/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/110705.mbx T R O U B L E D C O M P A N Y R E P O R T E R L A T I N A M E R I C A Tuesday, July 5, 2011, Vol. 12, No. 131 Headlines A N T I G U A & B A R B U D A STANFORD INT'L: SIPC to Disclose Liquidation Decision in Mid-Sept. A R G E N T I N A SOCIEDAD CONCESIONARIA: S&P Affirms 'BB' SPUR; Outlook Stable * ARGENTINA: Bankruptcy Code Changes Favor Workers Over Creditors C A Y M A N I S L A N D S ACCENTO FUNDING: Shareholders' Final Meeting Set for July 27 ARES VI: Shareholders' Final Meeting Set for July 27 AXA INVESTMENT: Shareholders' Final Meeting Set for July 21 BLINK ASSET: Shareholders' Final Meeting Set for July 13 DK EUROTUNNEL: Shareholders' Final Meeting Set for July 22 HI INVESTMENT: Shareholder to Receive Wind-Up Report on July 21 INVESTMENTS ONE: Shareholder to Receive Wind-Up Report on Aug. 5 KANAGAWA HOLDING: Shareholders' Final Meeting Set for July 27 KAPITALO INVESTMENTS: Shareholders' Final Meeting Set for July 22 LANGCREST HOLDINGS: Shareholders' Final Meeting Set for July 22 LATITUDE CHINA: Shareholders' Final Meeting Set for July 22 NYLON ENHANCED: Shareholder to Receive Wind-Up Report on August 22 NYLON ENHANCED: Shareholder to Receive Wind-Up Report on August 22 QRT OFFSHORE: Shareholder to Receive Wind-Up Report on July 21 J A M A I C A AIR JAMAICA: To Make More Job Cuts Following Merger M E X I C O VITRO SAB: No Ruling Yet on Involuntaries Against U.S. Units P U E R T O R I C O FIRST BANK: Moody's Review 'B3' Deposit Rating for Upgrade SWISS CHALET: Inks Agreement on Use of CPG/GS Cash Collateral SWISS CHALET: Files Schedules of Assets & Liabilities P A N A M A HILLVIEW ENTERPRISES: S&P Rates Corp. Credit & Secured Debt 'B' X X X X X X X X * NBC Bookseller's Filing Raises S&P's 2011 Default Tally to 18 * Large Companies With Insolvent Balance Sheets - - - - - =============================== A N T I G U A & B A R B U D A =============================== STANFORD INT'L: SIPC to Disclose Liquidation Decision in Mid-Sept. ------------------------------------------------------------------ The Securities Investor Protection Corporation (SIPC), which maintains a special reserve fund mandated by Congress to protect the customers of insolvent brokerage firms, said that it expects its Board of Directors to announce on or about September 15, 2011, its decision about the referral provided by the U.S. Securities and Exchange Commission with respect to the Stanford Group Company, operated by Robert Allen Stanford. On February 17, 2009, the SEC filed an action in the U.S. District Court for the Northern District of Texas alleging that Stanford orchestrated an US$8 billion fraud based on false promises of guaranteed returns related to certificates of deposit issued by the Antiguan-based Stanford International Bank. The SEC's Complaint alleged that SIB sold approximately US$7.2 billion of CDs to investors by promising returns that were "improbable, if not impossible." See Complaint, SEC v. Stanford International Bank, Ltd., et al., Case No. 3:09-CV-0298-N (N.D. Tex. filed February 17, 2009). In response to the SEC's request for emergency relief, the Court immediately issued a temporary restraining order, froze the defendants' assets, and appointed a receiver to marshal those assets. The SEC filed a second amended complaint on June 19, 2009, alleging that Stanford conducted a Ponzi scheme. SIPC President and Chief Executive Officer Stephen Harbeck said that SIPC has already started conferring with the SEC and the Stanford receiver regarding the SEC's referral in the Stanford matter. The SEC's referral on June 15, 2011 was the first time the SEC had informed SIPC of the possibility that the Stanford matter was appropriate for a proceeding under the Securities Investor Protection Act. About SIPC The Securities Investor Protection Corporation is the U.S. investor's first line of defense in the event a brokerage firm fails, owing customers' cash and securities that are missing from customer accounts. SIPC either acts as trustee or works with an independent court-appointed trustee in a brokerage insolvency case to recover funds. The statute that created SIPC provides that customers of a failed brokerage firm receive all non-negotiable securities - such as stocks or bonds -- that are already registered in their names or in the process of being registered. At the same time, funds from the SIPC reserve are available to satisfy the remaining claims for customer cash and/or securities custodied with the broker for up to a maximum of US$500,000 per customer. This figure includes a maximum of US$250,000 on claims for cash. From the time Congress created it in 1970 through December 2010, SIPC has advanced US$ 1.6 billion in order to make possible the recovery of US$109.3 billion in assets for an estimated 739,000 investors. About Stanford International Bank Domiciled in Antigua, Stanford International Bank Limited -- http://www.stanfordinternationalbank.com/-- is a member of Stanford Private Wealth Management, a global financial services network with US$51 billion in deposits and assets under management or advisement. Stanford Private Wealth Management serves more than 70,000 clients in 140 countries. On Feb. 16, 2009, the U.S. District Court for the Northern District of Texas, Dallas Division, signed an order appointing Ralph Janvey as receiver for all the assets and records of Stanford International Bank, Ltd., Stanford Group Company, Stanford Capital Management, LLC, Robert Allen Stanford, James M. Davis and Laura Pendergest-Holt and of all entities they own or control. The February 16 order, as amended March 12, 2009, directs the Receiver to, among other things, take control and possession of and to operate the Receivership Estate, and to perform all acts necessary to conserve, hold, manage and preserve the value of the Receivership Estate. The U.S. Securities and Exchange Commission on Feb. 17, 2009, charged before the U.S. District Court in Dallas, Texas, Mr. Stanford and three of his companies for orchestrating a fraudulent, multi-billion dollar investment scheme centering on a US$8 billion Certificate of Deposit program. A criminal case was also pursued against Mr. Stanford in June 2009 before the U.S. District Court in Houston, Texas. Mr. Stanford pleaded not guilty to 21 charges of multi-billion dollar fraud, money-laundering and obstruction of justice. Assistant Attorney General Lanny Breuer, as cited by Agence France-Presse News, said in a 57-page indictment that Mr. Stanford could face up to 250 years in prison if convicted on all charges. Mr. Stanford surrendered to U.S. authorities after a warrant was issued for his arrest on the criminal charges. The criminal case is U.S. v. Stanford, H-09-342 (S.D. Tex.). The civil case is SEC v. Stanford International Bank, 09-cv-00298 (N.D. Tex.). ================= A R G E N T I N A ================= SOCIEDAD CONCESIONARIA: S&P Affirms 'BB' SPUR; Outlook Stable ------------------------------------------------------------- Standard & Poor's Ratings Services affirmed its 'BB' underlying rating (SPUR) on Sociedad Concesionaria Vespucio Norte Express S.A. (VNE). The outlook is stable. The 'BB' senior secured debt rating on VNE reflects the higher of the project's SPUR and the rating on bond insurance provider MBIA Insurance Corp. (B/Negative/--). "The affirmation of the SPUR reflects our expectation that the project would get substantial insurance coverage for property damages and business interruption under its existing policies. The affirmation also reflects our expectation that the final financial effect of the damage would not materially affect the project's liquidity provisions," S&P said. "In addition, although the damage will delay previously expected revenue improvements, VNE's long-term traffic fundamentals remain adequate," said Standard & Poor's credit analyst Javier Cobas. The stable outlook on the SPUR reflects the project's strong liquidity provisions that would provide adequate protection against potential cash shortfalls in the medium term. "We could lower the SPUR if we find evidence of poor long-term traffic fundamentals, if final insurance coverage for earthquake-related effects results in well-below-actual reconstruction costs or if the DSCR falls below 1.05x, excluding insurance compensations. However, we could raise the SPUR if the project shows significant progress in matching original revenue expectations," S&P stated. * ARGENTINA: Bankruptcy Code Changes Favor Workers Over Creditors ----------------------------------------------------------------- Ken Parks at Dow Jones Newswires reports that Argentina President Cristina Fernandez has signed into law modifications to the country's bankruptcy code that will give workers greater power to take over bankrupt firms at the expense of creditors such as banks. Among the more controversial aspects of the law in the Official Bulletin is a provision that allows the workers of a bankrupt firm who set up a cooperative to ask a judge to suspend for up to two years the ability of creditors to execute guarantees backed by the company's property or assets, according to Dow Jones Newswires. Dow Jones Newswires notes that Martin Garces, an attorney at legal firm Baker & McKenzie, said the law will probably drive up the cost of credit for businesses. "Whoever is going to make a commercial loan to a company is going to have to take into account the possible two-year suspension," Mr. Garces told Dow Jones Newswires in an interview. Dow Jones Newswires notes that workers seized hundreds of bankrupt firms to protect their jobs as a result of Argentina's 2001-2002 economic crisis that triggered a wave of defaults and business failures. The government said that there are about 300 so-called "recovered" companies employing around 20,000 people, the report relates. Dow Jones Newswires adds that the new law dovetails with President Cristina Kirchner's policies of promoting employment through measures that include import barriers and soft loans to companies. * * * As of July 2, 2010, the Argentina republic continues to carry Moody's "Caa1" country ceiling long-term foreign bank deposit rating and "B2" country ceiling long-term currency debt ratings. The country also continues to carry Standard and Poor's "B-" currency long-term debt ratings and "C" currency ST debt ratings. =========================== C A Y M A N I S L A N D S =========================== ACCENTO FUNDING: Shareholders' Final Meeting Set for July 27 ------------------------------------------------------------ The shareholders of Accento Funding Limited will hold their final meeting on July 27, 2011, at 9:20 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marc Randall c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands ARES VI: Shareholders' Final Meeting Set for July 27 ---------------------------------------------------- The shareholders of Ares VI CLO Ltd. will hold their final meeting on July 27, 2011, at 9:30 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Victor Murray c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands AXA INVESTMENT: Shareholders' Final Meeting Set for July 21 ----------------------------------------------------------- The shareholders of AXA Investment Managers & Advisors, Ltd. will hold their final meeting on July 21, 2011, at 9:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marc Randall c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands BLINK ASSET: Shareholders' Final Meeting Set for July 13 -------------------------------------------------------- The shareholders of Blink Asset Management Limited will hold their final meeting on July 13, 2011, at 11:00 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Rainer Hok Chung Lam c/o Sarah Moxam Telephone: (345) 914 8634 Facsimile: (345) 945 4237 P.O. Box 258 Grand Cayman KY1-1104 Cayman Islands DK EUROTUNNEL: Shareholders' Final Meeting Set for July 22 ---------------------------------------------------------- The shareholders of DK Eurotunnel Ltd. will hold their final meeting on July 22, 2011, at 12:15 p.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers Corporate Services Limited Walker House 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands HI INVESTMENT: Shareholder to Receive Wind-Up Report on July 21 --------------------------------------------------------------- The sole shareholder of HI Investment Funds SPC will receive on July 21, 2011, at 12:00 noon, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Ogier c/o Jo-Anne Maher Telephone: (345) 815-1762 Facsimile: (345) 949-9877 INVESTMENTS ONE: Shareholder to Receive Wind-Up Report on Aug. 5 ---------------------------------------------------------------- The sole shareholder of Investments One Inc. will receive on August 5, 2011, the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Royhaven Secretaries Limited c/o Julie Reynolds Telephone: 945-4777 Facsimile: 945-4799 PO Box 707 Grand Cayman KY1-1107 Telephone: 945-4777 Facsimile: 945-4799 KANAGAWA HOLDING: Shareholders' Final Meeting Set for July 27 ------------------------------------------------------------- The shareholders of Kanagawa Holding Cayman Co., Ltd. will hold their final meeting on July 27, 2011, at 9:10 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Marc Randall c/o Maples Liquidation Services (Cayman) Limited P.O. Box 1093, Boundary Hall Grand Cayman KY1-1102 Cayman Islands KAPITALO INVESTMENTS: Shareholders' Final Meeting Set for July 22 ----------------------------------------------------------------- The shareholders of Kapitalo Investments Fund Limited will hold their final meeting on July 22, 2011, at 11:30 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers Corporate Services Limited Walker House 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands LANGCREST HOLDINGS: Shareholders' Final Meeting Set for July 22 --------------------------------------------------------------- The shareholders of Langcrest Holdings will hold their final meeting on July 22, 2011, at 9:30 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Richard Finlay c/o Maree Martin Telephone: (345) 814 7376 Facsimile: (345) 945 3902 P.O. Box 2681, Grand Cayman KY1-1111 Cayman Islands LATITUDE CHINA: Shareholders' Final Meeting Set for July 22 ----------------------------------------------------------- The shareholders of Latitude China Holdings will hold their final meeting on July 22, 2011, at 11:45 a.m., to receive the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Walkers Corporate Services Limited Walker House 87 Mary Street, George Town Grand Cayman KY1-9002 Cayman Islands NYLON ENHANCED: Shareholder to Receive Wind-Up Report on August 22 ------------------------------------------------------------------ The sole shareholder of Nylon Enhanced Fund Limited will receive on August 22, 2011, at 10:15 a.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Alan Tooker A.R.C. Directors Ltd. Grand Pavilion Commercial Centre 802 West Bay Road P.O. Box 10250, Grand Cayman KY1-1003 Cayman Islands Telephone: 1-345-769-3401 Facsimile: 1:345-769-3404 NYLON ENHANCED: Shareholder to Receive Wind-Up Report on August 22 ------------------------------------------------------------------ The sole shareholder of Nylon Enhanced Master Fund Limited will receive on August 22, 2011, at 10:00 a.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Alan Tooker A.R.C. Directors Ltd. Grand Pavilion Commercial Centre 802 West Bay Road P.O. Box 10250, Grand Cayman KY1-1003 Cayman Islands Telephone: 1-345-769-3401 Facsimile: 1:345-769-3404 QRT OFFSHORE: Shareholder to Receive Wind-Up Report on July 21 -------------------------------------------------------------- The sole shareholder of QRT Offshore, Ltd. will receive on July 21, 2011, at 10:00 a.m., the liquidator's report on the company's wind-up proceedings and property disposal. The company's liquidator is: Ogier c/o Jonathan McLean Telephone: (345) 815-1805 Facsimile: (345) 949-9877 ============= J A M A I C A ============= AIR JAMAICA: To Make More Job Cuts Following Merger --------------------------------------------------- Janet Silvera and Leaon Nash at The Gleaner report that Air Jamaica Limited will make additional set of jobs redundant as Caribbean Airlines Limited takes over all operations. The positions that are likely to go include ground handlers, information technology, flight operations and stores, according to The Gleaner. The airline's reservations department, the report relates, is also being relocated to Trinidad and Tobago. It is still unclear as to how many persons would be out of a job. The latest round of job cuts follows the termination of 54 positions in May and a long list of dismissals since Caribbean Airlines took over a year ago and promised a leaner operation, The Gleaner notes. Unnamed sources at the airline told The Gleaner that the takeover has seen the majority of customer service staff having their positions downgraded to part-time. At the same time, The Gleaner relates that they have had to accept a 50% cut in salary. Those who were retained from the previous cut were given two-month contracts which reportedly expired on Wednesday. Those who signed Caribbean Airline contracts in May were given six-month probation, but it is not clear what their current fate is, The Gleaner adds. =========== M E X I C O =========== VITRO SAB: No Ruling Yet on Involuntaries Against U.S. Units ------------------------------------------------------------ Bill Rochelle, the bankruptcy columnist for Bloomberg News, reports that at a June 28 hearing, bondholders were asking U.S. Bankruptcy Judge Harlin Hale to reconsider a ruling from April declining to put several of Vitro SAB's U.S. subsidiaries into Chapter 11 involuntarily. Judge Hale said he would need a "short amount of time" to write his ruling, Allan Brilliant, a lawyer for bondholders, said in an interview. Mr. Brilliant is with the New York office of Dechert LLP. At the same hearing, the company was asking Judge Hale to force the bondholders to disclose details of their trading in Vitro bonds. Mr. Brilliant said the judge likewise would decide soon on that request, Bloomberg cites. Judge Hale didn't say how he would rule on either dispute, Mr. Brilliant said, Bloomberg relates. Mr. Rochelle also discloses that a hearing to grant the Vitro parent's petition for protection in the U.S. under Chapter 15 was scheduled for June 28. Success in Chapter 15 is necessary so the U.S. court could enforce whatever reorganization Vitro works out in a Mexican court. The Chapter 15 hearing was postponed until July 14 in view of the decision last week in which Judge Hale said Vitro couldn't use Chapter 15 to protect subsidiaries not themselves in bankruptcy in the U.S. or Mexico. About Vitro SAB Headquartered in Monterrey, Mexico, Vitro, S.A.B. de C.V. (BMV: VITROA; NYSE: VTO), through its two subsidiaries, Vitro Envases Norteamerica, SA de C.V. and Vimexico, S.A. de C.V., is a global glass producer, serving the construction and automotive glass markets and glass containers needs of the food, beverage, wine, liquor, cosmetics and pharmaceutical industries. Vitro is the largest manufacturer of glass containers and flat glass in Mexico, with consolidated net sales in 2009 of MXN23,991 million (US$1.837 billion). Vitro defaulted on its debt in 2009, and sought to restructure around US$1.5 billion in debt, including US$1.2 billion in notes. Vitro launched an offer to buy back or swap US$1.2 billion in debt from bondholders. The tender offer would be consummated with a bankruptcy filing in Mexico and Chapter 15 filing in the United States. Vitro said noteholders would recover as much as 73% by exchanging existing debt for cash, new debt or convertible bonds. Concurso Mercantil & Chapter 15 Proceedings Vitro SAB on Dec. 13, 2010, filed its voluntary petition for a pre-packaged Concurso Plan in the Federal District Court for Civil and Labor Matters for the State of Nuevo Leon, commencing its voluntary concurso mercantil proceedings -- the Mexican equivalent of a prepackaged Chapter 11 reorganization. Vitro SAB also commenced parallel proceedings under Chapter 15 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 10-16619) in Manhattan on Dec. 13, 2010, to seek U.S. recognition and deference to its bankruptcy proceedings in Mexico. Early in January 2011, the Mexican Court dismissed the Concurso Mercantil proceedings. The judge said Vitro couldn't push through a plan to buy back or swap US$1.2 billion in debt from bondholders based on the vote of US$1.9 billion of intercompany debt when third-party creditors were opposed. Vitro as a result dismissed the first Chapter 15 petition following the ruling by the Mexican court. On April 12, 2011, an appellate court in Mexico reinstated the reorganization. Accordingly, Vitro SAB on April 14 re-filed a petition for recognition of its Mexican reorganization in U.S. Bankruptcy Court in Manhattan (Bankr. S.D.N.Y. Case No. 11-11754). In the present Chapter 15 case, the Debtor seeks to block any creditor suits in the U.S. pending the reorganization in Mexico. Chapter 11 Proceedings A group of noteholders, namely Knighthead Master Fund, L.P., Lord Abbett Bond-Debenture Fund, Inc., Davidson Kempner Distressed Opportunities Fund LP, and Brookville Horizons Fund, L.P. opposed the exchange. Together, the group held US$75 million, or approximately 6% of the outstanding bond debt. The Noteholder group commenced involuntary bankruptcy cases under Chapter 11 of the U.S. Bankruptcy Code against Vitro Asset Corp. (Bankr. N.D. Tex. Case No. 10-47470) and 15 other affiliates on Nov. 17, 2010. Vitro engaged Susman Godfrey, L.L.P. as U.S. special litigation counsel to analyze the potential rights that Vitro may exercise in the United States against the ad hoc group of dissident bondholders and its advisors. A larger group of Noteholders -- known as the Ad Hoc Group of Vitro Noteholders, comprised of holders, or investment advisors to holders, which represent approximately US$650 million of Vitro- issued senior notes due 2012, 2013 and 2017 -- was not among the Chapter 11 petitioners, although the group has expressed concerns over the exchange offer. The group says the exchange offer exposes Noteholders who consent to potential adverse consequences that have not been disclosed by Vitro. The group is represented by John Cunningham, Esq., and Richard Kebrdle, Esq. at White & Case LLP. The U.S. affiliates subject to the involuntary petitions are Vitro Chemicals, Fibers & Mining, LLC (Bankr. N.D. Tex. Case No. 10- 47472); Vitro America, LLC (Bankr. N.D. Tex. Case No. 10-47473); Troper Services, Inc. (Bankr. N.D. Tex. Case No. 10-47474); Super Sky Products, Inc. (Bankr. N.D. Tex. Case No. 10-47475); Super Sky International, Inc. (Bankr. N.D. Tex. Case No. 10-47476); VVP Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47477); Amsilco Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47478); B.B.O. Holdings, Inc. (Bankr. N.D. Tex. Case No. 10-47479); Binswanger Glass Company (Bankr. N.D. Tex. Case No. 10-47480); Crisa Corporation (Bankr. N.D. Tex. Case No. 10-47481); VVP Finance Corporation (Bankr. N.D. Tex. Case No. 10-47482); VVP Auto Glass, Inc. (Bankr. N.D. Tex. Case No. 10-47483); V-MX Holdings, LLC (Bankr. N.D. Tex. Case No. 10-47484); and Vitro Packaging, LLC (Bankr. N.D. Tex. Case No. 10-47485). A bankruptcy judge in Fort Worth, Texas, denied involuntary Chapter 11 petitions filed against four U.S. subsidiaries. On April 6, 2011, Vitro SAB agreed to put four Vitro units -- Vitro America LLC and three other U.S. subsidiaries -- that were subject to the involuntary petitions into voluntary Chapter 11. The Texas Court on April 21 denied involuntary petitions against the eight U.S. subsidiaries that didn't consent to being in Chapter 11. Kurtzman Carson Consultants is the claims and notice agent to Vitro America, et al. Alvarez & Marsal North America LLC is the Debtors' operations and financial advisor. The official committee of unsecured creditors appointed in the Chapter 11 cases of Vitro America, et al., has selected Sarah Link Schultz, Esq., at Akin Gump Strauss Hauer & Feld LLP, in Dallas, Texas, and Michael S. Stamer, Esq., Abid Qureshi, Esq., and Alexis Freeman, Esq., at Akin Gump Strauss Hauer & Feld LLP, in New York, as counsel. On June 13, 2011, U.S. Bankruptcy Judge Harlin "Cooter" Hale authorized the U.S. Debtors to sell their businesses to an affiliate of Sun Capital Partners Inc. for what the creditor's committee described as a gross price of US$64.4 million. ===================== P U E R T O R I C O ===================== FIRST BANK: Moody's Review 'B3' Deposit Rating for Upgrade ---------------------------------------------------------- Moody's Investors Service placed the long-term ratings of FirstBank Puerto Rico (FirstBank; long-term deposits at B3) under review for possible upgrade. The bank's unsupported bank financial strength rating (BFSR) of E+ mapping to a B3 on the long-term scale, and short-term rating of Not-Prime were affirmed. FirstBank is the primary operating subsidiary of First BanCorp, which is unrated. Ratings Rationale The review follows First BanCorp's announcement on June 28, 2011 that it has entered into a definitive agreement with Oaktree Capital Management, L.P., whereby Oaktree would purchase US$175.5 million of common stock. This would be done on essentially the same terms as the definitive agreement that First BanCorp had entered into on May 31, 2011 with Thomas H. Lee Partners, L.P. where THL had similarly agreed to purchase US$175.5 million of common stock as part of a proposed aggregate US$500 to US$550 million capital raise. First BanCorp also announced on June 28, 2011, that it had entered into additional investment agreements with institutional investors and other private equity firms for the issuance of approximately US$164 million of the company's common stock, which together with the Oaktree and THL investments totals US$515 million in commitments. Oaktree's and THL's investments will represent 24.9% of the outstanding shares of the Company's common stock upon completion of the capital raise and the conversion into common stock of the US$424.2 million of Series G Mandatorily Convertible Preferred Stock held by the United States Department of the Treasury. Both the Oaktree and THL investments are contingent upon several conditions, including, (a) the Corporation raises a total of at least US$500 million but no more than US$550 million of new capital, (b) conversion of the Series G Preferred Stock, (c) approval by the Corporation's stockholders of the issuance of shares of common stock, and (d) required regulatory approvals. If the contingencies are met and the capital infusion is completed, FirstBank would have capital ratios in excess of the guidelines set by its regulator and the well-capitalized minimums, and this is likely to lead to Moody's upgrading the bank's long- term ratings. During its review Moody's will focus on First BanCorp's ability to complete this transaction. During the review period, Moody's will also evaluate how this investment will influence the strategic direction and franchise of the company. Moody's last rating action on FirstBank was on April 25, 2011, when Moody's downgraded the long-term ratings (deposits to B3 from B2, senior unsecured to Caa2 from B3). FirstBank's unsupported BFSR was confirmed at E+. First BanCorp headquartered in San Juan, Puerto Rico, reported total assets of US$15.1 billion at March 31, 2011. On Review for Possible Upgrade: Issuer: FirstBank Puerto Rico -- Issuer Rating, Placed on Review for Possible Upgrade, currently Caa2 -- OSO Senior Unsecured OSO Rating, Placed on Review for Possible Upgrade, currently Caa2 -- Senior Unsecured Regular Bond/Debenture, Placed on Review for Possible Upgrade, currently Caa2 -- Senior Unsecured Deposit Rating, Placed on Review for Possible Upgrade, currently B3 Outlook Actions: Issuer: FirstBank Puerto Rico --Outlook, Changed To Rating Under Review From Negative SWISS CHALET: Inks Agreement on Use of CPG/GS Cash Collateral ------------------------------------------------------------- Swiss Chalet, Inc., asks the U.S. Bankruptcy Court for the District of Puerto Rico to approve a stipulation entered into with CPG/GS PR NPL LLC for the use of cash collateral subject to adequate protection. As previously reported by The Troubled Company Reporter on June 22, 2011, CPG/GS asked the Court to prohibit the Debtor from using its cash collateral without providing adequate protection. After substantial negotiations, the Debtor and CPG/GS agreed to the stipulation whereby, among other things, CPG/GS consents to the Debtor's limited use of certain cash collateral securing the Debtor's indebtedness to CPG/GS to satisfy certain operating expenses until August 31, 2011. CPG/GS is purchaser and successor-in-interest of certain assets of First Bank Puerto Rico, including, among others, credit facilities pursuant to the loans of approximately US$119 million. According to the Debtor's counsel, Charles A. Cuprill, Esq., at Charles A. Cuprill, P.S.C. Law Offices, in San Juan, Puerto Rico -- ccuprill@cuprill.com -- the Debtor has no debtor-in-possession financing and, thus, requires the use of cash collateral to satisfy operating expenses pending the approval and consummation of the sale of certain assets; the operation of the DoubleTree Hotel; and other approved expenses. As adequate protection to CPG/GS, Debtor will make monthly payments to CPG/GS, to be paid on the first day of each calendar month, from the cash, receivables collections, and other revenues received by Debtor during the previous month from Debtor's consolidated operations in excess of its consolidated operating costs. The Debtor countered that CPG/GS is adequately protected in the Debtor's use of receivables considering CPG/GS's encumbrances on the Debtor's assets principally real property, the pertinent portion of which are well maintained and in excellent condition, with the taxes relative thereto being current, as well as the insurance thereon. CPG/GS and Debtor recognize that there are certain expenses at Atlantis and Gallery Plaza, like insurance costs, maintenance, utilities, and others necessary for the maintenance of the Collateral, which are partially paid from the income generated from the operations of the DoubleTree Hotel. Therefore, the monthly payments to be made by Debtor to CPG/GS as adequate protection will be the lesser of US$75,000, or the difference between the total monthly income generated by Debtor's consolidated operations less Debtor's consolidated operating costs for the same month. These payments will be applied to the principal balance of CPG/GS secured claim without prejudice to reapplication of those payments to interest and other charges as permitted by the Bankruptcy Code if and when the value of CPG/GS' collateral is determined. As further adequate protection, the Debtor grants CPG/GS: -- a replacement lien and a postpetition security interest on all of the assets and Collateral acquired by Debtor after the Petition Date; and -- a super-priority claim in an amount equal to any diminution in value of the prepetition Collateral. As additional adequate protection, the Debtor will: -- permit designated agents of CPG/GS to visit the premises of the DoubleTree Hotel, Gallery Plaza and Atlantis Condominiums Hotel and make available to them all of Debtor's books and records, for the purpose of inspecting and auditing the operations of each of the DoubleTree, Gallery Plaza and Atlantis Condominium; -- submit to CPG/GS monthly reports detailing: (a) the amount, aging, and description of all of Debtor's accounts receivable, inventory and other Cash Collateral; (b) the amount of Cash Collateral collected and used to satisfy Permitted Expenses; (c) monthly income statements, (d) monthly expense statements; (e) monthly reports on the marketing and sales efforts for the Gallery Plaza and Atlantis Condominiums. As additional adequate protection, the Debtor agrees that upon the consummation of any sale of substantially all or any of its assets all of the net proceeds of that sale will be paid immediately and indefeasibly to CGP/GS in an amount equivalent to the outstanding balance of the Loans, plus any postpetition interest and charge that may have accrued to the extent permitted by the Bankruptcy Code. The Debtor also covenants and agrees to waive any and all rights under Section 506(c) of the Bankruptcy Code as to any of the Collateral. The Debtor will also grant CPG/GS access to monitor its debtor-in-possession accounts and the payments and deposits made therein or therefrom. The postpetition Collateral under the Replacement Liens and the prepetition Collateral will all serve as cross-Collateral for the Loans and any and all other amounts disbursed by CPG/GS under the Financing Agreements. CPG/GS will have the right to credit bid the indebtedness owed under the Loan Agreements and Loan Documents, in whole or in part, in connection with any sale or disposition of the Debtor's assets, and the Debtor hereby waives all rights to oppose such credit bid rights of CPG/GS. Objections are due July 5, 2011. If no objection or other response is received within the time allowed, the motion will be deemed unopposed and a final order may be entered approving the stipulation. If a timely objection is filed, a hearing will be held on July 7, 2011, at 9:30 a.m. Attorneys for CPG/GS are: David P. Freedman, Esq. Hermann D. Bauer, Esq. O'Neill & Borges American International Plaza 250 Munoz Rivera Avenue, Suite 800 San Juan, Puerto Rico 00918-1813 Tel: (787) 764-8181 Fax: (787) 753-8944 E-Mail: David.Freedman@oneillborges.com Hermann.bauer@oneillborges.com About Swiss Chalet The Swiss Chalet Inc., which owns the Best Western Hotel Pierre in San Juan, Puerto Rico, filed a Chapter 11 petition (Bankr. D. P.R. Case No. 11-04414) on May 27, 2011. Charles A. Cuprill, P.S.C. Law Offices serves as its bankruptcy counsel. In its Schedules, the Debtor disclosed total assets of US$118,521,510 and total debts of US$132,741,094. The petition was signed by Arnold Benus, director. SWISS CHALET: Files Schedules of Assets & Liabilities ----------------------------------------------------- Swiss Chalet Inc. filed with the U.S. Bankruptcy Court for the District of Puerto Rico its schedules of assets and liabilities, disclosing: Name of Schedule Assets Liabilities ---------------- ------- ----------- A. Real Property US$69,473,628 B. Personal Property $45,668,034 C. Property Claimed as Exempt D. Creditors Holding Secured Claims US$118,566,626 E. Creditors Holding Unsecured Priority Claims $326,064 F. Creditors Holding Unsecured Non-priority Claims $19,754,881 ------------ -------------- TOTAL US$115,141,662 US$138,646,572 About Swiss Chalet The Swiss Chalet Inc., which owns the Best Western Hotel Pierre in San Juan, Puerto Rico, filed a Chapter 11 petition (Bankr. D. P.R. Case No. 11-04414) on May 27, 2011. Charles A. Cuprill, P.S.C. Law Offices serves as its bankruptcy counsel. In its Schedules, the Debtor disclosed total assets of US$118,521,510 and total debts of US$132,741,094. The petition was signed by Arnold Benus, director. =========== P A N A M A =========== HILLVIEW ENTERPRISES: S&P Rates Corp. Credit & Secured Debt 'B' --------------------------------------------------------------- Standard & Poor's Rating Services assigned a 'B' long-term corporate credit rating to Panama-based gaming holding company Hillview Enterprises and a 'B' senior secured debt rating to its proposed five-year US$100 million 144A bond issuance. The outlook is stable. "The ratings on Hillview reflect mainly its asset concentration in Argentina and the risks inherent to operating in that country, such as the volatile regulatory environment, high inflation levels, and currency volatility," said Standard & Poor's credit analyst Diego Ocampo. The company somewhat mitigates those factors with its relatively good competitive position, which is backed by a benign regulatory framework that presents high entry barriers for new players, and its relatively high profitability, supported by its efficient cost structure. "An ample ability to generate discretionary cash flows, based on its positive cash cycle and low operating leverage levels, together with a conservative indebtedness and an adequate liquidity position underpin Hillview's financial risk profile, which we characterize as aggressive under our criteria. Partially counterbalancing those positives are the company's limited track record with debt markets and its focus on shareholder value creation that might reduce flexibility on dividends, investments, and financing," S&P stated. Because Hillview is a holding company that has no material assets other than the interests in three operating subsidiaries, holders of debt issued at the parent would be structurally subordinated to priority claims at the subsidiaries. "However, we rate Hillview's senior secured debt at the same level as the corporate credit rating because of the low level of subsidiary liabilities. We expect third-party debt at the subsidiary level to remain low. Furthermore, the terms and conditions of the new bonds include covenants that limit the ability of restricted subsidiaries to take on additional debt," S&P related. Hillview is majority owned by an investment fund that controls 60.241% of the company's voting stock. In 2007, the company acquired the 99.6% of three Argentine gaming halls in the Buenos Aires province through a US$77.5 million loan from its main shareholder and US$24.1 million in equity contributions. Two gaming halls are located in Avellaneda neighborhood, and the third in Florencio Varela, covering a densely populated area of about 1.8 million inhabitants. The gaming facilities have an aggregated capacity of 1,363 slot machines, 221 electronic roulette positions, 20 electronic poker seats, and approximately 2,828 bingo seats. During fiscal 2010, 93% of the revenues came from slot machines, 5% from bingo operations, and the rest from food and beverage sales. "The stable outlook reflects our expectation that the company should sustain relatively good free cash-flow generation throughout the bond's life and will be able to achieve some degree of cash build up that would mitigate its exposure to refinancing risk in 2016. In that respect we expect dividends to remain flexible to buffer any potential deterioration in cash-generation capacity. Upside potential will remain closely linked to our opinion on Argentina's business environment and transfer and convertibility risks, unless geographic diversification increases. On the contrary, a downgrade may follow a deterioration of the business environment that significantly hurts Hillview's financial flexibility," S&P stated. =============== X X X X X X X X =============== * NBC Bookseller's Filing Raises S&P's 2011 Default Tally to 18 --------------------------------------------------------------- U.S.-based bookseller NBC Acquisition Corp. filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy Code last week to implement its restructuring plan. This raises the 2011 global corporate default tally to 18, said an article published Friday by Standard & Poor's Global Fixed Income Research, titled "Global Corporate Default Update (June 24 - 29, 2011) (Premium)." Of the total, 11 issuers were based in the U.S., two each were based in Canada and New Zealand, and one each was based in the Czech Republic, France, and Russia. By comparison, 45 global corporate issuers had defaulted by this time in 2010. Of these defaulters, 32 were U.S.-based issuers, two were European issuers, four were from the emerging markets, and seven were in the other developed region (Australia, Canada, Japan, and New Zealand). Seven of this year's defaults were due to missed interest or principal payments and six were due to distressed exchanges--both among the top reasons for default in 2010. Of the remaining five, three issuers defaulted after they filed for bankruptcy, another had its banking license revoked by its country's central bank, and the fourth was forced into liquidation as a result of regulatory action. Of the defaults in 2010, 28 defaults resulted from missed interest or principal payments, 25 resulted from Chapter 11 and foreign bankruptcy filings, 23 from distressed exchanges, three from receiverships, one from regulatory directives, and one from administration. Standard & Poor's baseline projection for the U.S. corporate trailing 12-month speculative-grade default rate for March 2012 is 1.6%. A total of 24 issuers would need to default from April 2011 to March 2012 to reach the forecast. The projection of 1.6% is another 0.86-percentage-point (or another 35%) decline from the 2.46% default rate in March 2011. "This rate of decline would be sharp, but slower than the decline over the past 16 months. Improved lending conditions and a lower cost of capital are keeping our default expectations relatively upbeat in the next 12 months. We are seeing stronger credit quality, as reflected in fewer downgrades and lower negative bias," S&P said. "In addition to our baseline projection, we forecast the default rate in our optimistic and pessimistic scenarios. In our optimistic default rate forecast scenario, the economy and the financial markets improve more than expected. As a result, we would expect the default rate to be 1.2% (18 defaults in the next 12 months)," S&P said. "On the other hand, if the economic recovery stalls and the financial markets deteriorate -- which is our pessimistic scenario -- we expect the default rate to be 3.3% (50 defaults) by March 2012. We base our forecasts on quantitative and qualitative factors that we consider, including, but not limited to, Standard & Poor's proprietary default model for the U.S. corporate speculative-grade bond market. We update our outlook for the U.S. issuer-based corporate speculative-grade default rate each quarter after analyzing the latest economic data and expectations," S&P related. * Large Companies With Insolvent Balance Sheets ----------------------------------------------- Total Total Shareholders Assets Equity Company Ticker (US$MM) (US$MM) ------- ------ ------------ ------- ARGENTINA COMERCIAL PLA-BL COMEB AR 143096734 -251846058 COMERCIAL PL-ADR SCPDS LI 143096734 -251846058 IMPSAT FIBER NET 330902Q GR 535007008 -17164978 IMPSAT FIBER NET XIMPT SM 535007008 -17164978 IMPSAT FIBER NET IMPTQ US 535007008 -17164978 IMPSAT FIBER-$US IMPTD AR 535007008 -17164978 IMPSAT FIBER-BLK IMPTB AR 535007008 -17164978 IMPSAT FIBER-C/E IMPTC AR 535007008 -17164978 IMPSAT FIBER-CED IMPT AR 535007008 -17164978 SNIAFA SA SNIA AR 11229696 -2670544.88 SNIAFA SA-B SNIA5 AR 11229696 -2670544.88 SNIAFA SA-B SDAGF US 11229696 -2670544.88 SOC COMERCIAL PL COME AR 143096734 -251846058 SOC COMERCIAL PL COMED AR 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TELEBRAS SA-PREF TELB4 BZ 269372906 -13465060.7 TELEBRAS SA-PREF TLBRPN BZ 269372906 -13465060.7 TELEBRAS SA-RT TELB9 BZ 269372906 -13465060.7 TELEBRAS/W-I-ADR TBH-W US 269372906 -13465060.7 TELEBRAS-ADR TBAPY US 269372906 -13465060.7 TELEBRAS-ADR TBASY US 269372906 -13465060.7 TELEBRAS-ADR TBRAY GR 269372906 -13465060.7 TELEBRAS-ADR RTB US 269372906 -13465060.7 TELEBRAS-ADR TBX GR 269372906 -13465060.7 TELEBRAS-ADR TBH US 269372906 -13465060.7 TELEBRAS-BLOCK TELB30 BZ 269372906 -13465060.7 TELEBRAS-CED C/E TEL4C AR 269372906 -13465060.7 TELEBRAS-CEDE BL RCT4B AR 269372906 -13465060.7 TELEBRAS-CEDE PF TELB4 AR 269372906 -13465060.7 TELEBRAS-CEDE PF RCT4C AR 269372906 -13465060.7 TELEBRAS-CEDE PF RCTB4 AR 269372906 -13465060.7 TELEBRAS-CEDE PF RCT4D AR 269372906 -13465060.7 TELEBRAS-CEDEA $ TEL4D AR 269372906 -13465060.7 TELEBRAS-CM RCPT RCTB30 BZ 269372906 -13465060.7 TELEBRAS-CM RCPT RCTB31 BZ 269372906 -13465060.7 TELEBRAS-CM RCPT RCTB32 BZ 269372906 -13465060.7 TELEBRAS-CM RCPT TELE31 BZ 269372906 -13465060.7 TELEBRAS-CM RCPT TBRTF US 269372906 -13465060.7 TELEBRAS-COM RT TELB1 BZ 269372906 -13465060.7 TELEBRAS-PF BLCK TELB40 BZ 269372906 -13465060.7 TELEBRAS-PF RCPT TLBRUP BZ 269372906 -13465060.7 TELEBRAS-PF RCPT TBAPF US 269372906 -13465060.7 TELEBRAS-PF RCPT RCTB41 BZ 269372906 -13465060.7 TELEBRAS-PF RCPT CBRZF US 269372906 -13465060.7 TELEBRAS-PF RCPT RCTB40 BZ 269372906 -13465060.7 TELEBRAS-PF RCPT TELE41 BZ 269372906 -13465060.7 TELEBRAS-PF RCPT RCTB42 BZ 269372906 -13465060.7 TELEBRAS-RCT RCTB33 BZ 269372906 -13465060.7 TELEBRAS-RCT PRF TELB10 BZ 269372906 -13465060.7 TELEBRAS-RECEIPT TLBRUO BZ 269372906 -13465060.7 TELEBRAS-RTS CMN TCLP1 BZ 269372906 -13465060.7 TELEBRAS-RTS CMN RCTB1 BZ 269372906 -13465060.7 TELEBRAS-RTS PRF RCTB2 BZ 269372906 -13465060.7 TELEBRAS-RTS PRF TLCP2 BZ 269372906 -13465060.7 TELECOMUNICA-ADR 81370Z BZ 269372906 -13465060.7 TEXTEIS RENA-RCT TXRX9 BZ 73095834 -103943206 TEXTEIS RENA-RCT TXRX10 BZ 73095834 -103943206 TEXTEIS RENAU-RT TXRX1 BZ 73095834 -103943206 TEXTEIS RENAU-RT TXRX2 BZ 73095834 -103943206 TEXTEIS RENAUX RENXPN BZ 73095834 -103943206 TEXTEIS RENAUX RENXON BZ 73095834 -103943206 VARIG PART EM SE VPSC3 BZ 83017829 -495721700 VARIG PART EM TR VPTA3 BZ 49432124 -399290396 VARIG PART EM-PR VPSC4 BZ 83017829 -495721700 VARIG PART EM-PR VPTA4 BZ 49432124 -399290396 VARIG SA VARGON BZ 966298026 -4695211316 VARIG SA VAGV3 BZ 966298026 -4695211316 VARIG SA-PREF VARGPN BZ 966298026 -4695211316 VARIG SA-PREF VAGV4 BZ 966298026 -4695211316 WETZEL SA MWET3 BZ 100017711 -5359345.82 WETZEL SA MWELON BZ 100017711 -5359345.82 WETZEL SA-PREF MWELPN BZ 100017711 -5359345.82 WETZEL SA-PREF MWET4 BZ 100017711 -5359345.82 WIEST WISA3 BZ 34108201 -126997429 WIEST SA WISAON BZ 34108201 -126997429 WIEST SA-PREF WISAPN BZ 34108201 -126997429 WIEST-PREF WISA4 BZ 34108201 -126997429 CHILE CHILESAT CO-ADR TL US 1.075E+09 -61844614.3 CHILESAT CORP SA TELEX CI 1.075E+09 -61844614.3 CHILESAT CO-RTS CHISATOS CI 1.075E+09 -61844614.3 EMPRESA DE LOS F 2940894Z CI 1.934E+09 -50416404 TELEX-A TELEXA CI 1.075E+09 -61844614.3 TELEX-RTS TELEXO CI 1.075E+09 -61844614.3 TELMEX CORP SA CHILESAT CI 1.075E+09 -61844614.3 TELMEX CORP-ADR CSAOY US 1.075E+09 -61844614.3 *********** Monday's edition of the TCR-LA delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR-LA 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-LA constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR-LA editor holds some position in the issuers' public debt and equity securities about which we report. Tuesday's edition of the TCR-LA features a list of companies with insolvent balance sheets obtained by our editors based on the latest balance sheets publicly available a day prior to publication. 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. A list of Meetings, Conferences and Seminars appears in each Thursday's edition of the TCR-LA. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com *********** S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Latin America is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Valerie U. Pascual, Psyche A. Castillon, Ivy B. Magdadaro, Frauline S. Abangan, and Peter A. Chapman, Editors. Copyright 2011. All rights reserved. ISSN 1529-2746. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Latin America subscription rate is US$625 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Christopher Beard at 240/629-3300. * * * End of Transmission * * *