in a timely
manner.
Sustained Low-Cost Position: NOVA benefits from low-cost feedstock
at its Geismar, Louisiana, Joffre, Alberta and Corunna, Ontario
sites. These assets have access to some of the most prolific shale
oil & gas basins, and the Joffre assets are near Canadian oil sands
operations and integrated into the Alberta Ethane Gathering System.
Fitch expects North American ethylene production to remain cost
advantaged despite low global operating rates.
Increased Focus on Sustainability: Fitch believes that NOVA's
Circular Solutions business line, which focuses on producing
lower-emission, recycled solutions, will remain a key target for
investment during periods of greater cash flow and financial
access. The company expects to begin production at its new
recycling plant in Connersville, IN this year. Fitch believes
polyethylene producers that secure both supply and demand
commitments in North America will be able to enjoy premium pricing
on recycled products.
Peer Analysis
NOVA and Westlake Corporation (BBB/Stable) are both regional
producers concentrated in ethylene and polyethylene production, but
Westlake benefits from greater scale and product diversification.
Both producers have globally competitive cost bases and have some
specialized characteristics resulting in some margin uplift from
pure commodity chemical producers.
Though NOVA and Westlake's North American asset bases provide the
companies with a relative cost advantage, they lack the scale and
geographic diversification of Dow Chemical Company (BBB+/Stable)
and LyondellBasell Industries N.V. (BBB/Stable). These three peers
have demonstrated more capital discipline than NOVA, each electing
to repay debt during a period of record margins and cash flow in
2021 and early 2022 while NOVA paid $1.2 billion in sponsor
dividends. NOVA operates with far higher EBITDA leverage than its
peers, with YE 2023 leverage over 10.0x compared to LyondellBasell
at 2.1x.
Key Assumptions
- Corunna production drives 2024 recovery with modest operational
improvement thereafter;
- Fitch-calculated EBITDA margins recovered sharply in 2024, slowly
continuing toward 2019 levels in 2025-2026;
- Capex approximately in line with depreciation and amortization;
- No additional M&A or sponsor dividends modelled in the forecast;
- Limited debt repayment beyond successful execution of the
company's refinancing strategy.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- EBITDA leverage consistently above 5.5x, potentially driven by
persistently low utilization rates;
- Generally negative FCF through the cycle, straining liquidity;
- Aggressive capital deployment via significant dividends or
elevated capital spending.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Demonstrated commitment to operating with EBITDA leverage
consistently below 4.5x, including voluntary debt repayment;
- Generally neutral to positive FCF through the cycle.
Further insight into the capital structure at the new parent, the
permanence of the debt remaining at NOVA, and the strengths of
legal and operation linkages of the parents to the subsidiaries
could lead to a resolution of the ratings watch.
Liquidity and Debt Structure
At Sept. 30, 2024, NOVA had total liquidity consisting of $225
million in readily available cash and over $1.3 billion in revolver
availability. The company has largely addressed its near-term
maturities as of its new unsecured issuance, and Fitch believes
NOVA will be able to successfully address its maturities in a
timely manner, with its next significant maturity coming in 2027.
Issuer Profile
NOVA produces and sells ethylene, polyethylene and co-products.
These products are used in a wide variety of downstream
applications.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
NOVA Chemicals
Corporation LT IDR BB- Rating Watch On BB-
senior unsecured LT BB- Rating Watch On RR4 BB-
senior secured LT BB+ Rating Watch On RR2 BB+
ODEBRECHT ENGENHARIA: Chapter 15 Case Summary
---------------------------------------------
Lead Debtor: Odebrecht Engenharia e Construcao S.A.-
Em Recuperacao Judicial
Avenida das Nacoes Unidas, No.
14.401, 4th floor,
Part V - Edificio B1 - Aroeira, Vila Gertrudes
Sao Paulo, State of Sao Paulo 04794-000
Brazil
Business Description: OEC Engenharia & Construcao is a Brazilian
company specializing in large-scale civil
engineering, construction, and
infrastructure development projects. It
offers turnkey solutions, managing every
phase of construction from planning to
execution for both public and private sector
clients. The Company operates in five key
sectors: urban development, energy,
sanitation, industrial plants, and transport
and logistics. As a wholly owned subsidiary
of Novonor, OEC serves markets in Brazil,
Angola, Peru, and the United States.
Chapter 15 Petition Date: March 14, 2025
Court: United States Bankruptcy Court
Southern District of New York
Case numbers of 12 affiliates that concurrently filed voluntary
petitions for relief under Chapter 15 of the Bankruptcy Code:
Debtor Case No.
------ --------
Odebrecht Engenharia e Construcao S.A.- 25-10482
Odebrecht Holdco Finance Limited 25-10483
OECI S.A.-Em Recuperacao Judicial 25-10484
OEC Finance Limited 25-10485
CNO S.A.-Em Recuperacao Judicial 25-10486
Belgravia Servicos e Participacoes S.A.-Em
Recuperacao Judicial 25-10487
Tenenge Overseas Corporation 25-10488
CBPO-Em Recuperacao Judicial 25-10489
Oenger S.A.-Em Recuperacao Judicial 25-10490
Odebrecht Overseas Limited 25-10491
OECI S.A.-Em Recuperacao Judicial 25-10492
Tenenge Engenharia Ltda. Em Recuperacao
Judicial 25-10493
Foreign Representative: Adriana Henry Meirelles
Av. das Nacoes Unidas, 14401, Torre
Aroeira, 5th Floor
Chacara Santo Antonio, Sao Paulo -
SP, 04730-090
Brazil
Foreign Proceeding: Judicial reorganization proceeding
in the 2nd Bankruptcy and Judicial
Reorganization Court of the State
Capital District of Sao Paulo
pursuant to Federal Law 11.101 of
February 9, 2005 of the laws of the
Federative Republic of Brazil
Foreign Representative's
Counsel: Luke A. Barefoot, Esq.
Thomas S. Kessler, Esq.
CLEARY GOTTLIEB STEEN & HAMILTON LLP
One Liberty Plaza
New York NY 10006
Tel: (212) 225-2000
Fax: (212) 225-3999
Email: lbarefoot@cgsh.com
tkessler@cgsh.com
Estimated Assets: Unknown
Estimated Debt: Unknown
A full-text copy of the Lead Debtor's Chapter 15 petition is
available for free on PacerMonitor at:
https://www.pacermonitor.com/view/F7MXPWI/Odebrecht_Engenharia_E_Construo__nysbke-25-10482__0001.0.pdf?mcid=tGE4TAMA
ONONTIO LANDSCAPING: Court OKs Final Use of Cash Collateral
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of New York
issued a final order authorizing Onontio Landscaping, Inc. to use
cash collateral.
The final order authorized the company to use cash collateral to
cover payroll and operational expenses per the monthly budget.
Secured creditors, including PNC Bank, will be granted rollover
liens and security interests in assets of the company in which they
hold security interests.
As additional protection, PNC Bank will receive a monthly payment
of $736.61.
Meanwhile, Onontio was ordered to make weekly payments of $200 to
the Subchapter V trustee to fund an escrow for payment of the
trustee's fees up to the amount of $4,000.
About Onontio Landscaping
Onontio Landscaping, Inc. is a landscaping and snow removal service
provider.
The Debtor sought protection under Chapter 11 of the U.S.
bankruptcy Code (Bankr. N.D. N.Y. Case No. 24-60824) with $100,001
to $500,000 in assets and $500,001 to $1 million in liabilities.
Paul Levine, Esq., at Emery Greisler, LLC serves as Subchapter V
trustee.
Judge Patrick G. Radel oversees the case.
The Debtor is represented by Peter Alan Orville, Esq., at Orville &
Mcdonald Law, PC.
Secured creditor Onontio Landscaping is represented by:
Peter B. Foster, Esq.
Foster & Wolkind, P.C.
80 Fifth Avenue, Suite 1401
New York, NY 10011-8002
Tel: (212) 691-2313
Fax: (212) 691-2459
ORION SECURITY: Seeks Chapter 11 Bankruptcy in Puerto Rico
----------------------------------------------------------
On March 7, 2025, Orion Security Service and Investigation
Incorporated filed Chapter 11 protection in the U.S. Bankruptcy
Court for the District of Puerto Rico. 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 Orion Security Service and Investigation
Incorporated
Orion Security Service and Investigation Incorporated
Orion Security Service and Investigation Incorporated sought relief
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.P.R. Case
No. 25-01003) on March 7, 2025. In its petition, the Debtor reports
estimated assets between $500,000 and $1 million and estimated
liabilities between $1 million an $10 million.
The Debtor is represented by:
Rafael A. Gonzalez Valiente, Esq.
GODREAU & GONZALEZ, LLC
P.O. Box 9024176
San Juan, PR 00902-4176
Tel: 787-726-0077
E-mail: rgv@g-glawpr.com
PACIFIC DENTAL: Moody's Cuts CFR to B2, Outlook Stable
------------------------------------------------------
Moody's Ratings downgraded Pacific Dental Services, LLC ("Pacific
Dental") corporate family rating to B2 from B1, probability of
default rating to B2-PD from B1-PD, and senior secured first lien
bank credit facilities to B2 from B1 following the new add-on term
loan issuance. The outlook remains stable.
The downgrade of Pacific Dental's CFR reflects the company's
increased debt to EBITDA due to the most recent add-on term loan
issuance that will fund a dividend, and the risk that leverage will
remain above 5.0x. Despite strong organic revenue growth Moody's
expects Moody's adjusted EBITDA margins to weaken in 2025 reducing
the company's ability to deleverage.
Governance was also a key driver of the downgrade, which is
reflected in Moody's views that the company's financial policy has
changed due to a second debt-funded distribution following a
similarly structured $200 million add-on term loan in February
2024.
The new $250 million fungible add-on first lien term loan will be
used to pay a $100 million additional dividend to shareholders and
add $145 million cash to the balance sheet. The additional cash on
balance sheet may be used to pay another $150 million dividend in
2026, depending on the company's performance. Pro forma for the
transaction, debt to EBITDA will be 5.5x as of December 31, 2024.
RATINGS RATIONALE
Pacific Dental's B2 CFR is constrained by its high financial
leverage and geographic concentration in the state of California.
The company's debt to EBITDA was 5.5x as of December 31, 2024 (pro
forma for the new add-on term loan issuance) which Moody's expects
to remain in low 5.0x range over the next 12-18 months. Pacific
Dental has a history of negative free cash flow, which Moody's
expects to continue in 2025, due to aggressive capex spending to
fund new offices.
The rating is supported by Pacific Dental's strong track record of
same office sales growth and in developing new dental offices.
Pacific Dental has strong dentist retention rates due to its
dentist ownership model, which aligns the interests of the dentists
with the company. Further, the rating reflects Pacific Dental's
good service diversity, with the majority of practice revenue made
up of hygiene and general dentistry. These characteristics make the
company less susceptible to an economic downturn than other more
specialized dentistry companies. The rating also reflects the very
good liquidity position of the company.
Moody's expects the company's liquidity to be very good over the
next 12-18 months given the company's access to a $350 million
revolver (expiring 2029) and approximately $193 million in cash and
short-term investments, pro forma for the refinancing and dividend
payout in 2025. Moody's expects about $200 million of negative free
cash flow in 2025 driven by the dividend and growth spending, which
could be reduced under a challenging environment. Moody's also
expect an additional $150 million dividend to be paid out in early
2026. Moody's expects the company to maintain compliance with its
first lien net leverage financial covenant over the next 12 to 18
months. Alternative liquidity is limited with all the asset
secured under the revolver and term loan.
The B2 ratings on the pari pasu senior secured revolver and senior
secured term loan are in line with the B2 CFR, reflecting their
preponderance in the debt structure.
The outlook is stable reflecting Moody's expectations that the
company will continue to generate positive same store sales growth
and will effectively manage its expansion strategy albeit at higher
leverage.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if the company moderates its
expansion strategy while maintaining solid organic growth and very
good liquidity. Additionally, debt/EBITDA sustained below 5x could
support an upgrade.
The ratings could be downgraded if the company's liquidity and/or
operating performance deteriorates, or if the company fails to
effectively manage its rapid growth. The ratings could also be
downgraded if the company's adjusted debt/EBITDA is sustained over
6x for an extended period of time.
Pacific Dental Services, LLC provides management services to
affiliate dental practices. The company has been owned and led by
its founder, Stephen Thorne, since 1994.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
PALWAUKEE HOSPITALITY: Gets Interim OK to Use Cash Collateral
-------------------------------------------------------------
Palwaukee Hospitality, LLC received interim approval from the U.S.
Bankruptcy Court for the Northern District of Illinois to use cash
collateral of Albany Bank & Trust Company, N.A. and Holiday
Hospitality Franchising, LLC.
Palwaukee Hospitality was authorized to use cash collateral through
April 5, to pay operating expenses as set forth in the budget, with
a variance of up to 10% of the budgeted disbursements for the
month.
Palwaukee Hospitality projects total operational expenses of
$58,526 from March 1 to 31.
As adequate protection, Albany, a senior secured creditor, was
granted a replacement security interests in, and liens on,
post-petition property of the company.
The next hearing is scheduled for April 2.
About Palwaukee Hospitality LLC
Palwaukee Hospitality LLC operates a hotel property located at 600
N. Milwaukee Avenue in Prospect Heights, Illinois.
Palwaukee Hospitality LLC sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Ill. Case No. 25-02685) on
February 23, 2025. In its petition, the Debtor reports estimated
assets and liabilities between $1 million and $10 million each.
Honorable Bankruptcy Judge Deborah L. Thorne handles the case.
The Debtor is represented by:
Penelope N. Bach, Esq.
Bach Law Offices
P.O. Box 1285
Northbrook, IL 60065
Phone: 847-564-0808
Fax: 847-564-0985
PARAMOUNT INTERMODAL: Case Summary & 11 Unsecured Creditors
-----------------------------------------------------------
Debtor: Paramount Intermodal Systems, Inc.
345 N Baldwin Park Drive
City of Industry, CA 91746
Business Description: Paramount Intermodal Systems is a logistics
company focused on import and export
transportation, providing services like dry
and refrigerated transloading, port and rail
truck drayage, and transporting oversized
loads. The Company manages a fleet of
owner-operator trucks and prioritizes
efficiency through automated reporting using
its Transportation Management System (TMS).
With several locations across California and
operations at key ports, Paramount
Intermodal caters to industries in need of
dependable, specialized freight solutions,
including the transportation of perishable
items.
Chapter 11 Petition Date: March 14, 2025
Court: United States Bankruptcy Court
Central District of California
Case No.: 25-12098
Judge: Hon. Deborah J. Saltzman
Debtor's Counsel: Ron Bender, Esq.
LEVENE, NEALE, BENDER, YOO & GOLUBCHIK L.L.P.
2818 La Cienega Ave.
Los Angeles, CA 90034
Tel: (310) 229-1234
Fax: (310) 229-1244
E-mail: rb@lnbyg.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $500,000 to $1 million
The petition was signed by Carlos Orellana as director.
A full-text copy of the petition, which includes a list of the
Debtor's 11 unsecured creditors, is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/BCDXRHQ/Paramount_Intermodal_Systems_Inc__cacbke-25-12098__0001.0.pdf?mcid=tGE4TAMA
PARTY EMPORIUM: To Dispose Fixtures to Jenkins Fixtures for $1000
-----------------------------------------------------------------
Party Emporium LLC seeks permission from the U.S. Bankruptcy Court
for the Western District of Arkansas, Fort Smith Division, to sell
fixtures, free and clear of liens, interests, and encumbrances.
The Debtor owns certain personal property that were previously used
in the operation of its business. The Debtor closed one of its two
locations, the Conway location, and has burdensome fixtures
remaining at the location that are not necessary for an effective
reorganization.
The Debtor proposes to sell the fixtures to buyer, Jenkins Fixtures
and Equipment that has offered to dismantle, purchase, and haul
away the remaining fixtures at the Conway location, with the
purchase price of $1000.
The First National Bank-Fort Smith holds a first-priority perfected
lien in the fixtures.
The Debtor proposes to sell the fixtures as soon as practicable and
time is of the essence because the fixtures are the only remaining
items that need to be removed from the Conway location.
About Party Emporium LLC
Party Emporium, LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Ark. Case No. 24-72049) on Dec. 7,
2024. In the petition filed by Melody Sanford, managing member, the
Debtor disclosed $390,191 in assets and $1,259,574 in liabilities.
Judge Bianca M. Rucker oversees the case.
Stanley V. Bond, Esq., at Bond Law Office serves as the Debtor's
counsel.
PERFORMANCE MOBILE: Case Summary & Seven Unsecured Creditors
------------------------------------------------------------
Debtor: Performance Mobile Care, LLC
d/b/a Sherman's Detail and Reconditioning
5391 E 52nd Ave
Commerce City, CO 80022
Business Description: Based in Commerce City, Colorado,
Performance Mobile Care, LLC, also known as
Sherman's Detail, is a vehicle detailing
company specializing in providing mobile
detailing services for trucks.
Chapter 11 Petition Date: March 13, 2025
Court: United States Bankruptcy Court
District of Colorado
Case No.: 25-11281
Judge: Hon. Kimberley H Tyson
Debtor's Counsel: Jeffrey A. Weinman, Esq.
ALLEN VELLONE WOLF HELFRICH & FACTOR, P.C.
1600 Stout Street 1900
Denver, CO 80202
Tel: 303-534-4499
Email: jweinman@allen-vellone.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by J. Cass Cassell as CEO.
A copy of the Debtor's list of seven unsecured creditors is
available for free on PacerMonitor at:
https://www.pacermonitor.com/view/PXXYQZQ/Performance_Mobile_Care_LLC__cobke-25-11281__0002.0.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/PLY57NY/Performance_Mobile_Care_LLC__cobke-25-11281__0001.0.pdf?mcid=tGE4TAMA
PHCV4 HOMES: 31-Vacant Lots Sale to Chips Amberley OK'd
-------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Alabama,
Southern Division, has permitted PHCV4 Homes LLC and its
affiliates, to sell 31-Vacant Lots, free and clear of liens,
interests, and encumbrances.
The Debtor is authorized to sell its 31 vacant lots in the
community known as Amberley, in the municipality of Robertdale,
Baldwin County Alabama for the total purchase price of $1,348,000
to Chips Amberley LLC.
The Court ordered the Debtor to complete and consummate the sale
transaction.
The closing of the sale will occur no earlier that the expiration
of the 14-day appeal period, but not later than April 2, 2025.
No proceeds of the Sale will be paid to the Debtor or to any person
or party related to the Debtor. The entire purchase amount of
$1,348,500 will be paid directly to CoreVest at closing, free and
clear of all liens, interests, and encumbrances, with the sole
exception of de minimus routine and necessary sale-related
disbursements due at closing, each of which disbursements shall be
subject to CoreVest's approval.
With respect to the Admin Fee Surcharge in the amount of $45,000,
such amount shall be paid to the Debtor, held by the Debtor's
estate.
The Debtors stipulate and agree that CoreVest has valid,
senior-priority claims secured by the assets being approved for
sale.
About PHCV4 Homes, LLC
PHCV4 Homes LLC is part of the residential building construction
industry.
PHCV4 Homes LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ala. Case No. 24-02751) on September
10, 2024. In the petition filed by Misty M. Glass, as manager, the
Debtor reports estimated assets and liabilities between $10 million
and $50 million each.
The Honorable Bankruptcy Judge Tamara O. Mitchell presides over the
case.
The Debtor is represented by Frederick M. Garfield, Esq., at SPAIN
& GILLON, LLC.
PHCV4 HOMES: Court OKs 26-Vacant Lots Sale to Adams Homes
---------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Alabama,
Southern Division, has approved PHCV4 Homes LLC and its affiliates,
to sell 26-Vacant Lots, free and clear of liens, interests, and
encumbrances.
The Court has authorized the Debtor to sell the Lots in the
community known as Briar Rose, in the municipality of Bay Minette,
Baldwin County, Alabama, to Adams Homes LLC in the purchase price
of $1,170,000.
The property to be sold in connection with the Sale shall be sold
free and clear of all liens,
interests, and encumbrances.
The closing of the Sale shall occur no earlier than the expiration
of the 14-day appeal period, unless such date is extended by
CoreVest in writing in its sole and absolute discretion.
No proceeds of the Sale shall be paid to the Debtor or to any
person or party related to the Debtor. The entire Portfolio
Purchase Price in the amount of $1,170,000 shall be paid directly
to CoreVest at closing, free and clear of all liens, interests, and
encumbrances.
With respect to the Admin Fee Surcharge in the amount of $34,600,
such amount shall be paid to the Debtor, held by the Debtor's
estate.
The Debtor is authorized to take all such actions as are necessary
or appropriate to implement the terms of the Order.
About PHCV4 Homes, LLC
PHCV4 Homes, LLC operates in the residential building construction
industry.
PHCV4 Homes filed Chapter 11 petition (Bankr. N.D. Ala. Case No.
24-02751) on September 10, 2024, listing between $10 million and
$50 million in both assets and liabilities. Misty M. Glass, manager
of PHCV4 Homes, signed the petition.
Judge Tamara O. Mitchell presides over the case.
The Debtor is represented by Frederick M. Garfield, Esq., at Spain
& Gillon, LLC.
PHUNWARE INC: Board Names Q. Du as Director, Audit Committee Member
-------------------------------------------------------------------
Phunware Inc. filed a Form 8-K with the Securities and Exchange
Commission that on March 4, 2025, the Company's board of directors
appointed Quyen Du as a Class III director and a member of the
Board's audit committee, compensation committee and nominating and
corporate governance committee.
On March 6, 2025, the Company received a letter from the Nasdaq
Stock Market LLC informing the Company that, as a result of Ms.
Du’s appointment to the Board and the audit committee, the
Company has regained compliance with the audit committee
requirement for continued listing on Nasdaq set forth in Nasdaq
Listing Rule 5605(c)(2).
About Phunware
Headquartered in Austin, Texas, Phunware, Inc. --
http://www.phunware.com-- offers a fully integrated software
platform that equips companies with the products, solutions, and
services necessary to engage, manage, and monetize their mobile
application portfolios globally at scale. The Company's platform
provides the entire mobile lifecycle of applications, media and
data in one login through one procurement relationship.
Phunware reported a net loss of $52.78 in 2023, a net loss of
$50.89 million in 2022, a net loss of $53.52 million in 2021, and
a
net loss of $22.20 million in 2020, a net loss of $12.87 million
in
2019. The Company posted a net loss of $7.68 million for the nine
months ended Sept. 30, 2024.
"Our future capital requirements will depend on many factors,
including our pace of growth, subscription renewal activity, the
timing and extent of spend to support development efforts, the
expansion of sales and marketing activities and the market
acceptance of our products and services. We believe that it is
likely we will in the future enter into arrangements to acquire or
invest in complementary businesses, technologies and intellectual
property rights. We may be required to seek additional equity or
debt financing, or issue securities under our effective
registration statement...If additional financing is required from
outside sources, we may not be able to raise it on terms
acceptable
to us, or at all. If we are unable to raise additional capital
when desired and/or on acceptable terms, our business, operating
results and financial condition could be adversely affected," said
Phunware in its Quarterly Report on Form 10-Q for the period ended
Sept. 30, 2024.
PHUNWARE INC: Board Sets May 6 as Annual Stockholders' Meeting
--------------------------------------------------------------
Phunware Inc. filed a Form 8-K with the Securities and Exchange
Commission that the Company's Board of Directors has fixed May 6,
2025 as the date for the 2024 Annual Meeting of Stockholders and
the close of business on March 10, 2025 as the record date for
determining stockholders entitled to receive notice of, and vote
at, the 2024 Annual Meeting.
In accordance with the rules of the Securities and Exchange
Commission and the Company's bylaws, any stockholder proposal
intended to be considered for inclusion in the Company's proxy
materials for the 2024 Annual Meeting must be received by the
Corporate Secretary at the Company's principal executive offices at
1002 West Avenue, Austin, Texas 78701 on or before the close of
business on March 17, 2025. In addition to complying with this
deadline, stockholder proposals intended to be considered for
inclusion in the Company's proxy materials for the 2024 Annual
Meeting must also comply with the Company's bylaws and all
applicable rules and regulations promulgated by the SEC under the
Securities Exchange Act of 1934, as amended.
In addition, any stockholder who intends to submit a proposal
regarding a director nomination or who intends to submit a proposal
regarding any other matter of business at the 2024 Annual Meeting
and does not desire to have the proposal included in the
Company’s proxy materials for the 2024 Annual Meeting must ensure
that notice of any such nomination or proposal (including certain
additional information specified in the Company’s bylaws) is
received by the Corporate Secretary at the Company’s principal
executive offices on or before the close of business on March 17,
2025.
About Phunware
Headquartered in Austin, Texas, Phunware, Inc. --
http://www.phunware.com-- offers a fully integrated software
platform that equips companies with the products, solutions, and
services necessary to engage, manage, and monetize their mobile
application portfolios globally at scale. The Company's platform
provides the entire mobile lifecycle of applications, media and
data in one login through one procurement relationship.
Phunware reported a net loss of $52.78 in 2023, a net loss of
$50.89 million in 2022, a net loss of $53.52 million in 2021, and
a
net loss of $22.20 million in 2020, a net loss of $12.87 million
in
2019. The Company posted a net loss of $7.68 million for the nine
months ended Sept. 30, 2024.
"Our future capital requirements will depend on many factors,
including our pace of growth, subscription renewal activity, the
timing and extent of spend to support development efforts, the
expansion of sales and marketing activities and the market
acceptance of our products and services. We believe that it is
likely we will in the future enter into arrangements to acquire or
invest in complementary businesses, technologies and intellectual
property rights. We may be required to seek additional equity or
debt financing, or issue securities under our effective
registration statement...If additional financing is required from
outside sources, we may not be able to raise it on terms
acceptable
to us, or at all. If we are unable to raise additional capital
when desired and/or on acceptable terms, our business, operating
results and financial condition could be adversely affected," said
Phunware in its Quarterly Report on Form 10-Q for the period ended
Sept. 30, 2024.
PHVC4 HOMES: Amends Motion to Change Purchase Amount of 31-Lots
---------------------------------------------------------------
PHCV4 Homes LLC files a motion to amend the purchase price of its
31-vacant lots that is up for sale located in the community known
as Amberley, in the municipality of Robertdale, Baldwin County,
Alabama with the purchase price of $1,348,500.00 offered by
Chips-Amberley LLC.
About PHCV4 Homes LLC
PHCV4 Homes, LLC operates in the residential building construction
industry.
PHCV4 Homes filed Chapter 11 petition (Bankr. N.D. Ala. Case No.
24-02751) on September 10, 2024, listing between $10 million and
$50 million in both assets and liabilities. Misty M. Glass, manager
of PHCV4 Homes, signed the petition.
Judge Tamara O. Mitchell presides over the case.
The Debtor is represented by Frederick M. Garfield, Esq., at Spain
& Gillon, LLC.
PHVC4 HOMES: To Sell 26-Vacant Lots to Adams Homes for $1.1MM
-------------------------------------------------------------
PHCV4 Homes LLC seeks permission from the U.S. Bankruptcy Court for
the Northern District of Alabama, Southern Division, to sell real
property, free and clear of liens, interests, and encumbrances.
The Debtor proposes to sell its interest in certain real estate
consisting of 26 vacant lots in the community known as Briar Rose,
in the municipality of Bay Minette, Baldwin County, Alabama. The
proposed sale will be private sale and the total purchase price is
$1,170,000.
The Debtor requests to sell the property free an clear of any and
all mortgages, liens, interests, and other encumbrances, except
that CoreVest American Finance Lender LLC's lien rights
specifically and fully attached to all proceeds of the sale.
Adams Homes LLC enters into a contract to purchase the lots.
The Debtor asserts that the total sales price of the Lots represent
the fair market value of the Lots. The Purchaser has obtained or
will obtain financing, and the sales are contemplated to be closed
forthwith. The Lots will be purchased at the closing on or before
the 45th day of the entry of the Court's final order.
The Lots is subject to the liens, mortgages, or other interest held
by CoreVest.
About PHCV4 Homes LLC
PHCV4 Homes, LLC operates in the residential building construction
industry.
PHCV4 Homes filed Chapter 11 petition (Bankr. N.D. Ala. Case No.
24-02751) on September 10, 2024, listing between $10 million and
$50 million in both assets and liabilities. Misty M. Glass, manager
of PHCV4 Homes, signed the petition.
Judge Tamara O. Mitchell presides over the case.
The Debtor is represented by Frederick M. Garfield, Esq., at Spain
& Gillon, LLC.
PICCARD PETS: Court Extends Cash Collateral Access to March 24
--------------------------------------------------------------
Piccard Pets Supplies, Corp. received fifth interim approval from
the U.S. Bankruptcy Court for the Middle District of Florida,
Jacksonville Division, to continue to use its cash collateral until
March 24.
The fifth interim order authorized the company to use cash
collateral to pay the expenses set forth in its budget for the
period from Feb. 25 to March 24.
As protection for the use of their cash collateral, the company's
lenders were granted replacement liens on all post-petition assets
of the company to the same extent and with the same validity and
priority as their pre-bankruptcy liens.
The lenders are Ameris Bank, Amazon Capital Services, Inc., Fox
Business Funding, First Citizens Community Bank, U.S. Small
Business Administration, White Road Capital, LLC, Sellers Funding
Corp., ODK Capital, LLC, Celtic Bank, and CloudFund, LLC.
As additional protection, Ameris Bank will receive a monthly
payment of $5,781.94, starting this month.
The next hearing is scheduled for March 24.
About Piccard Pets Supplies
Piccard Pets Supplies Corp., a company in Jacksonville, Fla.,
offers pet supplies and medications.
Piccard Pets Supplies filed Chapter 11 petition (Bankr. M.D. Fla.
Case No. 24-02434) on Aug. 15, 2024, listing total assets of
$927,465 and total liabilities of $5,323,839. Marlon Martinez,
chief executive officer of Piccard Pets Supplies, signed the
petition.
Judge Jacob A. Brown oversees the case.
The Debtor is represented by Thomas Adam, Esq., at Adam Law Group,
PA.
Ameris Bank is represented by:
Christian P. George, Esq.
Akerman LLP
50 North Laura Street, Suite 3100
Jacksonville, FL 32202
Telephone: (904) 798-3700
Facsimile: (904) 798-3730
christian.george@akerman.com
PINSTRIPES HOLDINGS: NYSE Delisting Prevents Chapter 11 Filing
--------------------------------------------------------------
Maurie Backman of The Street reports that Pinstripes Holdings, the
operator of the popular Pinstripes chain known for its combination
of bistro, bowling, and bocce, is being delisted from the New York
Stock Exchange approximately one year after going public. The
delisting occurred after the company failed to maintain a market
capitalization of $15 million for 30 consecutive days.
In conjunction with the delisting announcement, Pinstripes secured
a $7.5 million loan from Oaktree Capital Management, allowing the
company to continue operations and avoid filing for Chapter 11
bankruptcy.
About Pinstripes Holdings
Pinstripes Holdings, the operator of the popular Pinstripes chain
known for its combination of bistro, bowling, and bocce.
POLARIS NEWCO: Moody's Lowers CFR to 'Caa1', Outlook Stable
-----------------------------------------------------------
Moody's Ratings downgraded the ratings of Polaris Newco, LLC
("Polaris"), including the corporate family rating to Caa1 from B3
and the probability of default rating to Caa1-PD from B3-PD.
Moody's have downgraded the ratings on the company's senior secured
multicurrency revolving credit facility to B1 from Ba3 and the
senior secured first lien term loan B to B3 from B2. The outlook is
maintained at stable.
The downgrade of Polaris' ratings reflects the company's very high
leverage and Moody's expectations for weak liquidity, including
negative free cash flow. The significant interest burden from of
the company's debt will result in negative free cash flow over the
rating horizon despite Moody's expectations for modest EBITDA
growth.
Governance was a key consideration for this rating action.
Governance factors including aggressive financial strategies and
risk management practices resulted in high financial leverage and
weak liquidity. The credit impact score was revised to CIS-5 from
CIS-4 to reflect these risks. The CIS-5 indicates that the rating
is lower than it would have been if ESG risk exposures did not
exist and that the negative impact is more pronounced than for
issuers scored CIS-4.
RATINGS RATIONALE
The ratings reflect the company's very high leverage, weak interest
coverage and weak liquidity, including ongoing negative free cash
flow. Debt-to-EBITDA (excluding the impact from foreign exchange
and derivate losses and gains) has been improving but Moody's
forecasts it to be 7.6x at the end of FY25 and below 7.5x at the
end of FY26. Improvement is a result of modest revenue growth and
the company's ability to successfully expand EBITDA margin. Moody's
expects revenue growth to come from pricing improvements and margin
expansion will be driven by the company's ongoing efforts to
improve operating efficiencies. Polaris benefits from having
approximately three quarters of its revenue from subscriptions,
which provides some stability to the top line since switching costs
for its solutions are high.
Liquidity will be weak due to Moody's expectations of negative free
cash flow over the rating horizon as the company's ongoing interest
expense burden negatively impacts cash flow. Moody's are concerned
that Polaris has limited options to further enhance liquidity and
will remain heavily reliant on its revolver.
Moody's expects the company to generate negative free cash flow of
over $100 million in FY25 and slightly negative to breakeven free
cash flow in FY26. Interest expense is forecast to be approximately
$950 million in FY26. As of Dec. 31, 2024, Polaris had $134 million
of cash and approximately $332 million of available capacity under
its $500 million revolving credit facility expiring June 2026.
Moody's expects the company to extend the expiration date in the
near term. In addition, the company has a $100 million promissory
note due to an affiliate of Vista due April 5, 2025 which Moody's
expects to be extended as it has been done historically. There are
no other material maturities until 2028.
The revolver is subject to a maximum springing first lien net total
leverage ratio of 7.0x, which is applicable if the drawn amount
exceeds 35% of the revolving capacity. If triggered, Moody's do not
expect the company to breach the financial covenant.
The stable outlook reflects Moody's expectations that Polaris will
continue to have modest revenue growth. The company benefits from
having 76% of revenue from recurring revenue. Earnings are expected
to grow modestly even as economic concerns mount.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be downgraded if the company fails to generate
positive free cash flow or if it does not address near term
maturities in a timely manner. A downgrade could also occur if
EBITDA to interest expense is below 1.0x. The ratings could also be
downgraded if Moody's believes the likelihood of default or debt
restructuring increases or Moody's estimates of recovery rates
declines.
The ratings could be upgraded if the company materially improves
its liquidity and generates positive free cash flow on a sustained
basis. Demonstrating a trajectory of reducing debt-to-EBITDA to
more sustainable levels could also support an upgrade.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
Polaris Newco, LLC is a global provider of information services and
software to the automotive and fleet industries. Customers include
automobile and property insurance companies, collision repair and
maintenance service facilities, auto dealers, fleet operators and
others. The company was formed in July of 2021 from the combination
of Solera, LLC, Omnitracs, LLC and DealerSocket LLC. Private equity
sponsor Vista Equity Partners is the majority owner of the combined
entity. The company operates in four different segments: Vehicle
Solutions, Vehicle Claims, Vehicle Repair and Fleet Solutions.
Revenue for the LTM period ended December 31, 2024 was $2.5
billion.
PREDICTIVE ONCOLOGY: Renovaro Acquires 467K Shares for $500K
------------------------------------------------------------
Predictive Oncology Inc. disclosed in a Form 8-K Report filed with
the U.S. Securities and Exchange Commission that as previously
reported, on January 1, 2025, the Company entered into a binding
letter of intent with Renovaro, Inc., a Delaware corporation, with
respect to the proposed acquisition of all of the capital stock of
Predictive Oncology by Renovaro.
On February 28, 2025, Predictive Oncology entered into an extension
agreement with Renovaro, pursuant to which the parties amended the
LOI to (i) eliminate Renovaro's obligation to acquire certain
shares of Predictive Oncology's common stock and (ii) extend the
outside termination date of the LOI from February 28, 2025, to
March 31, 2025.
Additionally, pursuant to the Extension Agreement, Renovaro is
acquiring 467,290 shares of Predictive Oncology's common stock for
an aggregate purchase price of $500,000 and agreed to purchase an
additional 901,298 shares of Predictive Oncology common stock for
an aggregate of $964,389 upon, and subject to, the execution of a
definitive agreement in respect of the Transaction.
About Predictive Oncology
Headquartered in Pittsburgh, Pennsylvania, Predictive Oncology
Inc.
is a knowledge and science-driven company that applies artificial
intelligence to support the discovery and development of optimal
cancer therapies, which can ultimately lead to more effective
treatments and improved patient outcomes. The Company uses AI and
a proprietary biobank of 150,000+ tumor samples, categorized by
tumor type, to provide actionable insights about drug compounds to
improve the drug discovery process and increase the probability of
drug compound success. The Company offers a suite of solutions
for
oncology drug development from early discovery to clinical trials.
Minneapolis, Minnesota-based BDO USA, P.C., the Company's auditor
since 2023, issued a "going concern" qualification in its report
dated March 28, 2024, citing that the Company has suffered
recurring losses from operations and has an accumulated deficit
that raises substantial doubt about its ability to continue as a
going concern.
PRIME CORE: Pursues $26.6MM Clawback from Crypto Finance Co.
------------------------------------------------------------
Rick Archer of Law360 Bankruptcy Authority reports that Prime Core
Technologies' litigation trust is seeking to recover $26.6 million
in cryptocurrency transferred from the custodian's accounts before
its Chapter 11 filing, arguing that reclaiming the funds is
essential to ensure fairness for other customers.
About Prime Core
Prime Core Technologies, Inc., was founded in 2016 by Scott Purcell
as a trust and custodial services company with respect to fiat
currency and other more traditional assets, with its primary
product being college savings trusts. Following the emergence and
exponential growth of the blockchain and cryptocurrency industry,
the Company recalibrated its focus away from providing more
traditional fiat currency custodial services and towards providing
custodial services for cryptocurrency and other digital assets.
Eventually, the Company emerged as a market leader, providing a
unique bundle of products and services that remain unparalleled in
the industry.
Prime Core Technologies, Inc., and three of its affiliates sought
Chapter 11 bankruptcy protection (Bankr. D.N.J. Lead Case No.
23-11161) on Aug. 16, 2023. The petitions were signed by Jor Law as
interim chief executive officer. The Hon. J. Kate Stickle presides
over the Debtors' cases.
The Debtors listed $50 million to $100 million in estimated assets
and $100 million to $500 million estimated liabilities.
McDermott Will & Emery LLP serves as counsel to the Debtors. The
Debtors' financial advisor is M3 Advisory Partners, LP; their
investment banker is Galaxy Digital Partners LLC; and their claims
and noticing agent is Stretto.
PRIMO WATER: Moody's Cuts Rating on Senior Unsecured Notes to B3
----------------------------------------------------------------
Moody's Ratings downgraded the ratings on Primo Water Holdings
Inc.'s (Primo Water) non-tendered backed senior unsecured notes to
B3 from B1 following the completion and closing of the tender
offers of the legacy notes issued by Primo Water Holdings Inc. and
Triton Water Holdings, Inc. Moody's also affirmed Primo Brands
Corporation's (Primo Brands) B1 Corporate Family Rating, B1-PD
Probabilityof Default Rating, and Ba3 ratings for the company's
$750 million senior secured first lien revolving credit facility
and $3.1 billion senior secured first lien term loan. The outlook
for Primo Brands remains positive and the speculative grade
liquidity rating remains SGL-1. Moody's also affirmed the Ba3
ratings on Primo Water Holdings Inc.'s exchanged Euro denominated
backed senior secured notes due 2028 and exchanged US
dollar-denominated backed senior secured notes due 2029. These
notes are co-issued by subsidiaries Triton Water Holdings, Inc.
(Triton Water) and Primo Water Holdings Inc. and guaranteed by
Primo Brands Corporation. Moody's also affirmed the B3 rating on
the exchanged US dollar-denominated backed senior unsecured notes
due 2029 that are also co-issued by subsidiaries Triton Water
Holdings, Inc. and Primo Water Holdings Inc. and guaranteed by
Primo Brands Corporation. The outlook for Primo Water Holding Inc
was changed to positive from stable. Moody's also withdrew Triton
Water Holdings, Inc.'s, (Triton Water) ratings consisting of the B2
CFR, the B2-PD PDR, and the Caa1 rating on the non-tendered senior
unsecured notes. Moody's changed the outlook for Triton Water to
ratings withdrawn from positive. Moody's also withdrew Primo Water
Holdings Inc.'s B1 CFR, B1-PD PDR and speculative grade liquidity
rating of SGL-1. Following the downgrade of Primo Water Holding,
Inc.'s non-tendered backed senior unsecured notes to B3, Moody's
plans to withdraw this rating.
On February 28, 2025, Primo Brands completed the tender offer for
its legacy Primo Water Holdin Inc notes and legacy Triton Water
Holding Inc notes. The tender offers follow the earlier refinancing
of the credit facilities of Primo Water and Triton Water and
largely complete the process of unifying the legacy credit
structures that remained in place at the time of the November 2024
all-stock merger of the companies. Moody's are withdrawing the
rating for the non-tendered Triton Water Holding Inc notes and
non-tendered Primo Water Holding Inc notes due to insufficient
information because the entities are no longer providing standalone
audited financial statements and the non-tendered notes are not
guaranteed by Primo Brands. The downgrade to B3 from B1 of Primo
Water Holding Inc's non-tendered backed senior unsecured notes due
2028 and 2029 prior to being withdrawn reflects that the guarantees
were removed as part of the tender offer, which creates structural
subordination with respect to the legacy Primo Water assets to
substantially all of Primo Brands' debt and reduces recovery in the
event of a default.
The change in outlook for Primo Water Holding Inc to positive from
stable aligns with the positive outlook of the parent Primo Brands
now that the credit structures have largely been combined. The
positive outlooks reflect Moody's expectations that revenue and
earnings of the combined entity will continue to grow, that
combining the credit structure will make it easier to execute and
realize the synergies from the merger that the company estimates at
roughly $200 million annually, and that the combined company will
reduce leverage and generate good free cash flow.
RATINGS RATIONALE
Moody's have decided to withdraw the ratings because Moody's
believes Moody's have insufficient or otherwise inadequate
information to support the maintenance of the ratings.
Primo Brands' B1 CFR reflects its leading positions in the US
single-serve ready-to-drink bottled water segment and home and
office water delivery (HOD) business. Primo Brands also has good
business diversity through its growing filtration services
business. The company benefits from positive consumer trends
towards healthier lifestyles in choosing beverages, a diverse
customer base, and positive industry trends due to consumers
seeking alternative sources for clean water due to the aging
municipal water infrastructure. Primo Brands' credit profile is
constrained by commodity-like single use bottled water in a highly
competitive market with large players, some risk of volatility both
from economic downturns, which can pressure profitability in the
HOD water services business. The single serve business also faces
some long-term volume pressure in part related to environmental
concerns of pollution from plastic bottles and containers. Primo
Brands faces risk to integrate the two businesses including merging
systems, production and distribution that could lead to operational
disruptions or challenges realizing synergies. Primo Brands' credit
profile is also restricted by majority private equity ownership,
which Moody's views as a governance risk that creates event risk to
facilitate the exit of the private equity firms, as well as a
dividend that reduces free cash flow. The company announced plans
to repurchase 4 million shares (approximately $125 million based
share price close as of Mar 7, 2025) of Primo Brands out of 46
million shares curremtly being sold by the equity sponsor, One Rock
Capital Partners LLC, which the company plans to fund with cash.
The company's financial leverage target range of 2.0x-2.5x net
debt-to-EBITDA (3.1x pro-forma as calculated by company as of
December 31, 2024) indicates a focus on deleveraging following the
merger.
Moody's expects Primo Brands will generate good annual free cash
flow of approximately $100 million in 2025 and $400 million in
2026, which should be more than sufficient to support investment
across its businesses. Moody's further expects that debt-to-EBITDA
leverage will decline to around 3.6x from 4.1x (incorporating
Moody's adjustments and pro forma for the combined company) over
the next year primarily from the realization of synergies that will
facilitate EBITDA growth.
The SGL-1 speculative grade liquidity rating reflects Primo Brands'
sizable cash balance of $614.4 million as of December 31, 2024,
good free cash flow generation ability and absence of meaningful
debt maturities over the next 12 months. Primo Brands also has
access to an undrawn $750 million revolver that expires in 2030 and
provides additional committed liquidity.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if there is consistent organic
revenue growth with a stable to higher operating margin, and good
realization of planned merger synergies without disrupting the
combined company's operations. The company would also need to
sustain debt to EBITDA leverage below 3.5x, generate strong and
consistent free cash flow and maintain good liquidity to be
upgraded.
The ratings could be downgraded if profitability weakens due to
volume declines or margin contraction, free cash flow is low, or
liquidity weakens. Debt financed share repurchases, dividend
increases, or debt to EBITDA maintained above 5.5x on Moody's
adjusted basis could also lead to a downgrade.
Primo Brands Corporation, based in Tampa, Florida and Stamford,
Connecticut, is a leading branded beverage company specializing in
healthy hydration solutions. The company offers a wide range of
water products across various formats, channels, price points, and
consumer occasions. The company produces and sells both regional
spring water and purified national water brands through retail
sales channels and its ReadyRefresh® and Primo Water
direct-to-consumer and office delivery services. In November 2024,
the company was formed through the merger of BlueTriton Brands Inc.
(BlueTriton) and Primo Water. Following the merger, Primo Water's
former shareholders own approximately 43% of the diluted shares of
Primo Brands with the majority 57% owned by private equity (PE)
partners , One Rock Capital Partners LLC and Metropoulos & Co.
(with plans bythe partners to sell their stake down to 46.2%).
Primo Brands Corporation is publicly traded on the NYSE under
ticker "PRMB". Pro-forma combined revenue was approximately $6.8
billion for the fiscal year ended December 31, 2024.
The principal methodology used in these ratings was Soft Beverages
published in September 2022.
RAYONIER ADVANCED: Incurs $38.7MM Net Loss in 2024
--------------------------------------------------
Rayonier Advanced Materials Inc. filed with the Securities and
Exchange Commission its Annual Report on Form 10-K disclosing a net
loss of $38,707,000 on $1,630,308,000 in net sales for the year
ended Dec. 31, 2024, compared to a net loss of $101,835,000 on
$1,643,330,000 in net sales for the year ended Dec. 31, 2023.
As of Dec. 31, 2024, the Company had $2,129,657,000 in total
assets, $400,162,000 in total current liabilities, $706,444,000 in
long-term debt, $160,466,000 in non-current environmental
liabilities, $77,239,000 in pension and other postretirement
benefits, $13,685,000 in deferred tax liabilities, $47,273,000 in
other liabilities, and $713,885,000 in total stockholders' equity.
In October 2023, the Company announced that they were exploring the
potential sale of their Paperboard and High-Yield Pulp assets at
their Temiscaming site. They remain committed to pursuing a sale of
these assets at a fair price.
In July 2024, they indefinitely suspended operations at their
Temiscaming High Purity Cellulose plant. The indefinite suspension
of the Temiscaming High Purity Cellulose plant was $17 million
positive to Adjusted EBITDA for 2024 and increased free cash flow
by $40 million, as lower capital expenditures and benefits from the
monetization of working capital more than offset the one-time and
other cash costs associated with the indefinite suspension of
operations.
Following the indefinite suspension of Temiscaming High Purity
Cellulose operations, the Temiscaming site continues to incur
custodial site costs in support of the ongoing energy needs of the
Paperboard and High-Yield Pulp operations. These costs are
mitigated by any sales of electricity generated during the process.
The Company expect to incur net custodial site costs totaling $20
million to $22 million in 2025.
In October 2024, an isolated fire occurred at their Jesup plant
during planned maintenance activity. There were no injuries to
employees or contractors and no risk to the surrounding community.
The plant's operations fully resumed within two weeks, incurring $3
million of emergency maintenance capital expenditures and a total
estimated unfavorable impact to 2024 EBITDA of $9 million,
including $2 million in immediate repair costs. Our preliminary
estimates indicate that additional capital expenditures of
approximately $15 million will be required over the next two years.
The Company carry property and business interruption loss insurance
with a $15 million combined deductible. They have notified their
insurance underwriters and are in the process of evaluating and
documenting the damage caused by the fire. The amount expected to
be recovered from property and business interruption loss insurance
is not currently estimable.
Beginning in January 2025, the Company reorganized their High
Purity Cellulose operating segment as a result of changes in their
internal operating model, significant developments in their
Biomaterials strategy and a successful enterprise reporting system
launch that significantly enhances our financial reporting
capabilities. Specifically, the Company determined, in light of
these new developments and capabilities, that the performance and
outlook of the High Purity Cellulose business will be better
managed as three separate businesses: Cellulose Specialties,
Cellulose Commodities and a new Biomaterials business. No changes
were made to the composition of the Paperboard and High-Yield Pulp
operating segments.
In February and March 2025, the U.S. government imposed new tariffs
on products imported from China, Canada and Mexico, including a 25
percent tariff on U.S. sales of paperboard, effective March 4,
2025. These tariffs may result in retaliatory tariffs and other
trade actions from these nations, as has already occurred with a 25
percent retaliatory tariff on U.S.-sourced paperboard and
substitute products, effective March 25, 2025. Given the evolving
nature of trade policies and the potential for further
modifications, reductions or expansions of these tariffs, it
remains uncertain how these actions will ultimately impact the
Company.
A full-text copy of the Form 10-K is available at
https://tinyurl.com/4e9kjmzf
About RYAM
RYAM -- http://www.RYAM.com-- is a global leader of
cellulose-based technologies, including high purity cellulose
specialties, a natural polymer commonly used in the production of
filters, food, pharmaceuticals, and other industrial applications.
The Company also manufactures products for paper and packaging
markets. The Company has manufacturing operations in the U.S.,
Canada, and France.
Rayonier Advanced reported a net loss of $101.84 million in 2023
compared to a net loss of $14.92 million in 2022. As of June 29,
2024, Rayonier Advanced Materials had $2.20 billion in total
assets, $376.60 million in total current liabilities, $752.75
million in long-term debt, $159.97 million in non-current
environmental liabilities, $94.69 million in pension and other
post-retirement benefits, $13.87 million in deferred tax
liabilities, $43.95 million in other liabilities, and $755.13
million in total stockholders' equity.
* * *
As reported by the TCR on June 17, 2024, Moody's Ratings affirmed
Rayonier Advanced Materials Inc.'s (RYAM) Caa1 corporate family
rating. The change in outlook to positive reflects the improvement
in liquidity and reduction in the risk of a potential covenant
breach due to covenant relief from lenders and declining secured
net leverage as a result of improving operating performance,
suspension of loss-making High Purity Cellulose (HPC) operations
at
Temiscaming and sale of softwood duty refund rights. However,
RYAM
has heightened refinancing risk with its ABL facility expiring in
December 2025 and senior secured notes maturing in January 2026.
The positive outlook also reflects Moody's expectation that the
company will refinance these upcoming debt maturities before they
go current.
REFRIGERATION TECHNOLOGIES: Gets Extension to Use Cash Collateral
-----------------------------------------------------------------
Refrigeration Technologies, LLC, received fourth interim approval
from the U.S. Bankruptcy Court for the Eastern District of
Pennsylvania to use cash collateral.
The fourth interim order authorized the company to use cash
collateral to pay its expenses during the period from March 6 until
the next hearing scheduled for May 7 or until the occurrence of a
so-called termination event.
As protection, secured creditors were granted a replacement liens
on the company's property to the same extent and with the same
priority as their pre-bankruptcy liens.
In case the replacement lien does not adequately protect secured
creditors, their claims may receive priority under Section 507(b)
of the Bankruptcy Code, which could place them ahead of other
creditors for repayment.
The next hearing is set for May 7.
About Refrigeration Technologies
Refrigeration Technologies, LLC filed a Chapter 11 bankruptcy
petition (Bankr. E.D. Pa. Case No. 24-12902) on August 19, 2024,
listing between $100,001 and $500,000 in assets and between
$500,001 and $1 million in liabilities.
Judge Ashely M. Chan presides over the case.
About Refrigeration Technologies
Refrigeration Technologies, LLC filed a Chapter 11 bankruptcy
petition (Bankr. E.D. Pa. Case No. 24-12902) on August 19, 2024,
with $100,001 to $500,000 in assets and $500,001 to $1 million in
liabilities.
Judge Ashely M. Chan presides over the case.
James Christopher Vandermark, Esq., at White and Williams, LLP
represents the Debtor as legal counsel.
RHODIUM ENCORE: Seeks to Extend Plan Exclusivity to June 23
-----------------------------------------------------------
Rhodium Encore LLC and its affiliates asked the U.S. Bankruptcy
Court for the Southern District of Texas to extend their
exclusivity periods to file a plan of reorganization and obtain
acceptance thereof to June 23 and August 19, 2025, respectively.
The Debtors claim that these cases are complex, involving multiple
companies and contracts in addition to numerous specialized assets
serving in the Debtors' bitcoin mining operations. Since entry of
the Exclusivity Extension Order, the Debtors and their
professionals have focused their attention on, among other things,
continuing to stabilize their business operations, participating in
the ongoing and very active Whinstone Litigation, the Whinstone AP,
negotiations surrounding the development of the Plan, and the Exit
Financing Process.
The Debtors explain that because the outcome of the ongoing
discussions and processes related to the Whinstone Litigation and
the Exit Financing will dictate the ultimate structure of the Plan,
at this time, the Debtors require more time to formulate a plan of
reorganization that will optimize the recovery for all of the
estates' stakeholders. Accomplishing these tasks since the entry of
the Exclusivity Extension Order has been a labor intensive process
that has extensively occupied the Debtors' representatives and
professionals. In view of all these circumstances, the Debtors
respectfully submit that ample cause exists to extend the Exclusive
Periods.
The Debtors assert that they are engaged in the Whinstone AP and
the Appeal, which absorb the Debtors' resources, add layers of
complexity to these Chapter 11 Cases, and whose outcome will
ultimately be determinative to any plan of reorganization. The
complexity of the issues addressed and the time, effort, and
planning required to obtain the progress made thus far cannot be
overstated. The facts and circumstances of these Chapter 11 Cases
justify extending the Exclusive Periods.
The Debtors further assert that they have made significant and
material progress in the Chapter 11 Cases. These achievements were
the result of the tireless efforts of the Debtors, their
management, and their professional advisors, in cooperation with
the U.S. Trustee and various other parties in interest in the
Chapter 11 Cases, to maximize the value of their estates.
Accordingly, the Debtors submit that this factor weighs in favor of
extending the Exclusive Periods.
The Debtors cite that they have worked diligently over the past few
months to preserve their estates during the pendency of the Chapter
11 Cases and require the extension sought by this Motion to ensure
that they are able to seek confirmation of their plan of
reorganization without any unnecessary distractions that would be
caused by competing plans. The Debtors are not seeking an extension
to pressure creditors or other parties in interest, but to
carefully balance their divergent interests as the sole party
exercising fiduciary duties to all stakeholders.
The Debtors state that termination of the Exclusive Periods would
adversely impact the Debtors’ efforts to preserve and maximize
value of the estates and the progress of the Chapter 11 Cases.
Terminating the Exclusive Periods would only serve to foster a
chaotic environment and only add the opportunity for parties to
engage in counterproductive, provincial and self-interested
behavior in pursuit of alternatives that are simply not feasible or
fair to all creditors and equity holders under the circumstances of
the Chapter 11 Cases.
Counsel to the Debtors:
QUINN EMANUEL URQUHART & SULLIVAN, LLP
Patricia B. Tomasco, Esq.
Joanna D. Caytas, Esq.
Cameron Kelly, Esq.
Alain Jaquet, Esq.
700 Louisiana Street, Suite 3900
Houston, Texas 77002
Telephone: 713-221-7000
Facsimile: 713-221-7100
Email: pattytomasco@quinnemanuel.com
Email: joannacaytas@quinnemanuel.com
Email: cameronkelly@quinnemanuel.com
Email: alainjaquet@quinnemanuel.com
- and-
Eric Winston, Esq.
Razmig Izakelian, Esq.
865 S. Figueroa Street, 10th Floor
Los Angeles, California 90017
Telephone: 213-443-3000
Facsimile: 213-443-3100
Email: ericwinston@quinnemanuel.com
Email: razmigizakelian@quinnemanuel.com
About Rhodium Encore
Rhodium Encore LLC is a founder-led, Texas based, digital asset
technology company utilizing proprietary tech to self-mine bitcoin.
The Company creates innovative technologies with the goal of being
the most sustainable and cost-efficient producer of bitcoin in the
industry.
Rhodium Encore sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 24-90448) on Aug.
24, 2024. In the petition filed by Michael Robinson, as co-CRO,
the Debtor reports lead debtor's estimated assets between $100
million and $500 million and estimated liabilities between $50
million and $100 million.
The Honorable Bankruptcy Judge Alfredo R. Perez oversees the case.
The Debtor tapped QUINN EMANUEL URQUHART & SULLIVAN, LLP, as
counsel, and PROVINCE as restructuring advisor.
ROCKET MORTGAGE: Moody's Affirms 'Ba1' CFR, Outlook Remains Stable
------------------------------------------------------------------
Moody's Ratings has affirmed Rocket Mortgage, LLC's Ba1 corporate
family rating and long-term senior unsecured ratings. Rocket
Mortgage's outlook remains stable.
The rating action follows Rocket Companies, Inc.'s (Rocket
Companies), Rocket Mortgage's parent, and Redfin Corporation's
(Redfin) announcement [1] that they have entered into a definitive
agreement under which Rocket Companies will acquire Redfin in an
all-stock transaction valued at a current value of $1.75 billion.
Pro-forma Rocket Companies' existing shareholders will own 95% of
the combined companies. The transaction is anticipated to close
either Q2 or Q3 this year.
RATINGS RATIONALE
The affirmation of the ratings reflects the largely credit neutral
impact of the Redfin acquisition. While leverage will increase
modestly and profitability will decrease following the close of the
transaction, the acquisition provides material upside to Rocket
Mortgage and Rocket Companies from increased purchase mortgage
origination volumes as well as higher real estate brokerage
revenues.
In addition, the affirmation reflects Rocket Mortgage's strong
franchise in the US mortgage market, its robust capitalization even
after the Redfin acquisition, its solid funding profile, and its
historically strong earnings.
Rocket Mortgage is unique among its non-bank mortgage companies
because its parent, Rocket Companies, owns several other
complementary businesses in the mortgage and home buying ecosystem.
These include Rocket Homes, a home search platform and real estate
agent referral network company; Rocket Money, a leading personal
finance app; Rocket Close, formerly known as Amrock, a title and
settlement company and Rocket Loans, a personal loan finance
company.
Redfin operates in four business segments: real estate services,
rentals, mortgage and title. In terms of revenues, the largest by
far is real estate services which includes a home search platform
with 50 million monthly visitors and a tech-enabled real estate
brokerage. In 2024, Redfin's search platform had around a million
buy-side and sell-side contacts--clients asking a question, setting
up a consultation with an agent, or requesting a home tour.
Redfin's real estate brokerage fulfills these connections by
utilizing more than 2,200 employees as lead agents as well as over
5,000 partner agents similar to Rocket Homes. The more the home
search and real estate brokerage are successful in increasing
traffic and engagement on its website along with expanding
relationships with real estate agents, the better positioned Rocket
Mortgage will be to increase its market share, particularly in
purchase mortgage originations.
Currently, the majority of Rocket Companies' revenues are generated
by Rocket Mortgage; however, the other businesses provide Rocket
Mortgage with expertise as well as partnership opportunities, which
could ultimately benefit Rocket Mortgage's as well as Rocket
Companies' profitability.
Rocket Mortgage is the largest retail and one of the largest
overall mortgage originators in the US. Historically, it has also
been one of the most profitable US mortgage originators. However,
profitability has been suppressed in recent years as elevated
mortgage rates and low housing stock have materially suppressed
mortgage origination volume. From 2022 to 2024, Rocket Companies'
after-tax profitability excluding fair value mortgage servicing
rights (MSRs) marks (core profitability), was $(469) million,
$(432) million, and $469 million in 2022, 2023, and 2024
respectively. Redfin lost $165 million in 2024, following a loss of
$126 million in 2023. Moody's believes that the combined companies
will be able to achieve revenue and cost synergies, which should
reduce Redfin's losses and over time drive positive profitability.
As a percentage of average assets, Rocket Companies' core
profitability was -2.0%, -2.5%, and 2.3% in 2022, 2023, and 2024
respectively. In comparison, from 2017 to 2021, core profitability
averaged 15.8%. The weak profitability from 2022 – 2024 was in
part driven by the company's elevated cost structure due to
continued investments in strengthening its purchase market
franchise, continued investments in its complementary businesses,
as well as maintaining excess operating capacity in anticipation of
a rate decline driven increase in origination volumes. While
Moody's believes the company's investments will likely result in a
financially stronger company over time, Moody's views an extended
period of weak profitability as not fully aligned with the
financial policy expected of an investment-grade issuer.
Rocket Mortgage's capitalization is currently very strong relative
to peers, providing it greater resilience to losses in stress
scenarios. Rocket Companies' capitalization, as measured by
tangible common equity (TCE) to adjusted tangible managed assets
(TMA), was 38% as of December 31, 2024. Assuming the Redfin
acquisition closes, pro-forma as of December 31, 2024 TCE to TMA
would have only declined modestly to 34%, primarily due to
acquisition goodwill. Given the uncertain macroeconomic and
political environment, Moody's expects that Rocket Companies' and
Rocket Mortgage's financial policies will remain conservative and
continue to retain excess capital until it returns to generating
stronger levels of profitability.
Of note, Rocket Mortgage is heavily reliant on the high liquidity
of agency and government mortgages, which consisted of around 85%
of total loan origination volume in 2024. The election of Donald
Trump to a second presidential term has renewed discussions on the
potential administrative release from conservatorship of
government-sponsored enterprises (GSEs) Federal National Mortgage
Association (Fannie Mae, Aaa negative) and Federal Home Loan
Mortgage Corp. (Freddie Mac, Aaa negative). Like government-insured
mortgages, mortgages eligible to be purchased by the GSEs are very
liquid, even during periods of market stress. This high level of
liquidity is due in large part to the implicit guarantee by the US
government for GSE MBS. If the GSEs were to be released from
conservatorship and the aggregate market share for agency and
government mortgages materially declined or the liquidity of agency
MBS materially declined, it would weaken the liquidity profile of
Rocket Mortgage and its peers, which would be a credit negative.
The stable outlook reflects Moody's expectations that while Rocket
Mortgage's profitability will be modestly below its historical
levels over the next 12-18 months, the company will maintain its
strong financial profile.
The Ba1 senior unsecured bond rating is at the same level as Rocket
Mortgage's Ba1 corporate family rating and incorporates the
priority of claim and strength of asset coverage.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The company's ratings could be upgraded if it is able to continue
to strengthen its purchase market franchise strength by
demonstrating its ability to continue to increase market share and
stronger purchase mortgage originations profitability. Assuming
that non-agency and non-government mortgages remain a modest
percentage of total originations, key performance metrics that
could lead to an upgrade include expected long-term strong
financial resilience as demonstrated by core profitability such as
net income to assets (excluding MSR fair value marks) in excess of
4.0% (ROA), combined with a solid capital position with its ratio
of TCE to TMA remaining above 25%, while maintaining solid
financial flexibility, such as keeping its secured debt to gross
tangible assets ratio below 50% and its secured MSR debt to
corporate debt below 20%, and low refinance risk on its warehouse
facilities with an average warehouse line maturity runway of more
than 12 months.
The company's ratings could be downgraded if its financial profile
or franchise position weaken. In particular, the ratings could be
downgraded if the company's TCE to TMA ratio declines to less than
20% or if profitability remains weak such that Moody's expects its
net income to average assets to remain below 4.0%. Until net income
to average assets is again consistently above 3.0%, the company's
ratings could be downgraded if TCE to TMA decreased and was
expected to remain below 27.5%.
In addition, negative ratings pressure may develop if 1) the
percentage of non-agency and non-government loan origination
volumes grow to much more than the current 15% of the company's
total originations without a commensurate increase in alternative
liquidity sources and capital to address the riskier liquidity and
asset quality profile that such an increase would entail, or 2)
refinance risk increased such that the average remaining time to
maturity of the company's warehouse lines decreased and what
expected to remain less than 12 months. An increase in the
company's reliance on secured debt, whereby secured MSR and secured
corporate debt to total corporate debt increased and was expected
to remain above 20%, could result in a downgrade of the long-term
senior unsecured rating, as it would further subordinate the debt's
priority ranking.
The principal methodology used in these ratings was Finance
Companies published in July 2024.
ROCKIES EXPRESS: Fitch Affirms 'BB' LongTerm IDR, Outlook Negative
------------------------------------------------------------------
Fitch Ratings has affirmed Rockies Express Pipeline, LLC's (ROCKIE)
Long-Term Issuer Default Rating (IDR) at 'BB', and affirmed
ROCKIE's senior unsecured debt at 'BB' with a Recovery Rating of
'RR4'. Additionally, Fitch has assigned a 'BB'/'RR4' rating to
ROCKIE's proposed new senior unsecured note offering. Proceeds from
the proposed new issuance will primarily be used to repay existing
debt. The Rating Outlook is Negative.
The Negative Outlook reflects parent Tallgrass Energy Partners,
LP's (Tallgrass; 'BB-'/Negative) ratings. Tallgrass's Trailblazer
CO2 Conversion (TPCO2) project poses meaningful execution risk. It
also increases Tallgrass' Fitch-calculated leverage above the
negative sensitivity during construction. Fitch will likely resolve
ROCKIE's Rating Outlook upon resolution of the Rating Outlook at
Tallgrass, which may take more than 18 months.
ROCKIE's ratings are supported by strong cash flow profile,
adequate credit quality of top customers, and steady demand load
delivery growth. The rating is constrained due to linkage with
parent.
Key Rating Drivers
Linkage with Parent Constraints Ratings: Given Tallgrass' 100%
common ownership of ROCKIE, there is a parent subsidiary
relationship between the two companies. Fitch considers ROCKIE to
have a stronger Standalone Credit Profile (SCP) than Tallgrass'
consolidated metrics. Therefore, as per Fitch's "Parent Subsidiary
Linkage" criteria, Fitch has followed the stronger subsidiary
path.
Legal ring-fencing is porous due to the regulated nature of ROCKIE,
and certain covenants in its credit agreement and bond indentures,
which limit intercompany fund flow. Fitch assesses access and
control as open because Tallgrass, as a dominant shareholder, can
control all major transactions. There is also an expectation of a
mix of external and intercompany funding at ROCKIE, and limited
confidence in ROCKIE's ability to operate autonomously. Given these
linkage considerations, Fitch will limit the rating difference
between ROCKIE and Tallgrass to one notch.
Elevated Leverage at Parent: ROCKIE's parent, Tallgrass, is
currently executing the capital-intensive Trailblazer CO Conversion
(TPCO2) project, which is largely debt financed. The project is on
track and within budget, but meaningful construction work is
ongoing ahead of the mid-2H25 in-service date. Successfully placing
the project in service on time and within budget, along with
successful operation and cash flow generation, will be key in
ensuring leverage at Tallgrass remains within the range
commensurate with its current rating. Until then, execution risks
remain high.
Robust Cash Flow Profile: ROCKIE is projected to generate nearly
100% of its EBITDA from fee-based contracts, with over 95% from
long-term take-or-pay contracts. Its most profitable section, Zone
3, transports natural gas from the Appalachia basin to the
Mississippi River. Zone 3 is fully contracted, with high
utilization rates, reaching 100% during peak times. ROCKIE is
adding contracts and expanding compression capacity, indicating
strong demand. The other two zones are also well-contracted and
utilized.
Contract Cliff Addressed: ROCKIE successfully addressed its
mid-2024 contract cliff by re-contracting most of the expiring
capacity. However, most of the volumes were re-contracted at rates
meaningfully lower than those of the most remunerative contract
that expired in 2024, leading to some revenue loss. This revenue
loss was largely offset by new contract additions, particularly on
the east end. As such, ROCKIE's leverage is expected to improve but
remain in the high 3.5x-4.0x range, which is considered strong for
its rating category.
Counterparty Credit Quality Intact: Most of ROCKIE's customers
maintained stable credit profiles over the past year,
notwithstanding improvements in some. The weighted average senior
unsecured rating by volume of the company's top four customers
remained intact at about 'BB'. Most customers continue to have a
Stable Outlook, with some even having a Positive Outlook. Hence,
Fitch expects credit quality of ROCKIE's top customers to remain
intact in the near term.
Peer Analysis
ROCKIE's ratings are constrained by those on its parent, Tallgrass.
Without an explicit rating linkage, Fitch views ROCKIE's SCP as
consistent with 'BB+' rated midstream issuers in its coverage
universe.
In Fitch's coverage, midstream issuers (subsidiaries) with rating
linkage to their parents, where the subsidiary has a stronger
credit profile, include Texas Eastern Transmission, LP (TET;
A-/Stable), Transcontinental Gas Pipeline Company, LLC (Transco;
BBB+/Positive), Northwest Pipeline LLC (NWP; BBB+/Positive), and
Southern Star Central Gas Pipeline Inc. (SSCGP; BBB/Stable).
Ratings of each of these subsidiaries are limited to a one-notch
difference from their parent's ratings, given the application of
Fitch's Parent Subsidiary Linkage criteria.
Most of ROCKIE's EBITDA is derived from long-term take-or-pay
contracts. Among 'BB' rated midstream issuers with similar
contracts, Sunoco, LP (SUN; BB+/Stable) is a close peer. SUN has
about 20%-25% of its volume under a long-term take-or-pay contract
with a 7-Eleven subsidiary, with roughly nine years remaining, and
expects this volume to increase modestly. SUN's resilient business
model provides stable cash flows, with leverage projected around
4.0x, aligning closely with ROCKIE's expectations.
While ROCKIE benefits from better contract coverage, SUN's larger
scale and business diversity balance ROCKIE's advantages, resulting
in similar credit profiles for both companies, in the absence of
rating linkages at ROCKIE.
Key Assumptions
- Fitch's oil and gas price deck;
- Successful re-contracting of most of the expiring contracts at
rates similar to recent contract wins on the respective ends;
- Natural gas volumes from the Trailblazer pipeline flows onto
ROCKIE under a long-term lease agreement, as part of TPCO2
project;
- Capex consistent with historical range, including minimal
maintenance and growth capital;
- Modest amount of cash distributions on the preferred equity;
- Base interest rate for the credit facility reflects the Fitch
Global Economic Outlook.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- A negative rating action at Tallgrass;
- EBITDA leverage approaching and expected to sustain above 6.0x;
- One of the top four customers approaching a distressed financial
condition, e.g., showing weak access to capital markets; or a
collection of smaller companies being in a similar condition;
- A large or a series of modest yet meaningful debt funded dividend
paid to the parent and/or large debt funded growth project(s),
implying a more aggressive financial policy at ROCKIE.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- ROCKIE's ratings are constrained by the ratings of its parent
Tallgrass at a one-notch difference. If rating linkage did not
exist, Fitch would likely rate it higher. In the presence of a
rating linkage, only a positive rating action at Tallgrass could
trigger positive rating action at the company.
Liquidity and Debt Structure
ROCKIE had a total liquidity of about $116 million as of Dec. 31,
2024. The company had about $0.4 million of cash on its balance
sheet and about $116 million available under its $170 million
senior unsecured RCF. The credit agreement contains a sublimit of
up to $75 million for letters of credit, and an uncommitted
accordion feature of $30 million. The revolver matures on July 31,
2028.
The covenants on the credit agreement requires ROCKIE to maintain
leverage at below 5.0x, temporarily increasing to 5.5x following
certain material acquisitions. As of the latest quarter, the
company was compliant with the covenants on the credit facility and
Fitch expects it to remain in compliance. After repayment of the
2025 senior unsecured note, ROCKIE's next debt maturity will be a
$550 million 4.95% senior unsecured note due July, 2029.
Fitch does not expect ROCKIE to use a large portion of the
revolver. However, the east-bound service opportunity into the west
could catalyze a sudden capex need, which might require revolver
draws.
Issuer Profile
ROCKIE transports natural gas through its pipeline system from Ohio
to Wyoming. The company is regulated by the Federal Energy
Regulatory Commission.
Summary of Financial Adjustments
Fitch has applied its "HoldCo PIK and Shareholder Loans" criteria,
adjustment 7, under the December 2024 Fitch Corporate Rating
Criteria, page no. 25, in evaluating ROCKIE's $800 million
Preferred Equity, issued for the buy-in transaction, and considers
it non-debt like.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
ESG Considerations
Rockies Express Pipeline LLC has an ESG Relevance Score of '4' for
Group Structure due to the high number of entities in the family,
which has a negative impact on the credit profile, and is relevant
to the rating[s] in conjunction with other factors.
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
Rockies Express
Pipeline LLC LT IDR BB Affirmed BB
senior unsecured LT BB New Rating RR4
senior unsecured LT BB Affirmed RR4 BB
ROCKIES EXPRESS: Moody's Rates New $500MM Sr. Unsecured Notes 'Ba2'
-------------------------------------------------------------------
Moody's Ratings assigned a Ba2 rating to Rockies Express Pipeline
LLC's (REX) proposed $500 million senior unsecured notes due 2033.
REX's common membership interest is indirectly wholly owned by
Prairie Acquiror LP (B1 negative); Prairie's ratings and outlook
are unchanged. REX's outlook remains negative. Proceeds from the
proposed notes will be used to repay its outstanding 2025 Notes,
repay the outstanding balance of its revolving credit facility, and
for general corporate purposes.
RATINGS RATIONALE
The proposed senior unsecured notes are rated Ba2, the same as
REX's other unsecured notes. The notes are rated two notches above
Prairie's B1 Corporate Family Rating (CFR). The REX notes rating
reflects the notes structural advantage over the rest of the debt
in the Prairie family through their structurally senior claim to
REX's assets and the benefits of REX's long-term customer
contracts. Given the complexity of the capital structure, changes
in the amount or mix of secured and unsecured debt at REX or
Prairie subsidiary Tallgrass Energy Partners, LP (TEP) could affect
the REX and TEP notes ratings.
Prairie's CFR reflects its high consolidated financial leverage,
including debt at TEP and REX. Prairie benefits from its meaningful
size, its predominantly interstate pipeline asset base with cash
flow from long-term firm transportation contracts, and geographic
and operational diversification. Borrowing to fund the majority of
its approximately $1.7 billion Trailblazer CO2 conversion project
is expected to cause Prairie's leverage to exceed Moody's
downgrades threshold in 2025. The project will have significant
uncontracted capacity initially with the opportunity to
substantially grow its volumes at attractive returns. Still, the
very high leverage and the project's execution risk leave little
margin for delays, overruns or underperformance.
Moody's expects Prairie to maintain adequate liquidity through
mid-2026. REX has a $170 million unsecured revolving credit
facility that expires in July 2028. TEP has a $1.5 billion senior
secured revolving credit facility that expires the earliest of May
31, 2028, November 27, 2026, if any of TEP's 6% senior notes due
March 2027 remain outstanding on that date or October 15, 2027, if
any of TEP's 5.50% senior notes due January 2028 remain outstanding
on that date. Moody's expects REX to have full availability under
its revolver once proceeds from the proposed notes are used to pay
down borrowings; the revolver had $54 million outstanding at year
end 2024. The TEP revolver had $166 million drawn at the same
point. Following repayment of the May 2025 notes, there are no
other maturities at REX, TEP or Prairie until TEP's $430 million
notes issue comes due in March 2027.
The negative outlook reflects the execution risks and debt TEP will
incur undertaking its $1.7 billion project to convert a portion of
its Trailblazer natural gas pipeline to a CO2 pipeline and build
out supporting infrastructure for a carbon capture and
sequestration system.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Ratings could be downgraded if Prairie's consolidated debt/EBITDA
is sustained above 7.5x and does not decline as projected following
the completion of the Trailblazer CO2 conversion project, the
project incurs material delays or cost overruns, or distribution
policy becomes more aggressive. Although unlikely in the near term,
an upgrade would be considered once consolidated debt/EBITDA is
maintained below 7x.
Prairie, through its ownership of TEP, provides crude oil
transportation, natural gas transportation and storage, processing
and water business services for customers in the Rocky Mountain,
Appalachian, Midwest, and West Coast regions of the United States.
The principal methodology used in this rating was Midstream Energy
published in February 2022.
SANTA PAULA HAY: Case Summary & 19 Unsecured Creditors
------------------------------------------------------
Debtor: Santa Paula Hay & Grain and Ranches
1203 S Sespe St
Fillmore, CA 93015
Business Description: Santa Paula Hay & Grain and Ranches
specializes in providing a variety of hay
and grain products to meet the needs of
farmers and animal owners. The Company
offers high-quality feed options for
livestock and pets.
Chapter 11 Petition Date: March 12, 2025
Court: United States Bankruptcy Court
Central District of California
Case No.: 25-10314
Judge: Hon. Ronald A Clifford III
Debtor's Counsel: Reed Olmstead, Esq.
LAW OFFICES OF REED H. OLMSTEAD
5142 Hollister Ave #171
Santa Barbara, CA 93111
Tel: (805) 963-9111
Email: reed@olmstead.law
Estimated Assets: $100 million to $500 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Guadalupe Guzman as managing member.
A full-text copy of the petition is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/VPWYO6A/Santa_Paula_Hay__Grain_and_Ranches__cacbke-25-10314__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 19 Unsecured Creditors:
Entity Nature of Claim Claim Amount
1. Aguilera Services Inc. Trade Debt $620,000
2814 E Vineyard Ave
Oxnard, CA 93036
2. AgWest Farm Credit $2,897,004
3755 Atherton Rd
Rocklin, CA 95765
3. AgWest Farm Credit $1,041,000
3755 Atherton Rd
Rocklin, CA 95765
4. Classic Harvest, LLC Trade Debt $390,000
4572 Ave 400
Dinuba, CA 93618
5. Coastal View Trade Debt $63,249
Packaging
2976 Gold Course Dr
Ventura, CA 93003
6. Coastline Harvesting, Inc. Trade Debt $415,528
1301 E Ventura St
Santa Paula, CA 93060
7. Community West Bank $462,101
445 Pine Ave
Goleta, CA 93117
8. Community West Bank $462,101
445 Pine Ave
Goleta, CA 93117
9. Community West Bank $462,101
445 Pine Ave
Goleta, CA 93117
10. Hendrick Land Clearing Trade Debt $980,000
1427 E Main St
Santa Paula, CA 93060
11. Hronis, Inc. Trade Debt $111,271
10443 Hronis Rd
Delano, CA 93215
12. Imperial Irrigation District Trade Debt $135,000
333 E Barioni Blvd
Imperial, CA 92251
13. Kern County Bull Ranch 45 $4,886
Treasurer-Tax Acres Land
Collector
PO Box 579
Bakersfield, CA
93302-0580
14. Kern Tulare Water District Trade Debt $53,379
5001 California Ave
Bakersfield, CA 93309
15. PG&E Trade Debt $135,000
300 Lakeside Dr
Oakland, CA 94612
16. Southern Califorina Edison Trade Debt $0
PO Box 900
Rosemead, CA 91770
17. Ventura County $255,606
Treasurer-Tax Collector
800 South Victoria Ave
Ventura, CA
93009-1290
18. Zions Agriculture Finance $1,289,606
500 Fifth St
Ames, IA 50010-6063
19. Zions Agriculture Finance $1,269,606
500 Fifth St
Ames, IA 50010-6063
SBLA INC: Cosmetic Brand Seeks Subchapter 11 Bankruptcy
-------------------------------------------------------
Kirk O'Neil of The Street reports that SBLA Beauty's parent company
has filed for Chapter 11 bankruptcy to restructure its business and
address its debt. The Boca Raton, Florida-based skincare and beauty
products manufacturer submitted its Subchapter V petition on March
11, 2025 in the U.S. Bankruptcy Court for the Southern District of
Florida, reporting assets between $500,000 and $1 million and
liabilities ranging from $1 million to $10 million.
SBLA Inc. specializes in non-invasive anti-aging solutions,
including the award-winning Eye Lift Wand, named Eye Treatment
Product of the Year, and the Neck, Chin & Jawline Sculpting Wand
XL, recognized as Anti-Aging Tool of the Year. The brand's Liquid
Facelift Wand was featured as a Vogue magazine pick, while the
Limited Edition Double The Plump Lip Plump and Sculpt was
highlighted by People magazine. The company also offers wellness
products like Illumin8 Gummies.
Operating through a direct-to-consumer e-commerce model via its
website, SBLA.com, the brand promotes its products as
scientifically proven alternatives to cosmetic procedures, with the
tagline "Where science meets beauty."
About SBLA Inc.
SBLA Inc. provides non-invasive, at-home anti-aging solutions
through its innovative "sculpting wands." The Company's product
line includes items like the Neck, Chin & Jawline Sculpting Wand,
Facial Instant Sculpting Wand, and Lip Plump & Sculpt to help firm,
lift, and rejuvenate various areas of the face and body. Known for
its collaboration with Christie Brinkley, SBLA emphasizes
effective, science-backed skincare to offer alternatives to
invasive procedures.
SBLA Inc. sought relief under Subchapter V of Chapter 11 of the
U.S. Bankruptcy Code (Bankr. S.D. Fla. Case No. 25-12606) on March
11, 2025. In its petition, the Debtor reports total assets of
$801,858 and total liabilities of $3,252,917.
Honorable Bankruptcy Judge Mindy A. Mora handles the case.
The Debtor is represented by:
Bradley S. Shraiberg, Esq.
SHRAIBERG PAGE PA
2385 NW Executive Center Dr Suite 300
Boca Raton, FL 33431
Tel: 561-443-0800
E-mail: bss@slp.law
SEABIRDS KITCHEN: Gets Interim OK to Use Cash Collateral
--------------------------------------------------------
Seabirds Kitchen, LLC got the green light from the U.S. Bankruptcy
Court for the Central District of California, Santa Ana Division to
use cash collateral.
The interim order signed by Judge Scott Clarkson authorized the
company to use cash collateral to pay its expenses pending a final
hearing set for March 27.
Farmers and Merchants Bank of Long Beach has a valid lien on the
company's cash collateral.
As protection, the secured lender was granted a replacement lien on
all of the company's assets or interests in assets acquired on or
after its Chapter 11 filing and will receive payments in accordance
with its budget.
As of the petition date, Seabirds Kitchen had $33,847.97 in cash or
cash equivalents. Accounts receivable equaled $10,281.52, comprised
principally of pre-bankruptcy debit and credit card payments being
processed by Revel Advantage, the company's merchant service
account vendor.
About Seabirds Kitchen
Seabirds Kitchen, LLC filed a petition under Chapter 11, Subchapter
V of the Bankruptcy Code (Bankr. C.D. Calif. Case No. 25-10460) on
February 24, 2025, with $50,001 to $100,000 in assets and $500,001
to $1 million in liabilities. Arturo Cisneros serves as Subchapter
V trustee.
Judge Scott C. Clarkson presides over the case.
The Debtor is represented by:
Steven E. Cowen, Esq.
S.E. Cowen Law
333 H Street, Suite 5000
Chula Vista, CA 91910
Email: Cowen.steve@secowenlaw.com
SEASONAL LANDSCAPE: Gets Extension to Access Cash Collateral
------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
extended Seasonal Landscape Solutions, Inc.'s authority to use cash
collateral until March 31.
The interim order authorized the company to use cash collateral in
accordance with its budget, which projects total operational
expenses of $191,637 from March 1 to 31.
The company is not allowed to make any payments or distributions
other than the itemized projected disbursements set forth in the
budget without the prior written consent of its pre-bankruptcy
secured lender.
BMO Harris Bank holds a senior lien on the company's assets
totaling at least $495,000, with a subordinate lien by the U.S.
Small Business Administration.
As adequate protection, BMO Harris Bank was granted a replacement
lien on substantially all of the company's assets, including cash
collateral equivalents, cash and accounts receivable, to the same
extent and with the same validity as its pre-bankruptcy lien.
In addition, BMO Harris Bank was granted an administrative expense
claim under Section 507(b) of the Bankruptcy Code.
The next hearing is scheduled for March 26.
About Seasonal Landscape Solutions
Seasonal Landscape Solutions, Inc. is a company in Algonquin, Ill.,
which specializes in residential design-build landscaping.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. N.D. Ill. Case No. 24-08880) on June 17,
2024, with $500,000 to $1 million in assets and $1 million to $10
million in liabilities. Ira Bodenstein serves as Subchapter V
trustee.
Judge Janet S. Baer presides over the case.
The Debtor is represented by Richard G. Larsen, Esq., at Springer
Larsen Greene, LLC.
SEMILEDS CORP: Repays $1.6MM of Loans With Shares of Stock
----------------------------------------------------------
SemiLEDs Corp. disclosed in a Form 8-K Report filed with the U.S.
Securities and Exchange Commission that on January 8, 2019, it
entered into a secured loan agreements with Trung Doan, its
Chairman and Chief Executive Officer and J.R. Simplot Company, its
largest shareholder, with aggregate amounts of $1.7 million and
$1.5 million, respectively, and an annual interest rate of 8%.
The Loan Agreement is secured by a second priority security
interest on the Company's headquarters building. The maturity date
of the Loan Agreements were January 14, 2021 and January 22, 2021,
respectively. On January 16, 2021, the maturity date of the Loan
Agreements was extended with same terms and interest rate for one
year to January 15, 2022, and on January 14, 2022, the maturity
date of the Loan Agreements was extended again with same terms and
interest rate for one more year to January 15, 2023. On January 13,
2023, the maturity date of the Loan Agreements was further extended
with same terms and interest rate for one year to January 15, 2024.
On January 7, 2024, J.R. Simplot Company and the Company entered
into an assignment agreement pursuant to which J.R. Simplot
assigned and transferred all of its right, title and interest in
and to the Loan Agreement to Simplot Taiwan Inc., in accordance
with and subject to the terms and conditions of the Loan Agreement.
On January 7, 2024, the Company entered into the Fourth Amendment
to the Loan Agreements with each of Simplot Taiwan Inc. and Trung
Doan. The Fourth Amendment to the Loan Agreements with Simplot
Taiwan Inc. (i) extended the maturity date to January 15, 2025, and
(ii) upon mutual agreement of the Company and Simplot Taiwan Inc.,
permitted the Company to repay any principal amount or accrued
interest, in an amount not to exceed $400,000, by issuing shares of
the Company's common stock in the name of Simplot Taiwan Inc. as
partial repayment of the Loan Agreement at a price per share equal
to the closing price of the Company's common stock immediately
preceding the business day of the payment notice date. All other
terms and conditions of the Loan Agreement with Simplot Taiwan Inc.
remained the same. The Fourth Amendment to the Loan Agreements with
Trung Doan to amend the loans maturity date with same terms and
interest rate to January 15, 2025. All other terms and conditions
of the Loan Agreement with Trung Doan remained the same. On
February 9, 2024, the Company entered into the Fifth Amendment to
the Loan Agreements with Trung Doan. The Fifth Amendment to the
Loan Agreements with Trung Doan (i) amended the Loan Agreement to
permit the Company to repay up to $800,000 of principal under the
Loan Agreement by issuing shares of the Company's common stock and
(ii) elected to prepay $800,000 of loan principal by delivering
629,921 shares of the Company's common stock to Trung Doan, based
on the closing price of $1.27 per share on February 8, 2024. All
other terms and conditions of the Loan Agreement remained the same.
On July 3, 2024, the Company and Trung Doan entered into the Sixth
Amendment to the Loan Agreement. The Sixth Amendment to the Loan
Agreement amended the Loan Agreement to permit, upon the mutual
agreement of the Company and Trung Doan, the Company to repay a
portion of the principal amount or accrued interest under the Loan
Agreement, by issuing shares of the Company's common stock to Trung
Doan as partial repayment of the Loan Agreement at a price per
share equal to the closing price of the Company's common stock
immediately preceding the business day of the payment notice date.
All other terms and conditions of the Loan Agreement, as amended by
the Sixth Amendment to the Loan Agreement, remained the same. On
January 15, 2025, the Company entered into the Seventh Amendment to
the Loan Agreement with Trung Doan and Fifth Amendment to the Loan
Agreement with Simplot Taiwan Inc. to extend the maturity date to
January 15, 2026. All other terms and conditions of the Loan
Agreement remained the same.
On February 28, 2025, the Company and Simplot Taiwan Inc. entered
into the Sixth Amendment to the Loan Agreement. The Amended Loan
Agreement, upon the mutual agreement of the Company and Simplot
Taiwan Inc., permits the Company to repay any principal amount or
accrued interest, in an amount not to exceed $1,200,000, by issuing
shares of the Company's common stock to Simplot Taiwan Inc. as
partial repayment of the Loan Agreement at a price per share equal
to the closing price of the Company's common stock immediately
preceding the business day of the payment notice date.
On February 28, 2025, the Company delivered a payment notice
indicating its intent to repay $1,200,000 and $400,000 of loan
principal by delivering 722,891 shares and 240,963 shares of the
Company's common stock to Simplot Taiwan Inc. and Trung Doan,
respectively, based on the closing price of $1.66 per share on
February 27, 2025. The shares of common stock were issued in
reliance on Section 4(a)(2) of the Securities Act of 1933, as
amended.
About SemiLEDs
Headquartered in Miao-Li County, Taiwan, R.O.C., SemiLEDs --
http://www.semileds.com-- develops, manufactures and sells light
emitting diode (LED) chips, LED components, LED modules and
systems. The Company's products are used for general specialty
industrial applications, including ultraviolet, or UV, curing of
polymers, LED light therapy in medical/cosmetic applications,
counterfeit detection, LED lighting for horticulture applications,
architectural lighting and entertainment lighting.
The Company suffered losses from operations of $2.9 million and
$3.4 million and used net cash in operating activities of $365
thousand and $984 thousand for the years ended August 31, 2024 and
2023, respectively. These facts and conditions raise substantial
doubt about the Company's ability to continue as a going concern.
SemiLEDs disclosed $10,400,000 in total assets, $8,820,000 in
total
liabilities, and $1,580,000 in total equity at November 30, 2024.
SGZ GROUP: Court Extends Cash Collateral Access to May 27
---------------------------------------------------------
The U.S. Bankruptcy Court for the District of Massachusetts issued
a proceeding memorandum and order extending SGZ Group, Inc.'s
authority to use cash collateral until May 27.
SGZ Group was authorized to use cash collateral on the same terms
and conditions set forth in its previous order issued on Dec. 6,
2024.
The next hearing is scheduled for May 20.
About SGZ Group Inc.
SGZ Group Inc., doing business as Kendall Press, was founded in
Kendall Square, Cambridge, MA in 1986 as a commercial print and
sign company serving the Boston and Cambridge community. Today, the
company has evolved to become a full-service content production
company delivering printed and digital media in support of
marketing, sales, and experiential initiatives to leading
businesses in the Boston region and beyond.
SGZ Group sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. D. Mass. Case No. 24-12330) on November 20, 2024, with
total assets of $351,334 and total liabilities of $1,397,764. J.
Edward Christopher, president of SGZ Group, signed the petition.
Judge Janet E. Bostwick oversees 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
Email: alston@mandkllp.com
SHERMAN/GRAYSON: PCO Reports No Change in Patient Care Quality
--------------------------------------------------------------
Daniel McMurray, the court-appointed patient care ombudsman, filed
his eighth report regarding the quality of patient care provided by
Sherman/Grayson Hospital, LLC.
The report covers the period from December 26, 2024 to February 23,
2025.
The Ombudsman conducted a facility visit from February 4 to 6, at
Wilson N. Jones Regional Medical Center to review the current
operational status of the Hospital and its programs. In connection
with or in addition to the site visit, the Ombudsman conducted
interviews with staff and reviewed various materials to maintain a
current understanding of the issues and challenges impacting the
operations and potentially the quality of care delivered, including
matters and issues presented in the bankruptcy process and/or noted
in the public domain.
The Ombudsman has continued to monitor operations and the quality
of care provided to those served by the Hospital. During this
reporting period, the Hospital's operations remained open and
functional, and the Hospital continues to provide services to
patients and the communities which the Hospital has served.
Mr. McMurray cited some evidence of deferred maintenance. The
facility continues to be well maintained and both neat and clean.
The Ombudsman identified no inappropriate storage or neglected
areas. The Ombudsman was informed that certain plant operations
issues have been identified within the cooling and heating systems.
The Hospital is working on appropriate solutions to address the
issues.
The Ombudsman found that after careful review, it appears that,
notwithstanding the continuing number of significant challenges
experienced during this reporting period, the care provided by the
Hospital has thus far been meeting or exceeding the standards for
quality, as reflected in the most recent quarterly HCAHPS scores,
volume improvements and patient and staff interviews.
The Ombudsman discovered no deterioration in quality as a result of
the bankruptcy or other circumstances. Minor suggestions made by
the Ombudsman during the review process were addressed and
resolved.
A copy of the ombudsman report is available for free at
https://urlcurt.com/u?l=b2FAon from PacerMonitor.com.
About Sherman/Grayson Hospital
Sherman/Grayson Hospital, LLC is the operator of Wilson N. Jones
Regional Medical Center, a 207-bed acute care hospital in Sherman,
Texas.
Sherman/Grayson Hospital sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Del. Case No. 23-10810) on June 23,
2023, with $1 million to $10 million in assets and $50 million to
$100 million in liabilities. Judge J. Kate Stickles oversees the
case.
Leonard M. Shulman, Esq., at Shulman Bastian Friedman & Bui, LLP
and Rosner Law Group, LLC serve as the Debtor's bankruptcy counsel
and Delaware counsel, respectively.
The U.S. Trustee for Region 3 appointed an official committee to
represent unsecured creditors in the Debtor's Chapter 11 case. The
committee tapped Potter Anderson & Corroon, LLP and RK Consultants,
LLC as legal counsel and financial advisor.
Daniel T. McMurray is the patient care ombudsman appointed in the
Debtor's Chapter 11 case.
SHUBREW LLC: Beer and Brewery Brand Seeks Chapter 11 Bankruptcy
---------------------------------------------------------------
Kirk O'Neill of The Street reports that on March 6, 2025, ShuBrew
LLC filed for Chapter 11 bankruptcy protection in the U.S.
Bankruptcy Court for the Western District of Pennsylvania in
Pittsburgh. The company reported assets ranging from $100,000 to
$500,000 and liabilities between $500,000 and $1 million.
Despite the filing, neither ShuBrew's website nor its Facebook page
mentions the bankruptcy. Both continue to promote upcoming events,
and the business appears to be operating as usual. As of March 7,
2025, the brewpub was still accepting reservations and takeout
orders through its website, featuring a full calendar of events,
including the weekly Friday fish fry and a St. Patrick's Day party
on March 15, 2025.
According to a post on X by RK Consultants, the bankruptcy filing
lists between 1 and 49 creditors, with no funds expected to be
available for unsecured creditors after covering administrative
expenses. The petition was signed by managing member Zachary
Shumaker, with legal representation from Brian C. Thompson of
Thompson Law Group P.C.
ShuBrew has not yet responded to requests for comment.
About ShuBrew LLC
ShuBrew LLC is a famous beer and brewery brand.
ShuBrew LLC sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. W.D. Pa. Case No. 25-20577) on March 6, 2025. In its
petition, the Debtor reports estimated assets ranging from $100,000
to $500,000 and liabilities between $500,000 and $1 million.
The Debtor is represented by:
Brian C. Thompson, Esq.
Thompson Law Group, PC
125 Warrendale Bayne Road, Suite 200
Warrendale, PA 15086
Telephone: (724) 799-8404
Facsimile: (724) 799-8409
Email: bthompson@thompsonattorney.com
SILVER LINING: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Silver Lining Advertising, LLC
1660 E. Helm Dr., Unit 400
Las Vegas, NV 89119
Business Description: Silver Lining Advertising is an advertising
agency located in Las Vegas, specializing in
innovative mobile and digital marketing
strategies. The Company provides services
such as mobile billboards (both static and
digital), street teams, walking billboards,
and the Vegas Vibe magazine, a local
publication used for promotional purposes.
Additionally, Silver Lining runs a Concierge
Program and collaborates with notable
clients like AREA15, Blue Man Group, and
Imagine Exhibitions.
Chapter 11 Petition Date: March 14, 2025
Court: United States Bankruptcy Court
District of Nevada
Case No.: 25-11398
Debtor's Counsel: Matthew C. Zirzow, Esq.
LARSON & ZIRZOW, LLC
850 E. Bonneville Ave.
Las Vegas, NV 89101
Tel: 702-382-1170
E-mail: mzirzow@lzlawnv.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Dusty Chambers as manager.
A full-text copy of the petition, which includes a list of the
Debtor's 20 largest unsecured creditors, is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/E6B6UHQ/Silver_Lining_Advertising_LLC__nvbke-25-11398__0001.0.pdf?mcid=tGE4TAMA
SNP ENTERPRISES: Case Summary & Six Unsecured Creditors
-------------------------------------------------------
Debtor: SNP Enterprises, LLC
865 State Route 33
Suite 3-247
Freehold, NJ 07728
Business Description: SNP Enterprises' principal assets are
located at 40 Reeds Road, Tinton Falls, NJ
07724.
Chapter 11 Petition Date: March 13, 2025
Court: United States Bankruptcy Court
District of New Jersey
Case No.: 25-12586
Judge: Hon. Mark Edward Hall
Debtor's Counsel: Robert Nisenson, Esq.
ROBERT C. NISENSON
10 Auer Court
East Brunswick, NJ 08816
Email: r.nisenson@rcn-law.com
Total Assets: $1,572,715
Total Liabilities: $1,096,158
The petition was signed by Samantha Pitt as managing member.
A full-text copy of the petition, which includes a list of the
Debtor's six unsecured creditors, is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/GUJRIEQ/SNP_Enterprises_LLC__njbke-25-12586__0001.0.pdf?mcid=tGE4TAMA
SOFT PACKAGING: Gets OK to Use Cash Collateral Until May 31
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
(Los Angeles Division) issued an interim order authorizing Soft
Packaging, Inc. to use cash collateral.
Soft Packaging was authorized to use cash collateral through May 31
to pay the expenses outlined in the approved budget, with a 15%
variance allowed.
A replacement lien was granted to Celtic Bank Corporation and other
secured creditors to the extent that their cash collateral is
used.
Soft Packaging was ordered to make monthly payments of $3,500 to
Celtic Bank Corporation.
About Soft Packaging Inc.
Soft Packaging Inc. operates as a packaging company in Commerce,
Calif.
Soft Packaging filed Chapter 11 petition (Bankr. C.D. Calif. Case
No. 25-10214) on January 13, 2025. In its petition, the Debtor
reported assets up to $50,000 and liabilities between $1 million
and $10 million.
Judge Vincent P. Zurzolo handles the case.
The Debtor is represented by:
Matthew D. Resnik, Esq.
Rhm Law, LLP
Tel: 818-285-0100
Email: matt@rhmfirm.com
SOLID BIOSCIENCES: Incurs $124.6MM Net Loss in 2024
---------------------------------------------------
Solid Biosciences Inc. filed with the Securities and Exchange
Commission its Annual Report on Form 10-K disclosing a net loss of
$124,697,000 for the year ended December 31, 2024, compared to
$96,015,000 in net loss for the year ended December 31, 2023.
As of Dec. 31, 2024, the Company had $188,662,000 in total assets,
$51,416,000 in total liabilities, and $137,246,000 in total
stockholders' equity.
The accompanying consolidated financial statements have been
prepared on a basis that assumes the Company will continue as a
going concern and which contemplates the realization of assets and
satisfaction of liabilities and commitments in the ordinary course
of business. Through December 31, 2024, the Company has funded its
operations primarily with the proceeds from the sale of redeemable
preferred units and member units as well as the sale of common
stock and pre-funded warrants to purchase shares of its common
stock in private placements and the sale of common stock in its
initial public offering and follow-on public offering in March 2021
and under its at-the-market sales agreement.
On January 11, 2024, the Company issued and sold in a private
placement 16,973,103 shares of the Company's common stock at a
price per share of $5.53 and, to one investor in lieu of shares of
common stock, pre-funded warrants to purchase 2,712,478 shares of
common stock at a price of $5.529 per pre-funded warrant. The
Company received $103.7 million of net proceeds from the January
2024 Private Placement after deducting offering costs. No warrants
were exercised during the year ended December 31, 2024.
During the year ended December 31, 2024, the Company issued
2,212,937 shares of its common stock, pursuant to the Company's
“at-the-market offering” sales agreement, between the Company
and Jefferies LLC for net proceeds of $18.4 million.
On February 19, 2025, the Company issued and sold 35,739,810 shares
of its common stock at a price per share of $4.03 and, to certain
investors in lieu of shares of common stock, pre-funded warrants to
purchase 13,888,340 shares of common stock at a price of $4.029 per
pre-funded warrant. The Company received approximately $187.5
million of net proceeds from the February 2025 Offering after
deducting underwriting discounts and commissions and estimated
offering costs.
In accordance with Accounting Standards Codification 205-40, Going
Concern, the Company has evaluated whether there are conditions and
events, considered in the aggregate, that raise substantial doubt
about the Company's ability to continue as a going concern within
one year after the date the financial statements are issued. As of
December 31, 2024, the Company had an accumulated deficit of $783.5
million. During the years ended December 31, 2024 and 2023, the
Company incurred net losses of $124.7 million and $96.0 million,
respectively. The Company used $100.0 million of cash in operations
for the year ended December 31, 2024. The Company expects to
continue to generate operating losses in the foreseeable future.
Based upon its current operating plan, the Company expects that its
cash, cash equivalents and available-for-sale securities of $148.9
million, excluding restricted cash of $2.0 million, as of December
31, 2024, together with the net proceeds from the February 2025
Offering, will be sufficient to fund its operating expenses and
capital expenditure requirements for at least twelve months from
the date of issuance of these financial statements. However, the
Company has based this estimate on assumptions that may prove to be
wrong, and its operating plan may change as a result of many
factors currently unknown to it. As a result, the Company could
deplete its capital resources sooner than it currently expects. The
Company expects to finance its future cash needs through a
combination of equity offerings, debt financings, collaborations,
strategic alliances or licensing arrangements. If the Company is
unable to obtain funding, the Company would be forced to delay,
reduce or eliminate some or all of its research and development
programs, preclinical and clinical testing or commercialization
efforts, which could adversely affect its business prospects.
A full-text copy of the Form 10-K is available at
https://tinyurl.com/2af4ek75
About Solid Biosciences
Charlestown, Mass.-based Solid Biosciences, Inc. is a life
sciences
company focused on advancing a portfolio of current and future
gene
therapy candidates, including SGT-003 for the treatment of
Duchenne
muscular dystrophy, SGT-501 for the treatment of catecholaminergic
polymorphic ventricular tachycardia, and additional assets for the
treatment of cardiac and other diseases, at different stages of
development with varying levels of investment.
As of September 30, 2024, the Company had $211.8 million in total
assets, $44.8 million in total liabilities, and $167 million in
total stockholders' equity.
The Company has evaluated whether there are conditions and events
that, considered in the aggregate, raise substantial doubt about
the Company's ability to continue as a going concern within one
year after the date the financial statements are issued. As of
September 30, 2024, the Company had an accumulated deficit of
$740.9 million. The Company expects to continue to generate
operating losses for the foreseeable future. Based upon its
current
operating plan, the Company expects that its cash, cash
equivalents
and available-for-sale securities of $171.1 million excluding
restricted cash of $1.9 million, as of September 30, 2024, will be
sufficient to fund its operating expenses and capital expenditure
requirements for at least twelve months from the date of issuance
of these condensed consolidated financial statements. However, the
Company has based this estimate on assumptions that may prove to
be
wrong, and its operating plan may change as a result of many
factors currently unknown to it. As a result, the Company could
deplete its capital resources sooner than it currently expects.
The
Company expects to finance its future cash needs through a
combination of equity offerings, debt financings, collaborations,
strategic partnerships and alliances, or licensing arrangements.
If
the Company is unable to obtain funding, the Company would be
forced to delay, reduce or eliminate some or all of its research
and development programs, preclinical and clinical testing, or
commercialization efforts, which could adversely affect its
business prospects.
SOLO BRANDS: Issues Going Concern Warning, Finds Refinancing
------------------------------------------------------------
Robb M. Stewart of Barrons.com reports that Solo Brands announced
on Wednesday, March 12, 2025, that it is evaluating options to
refinance its existing debt but warned that there is substantial
doubt about its ability to continue operating as a going concern.
The outdoor goods and apparel retailer plans to enhance its
financial performance and liquidity throughout 2025 by implementing
various operational improvements.
Solo Brands, which owns Solo Stove, Chubbies, Isle, and Oru,
reported a fourth-quarter loss of $37 million, narrowed from
previous periods, alongside a 13% decline in sales to $143.5
million. The decrease was primarily driven by lower sales in both
retail and direct-to-consumer channels within its Solo Stove
segment.
According to interim president and CEO John Larson, the board and
management team developed a comprehensive turnaround plan during
the final quarter of 2024. This initiative involved hiring external
financial advisers to conduct a thorough analysis of the company's
business operations.
"Despite challenging results, Solo Brands has a strong foundation
for success, including popular enthusiast brands, a pipeline of new
products, and a loyal customer base," Larson said.
In late February 2025, Solo Brands received a notice from the New
York Stock Exchange indicating noncompliance with listing
standards, as the average closing price of its Class A shares
remained below $1 for 30 consecutive trading days. The company has
six months from the date of the notice to regain compliance.
Earlier in February, the company announced that CEO Christopher
Metz would step down after serving for just over a year.
About Solo Brands
Solo Brands is an outdoor goods and apparel retailer.
SOPHIA HOSPITALITY: Court Extends Cash Collateral Access to April 5
-------------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
extended Sophia Hospitality, LLC's authority to use cash collateral
to April 5 from March 14.
The order allowed the company to use cash collateral to pay
expenses, including up to $20,000 in payroll and payroll expenses
due on March 28.
As protection for the use of its cash collateral, Hanmi Bank, a
senior secured creditor, was granted replacement liens on assets in
which it held a lien as of the petition date.
Sophia Hospitality previously received approval to use cash
collateral to pay its expenses from March 5 to 14, including up to
$20,000 in payroll and payroll expenses due on March 7.
The next hearing is set for March 26. Objections are due by March
24.
About Sophia Hospitality
Sophia Hospitality, LLC, a company in Skokie, Ill., filed Chapter
11 petition (Bankr. N.D. Ill. Case No. 25-03361) on March 5, 2025,
listing between $10 million and $50 million in assets and between
$1 million and $10 million in liabilities. The petition was signed
by Amin Amdani as member.
Judge David D. Cleary oversees the case.
The Debtor is represented by:
Penelope Bach, Esq.
Bach Law Offices
P.O. Box 1285
Northbrook, IL 60065
Tel: (847) 564-0808x216
Fax: (847) 564-0985
Email: pnbach@bachoffices.com
SOUTHERN CUTTERS: Files Emergency Bid to Use Cash Collateral
------------------------------------------------------------
Southern Cutters Land Clearing and Hauling, LLC received interim
approval from the U.S. Bankruptcy Court for the Southern District
of Alabama for authority to use cash collateral.
The interim order authorized the company to use $10,057.06 in cash
collateral to pay contract labor, wages and related taxes for
employees, and $3,149.12 for fuel and other related necessary
supplies.
Throughout approximately the last two years, the Debtor has
suffered financial problems believed to be related, at least in
part, to the lack of capital improvements/construction by existing
business and the decline in the construction and development of new
businesses, possibly related to the COVID-19 Pandemic, which has
caused a decrease in revenue. The Debtor has defaulted on various
secured debts and faced the threat of imminent repossession as of
the Petition Date.
Commercial Credit Group, Inc., Auxilior Capital Partners, Inc., and
Trustmark National Bank may assert an interest in the cash
collateral.
As protection, secured creditors were granted a replacement lien,
with the same validity and priority as their pre-bankruptcy liens.
A copy of the motion is available at https://urlcurt.com/u?l=TlbCI8
from PacerMonitor.com.
About Southern Cutters Land Clearing and Hauling
Southern Cutters Land Clearing and Hauling, LLC sought protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Ala. Case
No. 25-10519) on February 26, 2025.
In the petition signed by Alicia N. Wolford, member, the Debtor
disclosed up to $1 million in both assets and liabilities.
Judge Henry A. Callaway oversees the case.
Anthony B. Bush, Esq., at the Bush Law Firm, LLC, represents the
Debtor as legal counsel.
SPIRIT AEROSYSTEMS: Ernst & Young Raises Going Concern Doubt
------------------------------------------------------------
Spirit AeroSystems Holdings, Inc. disclosed in a Form 10-K Report
filed with the U.S. Securities and Exchange Commission for the
fiscal year ended December 31, 2024, that its auditor expressed an
opinion that there is substantial doubt about the Company's ability
to continue as a going concern.
Wichita, Kansas-based Ernst & Young LLP, the Company's auditor
since 2014, issued a "going concern" qualification in its report
dated February 28, 2025, citing that the Company has suffered
recurring losses from operations and has stated that substantial
doubt exists about the Company's ability to continue as a going
concern.
According to the Company, since 2020, the Company has incurred
significant operating losses. In particular, the Company has
incurred net losses of $2,139.8 million, $616.2 million, $545.7
million, and $540.8 million, for the years ended December 31, 2024,
2023, 2022, and 2021, respectively.
The Company's liquidity has been impacted by, among other things,
higher levels of inventory and contract assets, lower operational
cash flows due to a decrease in expected deliveries to Boeing,
higher factory costs to maintain rate readiness, Boeing no longer
allowing for traveled work on the B737 fuselage to its factories,
the strike by Boeing employees, and the limitations on Boeing
increasing production rates. On October 18, 2024, the Company
announced a 21-day furlough, effective October 28, 2024, for
approximately 700 Company employees working on the B767 and B777
programs in response to the strike by Boeing employees, as the
Company has reached maximum storage capacity on the B767 and B777
programs.
As of December 31, 2024, management has developed a plan designed
to improve liquidity in response to the developments described
above. These plans are dependent on many factors, including, among
other things, the outcomes of our active discussions related to the
timing or amounts of repayment for certain customer advances and
achieving forecasted B737 deliveries. Management also is evaluating
additional strategies intended to improve liquidity to support
operations, including, but not limited to, additional customer
advances and restructuring of operations with the aim of increasing
efficiency and decreasing expenses, which may include layoffs or
additional furloughs.
There can be no assurance with respect to the outcomes of such
discussions or that these plans or strategies will sufficiently
improve the Company's liquidity needs to enable continuation of
operations for at least the next 12 months. Accordingly, these
conditions and events raise substantial doubt about the Company's
ability to continue as a going concern.
Spirit AeroSystems said, "The substantial doubt about our ability
to continue as a going concern may adversely impact the price of
our common stock, our reputation and relationship with investors,
employees and third parties with whom we do business, our ability
to raise additional capital or refinance existing debt, our ability
to comply with certain covenants under our debt agreements or meet
other contractual obligations, and our ability to achieve our
business objectives, which could materially and adversely impact
our business, financial condition and results of operations. In
addition, to the extent the Company seeks additional sources of
financing, there can be no assurance that such financing would be
available to the Company on acceptable terms or at all, and any
financing that the Company obtains could entail dilution to
stockholders, onerous interest rates or covenants, or other terms
that are unfavorable to the Company and the holders of its common
stock."
A full-text copy of the Company's Form 10-K is available at:
https://tinyurl.com/wjkzce6d
About Spirit AeroSystems
Spirit AeroSystems Holdings, Inc. incorporated in Delaware with its
headquarters in Wichita, Kansas, is one of the world's largest
non-Original Equipment Manufacturer manufacturers of
aerostructures, serving markets for commercial airplanes, military
platforms and business/regional jets. With expertise in aluminum
and advanced composite manufacturing solutions, the Company's core
products include fuselages, integrated wings and wing components,
pylons and nacelles. The Company also serves the aftermarket for
commercial and military platforms. In addition to commercial
aircraft structures, it also designs, engineers, and manufactures
structural components for military aircraft and other
applications.
As of December 31, 2024, the Company has $6.8 billion in total
assets, $9.4 billion in total liabilities, and total stockholders'
deficit of $2.6 billion.
STAR TRANSPORTATION: Seeks to Extend Plan Exclusivity to May 2
--------------------------------------------------------------
Star Transportation PA Inc. and its affiliates asked the U.S.
Bankruptcy Court for the Southern District of Florida to extend
their exclusivity periods to file a plan of reorganization and
obtain acceptance thereof to May 2 and June 30, 2025, respectively.
The Debtors explain that ample cause exists to grant the relief
requested by this Motion in these Chapter 11 Cases.
First, the Debtors' cases are complex: there are over a dozen
active creditors and lenders critically important to the Debtors'
operations with whom the Debtor is actively engaged in
negotiations; second, the Debtors are paying their bills as they
come due or otherwise disposing of select, value-subtracting
collateral consistent with rights under applicable law as asserted
by the relevant party; third, the Debtors are working in good faith
to progress toward an exit path, already formulating medium term
and long term payment terms to offer to parties in interest in the
coming days with, now, more certainty as to what the Debtors' fleet
will look like; fourth, a massive unresolved is the proverbial
elephant in the room that is the trucking market at large, as
acknowledged by virtually every party in interest in this case; and
fifth, the Debtor is proposing this extension to work with
creditors consensually, not pressure them.
Indeed, the Debtors are not seeking this extension to delay this
proceeding. Rather, the proposed extensions of the Exclusivity
Period and Acceptance Period will advance the Debtors' efforts to
confirm a plan as expeditiously as possible and bring this case to
a resolution.
Further, this is the Debtors' first request for an extension of the
exclusive periods. The Debtors submit requested extension is
reasonable given the Debtors' progress to date and the current
posture of the Chapter 11 Cases. The requested extension will
afford the Debtors an opportunity to propose a realistic chapter 11
plan.
Star Transportation PA, Inc. is represented by:
Joseph A. Pack, Esq.
Pack Law, P.A.
51 NE 24th St., Suite 108
Miami, FL 33137
Tel: (305) 916-4500
Email: joe@packlaw.com
About Star Transportation PA Inc.
Star Transportation PA, Inc., offers specialized freight trucking
services in Miami, Fla.
Star Transportation sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Fla. Case No. 24-21557) on November 1,
2024, with $1 million to $10 million in assets and $10 million to
$50 million in liabilities. Victor Khramov, president of Star
Transportation, signed the petition.
Judge Corali Lopez-Castro oversees the case.
The Debtor is represented by Joseph A. Pack, Esq., at Pack Law.
STEWARD HEALTH: PCO Files Fifth Supplemental Report
---------------------------------------------------
Susan Goodman, the patient care ombudsman, filed with the U.S.
Bankruptcy Court for the Southern District of Texas her fifth
supplemental report regarding the quality of patient care provided
by Steward Health Care System, LLC and affiliates.
The PCO filed five initial reports, separated by geographical
location, on July 22, 2024. Thereafter, PCO filed a supplemental
report regarding the St. Luke's Behavioral Health Hospital ("SLBH")
location alerting the Court to a catastrophic heating, ventilation,
and air conditioning ("HVAC") system failure.
Thereafter, PCO filed a third supplemental report to highlight the
importance of continued record access for a largely involuntary
acute, inpatient behavioral health patient population inclusive of
adults, adolescents, and children. Debtors represented, on the
record to the court, that they remained the record custodian for
SLBH patients.
The PCO filed a fourth supplemental report updating the court on
the resumption of clinical care services by the interim management
company and anticipated owner, College Health. Under College
Health's management, SLBH is now referred to as College Medical
Center Phoenix ("CMC PHX").
The PCO noted that she has remained in regular contact with CMC
PHX's Chief Executive Officer and Administrator (the "CEO"). Since
the filing of the last supplemental report, the CEO reported
successful accreditation survey completion, with a deemed status
recommendation to the Centers for Medicare and Medicaid Services
("CMS") by the surveying entity, the Center for Improvement in
Healthcare Quality ("CIHQ").
In addition to this brief update to the court, PCO provides notice
of her anticipated filing of a fourth interim report covering the
CMC PHX location once she completes a thorough review of the survey
findings and associated responses. Further, PCO expects to engage
in another site visit to review the resumption of on-site food
service preparation and the full patient census for the one
operational inpatient unit. A report will follow the completion of
these tasks.
A copy of the ombudsman report is available for free at
https://urlcurt.com/u?l=pRZFYt from Kroll, claims agent.
The ombudsman may be reached at:
Susan N. Goodman
PIVOT HEALTH LAW, LLC
P.O. Box 69734 |Oro Valley, AZ 85737
Ph: 520.744.7061 (message)
Email: sgoodman@pivothealthaz.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. Judge
Christopher M. Lopez oversees the cases.
The Debtors tapped Weil, Gotshal & Manges, LLP as bankruptcy
counsel; McDermott Will & Emery as special corporate and regulatory
counsel; AlixPartners, LLP as financial advisor and John Castellano
of AlixPartners as chief restructuring officer. Lazard Freres & Co.
LLC, Leerink Partners LLC, and Cain Brothers, a division of KeyBanc
Capital Markets Inc., provide investment banking services to the
Debtors. Kroll is the claims agent.
Susan N. Goodman is the patient care ombudsman appointed in the
Debtors' cases.
SUNSHINE PEDIATRICS: Seeks Subchapter V Bankruptcy in Arizona
-------------------------------------------------------------
On March 6, 2025, Sunshine Pediatrics PC filed Chapter 11
protection in the U.S. Bankruptcy Court for the District of
Arizona. 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 Sunshine Pediatrics PC
Sunshine Pediatrics PC is a pediatric healthcare practice in
Phoenix, AZ, offering comprehensive care for children from newborns
to young adults. With a focus on family-centered wellness and
prevention, it provides services such as sick visits, vaccinations,
allergy testing, and asthma management.
Sunshine Pediatrics PC sought relief under Subchapter V of Chapter
11 of the U.S. Bankruptcy Code (Bankr. D. Ariz. Case No. 25-01927 )
on March 6, 2025. In its petition, the Debtor reports estimated
assets between $500,000 and $1 million and estimated liabilities
between $1 million and $10 million.
The Debtor is represented by:
Lawrence D. Hirsch, Esq.
PARKER SCHWARTZ, PLLC
7310 N 16th Street, Suite 300
Phoenix, AZ 85020
Tel: (602) 282-0477
Fax: (602) 282-0478
E-mail: lhirsch@psazlaw.com
SWC INDUSTRIES: Seeks to Extend Plan Exclusivity to June 30
-----------------------------------------------------------
SWC Industries LLC and affiliates asked the U.S. Bankruptcy Court
for the Northern District of California to extend their exclusivity
periods to file a plan of reorganization and obtain acceptance
thereof to June 30, 2025.
The Debtors explain that they have made substantial progress in the
first three months of these Chapter 11 Cases. A primary objective
of these Chapter 11 Cases was to effectuate a Sale transaction, and
the Debtors have made meaningful progress to achieve this
objective, including: (a) entry of the Bidding Procedures Order and
maturation of the competitive sale process to maximize value; (b)
fully negotiating a binding purchase agreement with a stalking
horse bidder and obtaining Court approval of the same, setting a
floor for the achievable price in the sale process; and (c)
developing the Plan under which the Sale will be consummated.
Finally, and most notably, the Debtors have proposed a chapter 11
plan and made meaningful progress in further negotiating its terms
with the Committee and other parties in interest, including their
insurers and certain environmental regulatory authorities.
Extending exclusivity will preserve the current negotiation dynamic
and allow the Debtors more time to build consensus, broker
compromises, and reduce the extent to which the Court will need to
make legal rulings on contested matters at confirmation.
The Debtors claim that they are not seeking an extension to
unfairly prejudice or pressure creditors. The Debtors anticipate
that the Plan will be confirmed on or around May 6, 2025, which is
six days prior to the expiration of the initial Exclusive
Solicitation Period under section 1121(c)(3) of the Bankruptcy
Code. The Debtors merely seek an extension of the Exclusive Periods
through June 30, 2025 out of an abundance of caution; such an
extension will not unfairly prejudice or pressure creditors. Thus,
Dow Corning Factor 8 weighs in favor of extending the Exclusive
Periods.
The Debtors assert that they intend to present a feasible and
largely consensual chapter 11 plan. However, there are a number of
outstanding contingencies that may affect the Debtors' ability to
do so, such as identifying the successful bidder at the conclusion
of the auction, determining how to best monetize potential causes
of action of the estates, and evaluating and planning for the
post-confirmation environmental obligations of the Liquidating
Trust, if any. Accordingly, Dow Corning Factor 9 weighs in favor
extending the Exclusive Periods.
Counsel to the Debtors:
Robert Harris, Esq.
Reno Fernandez, Esq.
BINDER MALTER HARRIS & ROME-BANKS LLP
2775 Park Ave.
Santa Clara CA 95050
Tel: (408) 295-1700
Email: rob@bindermalter.com
reno@bindermalter.com
-and-
C. Luckey McDowell, Esq.
Ian E. Roberts, Esq.
ALLEN OVERY SHEARMAN STERLING US LLP
2601 Olive Street, 17th Floor
Dallas, TX 75201
Phone: (212) 271-5777
Email: luckey.mcdowell@aoshearman.com
ian.roberts@aoshearman.com
William S. Holste, Esq.
599 Lexington Avenue
New York, NY 10022
Phone: (212) 848-4000
Email: william.holste@aoshearman.com
About SWC Industries LLC
With principal operations in California and Massachusetts, SWC
Industries LLC manufactures a range of innovative sealing and
logistics equipment -- and offers related services -- that create
efficiencies and reduce costs across multiple industries. In
addition, the Company's San Diego-based business designs and
develops a full suite of software designed to improve warehouse
operations.
SWC Industries LLC and 12 affiliates sought Chapter 11 protection
(Bankr. N.D. Cal. Lead Case No. 24-51721) on Nov. 13, 2024.
SWC listed assets and debt of $50 million to $100 million as of the
bankruptcy filing.
The Debtors tapped Allen Overy Shearman Sterling US LLP as lead
restructuring counsel; Binder Malter Harris & Rome-Banks LLP as
restructuring co-counsel and local counsel; Getzler Henrich &
Associates LLC as financial advisor; and Gordian Group, LLC, as
Investment banker. Stretto, Inc., is the claims agent.
TALLGRASS ENERGY: Fitch Affirms BB- LongTerm IDR, Outlook Negative
------------------------------------------------------------------
Fitch Ratings has affirmed Tallgrass Energy Partners, LP's
Long-Term Issuer Default Rating (IDR) at 'BB-', and affirmed the
instrument ratings of Tallgrass' senior secured debt at 'BB+' with
an 'RR1' Recovery Rating and the senior unsecured debt at
'BB-'/'RR4'. Tallgrass Energy Finance Corp. (FinCo) is a co-obligor
on Tallgrass' senior unsecured notes. The Rating Outlook is
Negative.
The Negative Outlook reflects expected leverage increases due to
the capital-intensive, high-risk Trailblazer CO2 Conversion (TPCO2)
project. The project is on budget and on track to begin service by
mid-2H25, but execution risks remain in the final construction
phase. Successful, on-time completion and cash flow generation are
crucial to bring leverage below Fitch's negative sensitivity.
Resolving the Negative Outlook may take 18+ months.
Tallgrass' ratings are supported by stable cash flow, a diversified
asset base that lowers business risk and a supportive sponsor
relationship, but are constrained by linkage to its parent's
rating.
Key Rating Drivers
TPCO2 Project Execution Risk: The project is on track and within
budget, but material construction remains for its mid-2H25 initial
service launch. It has secured multiple contracts as the sole CO2
capture, transport, and sequestration provider. Archer Daniels
Midland Company (ADM; A/Negative) is the anchor customer,
accounting for one-fourth of the currently signed contracts. While
exclusivity prevents competitive volume loss, the absence of
minimum volume guarantees poses volumetric risks. 100% right of way
for tier 1 laterals has been secured, with construction proceeding
as planned.
Ethanol plants linked to tier 1 laterals are currently producing
slightly over 4 mmtpa of CO2. Most contracts include a fixed fee
for CO2 captured and sequestered, with some having 45Q tax credits
under the Inflation Reduction Act (IRA). Any substantial adverse
changes to the 45Q law or executive branch administration of the
law could significantly impact the project. However, Fitch assumes
no adverse changes in either the law or in management expectations
that tax credit applications will be promptly reviewed and
fulfilled.
Elevated Near-Term Leverage: The capital-intensive debt-funded
TPCO2 project will raise Tallgrass' leverage to the mid-8.0x range,
according to Fitch's forecast, likely staying high until 2027.
Delays or budget issues could extend this elevated leverage period.
Tallgrass has achieved important milestones in obtaining
non-recourse project financing, and a closing is expected in late
1Q25 or early 2Q25. TPCO2 project's success is vital for Tallgrass
to maintain leverage within the 7.0x-8.0x range (per Fitch's
calculations) which is consistent with its current rating.
Liberty Express Contract Renewals: Tallgrass' second-largest asset,
the crude oil carrying Liberty Express Pipeline (LEP), accounts for
nearly 20% of EBITDA. LEP historically has had a shorter-term
contract life. The current remaining weighted average contract life
is two years. LEP volumes have consistently exceeded contractual
minimums and shown year-over-year growth. Refinery utilization
rates in LEP's region and related demand for refined products are
expected to be stable. Tallgrass has managed similar contract
renewals in the past and is expected to timely re-contract LEP's
expiring capacity.
Long-Term Contracts Support Cash Flows: Tallgrass is expected to
generate over 95% of its EBITDA from fee-based contracts, including
85% from long-term take or pay (TOP) and minimum volume commitment
(MVC) contracts with creditworthy customers. This provides
meaningful stability and clarity into future cash flows,
particularly during industry downturns, thereby lowering business
risk.
Diversified Asset Portfolio Enhances Stability: Tallgrass boasts a
robust portfolio of midstream assets spread across various oil and
gas regions in the U.S., with major assets like LEP and Rockies
Express Pipeline, LLC (ROCKIE; BB/Negative, a natural gas pipeline)
being highly contracted and well-utilized assets. Its diverse asset
ownership, coupled with commodity and geographic diversity,
minimizes the risk of simultaneous impacts across its businesses
during downturns, unlike midstream companies with single asset
concentration in specific regions or commodities.
Supportive Sponsor Relationship: Tallgrass' sponsors are
instrumental in maintaining its credit profile, demonstrated by
dividend cuts in 2020 to conserve capital during the pandemic
downturn. The sponsors aim for leverage below 6.5x (as per
management calculations at the Prairie ECI Acquiror, LP level),
with distributions limited to servicing the debt at Prairie. Fitch
anticipates continued sponsor support for Tallgrass' credit
profile, at least in the near term.
Ratings Constrained by Parent Linkage: Tallgrass is a subsidiary of
Tallgrass Energy, LP, which is party to debt issued at Prairie ECI
Acquiror, LP, and is collectively referred as HoldCo. Fitch
assesses HoldCo's standalone credit profile (SCP) using
consolidated metrics, noting that Tallgrass' SCP is stronger. Per
Fitch's "Parent and Subsidiary Linkage Criteria," Tallgrass'
ratings will be limited to one notch from HoldCo, which is viewed
to have a credit profile in line with a 'b+' rated midstream
issuer.
Peer Analysis
The Williams Companies, Inc. (Williams; BBB/Positive) is a close
peer to Tallgrass. Both Williams and Tallgrass operate
FERC-regulated long-distance pipelines central to their credit
profiles, alongside gathering and processing (G&P) businesses. They
both feature highly contracted long-term revenue profiles with
creditworthy customers and have stronger subsidiaries rated higher
than their parents.
While Williams has a larger operating size, that is partially
offset by its larger, riskier gathering and processing business.
Fitch projects Williams's near-term leverage to be lower than that
of Tallgrass. Tallgrass' smaller scale and higher leverage account
for the difference in IDR with Williams.
Howard Midstream Energy Partners, LLC (Howard; BB-/Stable), like
Tallgrass, operates long-distance pipelines and other assets across
multiple oil and gas producing regions in the U.S. Howard is
smaller, yet more diversified. Howard has a larger, riskier G&P
business and only about 45% of EBITDA underpinned by revenue
assurance contracts, resulting in a weaker cash flow profile.
However, Howard's lower near-term leverage expectations in the low
4.0x range contrast with much higher leverage expectations at
Tallgrass, leading to similar IDRs. Howard, however, does not
contain the execution risks Tallgrass faces with the TPCO2
project.
Key Assumptions
- Fitch's oil and gas price deck;
- Oil and gas activity levels in the regions where Tallgrass
operates consistent with Fitch's base case for oil and gas prices;
- Base interest rate for the credit facility reflects Fitch's
"Global Economic Outlook";
- Fitch makes a conservative adjustment to management's
construction plan for the TPCO2 project, and assumes continuation
and smooth administration of the 45Q tax credits law;
- Successful re-contracting at the Liberty Express Pipeline (Pony
Express) for contracts expiring in the next two years, and
transport volumes consistent with prevailing volumes in recent
months;
- Distributions upstream consistent and limited to the amounts
required to service the HoldCo debt.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- An inability to fund the TPCO2 project in a credit supportive
manner or failures to execute on the project within budget and on
schedule;
- Proportionate consolidated EBITDA leverage (measured at the
HoldCo level) that is expected to be above 8.0x for a sustained
period;
- A large customer with a long-term take or pay (ROCKIE) contract
or MVC (Liberty Express) contract has a financial condition that is
consistent with a potential bankruptcy filing, and the current
market for Tallgrass' transportation service indicates the
potential for a contract rejection;
- Fitch's change in view of the company's relationship with its
sponsors that is less supportive of its credit profile.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Fitch would revise the Outlook to Stable upon gaining further
confidence in Tallgrass' ability to successfully execute on the
TPCO2 project in a credit supportive manner, and its demonstrated
ability to sustain leverage under 8.0x (per Fitch's calculations);
- Proportionate consolidated EBITDA leverage (measured at the
HoldCo level) that is expected to be below 7.0x for a sustained
period;
- A decrease in business risk, such as might occur with ROCKIE
and/or Pony Express contracting a significant part of their
capacity in a long-term revenue-assured relationship with an
investment grade shipper.
Liquidity and Debt Structure
Tallgrass had total liquidity of approximately $1,258 million as of
Dec. 31, 2024. The company had roughly $12 million cash on its
balance sheet, and approximately $1,246 million available under its
$1.5 billion first-lien secured revolving credit facility (net of
roughly $88 million in outstanding letters of credit). The credit
facility matures on May 31, 2028, subject to repayment of the $430
million 6.00% senior unsecured notes due 2027 and the $750 million
5.50% senior unsecured notes due 2028 by the respective established
deadlines.
The credit agreement requires Tallgrass to maintain a total
leverage ratio of less than 5.5x, a senior secured leverage ratio
of less than 3.5x, and an interest coverage ratio of more than
2.5x. As of Dec. 31, 2024, the company was compliant with all the
covenants on its credit agreement. Fitch expects Tallgrass to
remain compliant with all the covenants on its credit agreement
over the forecast period.
Issuer Profile
Tallgrass owns and operates a variety of midstream assets,
primarily long-distance interstate pipelines located in the United
States.
Summary of Financial Adjustments
Fitch typically adjusts midstream energy companies' EBITDA to
exclude equity in earnings of unconsolidated affiliates but
includes cash distributions from unconsolidated affiliates.
For Tallgrass and HoldCo, Fitch calculates leverage metrics
including ROCKIE (for part of 2024) and LEP distributions as
described above. Fitch also considers metrics on a proportionately
consolidated basis, including ROCKIE (previously 75%, now 100%
common ownership post-buy-in) and LEP (75% common ownership) EBITDA
and debt, proportional to their ownership interest in the
pipelines. LEP EBITDA is handled similarly as the joint venture's
distribution structure changes in accordance with its terms.
Lastly, Fitch measures leverage at Tallgrass with HoldCo's debt
(Term Loan at Prairie ECI Acquiror LP) imputed due to the PSL
relationship, in the above sensitivities and other parts of this
rating action commentary.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
ESG Considerations
Tallgrass Energy Partners, LP has an ESG Relevance Score of '4' for
Group Structure due to the high number of entities in the family,
which has a negative impact on the credit profile, and is relevant
to the rating[s] in conjunction with other factors.
Tallgrass Energy Partners, LP has an ESG Relevance Score of '4' for
Financial Transparency due to debt at other entities in the group
structure which Fitch doesn't rate and doesn't have access to the
financials, which has a negative impact on the credit profile, and
is relevant to the rating[s] in conjunction with other factors.
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
Tallgrass Energy
Partners, LP LT IDR BB- Affirmed BB-
senior unsecured LT BB- Affirmed RR4 BB-
senior secured LT BB+ Affirmed RR1 BB+
Tallgrass Energy
Finance Corp.
senior unsecured LT BB- Affirmed RR4 BB-
TEXAS WHEEL: Gets Final OK to Use Cash Collateral
-------------------------------------------------
Texas Wheel Repair Express 360, LLC received final approval from
the U.S. Bankruptcy Court for the Northern District of Texas,
Dallas Division, to use cash collateral.
The company generates revenue from its wheel repair business and
intends to use such revenue to pay the expenses set forth in its
30-day budget.
The budget shows total projected cash disbursements of $103,151.
As protection for the use of their cash collateral, secured
creditors were granted replacement liens on post-petition assets,
including cash collateral to the same extent and with the same
priority as its pre-bankruptcy lien.
Texas Wheel was ordered to pay $500 per month to United First, LLC,
starting this month. In addition, the company was ordered to hold
in escrow an additional $500 per month reserved for payment to any
other secured creditor that asserts its right to protection.
The company's obligations to pay "adequate" protection and escrow
funds terminate upon the confirmation of a reorganization plan,
dismissal or conversion of its Chapter 11 case to one under Chapter
7.
United First, LLC is represented by:
Shanna M. Kaminski, Esq.
Kaminski Law, PLLC
P.O. Box 247
Grass Lake, MI 49240
(248) 462-7111
skaminski@kaminskilawpllc.com
About Texas Wheel Repair Express 360
Texas Wheel Repair Express 360 LLC specializes in the
straightening, repair, replacement, and refinishing of aluminum and
alloy wheels.
Texas Wheel Repair Express 360 filed Chapter 11 petition (Bankr.
N.D. Texas Case No. 25-30409) on February 3, 2025, listing total
assets of $338,188 and total debts of $1,101,411. Frances Smith,
Esq., at Ross, Smith & Binford, PC, serves as Subchapter V
trustee.
Judge Scott W. Everett handles the case.
The Debtor is represented by Robert Lane, Esq., at The Lane Law
Firm, PLLC.
UNITED AIRLINES: Fitch Hikes IDR to 'BB', Outlook Positive
----------------------------------------------------------
Fitch Ratings has upgraded United Airlines' Issuer Default Rating
(IDR) to 'BB' from 'BB-'. The Rating Outlooks is Positive.
The upgrade reflects a reduction in United's adjusted debt balance
by $3 billion in 2024, or 8% of the prior year's adjusted debt
balance. EBITDAR leverage ended 2024 at 3.7x, near Fitch's prior
positive rating sensitivity. Net leverage declined to 2.1x as the
company continues to hold elevated cash balances. Fitch expects
United's gross leverage to decline toward 3x over the next few
years, consistent with 'BB' rating tolerances. The upgrade is
further supported by higher-than-expected FCF, driven by lower
capital spending and improving profitability.
The Positive Outlook reflects Fitch's expectations for continued
debt repayment and solid financial performance relative to peers.
United's network investments and loyalty program offerings have
solidified its market position in its fortress hubs, paving the way
for increased profitability.
EETCs
Fitch has upgraded or affirmed United's enhanced equipment trust
certificate (EETC) ratings as follows:
UAL 2019-2:
- $549.4 million class AA certificates due 2032 affirmed at 'A+';
- $222.6 million class A certificates due 2028 upgraded to 'BBB+'
from 'BBB';
- $110.2 million class B certificates due 2028 upgraded to 'BBB-'
from 'BB+'.
UAL 2019-1:
- $487.8 million class AA certificates due in 2031 affirmed at
'A+';
- $202.1 million class A certificates due in 2031 upgraded to
'BBB+' from 'BBB'.
UAL 2018-1:
- $480.8 million class AA certificates due March 2030 affirmed at
'A+';
- $183.2 million class A certificates due March 2030 upgraded to
'BBB+' from 'BBB';
- $99.8 million class B certificates due March 2026 upgraded to
'BBB' from 'BBB-'.
UAL 2016-2:
- $410.6 million class AA certificates due in 2028 affirmed at
'A';
- $180.6 million class A certificates due in 2028 upgraded to 'BBB'
from 'BBB-'
- $94.6 million class B certificates due in 2025 upgraded to 'BBB-'
from 'BB+'.
UAL 2016-1:
- $459.6 million class AA certificates due in 2028 affirmed at
'A';
- $204.4 million class A certificates due in 2028 upgraded to
'BBB+' from 'BBB';
- $114.5 million class B certificates due in 2026 upgraded to
'BBB-' from 'BB+'.
United Airlines 2014-2:
- $410.8 million class A certificates due in 2026 affirmed at 'A'.
United Airlines 2014-1:
- $354.9 million class A certificates due in 2026 affirmed at 'A-'
United Airlines 2013-1:
- $362.6 million class A certificates due in 2025 upgraded to
'BBB+' from 'BBB'.
The upgrades are primarily driven by a one-notch upgrade of
United's IDR to 'BB' from 'BB-'. The affirmations for tranches
rated through Fitch's top-down approach are driven by loan-to-value
(LTV) ratios that continue to support the existing ratings.
Key Rating Drivers
Debt Reduction Improves Credit Metrics: United's credit metrics are
improving due to debt repayment, positive results from strategic
initiatives, lower fuel prices, and a healthy operating
environment. EBITDAR leverage ended the year at 3.7x, down from
4.2x at YE 2023, aided by debt repayment totaling USD4.5 billion in
2024. Fitch's rating case forecasts leverage will decline toward 3x
over the next one to two years due to modestly declining debt
balances. There is potential upside if United hits its margin
expansion goals, compared with Fitch's forecast for relatively flat
margins.
United's liquidity remains high, driving net metrics roughly in
line with higher-rated Delta Air Lines, though Fitch expects Delta
to produce better FCF over the next several years. United is
targeting adjusted net leverage below 2x in 2025, down from 2.9x at
YE 2023. EBITDAR fixed charge coverage has also improved to the
high-3x range, above its previous positive rating sensitivity.
Fitch expects incremental EBITDAR coverage improvement to
low-to-mid 4x range through the forecast.
Healthy Cash Flows and Liquidity: Fitch expects United to generate
meaningful FCF in 2025, driven by a healthy operating environment
and reduced capital spending from delays in aircraft deliveries.
FCF is then likely to fall to neutral levels in 2026 as aircraft
deliveries increase. Upcoming capital expenditures are well covered
by United's projected cash flow generation and elevated liquidity
position, which remains above its peers and pre-pandemic levels.
Fitch expects share repurchases to be secondary in the use of
liquidity.
Initiatives Strengthen Market Position: United's investments in its
network and loyalty program offerings improve its market position
in strategic hubs across the U.S. Leveraging its network and
MileagePlus loyalty program, United provides customers with
competitive travel offerings, including high-frequency routes
across a wide range of destinations and comprehensive rewards and
benefits. This combination of services attracts and retains a loyal
customer base around its key hubs, allowing the company to benefit
from premium pricing compared to its peers.
Solid Profitability: Profit margins were flat in 2024 but have
consistently performed well compared with peers. Fitch expects flat
or slightly increasing margins in the next few years. This would
leave margins below pre-pandemic levels but would result in
sufficient cash flows to allow for continued credit metric
improvement over time. Fitch believes there is potential upside to
its forecast. Recent industry capacity restraint and benefits from
United's ongoing United Next program may lead to more significant
unit revenue gains in 2025 and 2026 compared to the modest growth
incorporated into Fitch's forecast.
Constructive Operating Environment: Fitch anticipates that demand
for air travel will remain robust throughout 2025 evidenced by
recent reports of solid booking trends through first quarter and
the ongoing improvement in business and premium travel. Although
Fitch expects slower U.S. economic growth this year, consumers are
likely to continue prioritizing travel spending.
Manageable Industry Capacity: Fitch expects airline pricing power
to be supported by limits on seat supply driven by reduced capacity
by domestic carriers and by original equipment manufacturer (OEM)
production delays and engine maintenance issues. Examples include
Southwest's commitment to limit capacity growth to 1%-2%, and
Spirit's expectations for reduced capacity this year. However, cost
inflation remains a headwind. Unit cost excluding fuel outpaced the
growth of unit revenue in the prior year.
United Next Benefits: United is seeing benefits from its "United
Next" fleet renewal plan, with the bulk of the planned improvement
to come starting in 2026. Fitch believes that United's fleet
transformation will have a positive impact on United's cost
structure and on its competitive position in domestic markets. The
aircraft on order will be significantly more fuel efficient both in
terms of engine technology and in seats per departure. Fitch views
the fleet renewal as particularly impactful for United's regional
operations as it replaces smaller inefficient regional jets.
EETCs
Class AA Affirmations: The affirmation of United's class AA
certificates for the 2019-2, 2019-1 and 2018-1 transactions at 'A+'
is supported by strong LTVs in the high-70% low-80% range, which
gives them material headroom within Fitch's 'A' stress scenario.
Fitch affirmed the class AA certificates for the 2016-2 and the
2016-1 transactions at 'A'. They continue to pass Fitch's 'A'
stress scenario with LTVs the mid-80% range. The 2016-2 LTVs
increased slightly compared to Fitch's prior review, due to a
change in appraiser with moderately lower base values for the
777-300ER.
Class A Affirmations and Upgrades: The affirmation of United's
class A certificates for 2014-2 and 2014-1 at 'A' and 'A-',
respectively, reflects steady LTVs since Fitch's last review in the
high-80s to low-90% range. The values of the aircraft in this
transaction have declined to the low-to-mid single digits, which is
in line with its assumptions for Tier 1 and Tier 2 aircraft at 6%
and 7%, respectively.
The loan-to-value ratios for United's remaining transactions do not
pass Fitch's 'BBB' Stress test, and according to Fitch's criteria,
are rated via a bottom-up approach and notched off of United's IDR.
Fitch's bottom-up approach calls for ratings to be notched up from
the airline IDR based on three primary variables: 1) the
affirmation factor (0-2 notches) 2) the presence of a liquidity
facility (0-1 notch), and 3) recovery prospects (0-1 notch).
Other than the class A certificates in the 2014-2 and 2014-1
transactions, all of the class A certificates are rated either
'BBB+' or 'BBB'. These certificates have received +2 notches of
uplift for a high affirmation factor and a +1 notch uplift for a
liquidity facility. The 2016-2 transaction is rated 'BBB', and it
is the only class A certificate that received a zero-notch
adjustment for average recovery prospects.
United's 2019-2, 2019-1, 2018-1, 2016-1, and 2013-1 certificates
are rated 'BBB+' and received a +1 notch adjustment for superior
recovery prospects. United's 2016-1 and 2016-2 transactions are
quite similar in terms of underlying collateral. The rating
differential between United's 2016-1 and 2016-2 class A
certificates is driven partly by slower scheduled amortization and
higher widebody exposure for 2016-2.
Class B Certificate Ratings: United's class B certificates are also
derived through Fitch's bottom up approach and are rated either
'BBB' or 'BBB-'. All of the class B certificates have received +2
notches uplift for a high affirmation factor and a +1 notch uplift
for the presence of a liquidity facility. The 2018-1 transaction is
rated 'BBB-', and it is the only class B certificate that received
a zero-notch adjustment for average recovery prospects. United's
2019-2, 2016-2, and 2016-1 class B certificates are rated 'BBB-'
and received a -1 notch adjustment for poor recovery prospects.
Aircraft Tiers: United's EETC transactions are secured by the
787-8, 787-9, 737-900ER, 737 MAX 9, 777-300ERs, and E175s. Tier
classifications for each of these aircraft types are unchanged from
Fitch's prior review. Fitch considers the 787-8, 787-9, and 737-800
to be tier 1 aircraft. The 737-800 is prior generation technology,
but it is the workhorse of the industry, with a very large
in-service fleet and operator base (~280). Fitch believes that
replacement of the 737-800 will be slow due to delivery delays of
new aircraft.
The 787-8 is equipped with new generation technology, with a
mid-sized fleet (~350), limited order backlog (~31) and modest
operator base (~53). Its engine commonality with the 787 family,
and the potential for replacement demand for A330s keeps it in Tier
1. The 787-9 has remained in Tier 1 as it is the best-in-class
aircraft with a reasonable fleet size (~575) and a growing order
backlog. The remaining aircraft in United's EETCs are considered
tier 2 due to limited user bases and backlogs.
Affirmation Factor: Fitch has assigned the maximum notching of '+2'
to subordinated tranches for affirmation. Fitch's views on
transaction-specific affirmation factors are consistent with prior
reviews, and this maximum affirmation factor is driven by the
collateral pools for these transactions, which Fitch believes are
highly likely to be affirmed in a bankruptcy scenario as they
comprise of aircraft that is essential to United's fleet strategy.
Delays in aircraft delivery from Boeing (BBB/Negative) and Airbus
(A-/Positive) further underscores the importance of these aircraft
to United's fleet. Fitch continues to believe that United would not
reject the newer aircraft in the event of a bankruptcy but would
offload leased aircraft first. As of YE 2023, the company leased
133 aircraft which include older, less fuel efficient A319s, A320s,
737s, 757s, 787s and 777-200ERs.
LTV Summary:
LTV calculations are approximate and reflect the lower of mean or
median of three appraised values.
- UAL 2019-2 class AA: base case 49.3%, 'A'; stress case 82.8%;
- UAL 2019-2 class A: base case 69.1%, 'BBB'; stress case 104.7%;
- UAL 2019-1 class AA: base case 46.8%, 'A'; stress case 83.1%;
- UAL 2019-1 class A: base case 66.2%, 'BBB'; stress case 104.8%;
- UAL 2018-1 class AA: base case 49.2%, 'A'; stress case 76.2%;
- UAL 2018-1 class A: base case 67.9%, 'BBB'; stress case 94.8%;
- UAL 2016-2 class AA: base case 50.8%, 'A'; stress case 87.7%;
- UAL 2016-2 class A: base case 73.4%, 'BBB'; stress case 113.9%;
- UAL 2016-1 class AA: base case 50.8%, 'A'; stress case 82.4%;
- UAL 2016-1 class A: base case 73.4%, 'BBB'; stress case 106.7%;
- UAL 2014-2 class A: base case 56.6%, 'A'; stress case 86.1%;
- UAL 2014-1 class A: base case 57.4%, 'A'; stress case 93.3%;
- UAL 2013-1 class A: base case 62.2%, 'BBB'; stress case 98.9%;
Peer Analysis
United's 'BB' rating is two notches above American Airlines
(B+/Stable). The rating differential is partially driven by
United's total debt burden, which remains lower than American's,
along with a higher liquidity balance. However, Fitch believes
United has lower de-leveraging capacity and greater execution risk
relative to American, due to the company's capital spending and
fleet renewal program.
United is two notches below Delta Air Lines (BBB-/Stable), with the
difference driven by United's higher gross leverage. Delta also
benefits from higher operating margins and pre-pandemic track
record of FCF generation.
EETCs
The certificates rated 'A+' are in line with other class 'AA'
certificates in certain American Airlines transactions and one
notch higher than ratings for several class A certificates issued
by other carriers. Stress scenario LTVs for the 2019-2, 2019-1 and
2018-1 transactions remain low and continue to support the 'A+'
rating. Class A certificates that are rated 'A' compare well with
issuances from American and Air Canada that are also rated 'A'.
Rating similarities are driven by similar levels of
overcollateralization and high-quality pools of collateral.
Certificates rated at 'BBB+', 'BBB' or 'BBB-' are notched up from
United's IDR through Fitch's bottom-up approach. The four-notch
uplift for transactions rated 'BBB+' is higher than transactions
issued by American Airlines (B+/Stable) despite the latter
receiving maximum notching (+5) due to the differential in issuer
default rating. Certificates rated 'BBB' or 'BBB-' receive less
uplift compared to similar transactions from other issuers due to
weaker recovery prospects.
Key Assumptions
- United's capacity grows in the low to mid-single digits
percentage range annually;
- Continued travel demand growth keeps load factors in the 83%-84%
range;
- Flat to modestly increasing unit revenues;
- Jet fuel prices averaging around $2.65/gallon throughout the
forecast, implying Brent crude prices in the mid-$70/barrel range,
while crack spreads remain moderately above historical averages;
- Capital spending in line with the company's public guidance.
EETCs
- Key assumptions within the rating case for the issuer include a
harsh downside scenario in which United declares bankruptcy,
chooses to reject the collateral aircraft, and where the aircraft
are remarketed in the midst of a severe slump in aircraft values. A
United Airlines bankruptcy is hypothetical, and Fitch does not
currently expect such a scenario, as indicated by United's 'BB'
IDR. Fitch's models also incorporate a full draw on liquidity
facilities and include assumptions for repossession and remarketing
costs;
- Fitch's recovery analyses for subordinated tranches utilize its
'BB' level stress tests and include a full draw on liquidity
facilities and assumptions for repossessions and remarketing
costs;
- Fitch's analysis incorporates a 6% annual depreciation rate for
Tier I aircraft and a 7% annual depreciation rate for Tier II
aircraft. Fitch has increased its depreciation rate assumptions
modestly reflecting updated analysis of historical aircraft value
trends;
- 'A' level stresses incorporate a 25% haircut for 787-9 and
737-800 aircraft, a 30% haircut for 737 MAX 9, and 787-8 aircraft
and a 35% haircut for 777-300ER, 737-900ER, ERJ 175, and 787-10
aircraft.
RATING SENSITIVITIES
Factors That Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Adjusted debt/EBITDAR sustained above 3.5x or EBITDAR
fixed-charge coverage sustained below 3.0x;
- EBITDAR margins deteriorating into the low double-digit range;
- Persistently negative or negligible FCF.
Factors That Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Adjusted debt/EBITDAR sustained below 3.0x and EBITDAR
fixed-charge coverage above 4.0x;
- Sustained positive FCF generation;
- Demonstration of continued improvement in unit revenues;
- Progress towards United's fleet renewal efforts while maintaining
financial flexibility, including maintaining or increasing
unencumbered assets.
EETCs
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
Top-down approach:
United's class AA certificates and the 2014-2 and 2014-1 class A
certificates are primarily based on a top-down analysis based on
the value of the collateral. Therefore, a negative rating action
could be driven by an unexpected decline in collateral values. All
the class AA certificates remain well overcollateralized, and
therefore negative actions based on declining aircraft values are
less likely. Collateral coverage for the 2014-2 and 2014-1 class A
certificates is less robust. Modest value declines could drive a
one-notch downgrade for either transaction.
Bottom-up approach:
United's remaining EETC tranches are notched off of United's IDR.
Tranches rated 'BBB+' or 'BBB' are sensitive to recovery
expectations in a stress scenario. Declining asset values could
drive weaker recovery prospects, leading to further downgrades.
Subordinate tranches are also subject to changes in Fitch's view of
the likelihood of affirmation for the underlying collateral. In
addition, tranches rated through the bottom up approach would be
subject to downgrade should Fitch downgrade United's corporate
rating.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
Top-down approach:
United's class AA certificates and the 2014-2 and 2014-1 class A
certificates are primarily based on a top-down analysis based on
the value of the collateral. Positive rating actions are less
likely for the remaining tranches.
Bottom-up approach:
United's remaining EETC tranches are notched off of United's IDR,
and the tranches would move with any changes to the IDR.
Liquidity and Debt Structure
United's YE 2024 cash and short-term investments totaled $14.5
billion and $2.97 billion available under its revolver, equivalent
to 31% of United's LTM revenue. United's liquidity balance was
higher than either of its major peers, and provides a material
amount of protection against potential economic pressure.
Pre-pandemic, United targeted a minimum of $5 billion-$6 billion in
total liquidity.
Fitch expects the company's current liquidity balance and improving
operating cash flows to be more than sufficient to cover near-term
obligations. Fitch expects United to direct cash towards aircraft
deliveries and scheduled debt maturities. As such, unencumbered
assets are expected to rise through the forecast period, rebuilding
after United utilized much of its unencumbered asset base to raise
funds during the pandemic.
United's upcoming debt maturities are sizeable but manageable.
Principal repayments total $2.9 billion in 2025, $4.8 billion in
2026, and $2.3 billion in 2027. Fitch expects maturities to be met
through a combination of cash generated from operations, drawing
down the current cash balance, and financing upcoming aircraft
deliveries.
United's debt structure primarily consists of aircraft backed
EETCs, secured term loan and notes backed by the company's
slots/gates/routes collateral, and a secured note backed by its
loyalty program. United also has a number of unsecured obligations
that arose as part of the government Payroll Support Program.
Fitch also rates a series of special facility revenue bonds
guaranteed by United. Funds from the bonds financed the
construction of a multi-terminal baggage handling system, tenant
and other improvements at International passenger terminal
(Terminal E) and related airport facilities for use by United
(formerly Continental Airlines) at George H. Bush International
Airport/Houston.
Although the revenue bonds benefit from a security interest in
United's lease payments, Fitch views the risk profile of these
revenue bonds as closer to United's unsecured issuances. United
does not have a master lease at Houston International Airport.
Instead, United has multiple leases in place tied to various
terminals and facilities. In a bankruptcy scenario, it is possible
select leases could take priority and leave other leases to be
rejected or consolidated. As such, Fitch rates these revenue bonds
at 'BB/RR4' in line with United's unsecured debt ratings.
EETCs
UAL 2019-2
All three tranches of debt in this transaction feature a dedicated
liquidity facility provided by NAB (AA-/F1+/Stable).
UAL 2019-1
The 'A' and 'B' tranches of debt in this transaction feature a
dedicated liquidity facility provided by NAB (AA-/F1+/Stable).
UAL 2018-1
All three tranches of debt in this transaction feature a dedicated
liquidity facility provided by NAB (AA-/F1+/Stable).
UAL 2016-2
All three tranches of debt in this transaction feature a dedicated
liquidity facility provided by Commonwealth bank of Australia
(AA-/F1+/Stable).
UAL 2016-1
All three tranches of debt in this transaction feature a dedicated
liquidity facility provided by Commonwealth bank of Australia
(AA-/F1+/Stable).
UAL 2014-2
The 'A' and 'B' tranches of debt in this transaction feature a
dedicated liquidity facility provided by BNP Paribas
(A+/F1/Stable).
UAL 2014-1
The 'A' and 'B' tranches of debt in this transaction feature a
dedicated liquidity facility provided by Credit Agricole
(A+/F1/Stable).
UAL 2013-1
The 'A' and 'B' tranches of debt in this transaction feature a
dedicated liquidity facility provided by Natixis (A/F1/Stable).
Issuer Profile
United Airlines is one of the largest airlines in the world. The
company maintains hubs at Newark Liberty International Airport,
Chicago O'Hare International Airport, Denver International Airport,
George Bush Intercontinental Airport in Houston, and Los Angeles
International Airport, among others.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
United Airlines
Holdings, Inc. LT IDR BB Upgrade BB-
United Airlines,
Inc. LT IDR BB Upgrade BB-
senior secured LT BBB- Upgrade RR1 BB+
senior
unsecured LT BB Upgrade RR4 BB-
United Airlines
Pass Through
Certificate Series
2019-2
senior secured LT BBB+ Upgrade BBB
senior secured LT BBB- Upgrade BB+
senior secured LT A+ Affirmed A+
United Airlines
Pass Through
Certificates Series
2019-1
senior secured LT A+ Affirmed A+
senior secured LT BBB+ Upgrade BBB
United Airlines
Pass Through Trust
Series 2018-1
senior secured LT BBB+ Upgrade BBB
senior secured LT BBB Upgrade BBB-
senior secured LT A+ Affirmed A+
United Airlines
Pass Through Trust
Series 2016-2
senior secured LT A Affirmed A
senior secured LT BBB Upgrade BBB-
senior secured LT BBB- Upgrade BB+
United Airlines
Pass Through Trust
Series 2016-1
senior secured LT A Affirmed A
senior secured LT BBB+ Upgrade BBB
senior secured LT BBB- Upgrade BB+
United Airlines
Pass Through Trust
Series 2014-2
senior secured LT A Affirmed A
United Airlines
Pass Through Trust
Series 2014-1
senior secured LT A- Affirmed A-
United Airlines
Pass Through Trust
Series 2013-1
senior secured LT BBB+ Upgrade BBB
UNITI GROUP: Files Amendment No. 1 to 2024 Form 10-K
----------------------------------------------------
Uniti Group Inc. filed Amendment No. 1 on Form 10-K/A to its Annual
Report for the year ended December 31, 2024, filed with the U.S.
Securities and Exchange Commission on February 21, 2025 to include
financial statements and related notes of Windstream Holdings II,
LLC and consolidated subsidiaries, the Company's most significant
customer.
For the years ended December 31, 2024, 2023 and 2022, 68.3%, 67.3%
and 66.5% of the Company's revenues, respectively, were derived
from leasing the Company's fiber and copper networks and other real
estate to Windstream.
A full-text copy of the Form 10-K/A is available at
https://tinyurl.com/4r39rv7m
About Uniti
Headquartered in Little Rock, Arkansas, Uniti --
http://www.uniti.com-- is an internally managed real estate
investment trust. It is engaged in the acquisition and
construction of mission critical communications infrastructure,
and
is a provider of wireless infrastructure solutions for the
communications industry. As of June 30, 2021, Uniti owns
approximately 123,000 fiber route miles, 7.1 million fiber strand
miles, and other communications real estate throughout the United
States.
Uniti Group reported a net loss of $718.81 million for the year
ended Dec. 31, 2020, compared to net income of $10.91 million for
the year ended Dec. 31, 2019. As of June 30, 2021, the Company
had
$4.75 billion in total assets, $6.88 billion in total liabilities,
and a total shareholders' deficit of $2.13 billion.
* * *
In March 2020, S&P Global Ratings placed all ratings on U.S.
telecom REIT Uniti Group Inc., including the 'CCC-' issuer credit
rating, on CreditWatch with positive implications. The
CreditWatch
placement follows the company's announcement it reached an
agreement in principle with its largest tenant Windstream Holdings
Inc. to resolve all legal claims it asserted against Uniti in the
context of Windstream's bankruptcy proceedings.
US 24 TRUCK: Seeks Chapter 11 Bankruptcy in Indiana
---------------------------------------------------
On March 10, 2025, US 24 Truck and Trailer Repair Co. filed
Chapter 11 protection in the U.S. Bankruptcy Court for
the Northern District of Indiana. According to court filing, the
Debtor reports $90,033 in debt owed to 1 and 49 creditors. The
petition states funds will be available to unsecured creditors.
About US 24 Truck and Trailer Repair Co.
US 24 Truck and Trailer Repair Co. offers a comprehensive range of
services for trucks and trailers, including mobile repair services,
tire and reefer repair, computer diagnostics, electrical repairs,
air conditioning service, suspension and hydraulics maintenance,
brakes and air leak fixes, engine repairs, and more.
US 24 Truck and Trailer Repair Co. sought relief under Chapter 11
of the U.S. Bankruptcy Code (Bankr. N.D. Ind. Case No. 25-40056) on
March 10, 2025. In its petition, the Debtor reports total assets of
$1,236,313 and total liabilities of $90,033.
The Debtor is represented by:
Weston E. Overturf, Esq.
KROGER, GARDIS & REGAS, LLP
111 Monument Circle, Suite 900
Indianapolis, IN 46204
Tel: 317-777-7443
VIEWSTAR LLC: To Sell New Jersey Property at Auction
----------------------------------------------------
Viewstar LLC seeks permission from the U.S. Bankruptcy Court for
the Southern District of New York, to sell its Assets in an
auction, free and clear of all liens, claims, and encumbrances.
The Debtor is the owner of the Property located at 10 Mountainview
Road, Upper Saddle River, New Jersey 07458, which does not have any
tenants and is currently vacant.
The Property is encumbered by a senior mortgage lien from Sterling
National Bank and a junior mortgage lien from 10 Mountainview.
The Debtor has failed to make certain required payments under the
Senor Mortgage Loan, and the Senior Mortgagee delivered default
notices to the Debtor in connection with the Debtor’s default,
resulting to a foreclosure action.
The Debtor retained Lee E. Buchwald as its restructuring officer
and hired Northgate Real Estate Group as its real estate advisor
with respect to the sale of the Property.
The Debtor proposes to implement bid procedures with the goal of
maximizing the value for the Property in an auction sale.
The bid deadline will be held 2 days before the Auction at 4:00
p.m. (prevailing Eastern Time).
The Qualifying Deposit will be 10%, however, each of the Senior
Mortgagee and the Junior Mortgagee is a qualified bidder.
The Auction will occur approximately 90 days after entry of the Bid
Procedures at 11:00 a.m.
The Successful Bidder following the Auction will increase its
initial deposit to provide for a deposit of 10% of the purchase
price of the winning bid.
The broker's commission will be 3.25% of the gross proceeds
realized from the sale of the Property, to be paid as a buyer's
premium.
The Senior Mortgagee may submit a credit bid or such other amount
as may be determined by the Court for the Property and pay all
other senior liens and encumbrances at closing.
The Debtor asserts that the Bid Procedures are reasonable,
appropriate, tailored to generate the highest and best offers at
the Auction for the Property.
About Viewstar LLC
Viewstar LLC is the owner of real property located at 10
Mountainview Road, Upper Saddle River, New Jersey 07458.
Viewstar LLC sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. S.D.N.Y. Case No. 24-22716) on August 15, 2024. In the
petition filed by Lee E. Buchwald, as restructuring officer, the
Debtor reports estimated assets and liabilities between $10 million
and $50 million each.
The Honorable Bankruptcy Judge Sean H. Lane handles the case.
The Debtor is represented by Paul Rubin, Esq. and Hanh V. Huynh,
Esq. at RUBIN LLC.
VISION PAINTING: Gets OK to Use Cash Collateral Until March 27
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
granted Vision Painting & Decorating Services, Inc authorization to
use cash collateral on an interim basis.
The interim order signed by Judge Janet Baer authorized the company
to use cash collateral until March 27 to pay the expenses set forth
in its budget, with a 10% variance allowed.
The budget shows total projected expenses of $117,925 for March.
The interim order granted the Internal Revenue Service and the
Illinois Department of Employment Security post-petition
replacement liens on the cash collateral and all post-petition
property of the company, to the same extent and with the same
priority as their pre-bankruptcy liens.
As additional protection, the IRS and the Illinois Department of
Employment Security will receive monthly payments of $900 and $450,
respectively.
The next hearing will be held on March 26.
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
Gregory K. Stern, P.C.
Tel: 312-427-1558
Email: greg@gregstern.com
WAYFAIR INC: Fitch Affirms 'B' LongTerm IDR, Outlook Stable
-----------------------------------------------------------
Fitch Ratings has assigned a 'BB' rating with a Recovery Rating of
'RR1' to Wayfair Inc.'s proposed $700 million of secured notes, to
be issued by Wayfair LLC. Proceeds will be used to address upcoming
maturities, including about $970 million of convertible notes due
2025/2026. Fitch has also affirmed Wayfair Inc.'s and Wayfair LLC's
Long-Term Issuer Default Rating (IDR) at 'B'. The Rating Outlook is
Stable.
Wayfair's rating reflects its position as a leading online retailer
of furniture and home furnishings, and its recent efforts to
structurally improve profitability following a long history of
focusing primarily on growth.
Fitch expects some growth in Wayfair's medium-term EBITDA and
positive cash flow on cost control and revenue growth, although the
rating recognizes the company's history of negative FCF. Fitch's
rating case assumes operating metrics improve such that EBITDAR
leverage improves to the mid-5x range by 2026 from about 8.5x in
2023 and 6.3x in 2024.
Key Rating Drivers
Online Disruptor: Over the past 15 years, Wayfair has built a
unique business model in the furniture and home furnishings space,
connecting suppliers and consumers on an e-commerce platform. While
resembling an online retailer, Wayfair does not own inventory,
which limits markdown risk and working capital needs. Fitch expects
Wayfair can generate mid-single-digit revenue growth longer term,
predicated on low-single-digit category growth and ongoing
e-commerce penetration expansion.
As one of a few essentially online-only retailers with meaningful
scale and infrastructure and strong relationships with customers
and vendors, Wayfair appears well positioned to continue gaining
share. Fitch recognizes the company's target of double-digit
medium-term growth through newer initiatives, although these
efforts entail some execution risk. Fitch also recognizes that
revenue over the next 12 to 18 months could remain choppy due to
softer consumer spending on discretionary goods and the furniture
category in particular.
Structural Margin Improvement: Recent efforts to reduce expenses
benefited Wayfair's margin profile. Prior to 2020, the company
generated EBITDA losses as it scaled revenue and infrastructure to
drive the top line. Wayfair saw positive EBITDA in 2020/2021 as
consumers accelerated spending on the category and online, although
these trends reversed in 2022. In 2023, the company actioned $1.4
billion in cost reductions (just over 10% of revenue), yielding
EBITDA margins in the high 3% range in 2024 from negative 3.4% in
2022.
Fitch projects Wayfair's EBITDA margins could improve toward mid-4%
in the next one to two years because of recent cost reduction
efforts and the company's heightened focus on expense management.
Cost reductions led to EBITDA improving to $450 million in 2024
from about $300 million in 2023, and Fitch projects EBITDA could
approach $500 million by 2026. Further margin upside exists toward
the company's targeted 10% EBTDA margin over the medium term if the
company is successful in driving additional sales growth through
its newer initiatives.
Challenged Market: Wayfair's near-term prospects will be limited by
macro challenges, including somewhat moderating consumer health.
These challenges and some overhang from strong home-related
spending in 2020/2021 have caused declines in the U.S. furniture
segment. Near-term results could be further impacted by tariffs,
which raise costs for Wayfair's vendor partners, impacting pricing
decisions and product inflation. Wayfair's topline could decline
around 2% in 2025 and stabilize in 2026, assuming some furniture
spending normalization.
Leverage Moderation: Wayfair's leverage could moderate below 6x
beginning 2025 from 8.5x in 2023 and 6.3x in 2024, largely
predicated on EBITDA growth and some debt reduction. The company
has $2.35 billion of convertible notes, due between 2025 and 2028.
Wayfair is proposing about $700 in secured debt issuance, with
proceeds to be used to address upcoming convertible notes
maturities. The company does not have a publicly articulated
financial policy and Fitch expects the company could refinance its
upcoming notes maturities.
Improving Cash Flow: Wayfair's FCF improvement should follow its
EBITDA expansion in the medium term. While 2025 FCF could moderate
to modestly positive from about $80 million in 2024 given higher
interest expense following secured notes issuances and cash
restructuring costs, FCF could increase to at least $100 million
beginning 2026. Fitch expects Wayfair's cash balances to remain
around $1 billion, in line with its history. Fitch expects Wayfair
to deploy its internally generated cash toward some debt repayment
and investments in growth initiatives.
Parent Subsidiary Linkage: Fitch's analysis includes a weak
parent/strong subsidiary approach between the parent and its
subsidiary, Wayfair LLC. Fitch assesses the quality of the overall
linkage as high, which results in an equalization of IDRs across
the corporate structure.
Peer Analysis
Wayfair's ratings balance the company's leading position in the
online furniture category and track record of strong growth with
its history of limited or negative cash flow generation and high
leverage. The ratings embed expectations of EBITDA growth over the
medium term, yielding positive FCF and EBITDAR leverage trending
below 6x.
Wayfair's peers include leading video retail and e-commerce
business QVC Group, Inc. QVC's 'B-'/Stable IDR reflects questions
regarding the company's ability to stabilize market share longer
term following recent revenue declines across its business,
somewhat mitigated by some financial flexibility afforded through
its positive FCF generation. Other peers include national
department store competitors Macy's Inc. (Macy's; BBB-/Stable),
Kohl's Corp (Kohl's; BB/Stable), and Nordstrom, Inc. (Nordstrom;
BB/Stable).
Each of these companies contend with secular headwinds affecting
the department store industry and are continuously refining
strategies to defend market share. Initiatives include investments
in omnichannel models, portfolio reshaping to reduce exposure to
weaker indoor malls, and efforts to strengthen merchandise
assortments and service levels. Leverage for these department
stores is expected to trend meaningfully below Wayfair's levels.
Fitch placed Kohl's Under Criteria Observation given its new
treatment of leases, published on Dec. 6, 2024. The UCO designation
indicates that the existing ratings may change due to the
application of the final criteria.
Key Assumptions
- Wayfair's revenue could grow around 5% longer term, given low
single-digit growth in the furniture and home furnishings category
and continued shifts in channel spending toward e-commerce and away
from physical retail. However, Wayfair's near-term prospects are
challenged by recent weakness in the furniture category. As such,
revenue in 2025 could decline modestly from the $12 billion
recorded in 2023 and grow around 2% in 2026 before accelerating to
the mid-single digits longer term;
- EBITDA, which improved to about $450 million in 2024 from $300
million in 2023, could improve toward $500 million over the next
two years despite stagnant revenue as margins benefit from recent
cost cuts. Margins could improve to the low 4% range in 2025 from
3.8% in 2024 and approach mid-4% by 2026;
- FCF could be modestly positive in 2025, below the $80 million
range recorded in 2024 given higher interest expense from the
issuance of secured notes and one-time cash restructuring costs
related to headcount reductions and the decision to exit Wayfair's
small Germany business. FCF could be around $100 million in 2026 on
EBITDA growth and lower one-time cash charges;
- This projection assumes generally neutral working capital and
around $300 million in average annual capex to support investments
in Wayfair's technology platform, logistics infrastructure and
physical retail;
- EBITDAR leverage, improved to about 6.3x in 2024 from 8.5x in
2023, could moderate below 6.0x beginning 2025 on some EBITDA
expansion and modest net debt reduction as Wayfair could deploy
some of its cash balances toward convertible notes redemption.
EBITDAR fixed charge coverage could trend around 2.0x;
- Wayfair's new and existing secured notes and existing convertible
debt have fixed interest rate structures.
Recovery Analysis
Fitch's recovery analysis assumes Wayfair's value is maximized as a
going concern in a post-default scenario, given a going concern
valuation of approximately $2.4 billion relative to a liquidation
value of around $450 million.
Fitch's going concern value is derived from a projected EBITDA of
around $400 million. The scenario assumes a lower revenue base of
around $10 billion, around 20% below 2024 levels, assuming
mis-execution yields customer count declines. EBITDA margins could
trend in the 4% range, similar to 2024 levels, assuming the impact
of lost sales on Wayfair's fixed expenses are somewhat offset by
cost reductions.
Fitch selected a going concern multiple of 6x, within the 4x-8x
range observed for North American corporates, reflecting an
assessment of Wayfair's industry dynamics and company-specific
factors. This is at the upper end of the 4x-6x range used in
Fitch's analysis of retailers given the company's outsized exposure
to the faster growing e-commerce channel.
After deducting 10% administrative claims from the going concern
valuation, Wayfair's secured revolver and existing and proposed
secured notes — which are pari passu — would have outstanding
recovery prospects while its convertible notes would have poor
recovery prospects. Fitch assumes the $500 million revolving credit
facility, which is secured by substantially all of Wayfair's
assets, would be fully drawn.
Due to the various recovery prospects, the secured debt is affirmed
at 'BB'/'RR1' while the convertible notes are rated 'CCC+'/'RR6'.
The notes, which are borrowed by Wayfair Inc., have been downgraded
from their prior 'B-'/'RR5' rating given additional secured notes
in Wayfair's capital structure following this issuance.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- EBITDAR leverage trending toward 7.0x, which could result from
capital allocation decisions or stagnant operating performance
leading to EBITDA remaining well below $500 million;
- EBITDAR fixed charge coverage approaching 1.5x.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- A combination of stronger than expected operating performance and
debt reduction which caused EBITDAR leverage to sustain below
5.5x;
- EBITDAR fixed charge coverage approaching 2.5x.
Liquidity and Debt Structure
At Dec. 31, 2024, Wayfair had $1.3 billion of cash and
approximately $530 million of availability on its $600 million
secured revolver due March 2026. Wayfair targets around $1 billion
of ongoing cash. Fitch considers Wayfair's liquidity reasonable
given limited working capital needs. The company generated negative
FCF through most of its history, although Fitch projects positive
FCF given EBITDA improvements.
As of Dec. 31, 2024, Wayfair's capital structure consisted of four
series of convertible notes totaling $2.35 billion, maturing
through 2028. Upcoming maturities include $237 million due October
2025 and $734 million due August 2026. In March 2025, the company
extended its revolver maturity to March 2030 and downsized it to
$500 million, which Fitch views as neutral to Wayfair's credit
profile given limited working capital swings.
In September 2024, the company issued $800 million in five-year
secured notes to repay convertible maturities, and it is proposing
an additional $700 million in notes to address upcoming convertible
maturities. These notes are secured by substantially all the
company's assets and are pari passu with its revolving credit
facility. Fitch expects Wayfair to continue refinancing convertible
maturities, although the company could use internally generated
cash flow to delever.
Issuer Profile
Wayfair is a leading online furniture and home furnishings
retailer, generating $12 billion in 2024 revenue to over 21 million
active customers.
Summary of Financial Adjustments
- Fitch uses the balance sheet reported lease liability as the
capitalized lease value when computing lease-equivalent debt;
- EBITDA adjusted to exclude stock-based compensation.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
Wayfair LLC LT IDR B Affirmed B
senior secured LT BB New Rating RR1
senior secured LT BB Affirmed RR1 BB
Wayfair Inc. LT IDR B Affirmed B
senior unsecured LT CCC+ Downgrade RR6 B-
WELCH & WELCH: Case Summary & Seven Unsecured Creditors
-------------------------------------------------------
Debtor: Welch & Welch Planting Co., LLC
1076 Lenox Nauvoo Rd.
Dyersburg, TN 38024
Business Description: Welch & Welch is an agricultural company
specializing in crop production, utilizing
advanced machinery for planting, soil
preparation, irrigation, and harvesting.
Chapter 11 Petition Date: March 13, 2025
Court: United States Bankruptcy Court
Western District of Tennessee
Case No.: 25-10356
Debtor's Counsel: Thomas H Strawn, Esq.
STRAWN LAW FIRM
400 W Masonic Street
Dyersburg, TN 38024
Tel: 731-285-3375
Fax: 731-285-3392
E-mail: tstrawn42@bellsouth.net
Total Assets: $1,323,500
Total Liabilities: $1,055,264
The petition was signed by Joe H. Welch as owner.
A full-text copy of the petition, which includes a list of the
Debtor's seven unsecured creditors, is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/SUIWJPY/Welch__Welch_Planting_Co_LLC__tnwbke-25-10356__0001.0.pdf?mcid=tGE4TAMA
WELCOME GROUP: Court Extends Use of Cash Collateral to June 15
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Ohio,
Eastern Division, extended its final order permitting Welcome Group
2, LLC, Hilliard Hotels, LLC, and Dayton Hotels, LLC to use cash
collateral from March 17 to June 15.
The use of cash collateral is subject to the terms and conditions
set forth in the final order issued on October 31, 2023, any
further order of the court, and reservation of rights and remedies
of RSS WFCM2019-C50 – OH WG2, LLC, the secured lender, under the
Bankruptcy Code.
About Welcome Group 2 LLC
Welcome Group 2, LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S. D. Ohio Case No. 23-53044) on September
1, 2023. In the petition signed by Abhijit Vasani, as president,
InnVite Opco, Inc., sole member, the Debtor disclosed up to $10
million in both assets and liabilities.
Judge C. Kathryn Preston oversees the case.
Denis E. Blasius, Esq., at Thomsen Law Group, LLC, represents the
Debtor as legal counsel.
Secured lender RSS WFCM2019-C50 - OH WG2, LLC, is represented by:
Tami Hart Kirby, Esq.
Walter Reynolds, Esq.
Porter Wright Morris & Arthur LLP
One South Main Street, Suite 1600
Dayton, OH 45402-2028
Telephone: (937) 449-6721
Facsimile: (937) 449-6820
E-mail: tkirby@porterwright.com
wreynolds@porterwright.com
WELLPATH HOLDINGS: Gets Court Okay to Solicit Bankruptcy Plan Votes
-------------------------------------------------------------------
Randi Love of Bloomberg Law reports that the troubled prison
health-care provider Wellpath Holdings Inc. secured court approval
to begin polling creditors, including inmates with personal injury
claims against the company, on its restructuring proposal, pending
revisions.
The March 14, 2025, ruling is a step forward for Wellpath as it
works on a bankruptcy plan to resolve funded debt issues and about
1,500 tort claims from current and former incarcerated people and
families of deceased prisoners, the report states.
"To some extent, the speed of the case informs what the debtor can
do and accomplish," Judge Alfredo R. Perez of the US Bankruptcy
Court for the Southern District of Texas said.
About Wellpath Holdings
Wellpath Holdings, Inc., formerly known as CCS-CMGC Holdings, Inc.,
is a provider of medical and mental healthcare in jails, prisons,
and inpatient and residential treatment facilities.
Wellpath Holdings and its affiliates sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Texas Lead Case
No. 24-90533) on Nov. 11, 2024. Timothy Dragelin, chief
restructuring officer and chief financial officer, signed the
petitions.
At the time of the filing, the Debtors reported $1 billion to $10
billion in assets and liabilities.
Judge Alfredo R. Perez oversees the cases.
The Debtors tapped Marcus A. Helt, Esq. at McDermott Will & Emery,
LLP as bankruptcy counsel; FTI Consulting, Inc., as financial
advisor; and Lazard Freres & Co., LLC and MTS Partners, LP as
investment banker.
WIN WASTE: S&P Raises ICR to 'B-' on Extended Maturities
--------------------------------------------------------
S&P Global Ratings raised its ratings on WIN Waste Innovations
Holdings Inc. by one notch, including its issuer credit rating to
'B-' from 'CCC+'. S&P also removed the ratings from CreditWatch
Developing, where they were placed on Feb. 18, 2025, following the
company's announcement of a proposed financing transaction that has
since closed.
The transaction addressed a key credit weakness and improved the
company's liquidity position considerably. However, some
liquidity-related credit weaknesses remain, constraining further
improvement to the ratings at this time. These include our
expectation for ongoing negative free cash flow generation, the
2026 maturity of a relatively small portion of the revolver whose
maturity was not extended, and a relatively short weighted-average
maturity profile for company debt of less than three years.
S&P said, "Our stable outlook reflects our expectation that ongoing
earnings improvement will be sustained into 2025 and credit metrics
will remain appropriate for the ratings. We also expect sources of
funds will remain at least 1.2x uses over the next 12 months."
S&P views WIN Waste's liquidity as adequate.
S&P said, "The company's successful execution of the transaction
has improved its near-term liquidity from the less-than-adequate
level we previously assessed it. Key improvements include the
generation of availability under a credit facility and the
extension by a few years of potentially onerous debt maturities. In
our view, the company now has some leeway and liquidity cushion as
it attempts to improve its operating performance, specifically in
terms of its ongoing negative free cash flow generation." The
company also has a longer runway than it previously did to address
large debt maturities that are now pushed out to year-end 2027 and
early 2028, from early 2026.
While the company addressed important near-term risks, the
concentration of maturities for virtually all debt in a short
period over the next two-and-a-half to three years creates some
medium term risk that we don't currently reflect in our view of
near-term (next twelve months) liquidity. Unless addressed in a
timely manner, this aspect of the capital structure could become a
meaningful risk beyond the near term. S&P thinks this creates
comparative risk relative to companies with otherwise similar
credit quality.
S&P expects WIN Waste's operating performance to remain steady or
improve.
The company's EBITDA has improved steadily from trough levels in
2023 and 2022, when unexpected operating issues and macroeconomic
challenges hurt earnings. S&P said, "We believe it has now built up
a brief track record of improving earnings. We expect the company
to at least maintain earnings at current levels in 2025. More
specifically, we think the company's Waste-to-Energy (WtE) business
will help sustain (or possibly improve) the EBITDA levels WIN Waste
achieved through much of 2024."
S&P said, "We expect WIN Waste's S&P Global Ratings-adjusted total
debt to EBITDA to be 6x-7x. This is a meaningful improvement from a
year ago, when the ratio approached 10x. In our calculations, we
exclude certain addbacks to company-reported EBITDA and add back
certain items such as capitalized operating leases to
company-reported debt. However, continued negative cash generation
will likely prevent a further decrease in its debt leverage.
"Our ratings continue to factor in WIN Waste's business strengths.
"We continue to view the company's operations within the
Northeastern U.S. and South Florida markets as a strength given the
shrinking landfill capacity and limits (related to environmental
regulations) on expansion of such capacity. We expect earnings in
2025 will increasingly reflect these strengths, as well as
improvements in pricing in energy markets in particular.
"Prior to 2024, external and unanticipated internal challenges hurt
earnings. We don't anticipate a repeat of that situation in our
base case given steps undertaken by management to strengthen
operations. The company better leveraged its strengths in recent
quarters. We will continue to monitor its ability to insulate its
performance from unexpected setbacks and future macroeconomic
challenges.
"Our stable outlook reflects our expectation that WIN Waste will
sustain its ongoing earnings improvement into 2025 and its credit
metrics will remain appropriate for the ratings. We also expect
sources of funds will remain at least 1.2x uses over the next 12
months. We do not anticipate any shareholder rewards or large,
debt-funded acquisitions. In our base case, we anticipate ongoing
negative free cash flow generation at least over the next 12
months, albeit at an improved level over the previous year. We
expect the company will maintain S&P Global Ratings-adjusted debt
to total EBITDA at current levels of below 7x.
"We could lower our ratings over the next 12 months if unexpected
earnings weakness or increases in debt results in
higher-than-anticipated debt leverage, or if liquidity weakens. We
don't anticipate such weakening in our base case.
"We could raise ratings if the company proactively addresses debt
maturing in 2027 and 2028, resulting in the potential for improved
liquidity or lower maturity risk beyond the next 12-months, and if
WIN Waste's debt to EBITDA approaches 6x or is lower than 6x. Any
review for an upgrade would consider our expectations for
supportive operating performance and management actions."
WINDWARD DESIGN: To Sell Furniture Business to Superior Plastic
---------------------------------------------------------------
Windward Design Group Inc. seeks approval from the U.S. Bankruptcy
Court for the Middle District of Florida, Tampa Division, to sell
substantially all of its assets, free and clear of liens,
interests, and encumbrances.
The Debtor is a 30-year-old, family-owned and operated business
that designs and manufactures high-quality, handcrafted outdoor
furniture and cushions supplied to retailers across Florida.
The Debtor's gross revenue for the year ending December 31, 2023
was approximately $13,416,462.00. For the year ending December 31,
2024, it was approximately $7,414,487.83, and through January 31,
2025, approximately $331,599.99.
The Debtor wants to sell its assets to Superior Plastic Products
LLC or its designee (Stalking Horse Bidder), or such higher or
better offer.
The Debtor's primary secured creditor is SouthState Bank in
connection with a line of credit in the approximate amount of
$975,000.
The two remaining secured creditors are Superior Plastic Products,
LLC, holding a junior lien to SouthState per the DIP financing
order and the Manatee County Tax Collector for 2024 tangible
personal property taxes.
The Debtor asserts that it would be in the best interest of its
creditors and its estate to maximize the value of its assets
through a sale of substantially all of its assets.
The only offer the Debtor received was from Superior Plastic and in
line with the bid procedures, the Debtor will publish a public
notice of the Auction that will be advertised until and through
March 21, 2025. Otherwise, the Debtor would most likely face a
Chapter 7 liquidation.
The consideration to be paid by the Stalking Horse Bidder for the
Assets shall be the total amount of $1,100,000.00, plus any Cure
Amounts.
About Windward Design Group Inc.
Windward Design Group, Inc. filed Chapter 11 petition (Bankr. M.D.
Fla. Case No. 25-00780) on February 6, 2025, listing up to $10
million in both assets and liabilities. David G. Peace, president
of Windward Design Group, signed the petition.
Judge Catherine Peek McEwen oversees the case.
Edward J. Peterson, Esq., at Johnson, Pope, Bokor, Ruppel & Burns,
LLP, represents the Debtor as legal counsel.
YJ SIMCO: Seeks Chapter 11 Bankruptcy in New York
-------------------------------------------------
On March 9, 2025, YJ Simco LLC filed Chapter 11 protection in the
U.S. Bankruptcy Court for the Southern District of New York.
According to court filing, the Debtor reports $6,045,000 in
debt owed to 1 and 49 creditors. The petition states funds will
not be available to unsecured creditors.
About YJ Simco LLC
YJ Simco LLC is a limited liability company.
YJ Simco LLC sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. S.D.N.Y. Case No. 25-10437) on March 9, 2025. In its
petition, the Debtor reports total assets of $9,250,000 and total
liabilities of $6,045,000.
Honorable Bankruptcy Judge Lisa G. Beckerman handles the case.
The Debtor is represented by:
Charles Wertman, Esq.
LAW OFFICES OF CHARLES WERTMAN P.C.
100 Merrick Road Suite 304W
Rockville Centre NY 11570-4807
Tel: (516) 284-0900
E-mail: charles@cwertmanlaw.com
Z BRAND: Gets Court OK to Use Cash Collateral
---------------------------------------------
Z Brand Group, Inc. got the green light from the U.S. Bankruptcy
Court for the Western District of Pennsylvania to use cash
collateral.
The order signed by Judge John Melaragno authorized the company to
use cash collateral to pay the expenses set forth in its budget,
with a 10% variance allowed.
As protection, secured creditor The Huntington National Bank was
granted a replacement lien on property of the company against which
the bank held valid lien as of the petition date.
As additional protection, Huntington will receive a monthly payment
of $1,671.87.
About Z Brand Group Inc.
Z Brand Group, Inc. operates by design, sourcing, and manufacturing
products.
Z Brand Group sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Pa. Case No. 24-22524) on October 14,
2024, listing up to $500,000 in assets and up to $10 million in
liabilities. Jeff Lizik, president of Z Brand Group, signed the
petition.
Judge John C. Melaragno oversees the case.
Donald R. Calaiaro, Esq., at Calaiaro Valencik, represents the
Debtor as legal counsel.
Huntington National Bank, as lender, is represented by:
Justin M. Tuskan, Esq.
Metz Lewis Brodman Must O'Keefe LLC
444 Liberty Avenue, Suite 2100
Pittsburgh, PA 15222
Phone: (412) 918-1100
Facsimile: (412) 918-1199
Email: jtuskan@metzlewis.com
[] 7 Healthcare Companies That File Bankruptcy Protection in 2025
-----------------------------------------------------------------
As reported by Madeline Ashley of Becker's Hospital CFO Report,
healthcare bankruptcies leveled off somewhat in 2024, but financial
pressures have persisted into 2025. Rising costs, workforce
shortages, and reimbursement challenges have driven many hospitals,
health systems, and healthcare organizations to seek bankruptcy
protection.
Shifting patient volumes and regulatory changes have further
strained finances, compelling some hospitals to restructure or shut
down.
Here are seven hospitals, health systems, and healthcare
organizations that Becker's has reported as filing for or emerging
from bankruptcy protection in 2025:
1. Landmark Holdings of Florida (Cape Girardeau, Mo.) - The
operator of six
long-term acute care hospitals filed for Chapter 11 bankruptcy
on March 9,
citing growing financial challenges, including declining
Medicare
reimbursements, rising labor costs, and liquidity constraints.
2. Coral Behavioral Services (West Palm Beach, Fla.) - The provider
of applied
behavioral analysis therapy for children with autism spectrum
disorder
filed for Chapter 7 bankruptcy in early March. The company,
which ceased
operations in 2024 and generated no value, reported debts
approximately 40
times its value.
3. NES Health - The physician-led staffing firm filed for Chapter 7
bankruptcy
on February 21, marking its official collapse after months of
financial
difficulties that left emergency department physicians at
multiple
hospitals unpaid. The company reported assets between $1 million
and $10
million and liabilities ranging from $10 million to $50
million.
4. Jackson Hospital and Clinic (Montgomery, Ala.) - The nonprofit
hospital
filed for Chapter 11 bankruptcy in early February to restructure
financially and reorganize operations. The hospital faced
significant
financial pressures due to challenges like COVID-19, an
unfavorable payer
mix, increased labor costs, and stagnant reimbursement rates.
5. Prospect Medical Holdings (Los Angeles)- The private
equity-backed system
filed for Chapter 11 bankruptcy in January and has been working
to sell 10
of its 16 hospitals. The voluntary bankruptcy proceedings aim to
facilitate
the timely completion of planned hospital sales. Prospect
intends to exit
the Connecticut, Rhode Island, and Pennsylvania markets,
focusing solely on
California.
Prospect's PHP Holdings, which includes Prospect Health Plan,
Prospect
Medical Systems, and Foothill Regional Medical Center, were not
included in
the bankruptcy filings and are expected to be sold to Alhambra,
Calif.-
based Astrana Health by mid-2025. Additionally, the system
secured a deal to
keep Crozer Health in Upland, Pa., open "for the immediate
future" after
earlier plans to close in March.
6. The Bellevue Hospital (Toledo, Ohio) - The hospital filed for
Chapter 11
bankruptcy and plans to be acquired by Firelands Health, based
in Sandusky,
Ohio. Rising operational costs, regulatory complexities, funding
constraints,
and limited access to capital drove the decision. The
restructuring and
acquisition are expected to help the hospital meet its financial
obligations
while maintaining patient care.
7. Southern Tier Orthodontics (Elmira, N.Y.) - The practice
abruptly closed in
early January and announced plans to file for bankruptcy due to
personal and
financial issues. Owner and orthodontist Jason Horn, DDS,
informed patients
that while records would be provided for continued care
elsewhere, refunds
would not be available, even for those who had paid in full or
in advance.
[] Fitch Affirms 'B+' LongTerm IDRs on Arxis Co-Borrowers
---------------------------------------------------------
Following completion of the Arxis transaction, Fitch Ratings has
affirmed the 'B+' Long-Term Issuer Default Ratings (IDRs) of the
Arxis co-borrowers: Kaman Corporation, Quantic Electronics, LLC,
Quantic Corporate Holdings, Inc., Sanders Industries Holdings,
Inc., and Qnnect, LLC. Fitch has also affirmed the companies'
senior secured debt at 'BB-' with Recovery Ratings of 'RR3'. The
Rating Outlook is Stable.
The IDRs reflect Arxis' diversified portfolio of proprietary,
spec'd-in (specified for inclusion), low-cost component products
(40,000 SKUs) across a range of customers (3,000+) and platforms
(600+). Its highly engineered products and significant aftermarket
exposure support an operating profile more consistent with the 'BB'
category.
Arxis' 'B+' rating considers its projected financial profile and
potential debt-funded M&A. Fitch forecasts EBITDA leverage could
fluctuate between 5.5x-6.0x, with EBITDA interest coverage
remaining in the mid-2.0x range.
Additionally, Fitch has affirmed and subsequently withdrawn Ovation
Parent, Inc.'s 'B+' IDR following the reorganization to create
Arxis. Fitch has also withdrawn Ovation Parent's 'BB'/'RR2' senior
secured ratings following repayment of the debt.
Key Rating Drivers
Scaled Portfolio, Decentralized Operating Model: Arxis' operational
strength is reinforced by a scaled portfolio of highly engineered,
~90% sole-sourced proprietary products, which are well-diversified
by platform and customer, supporting revenue stability. The
business combination scaling enhances cross-selling and wallet
share gain opportunities. Management has indicated they are likely
to pursue additional M&A to expand the product portfolio. Fitch
believes execution risks related to M&A are mitigated by
management's favorable track record and decentralized operating
model.
Entrenched Products, Aftermarket Provide Visibility: The highly
customized and spec'd in nature of the company's products
entrenches its positions on the programs it serves. Arxis'
proprietary, mission-critical components are ingrained across
multi-decade platforms, providing a strong, defensible market
position. These components, while essential, are low cost relative
to the overall platform, delivering an outsized value-to-cost ratio
that enhances defensibility and creates high switching costs for
customers, evidenced by near zero loss rates.
This strategic positioning, coupled with a revenue approach that
focuses on continuously adding new platform wins and building on
existing recurring revenue streams, helps provide stable, long-term
revenue visibility. This revenue visibility is further supported by
the maintenance and modernization needs over a platform's
lifecycle.
Engineered, Customer-Centric Products Underpin Position: Arxis
operates in highly regulated end markets, particularly aerospace
and defense and medical, which support higher barriers to entry.
The company has a competitive edge due to advanced engineering,
precision, and tolerance of its products, which is further
strengthened by the incorporation of materials science and
intellectual property (IP).
30% EBITDA Margins, Positive FCF: Fitch expects Arxis to operate
with EBITDA margins in the low-30% range. The nature of the
company's products, in conjunction with its limited customer LTAs
and PO-to-PO operating model, support margins and limit working
capital needs. Fitch expects the company will generate annual FCF
of $100 million-$200 million and margins in the mid-to-high single
digits. Arxis' EBITDA and FCF margins are strong for the industry
and its 'B+' rating.
Leverage Forecasted Below 6.0x, Coverage Mid-2.0x: Fitch forecasts
EBITDA leverage to decline below 6.0x with EBITDA interest coverage
remaining in the mid-2.0x range, consistent with 'B+' rating
tolerances. Fitch expects this to be driven by organic growth and
margin expansion. The company is likely to focus on bolt-on
acquisitions over debt reduction, keeping EBITDA leverage between
5.5x-6.0x. The permitted acquisitions covenant (first lien net
leverage below 5.75x) and forecasted (CFO-capex)/debt (mid-single
digits) should moderate M&A-linked leverage and support
deleveraging.
Industry Tailwinds Aid Growth: Due to Arxis' high degree of
exposure to aerospace and defense, the company is well-positioned
to benefit from continued travel demand and increasing production
rates at OEMs. In addition, increasing air traffic will also
support aftermarket demand. Bipartisan government support for
defense spending and heightened geopolitical tensions also support
demand for Arxis' defense-linked products. Favorable demand
dynamics support Fitch's expectation of mid-single digit revenue
growth over the forecasted horizon.
Peer Analysis
Arxis' closest peers mainly design and manufacture
aerospace-related components and include HEICO Corporation
(BBB/Stable), Signia Aerospace, LLC (B+/Stable), and TransDigm (not
rated).
Arxis is larger than Signia but considerably smaller than TransDigm
and HEICO. HEICO's Parts Manufacturing Approval and cost-plus
exposure result in lower EBITDA margins (mid-20%) relative to
Signia (mid-to-high 30%), Arxis (low-30%), and TransDigm (around
50%). Fitch expects Arxis to operate with EBITDA leverage
comparable to that of TransDigm in the 5.5x-6.5x range, which is
slightly above Signia (mid-5.0x) and well above HEICO (1.5x-2.0x).
Fitch views the operating profiles of Arxis and Signia as
consistent with the 'BB' category, while HEICO and TransDigm's
operating profile is commensurate with a strong investment grade
rating level.
Key Assumptions
- Organic revenue grows by mid-single digits annually over the
forecasted period, supported by commercial aircraft production
growth over the next few years, steady defense budget growth, and
stability in industrial and medical end markets;
- EBITDA margins in the low-30% range over the forecasted horizon;
- The company will pursue bolt-on M&A on an opportunistic basis.
Fitch assumes any M&A would carry margins in line with the overall
business and could be financed with a mix of cash on hand and/or
debt;
- Kaman's Precision Products will be outside of the credit group;
- No material dividends to the sponsor over the next few years.
Recovery Analysis
The recovery assumes that Arxis would be considered a going concern
(GC) in bankruptcy and that the company would be reorganized rather
than liquidated. A 10% administrative claim is assumed in the
recovery analysis.
Fitch assumes Arxis will receive an enterprise value multiple of
7.0x EBITDA under this scenario, which is at the higher end of the
range of multiples assigned to companies in the aerospace and
defense sector.
Fitch considers the company's proprietary, mission-critical product
offerings, revenue visibility, high barriers to entry, and stable
margin profile. Fitch also considers the company's platform and
customer diversification, and exposure to industry tailwinds across
aerospace and defense and medical end markets.
Each of these factors would likely support the company's ability to
recover from severe distress in the case of a hypothetical
bankruptcy. Most defaulters in the Aerospace & Defense sector, as
observed by Fitch in recent bankruptcy case studies, had less
diversified product lines or customer bases and were operating with
highly leveraged capital structures.
Fitch assumes $320 million as the going concern EBITDA, which is
supported by the sole-sourced and long-term nature of platform
exposure. This assumption represents a reasonable going-concern
expectation upon emergence from a hypothetical bankruptcy
scenario.
Fitch's recovery analysis assumes the catalyst for a restructuring
would likely result from a materially negative hit to the company's
reputation or operational issues that cause significant cash
outflows.
The 'BB-' rating and Recovery Rating of 'RR3' on the revolver and
term loan are based on Fitch's recovery analysis under a
going-concern scenario.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- EBITDA leverage sustained above 6.0x;
- (CFO-capex)/debt sustained below 2.5%;
- A deviation in M&A strategy or operational missteps that
heightens execution and cash flow risk;
- EBITDA interest coverage sustained below 2.25x.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Disciplined financial and capital allocation policy that supports
EBITDA leverage sustained below 5.5x;
- (CFO-capex)/debt sustained above 5%;
- EBITDA interest coverage sustained above 2.75x.
Liquidity and Debt Structure
Fitch expects Arxis' liquidity to be sufficient over the rating
horizon. Liquidity and financial flexibility are further bolstered
by the company's FCF generation and availability under its $400
million revolver.
Arxis has no near-term debt maturities. The company's capital
structure is comprised of a senior secured revolving credit
facility due in 2030 as well as a term loan and delayed-draw term
loan due in 2032.
Issuer Profile
Arxis is a manufacturer of highly specialized parts and components
serving aerospace and defense, industrial, and medical end
markets.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
Quantic Electronics,
LLC LT IDR B+ Affirmed B+
senior secured LT BB- Affirmed RR3 BB-
Quantic Corporate
Holdings, Inc. LT IDR B+ Affirmed B+
senior secured LT BB- Affirmed RR3 BB-
Qnnect, LLC LT IDR B+ Affirmed B+
senior secured LT BB- Affirmed RR3 BB-
Ovation Parent, Inc. LT IDR B+ Affirmed B+
LT IDR WD Withdrawn
senior secured LT WD Withdrawn BB
Sanders Industries
Holdings, Inc. LT IDR B+ Affirmed B+
senior secured LT BB- Affirmed RR3 BB-
Kaman Corporation LT IDR B+ Affirmed B+
senior secured LT BB- Affirmed RR3 BB-
[] John Murphy III Joins Paul Hastings' Structured Credit Practice
------------------------------------------------------------------
Further strengthening its premier asset-backed finance and complex
securitization offerings, Paul Hastings LLP announced that
structured credit lawyer John F. Murphy III has joined the firm as
a partner in New York.
Mr. Murphy's broad securities practice focuses on structured
finance and securitization, including the repackaging and
securitizing of both traditional and nontraditional assets and
related warehouse lending, with an emphasis on serving as deal
counsel and collateral manager counsel on U.S. collateralized loan
obligations (CLOs). His asset securitization experience includes
commercial and residential mortgage-backed securities (CMBS and
RMBS), trade receivables, aircraft securitizations and film
financing vehicles, in addition to other repackagings, stranded
cost transactions for investor-owned utilities and re-real estate
mortgage investment conduit (re-REMIC) securitizations.
"Our top-ranked CLO practice is experiencing unprecedented demand,
and John's extensive experience will add critical depth to our
platform in this space," said firm Chair Frank Lopez. "We continue
to attract premier talent as we scale to meet robust demand and
gain additional market share with new and existing clients."
Mr. Murphy advises issuers, underwriters, collateral managers and
sponsors in his CLO work, while representing arrangers, issuers and
servicers across a range of assets in his broad asset
securitization practice. He has been recognized by The Legal 500
USA for his securitization work and is a frequent speaker on
related topics. He joins from DLA Piper LLP.
"I've long admired this Paul Hastings' Structured Credit practice,
and I'm eager to collaborate with its exceptional lawyers in
support of our clients," said Mr. Murphy. "Additionally, I'm
excited to contribute to the firm's expansion in this thriving
area."
The Paul Hastings structured credit practice excels in
securitization and other asset-backed and specialty finance
products, including CLOs, for which it is Chambers USA Band
1-ranked.
About Paul Hastings
With widely recognized elite teams across 17 core practices, Paul
Hastings -- http://www.paulhastings.com-- is a premier law firm
with a culture of excellence focused on providing intellectual
capital and superior execution globally to the world's leading
investment banks, asset managers and corporations.
[] Manhattan Real Properties Up for Sale on March 27
----------------------------------------------------
Northgate Real Estate Group will hold an auction on March 27, 2025,
at 2:30 p.m., for the sale of real properties corner mixed-use
elevator buildings 21 Residential Unites, and 2 Retail units
located at 651 W 169th Street, Manhattan, New York. The deadline
to submit bid for the properties is March 25, 2025, at 5:00 p.m.
Interested bidders must contact Greg Corbin of Northgate Real
Estate Group at Gcorbin@nortgreg.com for more information on how to
participate in the auction.
The real properties are mixed-use elevator building spans six
stories and offers a total of 19,380 square feet. The properties
include 21 residential units and 2 retail spaces.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
TCR subscribers have free access to our on-line news archive.
Point your Web browser to http://TCRresources.bankrupt.com/and use
the e-mail address to which your TCR is delivered to login.
*********
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