New Chapter 11 Filing - ABT Molecular Imaging Inc.

ABT Molecular Imaging Inc. 

6/13/18

ABT is the designer, manufacturer and distributor of a Biomarker Generator. Our eyes glazed over just reading the filing papers on this one so we're going to outsource here, spare ourselves some time, and spare ourselves some serious boredom. 

The bottom line is that the company lost more money ($5.5mm) than it made in sales ($5.4mm). The company has $30mm of liabilities, all in, and assets with a net book value of merely $2.5mm. The disparity stems, in most respects, from the debt on the company's balance sheet. The purpose of the filing is to address the balance sheet and/or pursue a sale of the business. The company's secured lender, SWK Funding LLC, has agreed to fund a DIP credit facility over the course of the case and sponsor a sale through a chapter 11 plan if, during the bankruptcy process, the company is unable to find another suitable purchaser. 

• Jurisdiction: D of Delaware (Judge Silverstein)
• Capital Structure: $9.6mm first lien debt (SWK Funding LLC), $16.1 second lien debt (SWK Funding LLC)  
• Company Professionals:
  • Legal: Bayard PA (Justin Alberto, Erin Fay, Daniel Brogan, Greg Flasser)
  • Investment Banker:: SSG Capital Advisors LLC (J. Scott Victor, Neil Gupta, Michael Gunderson)
  • Claims Agent: Garden City Group (*click on company name above for free docket access)
• Other Parties in Interest:
  • Secured Lender: SWK Funding LLC
    • Legal: Holland & Knight LLP (Brian Smith, Brent Mcilwain) & (local) Young Conaway Stargatt & Taylor LLP 

New Chapter 22 Filing - SEGA Biofuels LLC

SEGA Biofuels LLC

3/11/18

SEGA Biofuels LLC, an industrial wood pellet manufacturer and distributor with a Georgia-based facility filed for bankruptcy to pursue a sale. This is the second bankruptcy in the last 5 years. In this instance, the debtor has been sitting on an idled plant since 2016, having marketed the asset on two separate occasions to no avail. In fact, the bankruptcies of other wood pellet manufacturers in Louisiana and Texas during the company's marketing process didn't help with the marketing. (Notably, Rentech Inc., another wood pellet manufacturer, filed for bankruptcy in December). 

Now, though, the company proposes to sell to Global Infrastructure Partners, an affiliate of the company's pre-petition secured lender and (now) DIP lender, GIP Genesis LLC, for the equivalent of a few dollars and some spitwads. Or, said another way, $4.2mm in the form of a combined credit bid + cash offer, cure amounts and some assumed liabilities. 

Really the only reason why we're even covering this filing is because it reflects the continued decimation of the wood pellet space. 

• Jurisdiction: S.D. of Georgia
• Capital Structure: $9.658 mm in 4 term loans (Heritage Bank), $26.6mm debt (GIP Genesis LLC)  
• Company Professionals:
  • Legal: Chipman Brown Cicero & Cole LLP (William Chipman Jr., Mark Olivere) & (local) Seyfarth Shaw LLP (John Mills III)
  • Financial Advisor/CRO: CRS Capstone Partners LLC (James Calandra)
  • Claims Agent: Garden City Group LLC (*click on company name above for free docket access)
  • Other Parties in Interest:
    • Buyer: Global Infrastructure Partners
      • Legal: Greenberg Traurig LLP (Matthew Hinker)

New Chapter 11 Bankruptcy - Woodbridge Group of Companies LLC

Woodbridge Group of Companies LLC

• 12/4/17 Recap: Real estate finance and development company focused on buying, improving, and selling high-end luxury homes has filed for bankruptcy. It is a "group of companies" because there are literally scores of individual debtor properties that are set up in special purpose vehicles (Propcos) wholly-owned by other related special purpose vehicles (Holdcos). It's like Inception: an SPV within an SPV. 140 Propcos are debtors and 127 Holdcos are debtors. As you can imagine, there are a ton of intercompany transfers here. The company has been the subject of an SEC investigation since September 2016 on the basis of "potential securities law violations, including the alleged offer and sale of unregistered securities, the sale of securities by unregistered brokers, and the commission of fraud in connection with the offer, purchase and sale of securities." Indeed, the company allegedly raised over $200mm from retail investors. But, wait: there's more. The company has also received information requests from state securities regulators in "approximately" 25 states. PETITION NOTE: what do they mean by "approximately"? There are a finite number of states. Have the requests become SO VOLUMINOUS that they company has lost track of how many there've been? The company has secured a $100mm DIP credit facility from Hankey Capital LLC and attempts to have a plan of reorganization confirmed by the end of 2018. 
• Jurisdiction: D. of Delaware (Judge Carey)
• Capital Structure: $750mm seller financing.    
• Company Professionals:
  • Current Legal: Klee Tuchin Bogdanoff & Stern LLP 
  • Previous Legal: Gibson Dunn & Crutcher LLP (Samuel Newman, Oscar Garza, Daniel Denny, J. Eric Wise, Matthew Kelsey, Matthew Porcelli) & (local) Young Conaway Stargatt & Taylor LLP (Sean Beach, Edmon Morton, Ian Bambrick, Allison Mielke)
  • Current Restructuring Advisor/CRO: Development Specialists Inc. (Bradley Sharp) 
  • Previous Restructuring Advisor: SierraConstellation Partners LLC (Larry Perkins, John Farrace, Robert Shenfeld, Reece Fulgham, Miles Staglik, Lissa Weissman)
  • Independent Manager of Affiliate: Beilinson Advisory Group LLC (Marc Beilinson)
  • Claims Agent: Garden City Group (*click on company name above for free docket access)
• Other Parties in Interest:
  • DIP Lender: Hankey Capital LLC
    • Legal: Buchalter (William Brody, Paul Arrow) & (local) Richards Layton & Finger PA (John Knight, Christopher De Lillo)
  • Former CEO: Robert Shapiro
    • Legal: DLA Piper LLP (US) (Eric Goldberg, Stuart Brown)

Updated 3/24/18 9:45 CT

New Chapter 9 Filing - The Kennewick Public Hospital District

The Kennewick Public Hospital District (aka Trios Health)

• 6/30/17 Recap: Now this is a different kind of healthcare bankruptcy filing. The District, which does business as Trios Health, was established in Benton County Washington by state statute in 1948 and is governed by a seven-member publicly-elected Board of Commissioners; it is one of the largest multi-specialty medical groups in Eastern Washington comprised of 2 hospitals and 10 urgent/outpatient care centers. To "remain competitive and retain market share," the District expanded and invested in improvements. This included a new hospital facility in a "relatively affluent" area, as well as the construction of complementary medical office space. This was all state-of-the-art. Which of course costs a boatload of dough (see capital structure info below). And so the Board issued revenue bonds secured by gross revenues and a subsequent bond secured by taxes. Of course, all of the foregoing was predicated upon a feasibility study that baked in revenue projections. And counted on revenue from HMO and PPO plans offered by Group Health. Want to guess how that all played out? Well, let us tell you. The projections were inflated. Shocker right? To be fair, the District's competitor, Kadlec, negotiated for the exclusion of the District from the Group Health Plans; it also opened a competitive emergency room nearby. So revenues failed to live up to expectations while secured obligations lived up to expectations. Creditors weren't happy and the District felt forced into action. Hence, Chapter 9. 
• Jurisdiction: E.D. of Washington (Corbit)
• Capital Structure: see below.     
• Company Professionals:
  • Legal: Foster Pepper PLLC (Jack Cullen, Bryan Glover, Andy Morton, Ella Vincent)
  • Claims Agent: Garden City Group LLC (*click on company name above for free docket access)
• Other Parties in Interest:
  • Official Committee of Unsecured Creditors
    • Legal: Arent Fox LLP (Andrew Silfen, George Angelich, Jordana Renert) & (local) Hillis Clark Martin & Peterson P.S. (Bradley Duncan, Josh Rataezyk)
  • Creditor: Kennewick Holdings LLC
    • Legal: Gibson Dunn & Crutcher LLP (Jeffrey Krause, Matthew Kelsey, Jason Goldstein) & (local) Davis Wright Tremaine LLP (Ragan Powers, Hugh McCullough)

Page 5 of First Day Declaration

Updated 10/5/17

New Chapter 11 Filing - Ignite Restaurant Group

Ignite Restaurant Group

• 6/6/17 Recap: Publicly-traded ($IRG) Houston-based owner of 112 Joe's Crab Shack locations and 25 Brick House Tavern + Tap locations filed for bankruptcy because people can't tear their eyes off of whatever mobile device they're towing around long enough to sit at a casual dining spot. "The market for casual dining has been deteriorating for some time." No kidding, dudes. That said, someone clearly still believes in the space as the company has lined up a stalking horse bidder to purchase the company in bankruptcy for $50mm and some assumed liabilities (subject to deductions/increases). That "someone" is KRG Acquisitions Co LLC, an affiliate of Kelly Investment Group. Maybe it's the "'I'm relaxed' restaurant experience" that the buyer finds compelling...? (Serious question: is weed legal in Texas yet?). Anyway, good luck with that. 
• Jurisdiction: S.D. of Texas
• Capital Structure: $30mm RCF & $165mm TL (Credit Suisse AG)     
• Company Professionals:
  • Legal: King & Spalding LLP (Sarah Borders, Jeffrey Dutson, Edward Ripley, Elizabeth Dechant)
  • Financial Advisor: Alvarez & Marsal LLC (John Tibus)
  • Investment Banker: Piper Jaffray & Co. (Richard Shinder, Teri Stratton)
  • Real Estate Advisor: Hilco Real Estate LLC 
  • Claims Agent: Garden City Group LLC (*click on company name above for the free docket)
  • Other Parties in Interest:
    • Credit Suisse AG
      • Legal: Latham & Watkins LLP (Keith Simon, David Hammerman, Hugh Murtagh) & (local) Porter Hedges LLP (John Higgins)
    • KRG Acquisition Co LLC 
      • Legal: Goldberg Kohn Ltd. (Randall Klein, Prisca Kim) & (local) Okin Adams LLP (Matthew Okin, Ryan O'Connor)
    • Official Committee of Unsecured Creditors
      • Legal: Pachulski Stang Ziehl & Jones LLP (Jeffrey Pomerantz, Bradford Sandler) & (local) Cole Schotz PC (Michael Warner)
    • Potential Buyer: Landry's Inc.
      • Legal: Haynes and Boone LLP (Patrick Hughes, Arsalan Muhammad, Jonathan Pressment, Sarah Jacobson)

Updated 7/17/17 11:23 am CT

New Chapter 11 Filing - Suniva Inc.

Suniva Inc.

• 4/17/17 Recap: Large US manufacturer of photovoltaic solar cells used in residential, commercial and government solar applications filed for bankruptcy because of (cue ominous music) CHINA. Shocker! China's well-documented cheap solar capacity and flooding of the US market has pressured the US market for years (and resulted in the imposition of 30% tariffs on the Chinese - tariffs that were easily circumvented through creative delivery through other parts of Asia). Luckily, management didn't get ahead of their skis and expand by (i) tripling the company's manufacturing capacity and (ii) spending nearly $100mm on larger facilities (while incurring new debt). Oh wait, strike that: that's precisely what management did. Oops. (More to come.)
• Jurisdiction: D. of Delaware 
• Capital Structure: $50.9mm (SQN Asset Servicing LLC), $15mm LOC (Wanxiang America Corporation - now first in priority as successor to Wells Fargo's rights)    
• Company Professionals:
  • Legal: Kilpatrick Townsend & Stockton LLP (Todd Meyers, Colin Bernardino, Gianfranco Finizio) & (local) Potter Anderson & Corroon LLP (Jeremy Ryan, R. Stephen McNeill, D. Ryan Slaugh)
  • Financial Advisor/CRO: Aurora Management Partners Inc. (David Baker, Steve Smerjac, Matt McEnerney)
  • Claims Agent: The Garden City Group Inc. (*click on the company name above for free docket)
• Other Parties in Interest:
  • SunEdison Products Singapore Pte. Ltd.
    • Legal: Togut Segal & Segal LLP (Frank Oswald, Brian Moore)
  • Wells Fargo NA
    • Legal: Morgan Lewis & Bockius LLP (Richard Esterkin, Kelly Costello)
  • Alternative DIP Lender: Lion Point Capital LP
    • Legal: Cleary Gottlieb Steen & Hamilton LLP (Sean O'Neal, Jane VanLare, Thomas Kessler) & Ashby & Geddes PA (Ricardo Palacio, Karen Skomorucha Owens)
  • Official Committee of Unsecured Creditors
    • Legal: Seward & Kissel LLP (John Ashmead, Robert Gayda, Catherine LoTempio) & (local) Morris Nichols Arsht & Tunnell LLP (Robert Dehney, Eric Schwartz, Tamara Minott)
    • Financial Advisor: Emerald Capital Advisors (John Madden, Jack Allen, Christopher Saitta, Daniel Pace, Ryan Feulner)

Updated 7/17/17 

New Chapter 11 Filing - Marbles Holdings LLC

Marbles Holdings LLC

• 2/6/17 Recap: The Chicago-based brainiacs behind the specialty retailer that sells games, puzzles, books and software apparently weren't smart enough to run a sustainable business. Consequently, Marbles Holdings filed a Chapter 11 to find a buyer for certain assets and liquidate the remainder. A proposed sale of IP and a wind-down of the 37 mall-based locations (including one in the ultimate "tourist mall," the World Trade Center, and many others in the, cough, "A Malls" owned by Westfield, Simon Properties, and General Growth Properties) and six in-store concept stores within Macy's will be funded pursuant to a $900k DIP. Choice quote in the first day declaration, "It is likely that other retailers may commence chapter 11 cases in the near term." Ominous. 
• Jurisdiction: N.D. of Illinois
• Capital Structure: ~$17.5mm secured debt (Amzak Capital Management, AMPR Marbles Investors LLC)
• Company Professionals:
  • Legal: Adelman & Gettleman LLP (Howard Adelman, Henry Merens, Erich Buck, Alexander Brougham)
  • Liquidator: Gordon Brothers Retail Partners LLC
  • Investment Banker: Hilco IP Services LLC d/b/a Hilco Streamback
  • Claims Agent: Garden City Group LLC
• Other Parties in Interest
  • Amzak Capital Management
    • Legal: Holland & Knight LLP (Barbra Parlin)

Updated 2/10/17

New Chapter 11 Filing - LMCHH PCP LLC

LMCHH PCP LLC (Louisiana Medical Center and Heart Hospital LLC)

• 1/30/17 Recap: This is a revenue and operating costs story. Not enough of the first. Too much of the latter. Utilization didn't make up for the cost and capital structure and now the debtor is in Chapter 11 with the hope of finding a buyer.
• Jurisdiction: E.D. of Louisiana (transferred from D. of Delaware)
• Capital Structure: $12mm RCF/$6.7mm funded (MidCap Financial LLC), $105mm Demand Note (Cardiovascular Care Group Inc.),    
• Company Professionals:
  • Legal: Alston & Bird LLP (Grant Stein, David Wender, Sage Sigler), Jones Walker LLP (Elizabeth Futrell) & (local) Young Conaway Stargatt & Taylor LLP (Joel Waite, Kenneth Enos)
  • Financial Advisor & CRO: Solic Capital Advisors LLC (Neil Luria)
  • Claims Agent: Garden City Group (*click on company name above for free docket)
  • Other Parties in Interest:
    • Official Committee of Unsecured Creditors
      • Legal: Heller Draper Patrick Horn & Dabney LLC (William Patrick, Tristan Manthey, Cherie Nobles)
      • Financial Advisor: CohnReznick LLP (Clifford Zucker)
    • MidCap Funding IV Trust
      • Legal: Locke Lord LLP (C. Davin Boldissar)

Updated 4/2/17

New Filing - Optima Specialty Steel LLC

Optima Specialty Steel

• 12/15/16 Recap: Miami-based independent specialty steel products manufacturer files for bankruptcy in the District of Delaware, capitulating under the weight of debt-laden acquisitions predicated on synergies and efficiencies that, shockingly, couldn't counteract various macroeconomic headwinds. The company cites low oil prices, a strong US dollar, excess capacity, slowing growth in other parts of the world (read: China), and decreased demand for specialty steel products. Unable to pay its December 15 debt maturity, the company filed to take advantage of the automatic stay - funded by cash collateral initially and seeking a DIP by January - and try to reorganize as a going concern.
• Jurisdiction: D. of Delaware
• Capital Structure: $171.7mm 12.5% senior secured notes (Wilmington Trust), $87.5mm 12% senior unsecured note (Wilmington Trust; privately-placed with DDJ Capital Management LLC)     
• Company Professionals:
  • Legal: Greenberg Traurig (Dennis Meloro, Nancy Mitchell, Paul Keenan, John Dodd, Ari Newman, Maria DiConza)
  • Financial Advisor: Ernst & Young LLP (Briana Richards)
  • Investment Banker: Miller Buckfire & Co., LLC (James Doak)
  • Claims Agent: Garden City Group (*click on company name for docket)
• Parties in Interest:
  • Ad Hoc Group of Unaffiliated Holders of Senior Secured Notes
    • Legal: Akin Gump Strauss Hauer & Feld LLP (Philip Dublin, Jason Rubin)
  • Official Committee of Unsecured Creditors
    • Legal: Squire Patton Boggs (US) LLP (Stephen Lerner, Norman Kinel, Nava Hazan, Elliot Smith) & (local) Whiteford Taylor & Preston LLP (Christopher Samis, L. Katherine Good, Chantelle McClamb)
  • Wilmington Trust
    • Legal: Morrison & Foerster LLP (Jonathan Levine, James Newton) & (local) Morris Nichols Arsht & Tunnell LLP (Eric Schwartz, Matthew Harvey)
  • DDJ Capital Management LLC
    • Legal: Latham & Watkins LLP (Richard Levy, Ted Dillman)

Updated 1/6/17

New Filing - Dowling College Inc.

Dowling College Inc.

• 11/29/16 Recap: Following the loss of its accreditation and a failed sale to a strategic, the non-profit educational institution filed for Chapter 11 with plans to effectuate a liquidation by way of sale of its Oakdale NY campus and residential portfolio. UMB Bank will fund a approximately $5mm DIP.
• Jurisdiction: E.D. of New York
• Capital Structure: ~$59mm municipal debt     
• Company Professionals:
  • Legal: Klestadt Winters Jureller Southard & Stevens LLP (Sean Southard, Lauren Kiss) 
  • Financial Advisor: RSR Consulting LLC (Robert Rosenfeld) 
  • Claims Agent: Garden City Group LLC (*click on company name for docket)
• Other Parties in Interest:
  • DIP Lender: UMB Bank
    • Legal: Mintz Levin Cohn Ferris Glovsky and Popeo PC (Ian Hammel, Eric Blythe) & (local) Garfunkel Wild PC (Adam Berkowitz)
  • Official Committee of Unsecured Creditors
    • Legal: SilvermanAcampora LLP (Ronald Friedman, Gerard Luckman, Kenneth Silverman)

Updated 12/30/16

New (Chapter 22) Filing - American Apparel Inc.

American Apparel Inc.

• 11/14/16 Recap: Large US-based apparel manufacturer and retailer with 193 total stores files for bankruptcy - months, uh, after emerging from bankruptcy. Company filed with a $30mm DIP proposal from Encina Business Credit LLC. Plan is to sell (for parts) expeditiously to Gilden Activewear SRL for $66mm (IP, remaining wholesale inventory and wholesale POs during restructuring).  
• Jurisdiction: D. of Delaware
• Capital Structure: $215mm of funded debt ($90mm DIP-rolled-into-TL-exit + $82mm of additional financing) & $15mm unsecured UK facility (Standard General)    
• Company Professionals:
  • Legal: Jones Day LLP (Carl Black, Scott Greenberg, Michael J. Cohen, Erin Brady, Stacey Corr-Irvine, Genna Ghaul, Christpher Lovrien) & (local) Pachulski Stang Ziehl & Jones LLP (Laura Davis Jones, James O'Neill, Joseph Mulvihill)
  • Financial Advisor: Berkeley Research Group LLC (Mark Weinsten, Joseph D'Ascoli) & FTI Consulting (Andrew Hinkelman, Chuck Goad, Adam Saltzman, Frank Marshall, William Breashears, Zach Contreras)
  • Claims Consultants: Resources Global Professionals (Thora Thoroddsen, Evelyne Anglade, Scott Ashcraft, Luis Barreda, Sharon Dannewitz, Yolanda Hoelscher, Rodney Teruya)
  • Investment Banker: Houlihan Lokey (Saul Burian, Devin Shanahan, Sanaz Memarsadeghi, Ethan Kopp, Alexander Stolarz, Varun Desai)
  • Claims Agent: Prime Clerk (*click on company name for docket)
• Other Parties in Interest:
  • DIP Lender: Encina Business Credit LLC
    • Legal: Riemer & Braunstein LLP (Steven Fox, Donald Rothman, Lon Singer, Alexander Rheaume) & (local) Ashby & Geddes PA (Gregory Taylor)
  • Agent to Prepetition Secured Lenders: Wilmington Trust
    • Legal: Covington & Burling LLP (R. Alexander Clark, Dianne Coffino) & Pepper Hamilton LLP (David Fournier)
  • Buyer: Gilden Activewear SRL
    • Legal: Sullivan & Cromwell LLP (Michael Torkin, Brian Hamilton, Miaoting Wu) & (local) Womble Carlyle (Matthew Ward)
  • Lead Lenders & Equityholders: Monarch Alternative Capital LP, Coliseum Capital Management LLC, Goldman Sachs Asset Management LP, Pentwater Capital Management LP, Standard General. 
    • Legal (except Standard General): Milbank Tweed (Gerard Uzzi, Eric Stodola) & (local) Fox Rothschild (Jeffrey Schlerf, L. John Bird)
    • Legal (Standard General): Debevoise & Plimpton LLP (Natasha Labovitz, Shannon Rose Selden, Craig Bruens, Erica Weisgerber) & (local) Young Conaway (Edmon Morton, Joseph Barry)
  • Largest Unsecured Creditors: Standard General, FTI Consulting, Moelis, Garden City Group
  • Unsecured Creditors' Committee:
    • Legal: Cooley LLP (Cathy Hershcopf, Seth Van Aalten, Robert Winning, Sarah Carnes, Michael Klein, Max Schlan) & (local) Bayard PA (Justin Alberto, Evan Miller, Gregory Flasser)
    • Financial Advisor: Emerald Capital Advisors (John Madden, Ryan O'Sullivan, Lawrence Jacobs, Christopher Moffatt, Jack Allen, Christopher Saitta, Daniel Pace, Ryan Feulner)

Updated 3/30/17