Marine Support Company Empire Seeks Lifeline in Bankruptcy Court
Blaming an industry downturn, Tidewater Inc. and 26 affiliates sought chapter 11 protection in the District of Delaware. The petition, signed by Chief Compliance Officer Bruce Lundstrom, discloses up to $100 million in assets and $10 billion in liabilities, including a $1,159,059,408 million claim in unsecured notes. “We believe that successful completion of our restructuring will provide the necessary liquidity and operational flexibility for Tidewater to continue to operate at lower levels of activity until offshore drilling activity recovers and more reasonable levels of vessel utilization and day rates are restored,” said Jeffrey Platt, president and CEO of Tidewater, in a statement online.
Read Tidewater’s motion for relief here
Fashion Retailer Follows Trends Into Bankruptcy Court
rue21 claimed $10 billion in assets and liabilities in its pleading for protection in the Western District of Pennsylvania. Affiliates Rhodes Holdco Inc., r services llc and rue services corp. joined the fray. The clothing retail chain reportedly moved the court for approval in securing some $175 million in DIP financing to provide the company with the cash it needs to continue day to day operations. Some 400 of its 1,179 stores are closing. “These actions are being undertaken with the goal of strengthening the company’s balance sheet, achieving a more efficient cost structure and concentrating resources on a tighter retail footprint in order to pave the best path forward,” stated Melanie Cox, CEO of rue21 in a press release. Creditors include Wells Fargo Bank, which is owed $239,200,000, according to court filings, for senior unsecured notes due in Oct. 2021 and $1,263,978 to Fed Ex Billing Online.
Read the declaration of Chief Financial Officer Todd M. Lenhart here
Coastal Drilling Services Provider Underwater in Bankruptcy Pleadings
After weeks of speculation, GulfMark Offshore Inc sought chapter 11 protection, claiming up to $500 million in assets and $1 billion in liabilities. The company operates marine transportation for off shore drilling through coastal bases located globally. Signed by President and CEO Quintin V. Kneen and filed in the U.S. Bankruptcy Court for the District of Delaware, the petition discloses an unliquidated claim of $429,640,000 owed to U.S Bank National Association. Court filings note that restructuring will help the company to withstand an extended market downturn, capitalize on potential growth opportunities and continue to service customers.
Read pleading by Brian J. Fox, GulfMark Offshore’s restructuring advisor here
Read Motion to approve DIP financing here
Manufacturer of Peanut Butter Substitute Blames E-Coli for Bankruptcy
Soynut Butter Company sought chapter 7 protection in the Northern District of Illinois. According to court documents, certain inventory of the health food store staple was possibly contaminated with e-Coli. The petition, signed by President Stephen L. Grubb, listed up to $10 million in liabilities and only $50,000 in assets.
Web of Shopping Centers Managed by Developer Abruzzino Unravels in Bankruptcy
Interstate_Properties LLC sought chapter 11 protection from up to $100 million in liabilities in the Middle District of Florida. Affiliates Center Designs LLC, Covington Place Associates LLC and Retail Designs LLC filed in March and April following the bankruptcies of Emerald Grande LLC and Tara Retail Group LLC in Jan. All five bankruptcy petitions were signed by managing member William A. Abruzzino who was named in a 2008 judgment, awarding some $343,675 be paid to Country Inns and Suites by Carlson, according to court filings. The bankruptcy pleading of Covington Place Associates discloses a disputed claim of $5,119,116 owed to Carter Bank and Trust for a shopping center mortgage while Tara Retail Group’s petition lists up to $50 million in liabilities. Owned by Mr. Abruzzino and Rebecca Abruzzino, Tara Retail Group was sued in 2016 for defaulting on a $13.6 million U.S. Bank loan, according to court filings, and Covington Place Associates sued Total Grace Christian Center, Inc in 2005 over the failure of a storm water catch and pipe system designed to receive runoff.
Read about the Country Inns and Suites lawsuit against Interstate Properties here
Read about U.S. Bank’s suit against the Tara Retail Group here
Read about Covington Place Associates suit against Total Grace Christian Center here.
Advisor’s Bankruptcy Filing Disputes $3.8 Million SDN Lender Claim
Murphy & Durieu L.P. (M&D) sought protection in bankruptcy court. Signed by chief restructuring officer Joshua Rizack, the chapter 11 petition listed up to $10 million in assets and liabilities including a disputed $2,727,498 owed to Janine May Scharff and $1,109,739.00 owed to Kirstin May Galvin who are both Greenwich, Conn. residents classified as secured demand note (SDN) lenders in court filings. M&D was expelled from the securities industry by FINRA in July 2015. The firm’s failure to pay some money owed to FINRA was among 29 regulatory events listed on the regulator’s website.
Read Mr. Rizack’s declaration here
Read more about M&D’s 29 regulatory FINRA events here
Vernon, N.J., Water Park and Ski Resort Slides Into Bankruptcy
Mountain Creek Resort Inc sought protection from creditors in the District of N.J., claiming up to $50 million in assets and liabilities. The petition, signed by CFO Jeffrey Koffman, included an unsecured claim of $3,867,750.00 owed to Vernon Township Municipal Utilities Authority in N.J. on a $2,650,000 bond. Affiliates that followed suit include Mountain Creek Services Inc., Mountain Creek Management, LLC, Mountain Creek Mountainslide, LLC, Mountain Leasing LLC and Appalachian Liquors Corp. Legal action filed against the company as recently as 2015 include a disability discrimination suit by former employee Richard Helmrich.
Read about the Helmrich v Mountain Creek Resort complaint here
Midwestern Manufacturer Melts Under Facility Acquisition and Relocation
Citing a marked decline in cash flow due to the relocation of its Bridgeton manufacturing facility, Katy Industries Inc. and 13 affiliates sought bankruptcy protection from creditors. Debts include $1,484,697.73 owed to Deltco, a plastics recycling company in Wisconsin for services rendered. Court filings also blamed unrealized expectations from the acquisition of an additional facility in Tiffin, Ohio. Listing $58 million in debt, the petition was filed in U.S. Bankruptcy Court for the District of Delaware and signed by Chief Restructuring Officer Lawrence Perkins. “Our goal is to put the Company on the proper financial footing, de-lever our balance sheet and use the influx of new funding to recover the business and position our operations for future growth while, at the same time, providing a mechanism to address the liquidity constraints and legacy liabilities that have impacted our ability to operate efficiently and effectively,” said Robert Guerra, president and CEO of Katy Industries, in a statement online. Former CEO David Feldman sued the company last year after being fired.
Read the debtor’s motion here
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