Monthly Archives: March 2021

Congress passed new, temporary bankruptcy relief measures late last year that impact certain commercial landlords and tenants. Among other things, the new legislation, which was signed into law on Dec. 27, 2020: 1) extends commercial rent forbearance for certain small business tenants experiencing material financial hardship related to the COVID-19 pandemic, 2) lengthens the time period for commercial tenants to assume or reject a commercial lease, and 3) establishes protections for certain commercial deferred rental payment agreements.

Description of Change: In general, a commercial tenant in bankruptcy must pay its rental obligations as they become due commencing on the date the tenant files for bankruptcy and continuing through such time that the tenant accepts or rejects the lease. The new law permits a commercial tenant experiencing "material financial hardship" due directly or indirectly to COVID-19 to forbear its obligations to pay rent until the earlier of 1) 60 days after the date of the order for relief under the Bankruptcy Code, a period that may be extended for an additional period of 60 days if the bankruptcy court determines that the commercial tenant is continuing to experience such material financial hardship, or 2) the date that the lease is assumed or rejected. Of note, "Material Financial Hardship" is not defined.

Applicability: The new changes to the bankruptcy code are limited to cases involving "small business debtors" under Subchapter V of Chapter 11 of the Bankruptcy Code, which is restricted to commercial debtors having noncontingent, liquidated debts under $7.5 million.

Sunset of Bankruptcy Relief: Dec. 27, 2022.

Effect: This change will afford a tenant who successfully demonstrates to a bankruptcy court that it has experienced a "material financial hardship" due to COVID-19 to forbear its obligation to pay rent under its lease for a longer time than was initially permitted by the bankruptcy code.

Description of Change: The new law extends the initial time period for a commercial tenant to assume or reject a lease from 120 days to 210 days. The prior provisions that provide that the bankruptcy court may order further extensions of this time period have not been changed, with the effect that there is an increase of 90 days within which such a lease may be assumed or rejected.

Applicability: Any Chapter 11 debtor.

Sunset of Bankruptcy Relief: Dec. 27, 2022.

Effect: The extension of time to assume or reject a lease will have the effect of giving commercial landlords and tenants more time to discuss whether the lease should be assumed or rejected. Of note, this extension applies to all debtors, not simply those that are experiencing financial hardship due to COVID-19.

Description of Change: Under bankruptcy law, certain payments made by a tenant to its landlord within 90 days of the bankruptcy filing are subject to being clawed back into the bankruptcy estate as "preferential payments." Under the new law, a commercial tenant in bankruptcy who makes a "covered rental arrearages" payment will be excluded from preferential treatment in certain situations. A "covered rental arrearages" payment is a rental payment that has been deferred or postponed under a commercial lease based on an amendment to such lease after March 13, 2020.

Applicability: Any Chapter 11 debtor.

Sunset of Bankruptcy Relief: Dec. 27, 2022.

Effect: This change will protect commercial landlords from having deferred rent payments being clawed back into the bankruptcy estate and thereby will encourage commercial landlords and tenants to negotiate rent deferment arrangements to mitigate the impacts of the COVID-19 pandemic.

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Congress Enacts Temporary Bankruptcy Relief Related to COVID-19 - JD Supra

Neiman Marcus Holding Company Inc. launched a junk-bond sale Thursday to refinance debt taken out to emerge from bankruptcy, marking the retailers return to the capital markets just six months after exiting from Chapter 11.

The troubled upscale department store is marketing a $1 billion five-year first-lien bond. Pricing is expected on Friday.

Proceeds will pay down the $125 million first-in, last-out facility and repay the roughly $748 million exit term loan and notes due in 2025, resulting in a modest reduction in interest expenses, according to a report Thursday morning by S&P Global Ratings.

Early pricing discussions are for a yield in the mid-to-high 7% range.

S&P rated the new notes and company CCC+, seven steps into junk. We continue to view Neimans capital structure as unsustainable based on our expectation for pressured performance through fiscal 2021, the S&P analysts wrote.

The COVID-19 pandemic shut down Neimans stores and caused an already precarious financial situation to tip it into bankruptcy. The Dallas-based company emerged from Chapter 11 in September under control of creditors Pacific Investment Management Co., Davidson Kempner Capital Management and Sixth Street Partners.

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Originally posted here:

Neiman taps junk-bond market to refinance its bankruptcy exit debt - The Dallas Morning News

The Covid-19 pandemic caused millions of people to lose their jobs; it took the lives of more than 534,000 Americans; and it has left countless, indelible marks on the world. But in the past year, there has not been a coinciding rise in bankruptcy filings in Arizona.

All bankruptcy filings in the United States Bankruptcy Court in the District of Arizona fell by 20.6% from 2019 to 2020, according to court records.

In Phoenix, Chapter 11 filings spiked in June but dropped by 13.4% annually, from 97 in 2019 to 84 in 2020.

In the first months of 2021, all types of filings continue to decline both in Phoenix and across the state. But experts suspect there is a wave of bankruptcies on the horizon, potentially dampening hopes of a full post-pandemic recovery.

Read more from the Phoenix Business Journal.

Read more here:

Pandemic measures have prevented bankruptcy filings in Arizona, but a flood may be on the horizon - ABC15 Arizona

The company announced today it's working toward an October 2021 grand opening forDeBartolo Commons an outdoor athletic and entertainment green space and event venue.

BOARDMAN Southern Park Mall owner Washington Prime Group said in a statement today that it still plans to follow through with its $30 million redevelopment of the Boardman mall, despite news of the company's potential bankruptcy.

Washington Prime Group told investors Tuesday its management has "substantial doubt" over whether the company can continue.

The company has engaged advisors to help negotiate with some of its corporate debt holders. During that process, "the company expects business as usual at Southern Park Mall.

"The company remains committed to executing a first-class redevelopment project, which will feature the DeBartolo Commons athletic and entertainment green space and event venue for the benefit of Southern Park Malls guests, tenants, and community neighbors and partners," according to the statement.

Programming details will be announced "closer to October."

A Planet Fitness location will open this spring, and afull interior mall "refresh" is expected to start January 2022.

The company has previously announced new upcoming local tenants: Bogey's and Steel Valley Brew Works. It's also working to secure another local tenant for the final space adjacent to the redevelopment.

According to the company, it still plans to invest $30 million into the site; $9 million has already been invested.

Read more here:

Bankruptcy looms, but Southern Park Mall owner expects 'business as usual' - Mahoning Matters

Antibioticbiotechs often struggle to turn their products into commercial triumphs, and that's certainly beenthe case for New Haven, Connecticut-based Melinta Therapeutics, which ultimately filed for bankruptcy in late 2019. ButMelinta hopesits newly minteddrug can become an exception, thanks toa convenience edge over rivals.

The FDA approved Melintas Kimyrsa, also known asoritavancin, to treat adults with acute bacterial skin and skin structure infections caused by designated Gram-positive microorganisms, such as methicillin-resistant Staphylococcus aureus. With its sights set on a summer launch, Melinta aims to provide a one-and-done alternative to the current multidose standard for treatment, the company said in a release.

The drug is a next-gen version of Melinta's Orbactiv antibiotic and has been tested both head-to-head against the commonly used antibiotic vancomycin and alongside its predecessor.A long-actinglipoglycopeptide antibioticKimyrsa isgiven as a one-hour, 1,200-mg infusion, potentially offeringclinicians flexibility to treat patients outside the hospital, Melinta said.

RELATED:GlaxoSmithKline to shut down antibiotics production, cut 300 jobs in wake of Novartis buyout

That consideration could be especially beneficial to patients struggling to meetinfusion schedules amid COVID-19, which has shut down or changed operations at clinics nationwide.

Bacterial skin infectionshitsome 14 million patients in the U.S. each year, Meltina says. The infections cause more than 3 million visits to the emergency room annually and are the 8th most common cause of ER admissions. Admitted patients typically remain hospitalized for around 4.1 days, costingU.S. facilities$4 billion each year, the company addeda burden it aims to reduce thanks to Kimyrsa's abbreviated infusion time and volume.

Regulators cleared the drug based on results from an open-label pharmacokinetics study that compared an hour-long Kimyrsa infusion with a three-hour Orbactiv infusion.

Kimyrsa also passed muster in thephase 3 Solo study, which also assessed Orbactiv. In that trial, researchers pitted a single, 1,200mg intravenous dose of Kimyrsa against twice-daily vancomycin in 1,987 adults, including a subset of 405 patients with methicillin-resistant Staphylococcus aureus infection, which can be tricky to treat. A singleKimyrsa dose was as effective as 7-10 days of twice-daily vancomycin at 15mg/kg, Melinta said.

RELATED:Novartis' Sandoz doubles down on antibiotics with $500M deal for GSK brands

The approval could give a much-needed boost to Melinta, which filed for bankruptcy in 2019 after months of mounting financial tensions, thoughturning an antibiotic into a cash boon is almost always a tricky prospect.

Last February, a U.S. bankruptcy court gavegroups interested in buying the biotechuntil March 2 to make an offer, withDeerfield Management thenin the pole position to snap upMelinta as payment for a $140 million loan it extended during the company's originalfiling.

Melinta made another bid to right its financials in June when it revealed it had won a bidding war withAcelRx Pharmaceuticals to buy upTetraphase Pharmaceuticals.Tetraphase won FDA approval for the antibiotic Xerava in patients with complicated intra-abdominal infections in 2018, butlike other antibiotic biotechs, it has struggled to turn Xerava into a commercial success.

By June 24, however, the deal entered the rearviewafter Tetraphase received a "superior offer" from La Jolla Pharmaceutical for$43.0 millionin cash, plus an additional$16.0 millionpotentially payable under contingent value rights.

Read more:

Melinta, bouncing back from bankruptcy, lands FDA approval for speedy skin infection fighter - FiercePharma

Japan Data

One decade after the Great East Japan Earthquake, the lingering effects of the disaster are still causing bankruptcies today.

According to the credit research company Teikoku Databank, there were 2,061 bankruptcies either directly or indirectly caused by the Great East Japan Earthquake in the 10-year period from March 2011, when the disaster occurred, to February 2021. The cumulative total debt was 1.71 trillion.

Full-scale reconstruction, the rebuilding of lives in the disaster area, and the restart of the local economy has meant that the number of disaster-related bankruptcies has been slowing down each year. The tenth year (March 2020February 2021) saw the lowest number yet with 40 cases.

Hotels and inns were the worst-hit industry subcategory over the cumulative 10-year period with 134 bankruptcies. Even with funding support like repayment deferments, there were many cases where companies went under because fundamental improvements in revenue could not be achieved. Following this were companies that had been hit by a decrease in the movement of goods and suppliers, with 51 cases in general freight transportation, 50 cases in timber construction, and 38 in wholesale of fresh seafood.

In 2021, at the 10-year point, the governments reconstruction projects will be significantly reduced. However, the spread of COVID-19 in 2020 has meant the Thoku regions tourism industry has suffered badly, and businesses are struggling. Teikoku Databank says it is impossible to rule out an increase in companies being suffocated by debt in the disaster area from the eleventh year onward.

(Translated from Japanese. Banner photo: Ongoing post-earthquake reconstruction in Minamisanriku town center. Jiji.)

Great East Japan Earthquake bankruptcy

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Bankruptcies Caused by Great East Japan Earthquake Exceed 2000 in 10 Years - Nippon.com