/raid1/www/Hosts/bankrupt/TCR_Public/060717.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, July 17, 2006, Vol. 10, No. 168
Headlines
I2 TELECOM: March 31 Balance Sheet Upside-Down by $1.7 Million
ABLE LABORATORIES: Gets $307,019 Settlement from Mallinckrodt
ADELPHIA COMMS: GE Capital Wants Mercury to Decide on Contract
ADELPHIA COMMS: JPMorgan Will Appeal Comcast-Time Warner Sale OK
AHPC HOLDINGS: Receives Additional Nasdaq Non-Compliance Notice
AIRADIGM COMMUNICATIONS: U.S. Trustee Unable to Form Committee
AIRBASE SERVICES: Trustee Assumes Contracts of Three Individuals
AIRNET COMMS: Court Grants Access to Laurus' Cash Collateral
ALL-TEX PAVING: Case Summary & 20 Largest Unsecured Creditors
ALLIED HOLDINGS: Can Assume Lexington Headquarter Leases
ALLIED HOLDINGS: Can Reject Software Engineering Contract
AMERUS GROUP: Moody's Puts Ratings Under Review and May Upgrade
B/E AEROSPACE: Launches Tender Offer for $175 Million Senior Notes
BERRY-HILL GALLERIES: Can Get Reimbursements from Co-Debtor Coram
CATHOLIC CHURCH: Court Approves Portland's Use of Funds
CATHOLIC CHURCH: Spokane Wants to Sell Five Real Properties
CITADEL SECURITY: Releases Preliminary Second Quarter Results
COGECO CABLE: Earns $12.4 Million in Quarter Ended May 31
CONSUMERS ENERGY: Agrees to Sell Nuclear Power Station to Entergy
DANA CORP: Wants to Sell Hydraulic-Related Assets to Bosch Rexroth
DANA CORP: Wants to Walk Away from 13 Contracts and Leases
DELPHI CORP: GM to Assume Certain Obligations in IUE-CWA Pact
DELPHI CORP: SEC Investigation on GM Spin-Off Continues
DELTA AIR: Inks Stipulation Extending Section 1110 Period
DORNIER AVIATION: 4th Cir. Says $146 Million Loan Was Equity
ENERGAS RESOURCES: Files Two Amended Financial Statements
EPIXTAR CORP: Seek Laurus' Agreement on FTC Settlement Pact
FALCONBRIDGE LTD: Inco & Phelps Dodge Increase Merger Offer
FERRO CORP: Sales Reach $505 Million for Quarter Ended March 31
FOAMEX INTERNATIONAL: Files 401(K) Savings Plan 2005 Annual Report
FOAMEX INTERNATIONAL: Taps Rainey Kizer as Real Estate Counsel
GARDEN STATE: Has Until Sept. 5 to Remove State Court Litigation
GENEVA STEEL: Ch. 11 Trustee Sells Emission Credits for $2.5 Mil.
GRUPO IUSACELL: Involuntary Chapter 11 Case Summary
HANDMAKER JEWISH: Defends Exclusivity; Faults Delay on Wells Fargo
HERTZ CORP: Parent Plans Initial Public Offering of Common Stock
INCO LTD: Increase Falconbridge Merger Offer By CDN$1 Per Share
INTERVISUAL BOOKS: Educational Dev't to Provide DIP Financing
ITEN CHEVROLET: Court Approves Buckley & Jensen as Bankr. Counsel
ITEN CHEVROLET: Court Approves Carson Clelland as Special Counsel
KAISER ALUMINUM: Court Allows MAXXAM to Sell Up to 3.5 Mil. Shares
KAISER ALUMINUM: Wants Orricks Herrington's Payment Request Denied
KEITH EICKERT: Escada Apparel Purchases Were Fraudulent Conveyance
LIONEL LLC: Wants Open-Ended Extension of Exclusive Periods
MAAX HOLDINGS: Posts $6.323 Million Net Loss in First Quarter 2006
MARINER MOTEL: Bankruptcy Auction to be Held on August 15
MAXXAM INC: Can Sell Up to 3.5 Million Kaiser Aluminum Shares
MESABA AIRLINES: Can Reject Contracts With Pilots & Mechanics
MIRANT CORP: $1.2 Bil. Equity Buy Back Cues Moody's to Cut Ratings
O'SULLIVAN INDUSTRIES: Sells United Kingdom Business Operations
O'SULLIVAN INDUSTRIES: To Close Virginia Facility by Year-End 2006
ONE TO ONE: U.S. Trustee Says Disclosure Statement is Inadequate
ONEIDA LTD: Okays Proposed $222 Mil. Buyout by Investment Firms
ORIENTAL TRADING: S&P Junks Rating on $180 Million 2nd-Lien Loan
OWENS-BROCKWAY: Completes Partial Tender Offer for 8-7/8% Notes
OWENS CORNING: Court Allows Shintech to Hold $7-Mil. Unsec. Claim
OWENS CORNING: Wickes Wants Admin. Priority on Preference Claim
PENHALL INTERNATIONAL: S&P Rates Proposed $175 Mil. Notes at CCC+
PETCO ANIMAL: Sells Assets to Investment Firms for $1.8 Billion
PHIBRO ANIMAL: Moody's Rates Proposed $240 Mil. Sr. Notes at B3
PLATINUM EQUITY: Moody's Junks Rating on Proposed $190 Mil. Notes
PLUSFUNDS MANAGER: Winding-Up Hearing Is Scheduled for July 28
PREMIUM PAPERS: Committee Hires Traxi LLC as Financial Advisor
PROCARE AUTOMOTIVE: Hires David Gole as Real Estate Consultant
PULL'R HOLDINGS: Committee Taps Weinstein Weiss as Counsel
PULL'R HOLDINGS: Wants Until Feb. 21 to File Chapter 11 Plan
QUAKER FABRIC: Posts $4.1 Mil. Net Loss in Quarter Ended March 31
REFCO INC: Six Creditors Withdraw Nine Proofs of Claim
RIM SEMICONDUCTOR: Files Four Amended Financial Statements
SAINT VINCENTS: Wants to Walk Away from Bayer Contracts
SEALY CORP: May 28 Balance Sheet Upside-Down by $212 Million
SECUNDA INTERNATIONAL: Gets Consent from 100% of Noteholders
SERVICE CORP: Moody's Holds Ba3 Rating on $1.1 Bil. Senior Notes
SHAW GROUP: Incurs $16.7 Million Net Loss in Third Quarter 2006
SILICON GRAPHICS: Five Shareholders Want Interests in New SGI
SILICON GRAPHICS: Wants Merrill Lynch Directed to Turn Over Assets
SOLO CUP: Susan H. Marks Resigns as Chief Financial Officer
SPHINX CONVERTIBLE: Court Sets Winding-Up Hearing on July 28
SPHINX CONVERTIBLE (FUND): Winding-Up Hearing Set for July 28
SPHINX DISTRESSED: Court Schedules Winding-Up Hearing on July 28
SPHINX DISTRESSED FUND: Court Sets Winding-Up Hearing on July 28
SPHINX EQUITY: Court Hears Winding-Up Petition on July 28
SPHINX EQUITY (FUND): Court Hears Winding-Up Petition on July 28
SPHINX FIXED: Winding-Up Hearing Is Scheduled for July 28
SPHINX FIXED (FUND): Court Sets Winding-Up Hearing on July 28
SPHINX LONG/SHORT: Court Hears Winding-Up Petition on July 28
SPHINX LONG/SHORT (FUND): Winding-Up Hearing Is Set for July 28
SPHINX LTD: Court Schedules Winding-Up Hearing for July 28
SPHINX MACRO: Court Schedules July 28 for Winding-Up Hearing
SPHINX MACRO FUND: Court Sets Winding-Up Hearing for July 28
SPHINX MANAGED: Court Schedules Winding-Up Hearing for July 28
SPHINX MERGER: Winding-Up Hearing Is Scheduled for July 28
SPHINX MERGER (FUND): Court Hears Winding-Up Petition on July 28
SPHINX PLUS: Court Schedules Winding-Up Hearing on July 28
SPHINX SPECIAL: Court Schedules Winding-Up Hearing for July 28
SPHINX SPECIAL (FUND): Winding-Up Hearing Is Set for July 28
SPHINX STRATEGY: Court Sets Winding-Up Hearing for July 28
SURFSIDE RESORT: Ct. Says Paid Insurance Policy Not Executory Pact
TOTAL TIME: Case Summary & 18 Largest Unsecured Creditors
USG CORP: Court Denies Consortium's Move for $12.5M Admin. Claim
USG CORP: Objects to Three Asbestos Personal Injury Claims
VALENTINE PAPER: Court Confirms Amended Plan of Liquidation
W.R. GRACE: Court Closes Asbestos Panels' Complaint v. Sealed Air
W.R. GRACE: U.S. Trustee Amends Creditors Committee Membership
WERNER HOLDINGS: Chap. 11 Filing Cues Moody's to Withdraw Ratings
WORLD HEART: Posts $3 Million Net Loss in Quarter Ended March 31
WORLDCOM INC: Intercity Cable Agrees to Reduce Claim to $500,000
* BOND PRICING: For the week of July 10 - July 14, 2006
*********
I2 TELECOM: March 31 Balance Sheet Upside-Down by $1.7 Million
--------------------------------------------------------------
i2 Telecom International, Inc., filed its financial statement for
the quarter ended March 31, 2006, with the Securities and Exchange
Commission.
The Company reported a $1,351,139 net loss on $140,003 of revenues
for the three months ended March 31, 2006, versus a $1,972,340 net
loss on $186,308 of revenues for the three months ended March 31,
2005.
At March 31, 2006, the Company's balance sheet showed $5,983,160
in total assets and $7,696,724 in total liabilities resulting in a
stockholders' deficit of $1,710,039.
The Company's balance sheet also showed working capital deficit
with total current assets of $1,407,245 and total current
liabilities of $7,093,199.
A full-text copy of the Company's financial statement for the
quarter ended March 31, 2006, is available for free at:
http://ResearchArchives.com/t/s?db6
Going Concern Doubt
Freedman & Goldberg expressed substantial doubt about i2 Telecom's
ability to continue as a going concern after it audited the
Company's financial statements for the years ended Dec. 31, 2005,
2004 and 2003. The auditing firm pointed to the Company's ongoing
losses from operations since inception.
About i2 Telecom
Headquartered at Atlanta, Georgia, i2 Telecom International, Inc.
-- http://www.i2telecom.com/-- provides high-quality
international and domestic long distance calling services to
subscribers at a fraction of the cost of traditional carriers by
leveraging the power of the Internet.
ABLE LABORATORIES: Gets $307,019 Settlement from Mallinckrodt
-------------------------------------------------------------
The Honorable Raymond T. Lyons of the U.S. Bankruptcy Court for
the District of New Jersey approved a Stipulation and Consent
Order between Able Laboratories, Inc., and Mallinckrodt Inc.
Mallinckrodt provided goods and services to the Debtor prior to
Able Laboratories' bankruptcy filing and received a return of some
of the goods provided.
Pursuant to their agreement, Mallinckrodt agrees to pay the Debtor
$307,019.63 to settle and compromise certain disputed claims.
The payment releases Mallinckrodt from any liability or causes of
action the Debtor may assert, including all actions under Chapter
5 of the Bankruptcy Code.
About Able Laboratories
Headquartered in Cranbury, New Jersey, Able Laboratories, Inc. --
http://www.ablelabs.com/-- develops and manufactures generic
pharmaceutical products in tablet, capsule, liquid and suppository
dosage forms. The Company filed for chapter 11 protection on July
18, 2005 (Bankr. D. N.J. Case No. 05-33129) after it halted
manufacturing operations and recalled all of its products not
meeting FDA regulatory standards. Deborah Piazza, Esq., and Mark
C. Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP represent
the Debtor in its restructuring efforts. David H. Stein, Esq.,
Michael F. Hahn, Esq., and Walter J. Greenhalgh, Esq., Duane
Morris LLP, represent the Official Committee of Unsecured
Creditors. When the Debtor filed for protection from its
creditors, it listed $59.5 million in total assets and
$9.5 million in total debts.
ADELPHIA COMMS: GE Capital Wants Mercury to Decide on Contract
--------------------------------------------------------------
Mercury Communications, Inc., an Adelphia Communications
Corporation debtor-affiliate, entered into a prepetition Aircraft
Lease Agreement with General Electric Capital Corporation, in
which Mercury leases a 1989 Cessna Citation III corporate jet from
General Electric.
Pursuant to the Lease Agreement, Mercury:
-- is obligated to pay term rent of $57,210 on the 18th day of
each month;
-- is obligated to properly maintain the Aircraft;
-- had an opportunity to exercise an early purchase option for
$4,540,268 on December 18, 2002; and
-- has the opportunity to purchase the Aircraft at "fair
market value" on December 18, 2006, the Lease's expiration
date.
The Lease is subject to a corporate guaranty by Adelphia Cable
Corporation, Inc., and is subject to a prepetition default of
$57,210.
In June 2006, the Court approved the ACOM Debtors' sale of
substantially all of their assets to Time Warner Cable NY, LLC,
and Comcast Corporation, and confirmed the Joint Venture Plan of
Century-TCI Debtors and Parnassos Debtors.
Susan G. Boswell, Esq., at Quarles & Brady Streich Lang LLP, in
Tucson, Arizona, contends that since neither of the ACOM Debtors'
purchasers seeks to assume the Lease, it is clear that the Lease
will be rejected eventually. The result of the approved Sale
Motion and the Joint Venture Plan is that the ultimate rejection
of the Lease will be postponed indefinitely, Ms. Boswell says.
Ms. Boswell tells the Court that the ACOM Debtors continue to use
the Aircraft, which also continues to depreciate in value. The
arrangement unfairly places substantially all of the risk
associated with the market or potential damage to the Aircraft on
General Electric, Ms. Boswell complains.
Accordingly, General Electric asks the Court to set a date by
which the ACOM Debtors must either assume or reject the Aircraft
Lease.
Based in Coudersport, Pa., Adelphia Communications Corporation
(OTC: ADELQ) -- http://www.adelphia.com/-- is the fifth-largest
cable television company in the country. Adelphia serves
customers in 30 states and Puerto Rico, and offers analog and
digital video services, high-speed Internet access and other
advanced services over its broadband networks. The Company and
its more than 200 affiliates filed for Chapter 11 protection in
the Southern District of New York on June 25, 2002. Those cases
are jointly administered under case number 02-41729. Willkie Farr
& Gallagher represents the ACOM Debtors. PricewaterhouseCoopers
serves as the Debtors' financial advisor. Kasowitz, Benson,
Torres & Friedman, LLP, and Klee, Tuchin, Bogdanoff & Stern LLP
represent the Official Committee of Unsecured Creditors.
(Adelphia Bankruptcy News, Issue No. 139; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
ADELPHIA COMMS: JPMorgan Will Appeal Comcast-Time Warner Sale OK
----------------------------------------------------------------
JPMorgan Chase Bank, N.A., as administrative agent under the
Second Amended and Restated Credit Agreement dated December 19,
1997, with FrontierVision Operating Partners, L.P., as borrower,
notifies the U.S. Bankruptcy Court for the Southern District of
New York that it will take an appeal to the U.S. District Court
for the Southern District of New York from Judge Gerber's approval
of the sale of substantially all of the assets of Adelphia
Communications Corporation and its debtor-affiliates to Comcast
Corporation and Time Warner Cable NY LLC.
JPMorgan wants the District Court to review whether the
Bankruptcy Court erred, as a matter of law, in concluding that
the sale of substantially all of the assets of the FrontierVision
Debtors was authorized under Section 363(b) of the Bankruptcy
Code outside of a Chapter 11 plan.
As reported in the Troubled Company Reporter on June 26, 2006,
Judge Gerber allowed the ACOM Debtors to restructure the sale of
substantially all of their assets to Time Warner and a portion of
its asset sale to Comcast.
According to Judge Gerber, the Debtors have demonstrated a
compelling and sound business justification for the Additional
Buyer Provisions set forth in the Amended Purchase Agreements.
Based in Coudersport, Pa., Adelphia Communications Corporation
(OTC: ADELQ) -- http://www.adelphia.com/-- is the fifth-largest
cable television company in the country. Adelphia serves
customers in 30 states and Puerto Rico, and offers analog and
digital video services, high-speed Internet access and other
advanced services over its broadband networks. The Company and
its more than 200 affiliates filed for Chapter 11 protection in
the Southern District of New York on June 25, 2002. Those cases
are jointly administered under case number 02-41729. Willkie Farr
& Gallagher represents the ACOM Debtors. PricewaterhouseCoopers
serves as the Debtors' financial advisor. Kasowitz, Benson,
Torres & Friedman, LLP, and Klee, Tuchin, Bogdanoff & Stern LLP
represent the Official Committee of Unsecured Creditors.
(Adelphia Bankruptcy News, Issue No. 139; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
AHPC HOLDINGS: Receives Additional Nasdaq Non-Compliance Notice
---------------------------------------------------------------
AHPC Holdings, Inc., disclosed that on July 6, 2006, it received
an additional determination from the Listing Qualifications Staff
of The Nasdaq Stock Market, Inc. indicating that the Company's
failure to solicit proxies and hold an annual meeting for fiscal
2005 on or before June 30, 2006, as required by Nasdaq Marketplace
Rules 4350(e) and 4350(g), could serve as a basis for the
delisting of the Company's securities from The Nasdaq Capital
Market.
The Company was aware of the annual meeting requirement and
addressed its plan for regaining compliance with this requirement
at the Company's hearing before the Nasdaq Listing Qualifications
Panel, which was held on June 15, 2006. Consistent with that
plan, the Company filed a proxy statement with the U.S. Securities
and Exchange Commission on July 7, 2006 for an annual shareholders
meeting to be held on August 14, 2006.
On June 15, 2006, the Company attended the Nasdaq hearing related
to its non-compliance with Nasdaq's $2.5 million shareholders'
equity requirement. On June 26, 2006, the Company disclosed that
it believed it had regained compliance with the $2.5 million
shareholders' equity requirement upon completion of a $3 million
equity financing with M.A.G. Capital, LLC and its affiliates. The
Company has advised Nasdaq of the closing of the private placement
and is now awaiting the issuance of the Panel's hearing decision,
which is expected to address both the stockholders' equity and
annual meeting issues. The Company's securities will remain
listed on The Nasdaq Capital Market pending the issuance of the
Panel's decision, there can be no assurance that the Panel will
grant the Company's request for continued listing.
About AHPC Holdings
Based in Glendale Heights, AHPC Holdings, Inc. (Nasdaq: GLOV) --
http://www.ahpc.com/-- markets disposable medical examination,
foodservice and retail gloves. The Company's wholly owned
subsidiary, American Health Products Corporation, supplies branded
and private label disposable gloves to the healthcare,
foodservice, retail and industrial markets nationwide.
Going Concern Doubt
As reported in the Troubled Company Reporter on Oct. 26, 2005,
Grant Thornton LLP expressed substantial doubt about American
Health Products Corporation's ability to continue as a going
concern after it audited the Company's financial statements for
the fiscal years ended June 30, 2005, and 2004. The auditing firm
points to the Company's recurring losses, including the $1,151,549
net loss incurred for the year ended June 30, 2005. AHPC
Holdings, Inc., fka WRP Corporation, operates through American
Health Products, its wholly owned subsidiary.
AIRADIGM COMMUNICATIONS: U.S. Trustee Unable to Form Committee
--------------------------------------------------------------
The U.S. Trustee for Region 11 informed the U.S. Bankruptcy Court
for the Western District of Wisconsin that there was an
insufficient number of creditors willing to serve on an Official
Committee of Unsecured Creditors in Airadigm Communications,
Inc.'s chapter 11 case. Accordingly, the U.S. Trustee is unable
to appoint a committee under Section 1102(a) of the Bankruptcy
Code at this time.
Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtors'
expense. They may investigate the Debtors' business and financial
affairs. Importantly, official committees serve as fiduciaries to
the general population of creditors they represent. Those
committees will also attempt to negotiate the terms of a
consensual chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest. If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee. If the Committee concludes reorganization
of the Debtors is impossible, the Committee will urge the
Bankruptcy Court to convert the chapter 11 cases to a liquidation
proceeding.
Headquartered in Little Chute, Wisconsin, Airadigm Communications,
Inc. -- http://www.eisnteinpcs.com/-- provides local wireless
phone services through its Einstein PCS wireless networking
technology. The company filed for chapter 11 protection on July
28, 1999 (Bankr. W.D. Wis. Case No. 99-33500). The Court
confirmed its plan of reorganization in 2000.
The company filed a second chapter 11 petition on May 8, 2006
(Bankr. W.D. Wis. Case No. 06-10930). Kathryn A. Pamenter, Esq.,
and Ronald Barliant, Esq., at Goldberg, Kohn, Bell, Black,
Rosenbloom & Moritz, Ltd., represent the Debtor in its new
bankruptcy proceedings. No Official Committee of Unsecured
Creditors has been appointed in the Debtor's new bankruptcy case.
In its second bankruptcy filing, the Debtor estimated assets
between $10 million to $50 million and debts of more than
$100 million.
AIRBASE SERVICES: Trustee Assumes Contracts of Three Individuals
----------------------------------------------------------------
The Honorable Dennis Michael Lynn of the U.S. Bankruptcy Court for
the Northern District of Texas in Fort Worth authorized Dennis
Faulker, the Chapter 11 Trustee for Airbase Services, Inc., to
assume executory contracts with three individuals:
-- John William "Bill" Nishnick,
-- Anna Gurevich, and
-- Heinz-Dieter Quent.
Each of these individuals is a consultant or program manager that
acts as liaisons between the Debtor and major airlines in
connection with the performance of contracts.
In an agreement with Mr. Nishnick, he agreed to act as program
director for a base salary of $6,000 per month. In the event that
Mr. Nishnick will perform his contract for at least 90 days, he
will receive an additional incentive of $500 per month.
Mr. Nishnick's contract is in support of customer relations in
connection with a program referred to as the Quoin Management
Services with American Airlines. In the event is contract is
terminated, the Debtor will be obligated to pay Mr. Nishnick's
wages through the end of the current period and may require
payment of the incentives accrued since Jan. 1, 2006. Mr.
Nishnick is willing to waive the termination payment in exchange
for the assumption.
Ms. Gurevich is a program manager that facilitates performance
under an American Airlines contract. She is employed for $85,000
per year. Her contract may be terminated on 45 days notice. As a
result, her contract has an effective termination expense of
$10,625. During the 45-day period, she is required to continue
providing necessary services.
Mr. Quent is a director of program management and assists in
monitoring and facilitating an American Airlines Program. Mr.
Quent bills GBP30.25 per hour as recorded on a time sheet and
approved by a manager. Mr. Quent is expected to work
approximately 45 hours per week, or longer, or none at all. Mr.
Quent's contract can be terminated on a 90 days notice.
The Chapter 11 Trustee needs to pay the prepetition fees and
expenses of these individuals in order to assume the contracts:
-- John William Nishnick for $12,000 and $694.20 respectively;
-- Anna Gurevich for $3,541.50 and $272.90 respectively, and
-- Heinz-Dieter Quent for $1,300.75 and $380.77 respectively.
The Chapter 11 Trustee belives that the expense incurred in
assuming these contracts are minor relative to the potential
benefit available as a result of performing on the agreements with
American Airlines.
Headquartered in Grand Prairie, Texas, Airbase Services, Inc. --
http://www.airbaseservices.com/-- maintains and repairs a wide
range of cargo equipment and cabin interior designs for commercial
airlines, and provides maintenance and management services for the
airline industry. Due to bankruptcies filed by several of its
airline customers, the Company filed for bankruptcy protection on
May 1, 2006 (Bankr. N.D. Tex. Case. No. 06-41231). The Court
approved the appointment of Dennis Faulkner as Chapter 11 Trustee
in the Debtor's chapter 11 case on May 3, 2006. Mark J.
Petrocchi, Esq., at Goodrich Postnikoff Albertson & Petrocchi,
LLP, represents the Trustee. No Official Committee of Unsecured
Creditors has been appointed in the Debtor's case. In its
schedules of assets and liabilities, the Debtor listed $12,628,078
in total assets and $28,311,883 in total liabilities.
AIRNET COMMS: Court Grants Access to Laurus' Cash Collateral
------------------------------------------------------------
The Honorable Arthur B. Briskman of the U.S. Bankruptcy Court for
the Middle District of Florida in Orlando authorized AirNet
Communications Corporation to use cash collateral securing
repayment of its debts to Laurus Master Fund, Ltd.
As of May 22, 2006, the Debtor owed Laurus approximately
$4,200,000 under a revolving credit facility. Laurus' cash
collateral pursuant to the terms of the credit facility is
comprised of inventory and funds on hand and funds to be received
from the Debtor's receivables for goods sold. The Debtor
estimates the book value of the cash collateral at approximately
$11,294,236 as of May 22, 2006.
The Debtor needs to use Laurus' cash collateral to maintain the
going-concern value of its business and preserve the value of the
estate's assets. Cash collateral will be used in accordance with
a monthly budget. A copy of this budget is available for free
at http://researcharchives.com/t/s?dc5
As adequate protection against the diminution in value of its cash
collateral, the Debtor grants Laurus a replacement lien with the
same validity, extent, and priority as its prepetition lien. To
the extent that the adequate protection fails to protect Laurus,
Laurus is granted a superpriority claim.
Headquartered in Melbourne, Florida, AirNet Communications
Corporation -- http://www.aircom.com/-- designs, manufactures,
and markets wireless infrastructure products and offers
infrastructure solutions for commercial GSM customers, and
government, defense, homeland security based agencies. The Debtor
filed for chapter 11 protection on May 22, 2006 (Bankr. M.D. Fla.
Case No. 06-01171). R. Scott Shuker, Esq., at Gronek & Latham,
LLP, represents the Debtor in its restructuring efforts. No
Official Committee of Unsecured Creditors has been appointed in
the Debtor's case. When the Debtor filed for protection from its
creditors, it listed total assets of $15,701,881 and total debts
of $21,615,346.
ALL-TEX PAVING: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: All-Tex Paving, Inc.
P.O. Box 110087
Carrollton, Texas 75011-0087
Bankruptcy Case No.: 06-32849
Type of Business: The Debtor is a project contractor and
specializes in asphalt and concrete paving,
and excavations.
Chapter 11 Petition Date: July 14, 2006
Court: Northern District of Texas (Dallas)
Judge: Barbara J. Houser
Debtor's Counsel: Joyce W. Lindauer, Esq.
8140 Walnut Hill Lane, Suite 301
Dallas, Texas 75231
Tel: (972) 503-4033
Fax: (972) 503-4034
Estimated Assets: $1 Million to $10 Million
Estimated Debts: $1 Million to $10 Million
Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Internal Revenue Service Payroll Taxes $350,000
Special Procedures
1100 Commerce Street
Mail Code DAL-5020
Dallas, TX 75242
Strasburger $286,307
901 Main Street, Suite 4300
Dallas, TX 75202
Dallas County Tax Assessor $120,000
P.O. Box 139066
Dallas, TX 75313-9066
APAC Texas, Inc. $60,000
P.O. Box 224048
Dallas, TX 75222-4048
Clovis & Roche, Inc. $32,896
P.O. Box 1164
Metairie, LA 70004
Fleet Business Credit Card $22,137
Bank of America
Nationwide Recovery Systems Collection $20,073
Mitch Wright $17,500
Scheef & Stone LLP Collection $16,879
Fleet Management Texaco/Shell Credit Card $13,634
Chase Bank One Credit Card $12,957
Financial Tech'nies Collection $12,856
Goldberg & Alexander P.C. Collection $12,032
Financial Asset Management Collection $10,927
New Holland Credit Credit Card $8,258
TXI $8,174
Guest & Associates, P.C. Collection $7,984
City of Carrollton Taxes $6,630
Thomas Reyes Trucking, Inc. $6,000
McDonald and Simmons, P.C. $5,904
ALLIED HOLDINGS: Can Assume Lexington Headquarter Leases
--------------------------------------------------------
The Honorable C. Ray Mullins of the U.S Bankruptcy Court for the
Northern District of Georgia signed an agreed order authorizing
Allied Holdings, Inc., to assume its leases with LEPERCQ Corporate
Income Fund L.P., (Lexington) for premises located at 160
Clairemont Avenue, in Decatur, Georgia.
The Court also permits Allied Holdings to pay Lexington:
* $11,505, representing unpaid tax reimbursement, as a cure
cost;
* $36,000 as compensation for actual pecuniary loss for
Lexington's attorneys' fees and costs incurred in protecting
its interests under the Headquarters Lease;
* $151,960, the actual cost incurred by Lexington for repairs
of the roof of the Premises, in three installments.
All proofs of claim filed by Lexington that relate to the
Headquarters Lease will be deemed withdrawn by payment in full of
the Unpaid Tax Reimbursement, the Pecuniary Loss Amount, and the
Roof Repair Amount.
Allied Holdings, Inc., uses the Lexington premises as their
corporate headquarters.
Headquartered in Decatur, Georgia, Allied Holdings, Inc. --
http://www.alliedholdings.com/-- and its affiliates provide
short-haul services for original equipment manufacturers and
provide logistical services. The Company and 22 of its affiliates
filed for chapter 11 protection on July 31, 2005 (Bankr. N.D. Ga.
Case Nos. 05-12515 through 05-12537). Jeffrey W. Kelley, Esq., at
Troutman Sanders, LLP, represents the Debtors in their
restructuring efforts. Henry S. Miller at Miller Buckfire & Co.,
LLC, serves as the Debtors' financial advisor. Anthony J. Smits,
Esq., at Bingham McCutchen LLP, provides the Official Committee of
Unsecured Creditors with legal advice and Russell A. Belinsky at
Chanin Capital Partners, LLC, provides financial advisory services
to the Committee. When the Debtors filed for protection from
their creditors, they estimated more than $100 million in assets
and debts. (Allied Holdings Bankruptcy News, Issue No. 25;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
ALLIED HOLDINGS: Can Reject Software Engineering Contract
---------------------------------------------------------
Allied Holdings, Inc., and its debtor-affiliates obtained
permission from the U.S. Bankruptcy Court for the Northern
District of Georgia to reject a software program product license
and maintenance agreement with Software Engineering of America,
Inc. The Court directs all claims arising out of the rejection of
the contract be filed with the Debtors' claims agent, JPMorgan
Trust Company, National Association, no later than July 21, 2006.
Thomas R. Walker, Esq., at Troutman Sanders LLP, in Atlanta,
Georgia, disclosed that the Debtors have determined that the
Contract:
-- is a burden to their estates;
-- is no longer necessary for their ongoing business
operations; and
-- will increase administrative costs if not rejected.
Headquartered in Decatur, Georgia, Allied Holdings, Inc. --
http://www.alliedholdings.com/-- and its affiliates provide
short-haul services for original equipment manufacturers and
provide logistical services. The Company and 22 of its affiliates
filed for chapter 11 protection on July 31, 2005 (Bankr. N.D. Ga.
Case Nos. 05-12515 through 05-12537). Jeffrey W. Kelley, Esq., at
Troutman Sanders, LLP, represents the Debtors in their
restructuring efforts. Henry S. Miller at Miller Buckfire & Co.,
LLC, serves as the Debtors' financial advisor. Anthony J. Smits,
Esq., at Bingham McCutchen LLP, provides the Official Committee of
Unsecured Creditors with legal advice and Russell A. Belinsky at
Chanin Capital Partners, LLC, provides financial advisory services
to the Committee. When the Debtors filed for protection from
their creditors, they estimated more than $100 million in assets
and debts. (Allied Holdings Bankruptcy News, Issue No. 25;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
AMERUS GROUP: Moody's Puts Ratings Under Review and May Upgrade
---------------------------------------------------------------
Moody's Investors Service placed the Baa3 senior unsecured debt
rating of AmerUs Group Company on review for possible upgrade.
The A3 insurance financial strength ratings on the company's three
principal operating companies -- AmerUs Life Insurance Company,
American Investors Life Insurance Company, and Indianapolis Life
Insurance Company -- were also placed on review for possible
upgrade.
The review was initiated following the recent announcement
that Aviva Plc, the largest insurer in the U.K., signed a
definitive agreement to acquire 100% of AmerUs in a transaction
that is expected to close in the fourth quarter of 2006, subject
to regulatory and shareholder approvals.
According to the rating agency, the rating review will focus on
Aviva's strategic plan for AmerUs and its subsidiaries, their
degree of integration into Aviva's U.S. operations, and the level
of implicit financial support to be expected from their new owner.
These ratings were placed on review for possible upgrade:
AmerUs Group Company
* senior unsecured debt at Baa3;
* preferred stock at Ba2;
* senior debt rating (shelf) at (P)Baa3;
* subordinated debt (shelf) at(P)Ba1;
* preferred stock (P)Ba2 (shelf);
AmerUs Life Insurance Company and American Investors Life
Insurance Company
* insurance financial strength ratings each at A3;
Indianapolis Life Insurance Company
* insurance financial strength rating at A3;
* surplus notes at Baa2;
AmerUs Capital I
* preferred stock rating at Ba1;
AmerUs Capital II, III, IV, and V
* preferred stock (shelf) rating at (P)Ba1.
The last rating action took place on May 9, 2006 when Moody's
rated $144 million of AmerUs' senior notes.
AmerUs Group Company is a life insurance group headquartered in
Des Moines, Iowa. As of March 31, 2006, the company reported
consolidated GAAP assets of approximately $25 billion and
consolidated GAAP shareholders' equity of $1.7 billion. American
Investors Life Insurance Company, AmerUs Life Insurance Company,
and Indianapolis Life Insurance Company are all wholly owned
subsidiaries of AmerUs Group Company.
Moody's Insurance Financial Strength Ratings are opinions of the
ability of insurance companies to repay punctually senior
policyholder claims and obligations.
B/E AEROSPACE: Launches Tender Offer for $175 Million Senior Notes
------------------------------------------------------------------
BE Aerospace, Inc., has commenced a cash tender offer and consent
solicitation for its outstanding $175 million aggregate principal
amount 8-1/2% Senior Notes due 2010.
The tender offer is scheduled to expire on Aug. 7, 2006. The
consent solicitation is scheduled to expire on July 21, 2006.
Holders may withdraw their tenders prior to July 21, 2006.
The Company is soliciting consents to amendments eliminating all
of the restrictive covenants and certain events of default in the
indenture governing the Notes. Holders tendering Notes will be
required to consent to the proposed amendments to the indenture.
The Company is offering to make a consent payment of $20 per
$1,000 principal amount of Notes to holders who validly tender
their Notes and deliver their consents on or prior to the July 21,
2006.
The Company will establish a $150 million revolving credit
facility, to use the proceeds together with its cash on hand to
purchase Notes in the tender offer.
The Company has retained UBS Securities LLC, Credit Suisse
Securities (USA) LLC and J.P. Morgan Securities Inc. to serve as
Dealer Managers, and Global Bondholder Services Corporation to
serve as Depositary and Information Agent.
Persons with questions regarding the tender offer and consent
solicitation should contact:
UBS Securities LLC
Telephone (203) 719-4210 (collect)
Toll Free (888) 722-9555 ext. 4210
Credit Suisse Securities (USA) LLC
Telephone (212) 325-7596 (collect)
Toll Free (800) 820-1653
J.P. Morgan Securities Inc.
Telephone (212) 270-7407 (collect)
Global Bondholder Services Corporation
Telephone (866) 804-2200
Requests for documentation should be directed to Global Bondholder
Services Corporation at (866) 804-2200.
Based in Wellington, Florida, B/E Aerospace, Inc. (Nasdaq:BEAV) --
http://www.beaerospace.com/-- is a manufacturer of aircraft cabin
interior products, and a leading aftermarket distributor of
aerospace fasteners. B/E designs, develops and manufactures a
broad range of products for both commercial aircraft and business
jets. B/E manufactured products include aircraft cabin seating,
lighting, oxygen, and food and beverage preparation and storage
equipment. The company also provides cabin interior design,
reconfiguration and passenger-to-freighter conversion services.
Products for the existing aircraft fleet -- the aftermarket --
generate about 60% of sales. B/E sells and supports its products
through its own global direct sales and product support
organization.
* * *
As reported in the Troubled Company Reporter on Jan. 16, 2006,
Moody's Investors Service raised the ratings of B/E Aerospace,
Inc., Corporate Family Rating to B1 from B3. Moody's said the
ratings outlook is stable.
BERRY-HILL GALLERIES: Can Get Reimbursements from Co-Debtor Coram
-----------------------------------------------------------------
The Honorable Robert E. Gerber allowed Coram Capital LLC to use
the cash collateral securing repayment of its indebtedness to ARCK
Credit Company, LLC, to reimburse its co-debtor Berry-Hill
Galleries, Inc., up to $273,520 to administer its chapter 11 case.
Coram is also be permitted to use up to $100,000 of the cash
collateral to reimburse Berry-Hill for costs necessary to pay any
fees relating to financing proposals.
Judge Gerber also allowed Coram to use the cash collateral to
reimburse Berry-Hill for future fees and expenses:
(1) 10% of professional fees and expenses related to the
administration of these Chapter 11 Cases; and
(2) 100% of amounts of certain miscellaneous expenses
associated with the operation of the Debtors' business that
allocable to Coram.
Coram is not required to provide ARCK Credit with any additional
protection in addition to the substantial equity cushion that
exists as a result of the excess of the value of the collateral
securing the claims of ARCK Credit.
Headquartered in New York, New York, Berry-Hill Galleries, Inc.
-- http://www.berry-hill.com/-- buys paintings and sculpture
through outright purchase or on a commission basis and also
exhibits artworks. The Debtor and its affiliate, Coram Capital
LLC, filed for chapter 11 protection on Dec. 8, 2005 (Bankr.
S.D.N.Y. Case Nos. 05-60169 & 05-60170). Robert T. Schmidt, Esq.,
at Kramer, Levin, Naftalis & Frankel, LLP, represents the Debtors
in their restructuring efforts. Robert J. Feinstein, Esq., at
Pachulski, Stang, Ziehl, Young, Jones & Weintraub P.C., represents
the Official Committee of Unsecured Creditors. When the Debtors
filed for protection from their creditors, they estimated assets
between $10 million and $100 million and debts between $1 million
and $50 million.
CATHOLIC CHURCH: Court Approves Portland's Use of Funds
-------------------------------------------------------
The U.S. Bankruptcy Court for the District of Oregon approves the
stipulation between the Archdiocese of Portland in Oregon and the
Tort Claimants Committee governing the use of the Archdiocese's
funds for the period July 1 through Dec. 31, 2006.
Among other things, the Stipulation provides that on or before
Dec. 31, 2006, the Archdiocese will deliver to the Tort Committee
an operating budget for the six-month period beginning Jan. 1,
2007, through June 30, 2007.
As reported in the Troubled Company Reporter on July 7, 2006, the
Archdiocese of Portland in Oregon maintained funds and investments
for itself, and as a fiduciary trustee or custodian for various
parishes, schools, charitable trusts and other entities. The
funds and investments were held in accounts located at Key Bank
and Union Bank of California.
The Official Committee of Tort Claimants appointed in the
Archdiocese's Chapter 11 case asserted that the parishes and
schools have no legal existence separate from the Archdiocese and
are analogous to divisions of a corporation.
The Tort Committee also contends that, among others, the
Archdiocese's bankruptcy estate included the parishes and schools,
and the Accounts, including the Archdiocesan Loan and Investment
Program, the Catholic Education Endowment Fund, and the parish and
school bank accounts.
To allow the Archdiocese, the parishes and the schools to continue
to operate in the ordinary course, and to provide adequate
oversight over the use and administration of the funds and
investments in the Accounts, the Tort Committee agreed that
Portland may continue to utilize the funds and investments in the
Accounts and in accordance with the Operating Budget, the ALIP
Budget, and the CEEF Budget.
The Archdiocese of Portland in Oregon filed for chapter 11
protection (Bankr. Ore. Case No. 04-37154) on July 6, 2004.
Thomas W. Stilley, Esq., and William N. Stiles, Esq., at Sussman
Shank LLP, represent the Portland Archdiocese in its restructuring
efforts. Albert N. Kennedy, Esq., at Tonkon Torp, LLP, represents
the Official Tort Claimants Committee in Portland, and scores of
abuse victims are represented by other lawyers. David A. Foraker
serves as the Future Claimants Representative appointed in the
Archdiocese of Portland's Chapter 11 case. In its Schedules of
Assets and Liabilities filed with the Court on July 30, 2004, the
Portland Archdiocese reports $19,251,558 in assets and
$373,015,566 in liabilities. (Catholic Church Bankruptcy News,
Issue No. 64; Bankruptcy Creditors' Service, Inc., 215/945-7000)
CATHOLIC CHURCH: Spokane Wants to Sell Five Real Properties
-----------------------------------------------------------
The Diocese of Spokane asks permission from the U.S. Bankruptcy
Court for the Eastern District of Washington to sell its interests
on these real properties, free and clear of liens and
encumbrances:
(1) Pastoral Center, 1023 W Riverside, Spokane County Parcel
No. 35183.1014;
(2) Residence at 1025 W. Cleveland, Spokane County Parcel No.
35072.2506 unimproved property;
(3) Spokane County Parcel Nos. 45334.0113 and 45334.9135;
(4) Property west of I-90, Spokane County Parcel No.
14121.9027; and
(5) Agricultural land in southeast Spokane County, Parcel Nos.
41183.9004, 31255.9001, 41302.9002, 41303.9003,
41303.9014, 41303.9005, 41303.9011, and 41312.9017.
In relation to the sale, the Diocese asks Judge Williams to
approve a bidding and auction procedures for the disposition of
its interests in the Sale Properties.
General Procedures
The Diocese will enter into purchase agreements with an initial
purchaser for each Sale Property. Subsequent to the execution of
an Initial Purchase Agreement with an Initial Purchaser, the
Diocese will send a Bidding Deadline and Auction Notice to
competing and prospective bidders.
Once a successful bidder is chosen after each auction, the
Diocese will serve a Notice of Sale on parties-in-interest, which
notice will provide for, among other things, the general terms of
the sale of a particular Sale Property and the deadline for filing
objections to the Sale.
Competing Bids
Bidders must submit written competing bids, together with the
other required bid documents, including a deposit, for any number
of Sale Properties, no later than the bidding deadline scheduled
in the Bidding Deadline and Auction Notice. The Diocese, in its
sole discretion, will extend any bidding deadlines.
Required Bid Documents and Deposit
All bids must include a written offer, a deposit, an executed
purchase agreement, and written evidence of a commitment for
financing or other evidence of ability to consummate promptly the
transaction.
The written offer must:
(1) state that the bidder's offer is irrevocable until the
earlier to occur of (x) the Closing, or (y) 45 days
after the entry of the Court's order approving the
applicable Purchase Agreement and authorizing the sale:
and
(2) disclose the identity of each entity that will be bidding
for a Sale Property.
The deposit will be in a cashier's or certified check, equal to
10% of the bid amount for each Sale Property on which a bidder
submits a bid. For the sale of residential Sale Property, the
deposit is 3% of the bid amount.
The Diocese's counsel will remit the deposits to Spokane County
Title Company, as escrow agent. The Escrow Agent will hold the
deposits of the first highest and best bidder and the second
highest and best bidder at an auction until the earlier to occur
of:
* the transaction closing; or
* 45 days after the Court's approval of the applicable
Purchase Agreement and the Sale.
Qualified Bids
Unless waived by the Diocese, only the Initial Purchasers and
Bidders that have submitted "Qualified Bids" will be eligible to
participate in an Auction. To be qualified, all bids must:
(1) include each of the Required Bid Documents;
(2) be a good faith and bona fide offer to purchase one or
more of the Sale Properties;
(3) not be contingent on obtaining financing or due diligence;
(4) be actually received by the applicable Bidding Deadline;
(5) if the Bid is for more than one Sale Property, allocate a
portion of the purchase price to each Sale Property;
(6) demonstrate to the Diocese the bidder's ability to
consummate promptly the purchase of the Sale Property; and
(7) must exceed the purchase price under the Initial Purchase
Agreement.
Auctions
Only those Bidders who submitted Qualified Bids will be allowed to
participate at an auction.
The successful bidder for each Sale Property being sold must
supplement its deposit within one business day of the Auction so
that, to the extent necessary, that deposit equals 10% of the
highest and best bid accepted by the Diocese at that Auction.
In the event the Diocese receives only a single Qualified Bid for
a particular Sale Property, that Sale Property may be, but need
not be, subject to bidding at an auction. The Diocese may seek to
sell the Sale Property without conducting an auction, if that
qualified bid is otherwise acceptable to the Diocese, in
consultation with counsel for the Tort Claimants Committee, Tort
Litigants Committee and the Future Claims Representative.
The sale of a Property will take place within 15 days after the
entry of the Court's order approving the sale transaction, or the
Closing.
In case of a failure to consummate a Court-approved sale of some
or all Sale Properties because of a breach or failure on the part
of a Successful Bidder, a Backup Bidder will be deemed the
Successful Bidder without further Court order.
A full-text copy of Spokane Diocese's Auction and Bidding
Procedures and related forms are available for free at:
http://researcharchives.com/t/s?dc2
The Diocese has employed Keen Realty, LLC, as special real estate
consultants, to assist it with the sale of the properties,
Michael J. Paukert, Esq., at Paine, Hamblen, Coffin, Brooke &
Miller, LLP, in Spokane, Washington, relates.
About Diocese of Spokane
The Roman Catholic Church of the Diocese of Spokane filed for
chapter 11 protection (Bankr. E.D. Wash. Case No. 04-08822) on
Dec. 6, 2004. Michael J. Paukert, Esq., at Paine, Hamblen,
Coffin, Brooke & Miller, LLP, represents the Spokane Diocese in
its restructuring efforts. When the Debtor filed for protection
from its creditors, it listed $11,162,938 in total assets and
$81,364,055 in total debts. (Catholic Church Bankruptcy News,
Issue No. 64; Bankruptcy Creditors' Service, Inc., 215/945-7000)
CITADEL SECURITY: Releases Preliminary Second Quarter Results
-------------------------------------------------------------
Citadel Security Software Inc., reported preliminary revenue
results for its second quarter ended June 30, 2006. The Company
reported revenues of $3 million, compared to revenues of
$2.7 million for the 2005 second quarter. During the second
quarter of 2006, new sales orders added $1.3 million of ratable
future revenue, increasing total deferred revenues to $5.3 million
at June 30, 2006, versus $2.5 million at June 30, 2005. In
addition, unfilled order backlog as of June 30, 2006, was
$1 million.
Preliminary revenues for the six months ended June 30, 2006, was
approximately $8.4 million, compared to approximately $4.4 million
in revenue for the six months ended June 2005.
Hercules Security Purchases
During the second quarter, the Company received orders for
Hercules, its flagship security solution, for software, content,
support and services from both government and commercial sectors.
The orders include purchases by the Department of Treasury,
Fairfax County Virginia, State Street Bank, Verizon, DemandTec,
First Horizon, among others. In addition, 20 Hercules(R) FlashBox
appliances were shipped to two agencies within the Department of
Defense. Hercules(R) FlashBox, which was first available for
shipment in May 2006, is a plug-and-play appliance designed and
developed to assist with the simplification of managing security
content across widely distributed and disconnected networks.
"We continue to see progress from our previously announced sales
strategy, as reflected by new customers wins," said Steven
Solomon, the company's CEO. "Our strategy to focus on driving
multiple smaller purchases from enterprise customers has allowed
us to build incremental revenue from the successful deployments of
Hercules over time rather than relying on any one large order to
achieve our revenue goals. With the recent introduction of the
Hercules appliance, we are now well positioned to offer solutions
to both small and mid-sized businesses, while still offering an
enterprise solution to our customers. In addition to new
business, we continue to see reorders from many of our existing
customers, reflecting the unique value proposition that Hercules
providers. These orders for additional licenses, content and
services from our installed customer base provides us with a solid
revenue base from which to build. While we have been highly
focused on growing sales, we continue to manage our expenses
conservatively. The company expects to see operational cost and
expense savings in the second quarter of 2006 from actions
initiated during 2005."
The Company says it will announce second quarter results later
this month.
About Citadel Security
Citadel Security Software Inc. (OTC Bulletin Board: CDSS) --
http://www.citadel.com/-- delivers security solutions that enable
organizations to manage risk, reduce threats and enforce
compliance with security policies and regulations. Citadel
solutions are used across the US Department of Defense, at the US
Department of Veterans Affairs, MCI, Raytheon and within other
government and commercial organizations.
At March 31, 2006, the Company's balance sheet showed a $1,350,874
stockholders' deficit compared to a $864,892 stockholders' deficit
at Dec. 31, 2005.
COGECO CABLE: Earns $12.4 Million in Quarter Ended May 31
---------------------------------------------------------
Cogeco Cable Inc. reported financial results for the third quarter
of fiscal 2006, ended May 31, 2006.
Net income for the third quarter amounted to $12.4 million,
compared to $8.2 million for the same period last year. For the
first nine months of fiscal 2006, net income amounted to $31.6
million, compared to $17.7 million for the same period in fiscal
2005. Net income increases in these periods were attributable to
the growth in operating income before amortization combined with a
decline in fixed charges.
For the third quarter and first nine months of fiscal 2006,
operating costs, excluding management fees payable to COGECO Inc.,
rose by $9.1 million or 11.5% and by $17.4 million or 7.3%
respectively. Operating costs also include network fees. Network
fees increased by 11.2% and 6.5% during the third quarter and
first nine months respectively, compared to the same periods
last year. These increases are mainly the result of the
introduction of digital telephony service, the Canadian Radio-
television and Telecommunications Commission mandated APTN
wholesale rate increase and RGU growth, partly offset by IP
transport costs that have declined despite HSI customer growth.
Other operating costs increased in order to serve additional
RGUs, including digital telephony.
Cogeco Cable reported strong increases in its revenue-generating
units, adding more than 48,000 RGUs, compared to 6,400 for the
same period last year, driving a revenue increase of 9.9%.
Operating income before amortization has improved by 8.5% while
net income jumped by 50% to stand at $12.4 million.
"Our operations continue to improve, exceeding most of our
projections. Therefore, we have revised our 2006 guidelines,
setting our revenue expectations to about $600 million, operating
income before amortization to approximately $245 million and free
cash flow should remain between $20 million and $25 million", said
Mr. Louis Audet, President and Chief Executive Officer of Cogeco
Cable.
As reported in the Troubled Company Reporter on June 8, 2006,
Cogeco Cable entered into an agreement with Cable Satisfaction
International Inc., Catalyst Fund Limited Partnership I and
Cabovisao - Televisao por Cabo, S.A., to purchase, at a cost of
EUR464.9 million, all the shares of the second largest cable
operator in Portugal, an indirect wholly-owned subsidiary of CSII.
The agreement and its execution by the monitor and interim
receiver RSM Richter Inc. on behalf of CSII was approved by the
Superior Court of Qu,bec on July 4, 2006, thus fulfilling one of
the conditions precedent to the sale and purchase of the
Cabovisao shares. Cogeco Cable is pleased with Cabovisao's growth
potential and expects to make attractive additions to the services
already provided to its customers. "This acquisition is
consistent with Cogeco Cable's strategy to pursue external growth
opportunities and Cabovisao is well positioned in the high-growth
cable telecommunications market in Portugal", stated Mr. Audet.
For fiscal 2007, Cogeco Cable expects continued increases in high-
speed Internet, digital video and digital telephony services.
Revenue from the Canadian operations should consequently improve
by between 10% and 12%. An operating margin of approximately 40%
should be achieved despite the launch of digital telephony in most
of the Corporation's networks. Growth in revenue and sustained
cost control should help achieve an increase in operating income
before amortization of approximately 9%.
"For the future, we are confident that the number of Canadian
customers will continue to grow, thanks to our strong offering,
which is in line with customer demand. As for Cabovisao, we are
dedicated to the successful integration of our newest and
promising asset to ensure the creation of value for Cogeco Cable's
shareholders", concluded Mr. Audet.
Income Taxes
In the third quarter and first nine months of fiscal 2006, income
taxes amounted to $8.2 million and $21.6 million respectively,
compared to $4.7 million and $11.8 million for the same periods
last year. The income tax increases were mainly attributable to
the growth in operating income before amortization combined with a
decline in fixed charges.
On May 2, 2006, the Federal government announced its intention to
reduce the corporate income tax rate progressively from 21% to 19%
effective in January 2010 and to eliminate the corporate surtax of
1.12% by Jan. 1, 2008. These measures were considered
substantially enacted on June 6, 2006, and therefore will reduce
future income taxes by approximately $18 million for the next
quarter ending Aug. 31, 2006.
About Cogeco Cable
Headquartered in Montreal, Quebec, Cogeco Cable Inc. (TSX: CCA) --
http://www.cogeco.ca/-- is evolving into one of Canada's major
telecommunications companies, by building on its cable
distribution base with the offering of analog, digital television,
high-speed Internet and digital telephony services.
Cogeco Cable provides about 1,464,000 revenue-generating units
(basic, digital, Internet and telephony service customers) to
approximately 1,462,000 households in its service territory. It
is the second largest cable system operator in both Ontario and
Quebec and the fourth largest in Canada. 72% of the Corporation's
service units are located in the Province of Ontario and 28% are
located in the Province of Quebec.
* * *
As reported in the Troubled Company Reporter on June 6, 2006,
Standard & Poor's Ratings Services placed its ratings on Cogeco
Cable Inc., including its long-term 'BB+' corporate credit rating,
on CreditWatch with negative implications, following Cogeco's
announcement that it has entered into an agreement to purchase the
second-largest cable TV operator in Portugal, Cabovisao-Televisao
por Cabo S.A. The CreditWatch placement reflected an expected
material weakening of the company's financial metrics resulting
from the debt-financed acquisition.
As reported in the Troubled Company Reporter on June 6, 2006,
Dominion Bond Rating Service placed the rating of Cogeco Cable
Inc. "Under Review with Negative Implications", following the
report that the Company intends on purchasing the second-
largest cable operator in Portugal, Cabovisao-Televisao por Cabo,
S.A., for approximately EUR465 million, using 100% bank debt
financing. The Company's Senior Secured Notes & Debentures are
Under Review - Negative BB (high) and the Company's Second Secured
Debentures, Series A are Under Review - Negative BB.
CONSUMERS ENERGY: Agrees to Sell Nuclear Power Station to Entergy
-----------------------------------------------------------------
Consumers Energy Company signed an Asset Sale Agreement with
Entergy Nuclear Palisades, LLC, an indirect wholly owned
subsidiary of Entergy Corporation.
Consumers agreed to sell its 798 megawatt Palisades Nuclear Power
Station located in Covert Township, Michigan to Entergy. The
purchase price is $380 million, representing $242 million for the
plant itself, $83 million in nuclear fuel and $55 million in
related assets. The sale also includes the Big Rock Point
Independent Spent Fuel Storage Installation.
The Company also reported that Entergy will make employment offers
to all 500 of the plant's current employees at their same salaries
for 18 months and also committed to maintain the benefits programs
for the employees for 36 months.
Consumers further entered into a Power Purchase Agreement with
Entergy. The term of the PPA is 15 years and provides that
Consumers will purchase 100% of the current capacity and energy of
the Plant on a unit contingent basis. The PPA will become
effective on the closing date of the sale of the Plant, targeted
to close in the first quarter of 2007.
The Company also disclosed the other highlights of the sales
agreement:
(a) Entergy will assume responsibility for eventual
decommissioning of the plant. Consumers Energy will
retain $200 million of the current $566 million Palisades
decommissioning funds balance, with the later return of
$116 million more.
(b) Consumers Energy will pay Entergy $30 million to accept
responsibility for the spent fuel at the decommissioned
Big Rock Point nuclear plant.
About Entergy Nuclear Palisades
Based in Jackson, Mississippi, Entergy Nuclear Palisades, LLC,
(NYSE: ETR) -- http://www.entergy-nuclear.com-- is a nuclear
power operator, delivering electricity to 2.7 million utility
customers in Arkansas, Louisiana, Mississippi and Texas. Entergy
has annual revenues of more than $10 billion and approximately
14,000 employees.
About Consumers Energy Company
Headquartered in Jackson, Michigan, Consumers Energy Company --
http://www.consumersenergy.com/-- a wholly owned subsidiary of
CMS Energy Corporation, is a combination electric and natural gas
utility that serves more than 3.3 million customers in Michigan's
Lower Peninsula.
* * *
As reported in the Troubled Company Reporter on April 4, 2006,
Fitch assigned a rating of 'BB+' to Consumers Energy Company's
$300 million 364-day revolving credit facility. Fitch said the
rating outlook is stable.
DANA CORP: Wants to Sell Hydraulic-Related Assets to Bosch Rexroth
------------------------------------------------------------------
Dana Corp. and its debtor-affiliates ask the U.S. Bankruptcy Court
for the Southern District of New York to approve the sale of their
assets associated with the development and commercialization of
the technology known as Intelligent Hydraulic Drive to Bosch
Rexroth Corporation for approximately $2,700,000.
The Debtors request is pursuant to the Court's order approving the
Debtor's procedures to sell or transfer certain of their
de minimis assets.
The Assets consist of:
(a) all of the Debtors' Intellectual Property related solely
to the development and commercialization of the
Intelligent Hydraulic Drive business, which includes their
activities in the hybrid hydraulic propulsion technology
development segment;
(b) all tangible materials in the possession of the Debtors or
their subcontractors or suppliers related to the IP
Assets;
(c) all rights, benefits and obligations contained in the
contracts assumed, or to be assumed, by the Debtors and
assigned to Bosch Rexroth;
(d) the assets identified on the Asset Purchase Agreement; and
(e) certain accounts receivable related to the IP Assets.
Six executory contracts and unexpired leases will be assigned
to Bosch Rexroth at the Closing:
1. License Agreement with Artemis Intelligent Power Limited
dated July 29, 2005,
2. Development Agreement with Artemis Intelligent Power
Limited dated July 29, 2005,
3. Professional Services Agreement with Venture Management
Services, LLC amended on Feb. 20, 2006,
4. P.O. No. 193560-00 from Artemis Intelligent Power Limited
dated March 24, 2006.
5. Letter Agreement with Navigant Consulting, Inc., effective
March 14, 2006, and
6. Contract No. W56HZV-05-C-L590, P.O. No. 5003 with
Government Support Services, Inc. effective Nov. 28, 2005.
The Debtors' Master License & Research & Development Agreement
with Permo-Drive Pty. Limited ACN 084071885 dated Aug. 9, 2005,
may be assigned to Bosch Rexroth after the Closing.
The amounts that the Debtors believe must be paid to cure
defaults under the Assumed Contracts are:
-- $6,193 pursuant to a Professional Services Agreement with
Venture Management Services, LLC, February 20, 2006; and
-- $4,700 pursuant to a License Agreement with Artemis
Intelligent Power Limited; effective July 29, 2005.
Corinne Ball, Esq., at Jones Day, in New York, discloses that two
parties hold liens or have other interests in the Assets:
1. Citicorp North America, Inc., as Administrative Agent under
a Court-approved Senior Secured Superpriority DIP Credit
Agreement dated March 3, 2006; and
2. Citicorp USA, Inc., as Administrative Agent under the
Security Agreement dated Nov. 18, 2005.
Each Lienholder either has consented to the proposed sale or the
Lienholder's lien or interest can be extinguished, has been
waived, or is capable of monetary satisfaction.
A full-text copy of the Bosch Rexroth Asset Purchase Agreement is
available for free at http://researcharchives.com/t/s?db3
Based in Toledo, Ohio, Dana Corporation -- http://www.dana.com/--
designs and manufactures products for every major vehicle producer
in the world, and supplies drivetrain, chassis, structural, and
engine technologies to those companies. Dana employs 46,000
people in 28 countries. Dana is focused on being an essential
partner to automotive, commercial, and off-highway vehicle
customers, which collectively produce more than 60 million
vehicles annually. The company and its affiliates filed for
chapter 11 protection on Mar. 3, 2006 (Bankr. S.D.N.Y. Case No.
06-10354). Corinne Ball, Esq., and Richard H. Engman, Esq., at
Jones Day, in Manhattan and Heather Lennox, Esq., Jeffrey B.
Ellman, Esq., Carl E. Black, Esq., and Ryan T. Routh, Esq., at
Jones Day in Cleveland, Ohio, represent the Debtors. Henry S.
Miller at Miller Buckfire & Co., LLC, serves as the Debtors'
financial advisor and investment banker. Ted Stenger from
AlixPartners serves as Dana's Chief Restructuring Officer.
Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel
LLP, represents the Official Committee of Unsecured Creditors.
When the Debtors filed for protection from their creditors, they
listed $7.9 billion in assets and $6.8 billion in liabilities as
of Sept. 30, 2005. (Dana Corporation Bankruptcy News, Issue No.
15; Bankruptcy Creditors' Service, Inc., 215/945-7000).
The Debtors' consolidated balance sheet at March 31, 2006, showed
a $456,000,000 total shareholder' equity resulting from total
assets of $7,788,000,000 and total liabilities of $7,332,000,000.
DANA CORP: Wants to Walk Away from 13 Contracts and Leases
----------------------------------------------------------
Dana Corp. and its debtor-affiliates seek authority from the
U.S. Bankruptcy Court for the Southern District of New York
to reject 13 executory contracts and unexpired leases effective as
of July 31, 2006:
Contracting Party Description
----------------- -----------
Global eXchange Services, Inc. Service Agreement
Ryder Truck Rental, Inc. Equipment Leases
Ryder Truck Rental, Inc. Equipment Leases
Ryder Truck Rental, Inc. Equipment Leases
Ryder Truck Rental, Inc. Equipment Leases
Ryder Truck Rental, Inc. Equipment Leases
Ryder Truck Rental, Inc. Equipment Leases
Ryder Truck Rental, Inc. Equipment Leases
Ryder Truck Rental, Inc. Equipment Leases
Ryder Truck Rental, Inc. Equipment Leases
Ryder Truck Rental, Inc. Equipment Leases
Kenworth, Indianapolis Leasing Div. Equipment Leases
Kenworth, Indianapolis Leasing Div. Equipment Leases
The Debtors have determined that that the 13 Contracts and Leases
are no longer necessary to their ongoing business operations or
restructuring efforts.
The Debtors assure the Court that they have surrendered, or will
surrender, possession of any property leased under the Contracts
and Leases to the Contracting Party by July 31, 2006.
Based in Toledo, Ohio, Dana Corporation -- http://www.dana.com/--
designs and manufactures products for every major vehicle producer
in the world, and supplies drivetrain, chassis, structural, and
engine technologies to those companies. Dana employs 46,000
people in 28 countries. Dana is focused on being an essential
partner to automotive, commercial, and off-highway vehicle
customers, which collectively produce more than 60 million
vehicles annually. The company and its affiliates filed for
chapter 11 protection on Mar. 3, 2006 (Bankr. S.D.N.Y. Case No.
06-10354). Corinne Ball, Esq., and Richard H. Engman, Esq., at
Jones Day, in Manhattan and Heather Lennox, Esq., Jeffrey B.
Ellman, Esq., Carl E. Black, Esq., and Ryan T. Routh, Esq., at
Jones Day in Cleveland, Ohio, represent the Debtors. Henry S.
Miller at Miller Buckfire & Co., LLC, serves as the Debtors'
financial advisor and investment banker. Ted Stenger from
AlixPartners serves as Dana's Chief Restructuring Officer.
Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel
LLP, represents the Official Committee of Unsecured Creditors.
When the Debtors filed for protection from their creditors, they
listed $7.9 billion in assets and $6.8 billion in liabilities as
of Sept. 30, 2005. (Dana Corporation Bankruptcy News, Issue No.
15; Bankruptcy Creditors' Service, Inc., 215/945-7000).
The Debtors' consolidated balance sheet at March 31, 2006, showed
a $456,000,000 total shareholder' equity resulting from total
assets of $7,788,000,000 and total liabilities of $7,332,000,000.
DELPHI CORP: GM to Assume Certain Obligations in IUE-CWA Pact
-------------------------------------------------------------
General Motors Corp. agreed to assume and pay post-employment
benefits obligations to Delphi Corp. employees who "check the box"
for purposes of retirement, and to pay the amounts due under the
IUE-CWA Special Attrition Program Agreement.
The U.S. Bankruptcy Court for the Southern District of New York
allows GM to assert a prepetition general unsecured claim with
respect to:
(a) the assumed OPEB obligations; and
(b) the assumed health care and life insurance obligations.
GM may not assert any other claim against the Debtors on account
of its obligations or performance under the UAW Supplement, or the
IUE-CWA Special Attrition Program Agreement.
The Court previously approved an agreement on the terms of an IUE-
CWAGM-Delphi Special Attrition Program. The IUE-CWA Special
Attrition Program largely mirrors the UAW Special Attrition
Program taken together with the UAW Supplement.
The IUE-CWA package provides special retirement options for 3,290
members who can either take a $35,000 bonus for a normal or early
retirement, take a 50 and 10 mutually satisfactory retirement, or
elect to participate in a special program where workers with
between 26 years and less than 30 years can grow into retirement.
The IUE-CWA made gains in the buyout offerings by creating a
third tier for workers compared with an earlier attrition program
available to both traditional and competitive rate workers.
Workers with at least 10 years' seniority can take a $140,000
buyout payment to sever ties with the company. Workers with
between 3 and 10 years' seniority are eligible for a $70,000
payment, while those with between 1 year and 3 years' seniority
can receive $40,000.
The Debtors and United Steel Workers are continuing framework
discussions regarding a similar special attrition program, which
they anticipate should be completed and scheduled for hearing
during July 2006.
Based in Troy, Mich., Delphi Corporation -- http://www.delphi.com/
-- is the single largest global supplier of vehicle electronics,
transportation components, integrated systems and modules, and
other electronic technology. The Company's technology and
products are present in more than 75 million vehicles on the road
worldwide. The Company filed for chapter 11 protection on Oct. 8,
2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler
Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in
their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell
A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins
LLP, represents the Official Committee of Unsecured Creditors.
As of Aug. 31, 2005, the Debtors' balance sheet showed
$17,098,734,530 in total assets and $22,166,280,476 in total
debts. (Delphi Bankruptcy News, Issue No. 32; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
DELPHI CORP: SEC Investigation on GM Spin-Off Continues
-------------------------------------------------------
Delphi Corporation is the subject of an ongoing investigation by
the Securities and Exchange Commission and the U.S. Department of
Justice involving Delphi's accounting for and the adequacy of
disclosures for a number of transactions dating from Delphi's
spin-off from General Motors.
In a regulatory filing with the SEC, Robert S. Miller, Jr.,
Delphi's CEO and chairman of the board of directors, says the
company is fully cooperating with the government's investigations.
Delphi has entered into an agreement with the SEC to suspend the
running of the applicable statute of limitations until April 6,
2006, and subsequently agreed to extend the suspension until
August 31, 2006.
The government's investigations were not suspended as a result of
Delphi's filing for Chapter 11.
Until these investigations are complete, Delphi is not able to
predict the effect, if any, that these investigations will have
on Delphi's business and financial condition, results of
operations and cash flows, Mr. Miller relates.
Delphi also believes that the SEC's Enforcement Division has taken
a more proactive role, what the SEC refers to as a "risk based"
approach, by seeking information from issuers in an effort to
assess issuers' accounting or disclosure practices before
identifying specific wrong-doing. Delphi believes that the
previously disclosed inquiry it received during the fourth quarter
of 2004 regarding accounting practices related to defined benefit
pension plans and other post-employment benefit plans is an
example of this practice.
Delphi continues to cooperate fully with the SEC's informal
inquiry in this matter, Mr. Miller adds.
Based in Troy, Mich., Delphi Corporation -- http://www.delphi.com/
-- is the single largest global supplier of vehicle electronics,
transportation components, integrated systems and modules, and
other electronic technology. The Company's technology and
products are present in more than 75 million vehicles on the road
worldwide. The Company filed for chapter 11 protection on Oct. 8,
2005 (Bankr. S.D.N.Y. Lead Case No. 05-44481). John Wm. Butler
Jr., Esq., John K. Lyons, Esq., and Ron E. Meisler, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in
their restructuring efforts. Robert J. Rosenberg, Esq., Mitchell
A. Seider, Esq., and Mark A. Broude, Esq., at Latham & Watkins
LLP, represents the Official Committee of Unsecured Creditors.
As of Aug. 31, 2005, the Debtors' balance sheet showed
$17,098,734,530 in total assets and $22,166,280,476 in total
debts. (Delphi Bankruptcy News, Issue No. 32; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
DELTA AIR: Inks Stipulation Extending Section 1110 Period
---------------------------------------------------------
In separate stipulations, Delta Air Lines, Inc., and the Bank of
New York, in its capacity as Indenture Trustee, agree to further
extend the Section 1110 Period with respect to aircraft bearing
Tail Nos. N958DL and N658DL until:
-- an undisclosed date agreed upon by the parties; or
-- an earlier date the parties may agree in writing later on.
Unless either party provides written notice of termination of the
Section 1110 Period to the other received at least 10 days before
the expiration of the extension, the Section 1110 Period will be
extended automatically by an additional one-month period.
About Delta Air Lines
Headquartered in Atlanta, Georgia, Delta Air Lines --
http://www.delta.com/-- is the world's second-largest airline in
terms of passengers carried and the leading U.S. carrier across
the Atlantic, offering daily flights to 502 destinations in 88
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners. The Company and 18
affiliates filed for chapter 11 protection on Sept. 14, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-17923). Marshall S. Huebner,
Esq., at Davis Polk & Wardwell, represents the Debtors in their
restructuring efforts. Timothy R. Coleman at The Blackstone Group
L.P. provides the Debtors with financial advice. Daniel H.
Golden, Esq., and Lisa G. Beckerman, Esq., at Akin Gump Strauss
Hauer & Feld LLP, provide the Official Committee of Unsecured
Creditors with legal advice. John McKenna, Jr., at Houlihan Lokey
Howard & Zukin Capital and James S. Feltman at Mesirow Financial
Consulting, LLC, serve as the Committee's financial advisors. As
of June 30, 2005, the Company's balance sheet showed $21.5 billion
in assets and $28.5 billion in liabilities. (Delta Air Lines
Bankruptcy News, Issue No. 36; Bankruptcy Creditors' Service,
Inc., 215/945-7000).
DORNIER AVIATION: 4th Cir. Says $146 Million Loan Was Equity
------------------------------------------------------------
The U.S. Court of Appeals for the Fourth Circuit upheld the
recharacterization of Fairchild Dornier GMBH's claim against its
subsidiary Dornier Aviation (North America) as equity rather than
debt.
Fairchild filed a $146 million claim in Dornier Aviation's Chapter
11 case, for the spare parts sold to the Debtor before the
Debtor's bankruptcy filing.
The U.S. Bankruptcy Court for the Eastern District of Virginia
determined that, while some aspects of the transaction were
consistent with a loan, the transaction on the whole was more
consistent with capital contribution.
The Bankruptcy Court pointed to:
1. Fairchild's insider status;
2. the lack of a fixed maturity date for the loan;
3. the fact that the Debtor would not be required to pay until
it became profitable;
4. the Debtor's long history of unprofitability; and
5. Fairchild's assumption of the Debtor's losses.
Fairchild appealed the decision to the U.S. District Court for the
Eastern District of Virginia contending that the Bankruptcy Court:
a) lacked the power to recharacterize claims;
b) erred in applying the recharacterization doctrine to its
claim; and
c) made a number of factual findings that were clearly
erroneous.
The District Court affirmed the judgment. Fairchild appealed.
The Circuit Court held in a decision published at 2006 WL 1737620
that:
a) Sec. 502 of the Bankruptcy Code gives a bankruptcy court
the power to recharacterize claims as equity rather than
debt;
b) the Bankruptcy Court did not err in recharacterizing the
Parent's claim;
c) the Bankruptcy Court did not err in finding that the Parent
and the Debtor had a "special" relationship;
d) the Bankruptcy Court did not err in finding a de facto
subordination agreement between the Parent and the Debtor;
and
e) the Bankruptcy Court did not err in finding that the entire
spare parts claim was an equity investment.
The Honorable Diana Gribbon Motz wrote the appellate court
opinion, in which Chief Judge Wilkins and Judge King joined.
"Contributions to capital receive a lower priority than loans
because 'the essential nature of a capital interest is a fund
contributed to meet the obligations of business and which is to be
repaid only after all other obligations have been satisfied,'"
Judge Motz opined, referring to the Bankruptcy Code's priority
scheme provision for the distribution of a debtor's assets.
Dornier Aviation (North America) is a U.S. subsidiary of German
aircraft manufacturer Fairchild Dornier GMBH. Some of the
Company's former employees filed an involuntary Chapter 7
bankruptcy petition on April 25, 2002 (Bankr. E.D.Va. Case No. 05-
1930). The case was subsequently converted to a Chapter 11
reorganization. The Debtor failed to reorganize and a liquidation
plan was proposed and confirmed in 2003.
ENERGAS RESOURCES: Files Two Amended Financial Statements
---------------------------------------------------------
Energas Resources, Inc., delivered its amended financial
statements for the year ended Jan. 31, 2006, and first quarter
results for the three months ended April 30, 2006, to the
Securities and Exchange Commission on July 11, 2006.
2006 Full Year Results
The Company reported a $1,583,501 net loss on $1,197,252 of total
revenues for the year ended Jan. 31, 2006, compared to a
$1,164,175 net loss on $668,490 of total revenues for the same
period in 2005.
At Jan. 31, 2006, the Company's balance sheet showed $7,542,998 in
total assests, $2,179,421 in total liabilities, and $5,363,577 in
total stockholders' equity.
The Company's Jan. 31 balance sheet showed strained liquidity with
$1,063,387 in total current assets available to pay $1,714,728 in
total current liabilities coming due within the next 12 months.
A full-text copy of the Company's amended annual report is
available for free at http://ResearchArchives.com/t/s?db0
2007 First Quarter Results
The Company reported a $281,532 net loss on $241,882 of total
revenues for the first quarter ended April 30, 2006, compared to a
$149,906 net loss on $257,881 of total revenues for the same
period in 2005.
At April 30, 2006, the Company's balance sheet showed $7,159,682
in total assets, $1,941,324 in total liabilities, and $5,218,358
in total stockholders' equity.
At April 30, 2006, the Company had a negative working capital of
$1,363,505.
Full-text copies of the Company's amended first quarter financial
statements for the three months ended April 30, 2006, are
available for free at http://ResearchArchives.com/t/s?db1
Going Concern Doubt
Murrell, Hall, McIntosh & Co., PLLP, in Oklahoma City, Oklahoma,
raised substantial doubt about Energas Resources, Inc.'s ability
to continue as a going concern after auditing the Company's
consolidated financial statements for the year ended Jan. 31,
2006. The auditor pointed to the Company's recurring operating
losses and negative working capital.
Based in Oklahoma City, Oklahoma, Energas Resources, Inc. --
http://www.energasresources.com/-- is involved in the exploration
and development of oil and gas. The Company's activities are
primarily dependent upon available financial resources to fund the
costs of drilling and completing wells. The Company principally
operates in the Arkoma Basin in Oklahoma, the Powder River Basin
in Wyoming and the Appalachian Basin of Eastern Kentucky.
EPIXTAR CORP: Seek Laurus' Agreement on FTC Settlement Pact
-----------------------------------------------------------
Epixtar Corp. and its debtor-affiliates ask the U.S. Bankruptcy
Court for the Southern District of Florida in Miami to approve a
Proposed Stipulated Preliminary Injunction with the Federal Trade
Commission.
Epixtar's affiliates, collectively known as the ISP Debtors, who
are party to the stipulation include:
-- Liberty Online Services, Inc.;
-- National Online Services, Inc.;
-- B2B Advantage, Inc.; and
-- Ameripages, Inc.
The Debtors further ask the Court to direct Laurus to acknowledge
that the Proposed Stipulated PI is similar in form and substance
to a version that the parties were operating under as of Dec. 1,
2005.
Laurus' acknowledgment of the stipulation will constitute its
acknowledgment that it is bound as a successor or assignee of the
Debtors' ISP business in accordance with the terms of the Court's
December 2005 settlement order. The Debtors owed Laurus
approximately $16,250,000, as of Sept. 21, 2005, on account of two
prepetition loans. Under the December settlement, Laurus extended
a $2.5 million debtor-in-possession financing, consented to the
Debtors' use of cash collateral, and took over ownership of the
Debtors' ISP related assets.
By entering into Proposed Stipulated PI, Epixtar and the ISP
Debtors will resolve an action commenced by the Federal Trade
Commission in 2003. With Laurus' acceptance of the Proposed
Stipulated PI, Epixtar and the ISP Debtors will be free of any
liability resulting from Laurus' possible actions or inaction in
connection with the ISP business.
FTC Lawsuit
The Debtors engage in two primary lines of business: business
process outsourcing concentrating on contact center activities and
Internet service provider services. The Debtors are currently
concentrating on their contact center business and has halted the
marketing of the ISP business. The ISP Debtors are now only
operating to serve their existing customer base.
The FTC commenced an action against Epixtar and the ISP Debtors in
2003 seeking permanent injunction and other relief pursuant to the
Federal Trade Commission Act. This case is pending before the
U.S. District Court for the Southern District of New York.
In November 2003, the District Court entered a stipulated
preliminary injunction requiring the Debtors to continue to honor
cancellations and refund requests from customers and to implement
procedures and safeguards in connection with their ISP operations.
The Debtors have since been operating under the preliminary
injunction.
The Debtors and the FTC have negotiated a permanent injunction and
final order to finally resolve the FTC action. The settlement is
subject to the approval of the FTC's Bureau of Consumer Protection
and must be ultimately approved by the Commissioners of the
Federal Trade Commission. The Commissioners will not approve the
settlement unless the Debtors execute the Proposed Stipulated PI.
Under their agreement, the FTC agreed to settle its lawsuit
against the Debtors for a $33 million monetary judgment. The
judgment will be deemed satisfied by compliance with consumer
refund provisions embodied in the Proposed Stipulated PI.
However, the Monetary Judgment will become due and payable in the
event that the Debtors fail to disclose any material asset,
materially understate the value of any asset or make any material
misrepresentation in or omission from the financial statements
provided to the FTC.
The Debtors want Laurus' agreement to be bound by the terms of the
Proposed Stipulated PI to ensure its performance in accordance
with the terms of the stipulation. If Laurus, or any of its
assignee, fails to perform in accordance with the Proposed
Stipulated PI, the Debtors need assurance that they will not have
any liability for the consequences of Laurus' actions.
The Court will convene a hearing at 10:00 a.m. on July 26, 2006,
to consider the Debtors' request.
A full-text copy of the Stipulated Final Judgment and Order for
Permanent Injunction is available for a fee at:
http://www.researcharchives.com/bin/download?id=060715000042
About Epixtar
Based in Miami, Florida, Epixtar Corp. -- http://www.epixtar.com/
-- fdba Global Assets Holding, Inc., aggregates contact center
capacity and robust telephony infrastructure to deliver
comprehensive, turnkey services to the enterprise market. The
Company and its debtor-affiliates filed for chapter 11 protection
on Oct. 6, 2005 (Bank. S.D. Fla. Case No. 05-42040). Michael D.
Seese, Esq., at Kluger, Peretz, Kaplan & Berlin, P.L., represents
the Debtors in their restructuring efforts. Glenn D. Moses, Esq.,
at Genovese Joblove & Battista, P.A., represents the Company's
Official Committee of Unsecured Creditors. When the Debtors filed
for protection from their creditors, they listed total assets of
$30,376,521 and total debts of $39,158,724.
FALCONBRIDGE LTD: Inco & Phelps Dodge Increase Merger Offer
-----------------------------------------------------------
Phelps Dodge Corp., Inco Ltd. and Falconbridge Ltd. took action to
improve the terms of their three-way combination. Phelps Dodge
increased the cash portion of the consideration to be paid to the
shareholders of Inco in the combination of Phelps Dodge and Inco
by CDN$2.75 per Inco share. Inco increased the cash portion of
its offer to purchase all outstanding common shares of
Falconbridge by CDN$1.00 per Falconbridge share, and the
Falconbridge board of directors has declared a special cash
dividend of CDN$0.75 per Falconbridge common share.
Improved Terms of 3-Way Combination
Under the improved terms, Phelps Dodge will acquire all
outstanding common shares of Inco for a combination of cash and
common shares of Phelps Dodge having a value of CDN$80.70 per Inco
share, based upon the closing price of Phelps Dodge stock and the
closing U.S./Canadian dollar exchange rate on Friday, July 14,
2006. Shareholders of Inco will receive 0.672 shares of Phelps
Dodge stock plus CDN$20.25 per share in cash for each share of
Inco stock. This represents a premium of 7.8% to Inco's market
price as of close of trading on July 14 and a premium of 23.7% to
Inco's market price as of the close of trading on June 23, the
last trading day before the announcement of the combination of
Phelps Dodge, Inco and Falconbridge.
Under its enhanced bid for Falconbridge, Inco is now offering
CDN$18.50 plus 0.55676 shares of Inco for each share of
Falconbridge, assuming full proration of the consideration. With
the completion of both transactions, Falconbridge shareholders
would receive an implied total consideration on a "look-through"
basis of CDN$63.43 per Falconbridge common share, consisting of:
(a) C$29.77 in cash; and
(b) 0.3741 of a Phelps Dodge Inco Corp. common share (based on
the closing price of the Phelps Dodge common shares on the
New York Stock Exchange and applicable U.S. Federal Reserve
U.S.-Canadian dollar exchange rates on July 14, 2006).
Falconbridge Special Dividend
In order to further increase the value received by Falconbridge
shareholders, the board of Falconbridge declared a special cash
dividend of CDN$0.75 per Falconbridge share payable on Aug. 10,
2006, to common shareholders of record at the close of business on
July 26, 2006. The Falconbridge board also unanimously determined
that Inco's amended offer for the shares of Falconbridge is
superior to the unsolicited offer by Xstrata and unanimously
recommends that Falconbridge shareholders accept the Inco offer.
Reduction in Minimum Tender Condition
In addition, Inco reduced the minimum condition in its offer for
Falconbridge from two thirds of the outstanding shares of
Falconbridge to 50.01% of outstanding shares on a fully diluted
basis. Phelps Dodge and Inco also amended their Combination
Agreement so that the combination of Phelps Dodge and Inco may be
consummated before the acquisition by Inco of 100% of
Falconbridge. Inco's amended offer for Falconbridge will expire
on July 27, 2006.
As part of the transaction, Phelps Dodge expects to repurchase up
to US$5 billion of its shares in the 12 months after closing.
"We strongly believe the combination of Phelps Dodge, Inco and
Falconbridge represents a unique value-creation opportunity for
the shareholders of all three companies," J. Steven Whisler,
chairman and chief executive officer of Phelps Dodge, said.
"There's no question that the value of the enhanced Inco offer for
Falconbridge is superior to the unsolicited offer by Xstrata. In
addition to the value inherent in the offer, the Falconbridge
shareholders will have the ability to participate in the upside
resulting from the three-way combination through their ownership
of almost 30% of the combined company, which includes a 30% share
in the $900 million of expected annual synergies, which in total
have a net present value of $5.8 billion."
"Today's actions demonstrate our shared commitment to create the
leading North American-based mining company and a global
powerhouse in copper and nickel," Scott Hand, chairman and chief
executive officer of Inco, said. "That's great news for our
shareholders, for our employees, for our communities and for
Canada."
"We are pleased with the actions taken today by Phelps Dodge and
Inco and by their affirmation of the value of Falconbridge," Derek
Pannell, chief executive officer of Falconbridge, said. "The
special dividend declared by our board today further enhances the
expected return to our shareholders. We are confident our
shareholders will see the value in the combination of these three
companies to create Phelps Dodge Inco."
All required regulatory approvals for Inco's acquisition of
Falconbridge have been received. Phelps Dodge's offer to acquire
Inco is expected to close in September, subject to Phelps Dodge
and Inco shareholder approval, regulatory approvals and customary
closing conditions.
About Phelps Dodge
Phelps Dodge Corp. -- http://www.phelpsdodge.com/-- produces
copper and molybdenum and is the largest producer of molybdenum-
based chemicals and continuous-cast copper rod. The company and
its two divisions, Phelps Dodge Mining Co. and Phelps Dodge
Industries, employ approximately 15,000 people worldwide.
About Inco
Headquartered in Sudbury, Ontario, Inco Limited (TSX, NYSE:N) --
http://www.inco.com/-- is the world's #2 producer of nickel,
which is used primarily for manufacturing stainless steel and
batteries. Inco also mines and processes copper, gold, cobalt,
and platinum group metals. It makes nickel battery materials
and nickel foams, flakes, and powders for use in catalysts,
electronics, and paints. Sulphuric acid and liquid sulphur
dioxide are produced as byproducts. The company's primary
mining and processing operations are in Canada, Indonesia, and
the U.K.
About Falconbridge
Headquartered in Toronto, Ontario, Falconbridge Limited
(TSX:FAL.LV)(NYSE: FAL) -- http://www.falconbridge.com/-- is a
leading copper and nickel company with investments in fully
integrated zinc and aluminum assets. Its primary focus is the
identification and development of world-class copper and nickel
orebodies. It employs 14,500 people at its operations and
offices in 18 countries. The Company owns nickel mines in
Canada and the Dominican Republic and operates a refinery and
sulfuric acid plant in Norway. It is also a major producer of
copper (38% of sales) through its Kidd mine in Canada and its
stake in Chile's Collahuasi mine and Lomas Bayas mine. Its
other products include cobalt, platinum group metals, and zinc.
* * *
Falconbridge's CDN$150 million 5% convertible and callable bonds
due April 30, 2007, carries Standard & Poor's BB+ rating.
FERRO CORP: Sales Reach $505 Million for Quarter Ended March 31
---------------------------------------------------------------
Ferro Corporation reported $505 million sales for the quarter
ended March 31, 2006. Sales were 9% higher than the prior-year
quarter and up 10% from the fourth quarter of 2005.
Net income from continuing operations was $7.2 million compared
with $600,000 in the first quarter of 2005.
The Company said the quarterly sales were driven by growth in
Ferro's business segments, including Electronic Materials,
Performance Coatings, Color and Glass Performance Materials,
Polymer Additives and Specialty Plastics.
First quarter 2006 net income from continuing operations had a
combined negative pre-tax effect of approximately $6.2 million.
The Company also recognized a $2.7 million non-cash, pre-tax loss
in the first quarter resulting from mark-to-market forward supply
contracts, mainly for natural gas. In the first quarter of 2005,
mark-to-market gain was $2.5 million from forward supply
contracts.
The Company's first quarter 2006 gross margin percentage was
21.3%, up 120 basis points from the prior-year quarter. Selling,
general and administrative expenses were 15.8% of sales for the
quarter, including the $6.2 million combined negative pre-tax
effect. SG&A, as a percent of sales, was 18.1 percent in the
first quarter of 2005.
Its total debt on March 31, 2006 was $650 million, up $95 million
from the end of 2005. The increase was the result of increased
deposit requirements for precious metal consignment arrangements
and for working capital to support increased sales.
The Company is moving forward with a plan to restructure the
Inorganic Specialties business of its European operations, which
includes the Performance Coatings and Color and Glass Performance
Materials segments. It established an overall goal of $40 million
to $50 million in annual operating cost savings by the end of
2009, with the full benefits realized in 2010.
Ferro's initial restructuring plan targets annual cost savings of
approximately $10 million. Its restructuring plan will also
require asset write-offs of approximately $11 million and
severance costs totaling approximately $5 million.
The Company also entered into a non-binding letter of intent for
the sale of its Specialty Plastics business in May 2006 and
expects the sale to be completed by the end of the third quarter.
This, it said, is part of its portfolio management activities to
apply its resources to core markets with the greatest opportunity
for operational synergies and financial success.
In addition, Ferro completed a new $700 million credit facility
and had extended its $100 million asset securitization program.
The new credit facility includes $250 million in revolving credit
and $450 million in term loans.
The Company further disclosed that its 2005 quarterly results and
results for the quarter ended March 31, 2006 have not been
reviewed by its auditor.
Headquartered in Cleveland, Ohio, Ferro Corporation (NYSE:FOE) --
http://www.ferro.com/-- produces performance materials for
manufacturers, including coatings and performance chemicals. The
Company has operations in 20 countries and has approximately 6,800
employees globally.
* * *
As reported in the Troubled Company Reporter on March 22, 2006,
Moody's Investors Service downgraded the senior unsecured ratings
of Ferro Corporation to B1 from Ba1 due to continuing delays in
the issuance of audited financial statements.
Moody's then withdrew Ferro's ratings following the downgrade,
saying it could reassign ratings to Ferro's notes and bonds once
it has received audited financials for 2004 and 2005. Ferro has
$355 million of senior unsecured notes and debentures outstanding,
with maturities between 2009 and 2028.
FOAMEX INTERNATIONAL: Files 401(K) Savings Plan 2005 Annual Report
------------------------------------------------------------------
Foamex International, Inc., filed its Foamex L.P. 401(K) Savings
Plan's Form 11-K for the year ended Dec. 31, 2005, with the U.S.
Securities and Exchange Commission.
The Foamex L.P. 401(K) Savings Plan is a defined contribution plan
available to eligible employees of Foamex L.P. The Plan is
subject to the provisions of the Employee Retirement Income
Security Act of 1974. The Savings Plan provides for various
investment options in mutual funds, which invest in any
combination of stocks, bonds securities, other mutual funds, and
other investment securities.
During 2005, Foamex, the Plan sponsor, determined that due to the
volatility of the price of Foamex International stock, the
Foamex Stock Fund was no longer an appropriate investment for the
Plan.
As a result of the Debtors' Chapter 11 filings, Foamex announced
to participants on Jan. 27, 2006, that the remaining shares of the
Foamex Stock Fund would be liquidated and transferred to the
Fidelity Retirement Money Market Portfolio on or about Feb. 24,
2006.
According to Gregory J. Christian, Foamex International's chief
administrative officer, due to delays in the bankruptcy process,
the liquidation was deferred. Participants still are able to make
exchanges out the Foamex Stock Fund.
Because the Foamex Stock Fund is a unitized stock fund whose value
depends on the performance of Foamex stock, the overall stock
market, and the amount of short-term investments in the fund, the
Plan Sponsor directed Fidelity Management Trust Company, the
Plan's trustee, to maintain a target cash balance of 50%, subject
to a minimum balance of 40% and a maximum of 60%, Mr. Christian
relates.
Foamex L.P. 401(k) Savings Plan
Statement of Net Assets Available For Benefits
For the Year Ended December 31, 2005
ASSETS
Investments
Mutual Funds $54,288,668
Collective Trust Fund 13,312,556
Foamex Stock Fund 33,517
Participant Loans 4,583,554
-----------
Total investments 72,218,295
Employer contributions receivable 174,721
-----------
Total Assets 72,393,016
-----------
LIABILITIES
Administrative expenses payable 31,130
-----------
Net Assets Available For Benefits $72,361,886
===========
Foamex L.P. 401(k) Savings Plan
Statement of Changes in Net Assets Available For Benefits
For the Year Ended December 31, 2005
ADDITIONS:
Additions to net assets attributed to:
Investment income
Interest and dividends $3,757,744
Net depreciation in fair value of investment (4,840,262)
-----------
Total investment loss, net (1,082,518)
-----------
Contributions
Participants 4,465,383
Employer 760,151
Rollover 201,438
-----------
Total contributions 5,426,972
-----------
Total Additions 4,344,454
-----------
DEDUCTIONS:
Deductions from net assets attributed to:
Benefits paid to participants 7,542,333
Administrative expenses 158,768
-----------
Total deductions 7,701,101
-----------
Net Decrease (3,356,647)
Net Assets Available For Benefits,
beginning of year 75,718,533
-----------
Net Assets Available For Benefits,
end of year $72,361,886
===========
Headquartered in Linwood, Pa., Foamex International Inc. --
http://www.foamex.com/-- is the world's leading producer of
comfort cushioning for bedding, furniture, carpet cushion and
automotive markets. The Company also manufactures high-
performance polymers for diverse applications in the industrial,
aerospace, defense, electronics and computer industries. The
Company and eight affiliates filed for chapter 11 protection on
Sept. 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-12693).
Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP,
represent the Debtors in their restructuring efforts. Houlihan,
Lokey, Howard and Zukin and O'Melveny & Myers LLP are advising the
ad hoc committee of Senior Secured Noteholders. Kenneth A. Rosen,
Esq., and Sharon L. Levine, Esq., at Lowenstein Sandler PC and
Donald J. Detweiler, Esq., at Saul Ewings, LP, represent the
Official Committee of Unsecured Creditors. As of July 3,
2005, the Debtors reported $620,826,000 in total assets and
$744,757,000 in total debts. (Foamex International Bankruptcy
News, Issue No. 22; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
FOAMEX INTERNATIONAL: Taps Rainey Kizer as Real Estate Counsel
--------------------------------------------------------------
Foamex International Inc. and its debtor-affiliates inform the
U.S. Bankruptcy Court for the District of Delaware that they have
tapped Rainey, Kizer, Reviere & Bell, PLC, as their real state
counsel, pursuant to the Court-approved procedures for hiring
ordinary course professionals.
RKRB will represent the Debtors in real estate matters associated
with a property located in Milan, Gibson County, Tennessee in
order to obtain the property title through leasehold rights and
then sell the property to a third-party buyer.
The Debtors will pay RKRB on an hourly basis based on the
customary rates of its professionals:
Professional Rate
------------ ----
Members $215
Associates $145
Paralegals $110
The Debtors will also reimburse the firm for necessary expenses
and other charges.
William C. Bell, Jr., Esq., a member of RKRB, discloses that his
firm has provided prepetition professional services to the
Debtors. He tells the Court that the Debtors do not owe his firm
any payment as of the Debtors' bankruptcy filing.
Mr. Bell assures the Court that his firm has no connection with
the Debtors, their creditors or stockholders, or any party-in-
interest nor does it hold or represent any interest adverse to the
Debtors or their estates.
RKRB may, from time to time, represent various other parties who
are creditors of the Debtors in matters wholly unrelated to the
scope of the firm's representation of the Debtors, Mr. Bell notes.
RKRB assures the Court that it does not and will not represent any
of the Debtors' creditors in the resolution of any dispute between
the Debtors and their creditors regarding the merits of any claim.
Headquartered in Linwood, Pa., Foamex International Inc. --
http://www.foamex.com/-- is the world's leading producer of
comfort cushioning for bedding, furniture, carpet cushion and
automotive markets. The Company also manufactures high-
performance polymers for diverse applications in the industrial,
aerospace, defense, electronics and computer industries. The
Company and eight affiliates filed for chapter 11 protection on
Sept. 19, 2005 (Bankr. Del. Case Nos. 05-12685 through 05-12693).
Attorneys at Paul, Weiss, Rifkind, Wharton & Garrison LLP,
represent the Debtors in their restructuring efforts. Houlihan,
Lokey, Howard and Zukin and O'Melveny & Myers LLP are advising the
ad hoc committee of Senior Secured Noteholders. Kenneth A. Rosen,
Esq., and Sharon L. Levine, Esq., at Lowenstein Sandler PC and
Donald J. Detweiler, Esq., at Saul Ewings, LP, represent the
Official Committee of Unsecured Creditors. As of July 3,
2005, the Debtors reported $620,826,000 in total assets and
$744,757,000 in total debts. (Foamex International Bankruptcy
News, Issue No. 22; Bankruptcy Creditors' Service, Inc.,
215/945-7000)
GARDEN STATE: Has Until Sept. 5 to Remove State Court Litigation
----------------------------------------------------------------
Garden State MRI Corporation and Ralph G. Dauito, IV -- Garden
State's owner and chief executive officer -- jointly obtained an
extension from the Honorable Gloria M. Burns of the U.S.
Bankruptcy Court for the District of New Jersey in Camden until
Sept. 5, 2006, the period by which they will remove actions
pursuant to Section 1452 of the Judiciary and Judicial Procedure
and Sections 9006 and 9027 of the Federal Rules of Bankruptcy
Procedures.
Before filing for bankruptcy, Debtors were involved in litigation
against Dr. Golestaneh and his related entities, in the Superior
Court of New Jersey, Chancery Division for Cumberland County,
Docket No. C-13-05.
The Bankruptcy Court confirmed the plan jointly filed by the
Debtor and Mr. Dauito on March 22, 2006.
The Plan provides that the Debtors would exchange mutual releases
with the Golestaneh Entities upon receiving releases from certain
secured creditors.
The Debtors' settlement with the Golestaneh Entities as a result
of Debtors' settlements with secured creditors would result in a
resolution of the State Court Litigation.
The Debtors have not had ample time to determine whether to remove
the State Court Litigation. The Debtors believe that an extension
of the removal deadline will protect the Estates' rights to remove
the State Court Litigation and any additional actions discovered
through an investigation and review of asserted claims against
them.
Headquartered in Vineland, New Jersey, Garden State MRI
Corporation, dba Eastlantic Diagnostic Institute --
http://www.eastlanticdiagnostic.com/-- operates an out-patient
imaging and radiology facility. The Company filed for chapter 11
protection on June 9, 2005 (Bankr. D. N.J. Case No. 05-29214).
Arthur Abramowitz, Esq. and Jerrold N. Poslusny, Jr., Esq., at
Cozen O'Connor, represent the Debtor in its restructuring efforts.
No Official Committee of Unsecured Creditors has been appointed in
this case. When the Debtor filed for protection from its
creditors, it listed estimated assets of less than $50,000 and
estimated debts between $10 million to $50 million. The
Bankruptcy Court confirmed a plan of reorganization jointly filed
by the Debtor and Ralph G. Dauito, IV -- Garden State's owner and
chief executive officer.
GENEVA STEEL: Ch. 11 Trustee Sells Emission Credits for $2.5 Mil.
-----------------------------------------------------------------
James T. Markus, the Chapter 11 Trustee appointed in Geneva Steel
LLC's bankruptcy case, will sell the Debtor's Emission Reduction
Credits to Nautilus Holding Company for $2.5 million. The
Honorable Glen E. Clark of the U.S. Bankruptcy Court for the
District of Utah, Central Division, approved the sale, free and
clear of liens, on June 29, 2006.
The Debtor's Emmission Reduction Credits are intangible personal
property extant in Utah County, Utah, and banked with the State of
Utah, Division of Air Quality under UAC R307-403-8, and listed on
the Registry of Emission Offset Credits for Utah County maintained
by the Utah Division of Air Quality.
The acquired assets also include an assignment of the rights of
the estate with respect to the enforcement of the emission
reduction credits previously sold to Anderson Geneva, LLC.
A complete list of the acquired assets is available for free
at http://researcharchives.com/t/s?dc6
A copy of the asset purchase agreement is available for a fee
at http://www.researcharchives.com/bin/download?id=060715001319
Headquartered in Provo, Utah, Geneva Steel LLC owns and operates
an integrated steel mill. The Company filed for chapter 11
protection on January 25, 2002 (Bankr. Utah Case No. 02-21455).
Andrew A. Kress, Esq., Keith R. Murphy, Esq., and Stephen E.
Garcia, Esq., at Kaye Scholer LLP, represent the Debtor in its
chapter 11 proceeding. James T. Markus was appointed as the
chapter 11 Trustee for the Debtor's estate on June 22, 2005.
John F. Young, Esq., at Block Markus & Williams, LLC represents
the chapter 11 Trustee. Dianna M. Gibson, Esq., and J. Thomas
Beckett, Esq., at Parsons Behle & Latimer, represent the Official
Committee of Unsecured Creditors. When the Company filed for
protection from its creditors, it listed $262 million in total
assets and $192 million in total debts.
GRUPO IUSACELL: Involuntary Chapter 11 Case Summary
---------------------------------------------------
Alleged Debtor: Grupo Iusacell Celular, S.A. de C.V
aka Iusacell
Montes Urales 460
Colonia Lomas de Chapultepec
Delegacion Miguel Hidalgo
Mexico, DF C.P. 11000
Case Number: 06-11599
Type of Business: The Debtor is a Mexican telecommunications
company. http://www.iusacell.com/
Involuntary Petition Date: July 14, 2006
Chapter: 11
Court: Southern District of New York (Manhattan)
Judge: Burton R. Lifland
Petitioners' Counsel: Alan M. Field, Esq.
Manatt, Phelps & Phillips, LLP
7 Times Square
New York, New York 10036
Tel: (212) 790-4500
Petitioners Nature of Claim Claim Amount
----------- --------------- ------------
Gramercy Emerging Markets Fund Beneficial $55,438,000
20 Dayton Avenue Interest in 10%
Greenwich, Connecticut 06830 Senior Notes due 2004
Pallmall LLC Beneficial $260,000
20 Dayton Avenue Interest in 10%
Greenwich, Connecticut 06830 Senior Notes due 2004
Kapali LLC Beneficial $180,000
20 Dayton Avenue Interest in 10%
Greenwich, Connecticut 06830 Senior Notes due 2004
HANDMAKER JEWISH: Defends Exclusivity; Faults Delay on Wells Fargo
------------------------------------------------------------------
Handmaker Jewish Services for the Aging objects to Wells Fargo
Bank, National Association's move to have Handmaker Jewish's
exclusive period to file a plan of reorganization and to solicit
acceptances for that plan terminated.
Wells Fargo is the trustee under the Debtor's October 1, 2000,
bond indenture.
Michael McGrath, Esq., at Mesch, Clark & Rothschild, P.C., tells
the U.S. Bankruptcy Court for the District of Arizona that since
the Debtor filed for bankruptcy, it has moved its chapter 11 cases
as quickly as possible. On Oct. 4, 2005, the Debtor asked the
Court determine the value of the Debtor's real property,
recognizing that an essential ingredient of its reorganization
plan would be the value of its real property. A pre-trial
conference was scheduled for Oct. 27, 2005, with the hearing to be
held during the first week of December 2005.
Mr. McGrath argues that delays in achieving plan confirmation have
been precipitated by the Bond Trustee. The Bond Trustee waited
until October 26, 2005, to file a response to Debtor's motion for
determination of value, one day before the previously scheduled
pre-trial conference. At the pre-trial conference held on the
valuation issue, the Bond Trustee sought a continuance of the
previously agreed to December date for the valuation hearing.
Over the Debtor's objection, the Court set the hearing for
Jan. 9, 2006.
During the October 27 pre-trial conference, the Bond Trustee's
counsel said that their appraisal would not be completed until
Nov. 11, 2005. The Bond Trustee's counsel believes all needed
information will be gathered by the end of November so hearing
will have to be in late December 2005 or early January 2006.
On Nov. 18, 2005, the Court issued its evidentiary hearing order
regarding the January 9, 2006 hearing. On Dec. 16, 2005, the Bond
Trustee sought to have the valuation hearing set for Jan. 6, 2006,
which the Debtor opposed. At an expedited hearing held on
Dec. 20, 2005 and again over the Debtor's objection, the Court
continued the hearing on valuation to Feb. 1, 2006. The Court
indicated that this was a firm date and the Court would not agree
to put off a valuation hearing until April or May 2006, as the
Bond Trustee sought.
On Jan. 27, 2006, the Debtor filed its Plan of Reorganization,
Disclosure Statement, and asked the Court to extend its exclusive
periods. The Bond Trustee found more reasons to delay the
valuation hearing.
Mr. McGrath contended that delays in getting to plan confirmation
were not as a result of any deficiency on the Debtor's part, but
rather as a result of the Bond Trustee's inability to obtain its
appraisal report in a timely manner. Valuation was continued from
February to April to allow settlement discussions and that the
time taken for those discussions would have no impact on the
Debtor's exclusivity period as that time frame was purely for
settlement purposes. The modest delays in the process have been
occasioned by the Bond Trustee initially, by settlement
discussions in the spring and in May due to Debtor's counsel being
in trial out-of-town for a six-week period.
Headquartered in Tucson, Arizona, Handmaker Jewish Services for
the Aging owns and operates a multiple residence-retirement
community complex facility. The Company filed for chapter 11
protection on Sept. 30, 2005 (Bankr. D. Ariz. Case No. 05-05924).
Michael W. McGrath, Esq., at Mesch Clark & Rothschild, represents
the Debtor in its restructuring efforts. When the Debtor filed
for protection from its creditors, it listed $10,384,351 in assets
and $21,625,125 in debts.
HERTZ CORP: Parent Plans Initial Public Offering of Common Stock
----------------------------------------------------------------
Hertz Global Holdings, Inc., the indirect parent corporation of
The Hertz Corporation, filed a Registration Statement on Form S-1
with the Securities and Exchange Commission in connection with the
initial public offering of its common stock. The securities to be
offered in the proposed IPO will include shares to be issued and
sold by Hertz Global Holdings as well as shares to be sold by
certain current stockholders of Hertz Global Holdings.
Hertz Global Holdings intends to use the net proceeds to it from
the offering to repay borrowings outstanding under its $1 billion
loan facility entered into on June 30, 2006, with the remainder of
the proceeds, if any, to be used for general corporate purposes
(which may include the repayment of borrowings outstanding under
The Hertz Corporation's senior credit facilities).
Goldman, Sachs & Co., Lehman Brothers Inc. and Merrill Lynch & Co.
are the joint global coordinators and bookrunners for the
offering. Deutsche Bank Securities and JPMorgan are joint
bookrunners. Hertz Global Holdings and the selling stockholders
will also grant the underwriters an option to purchase additional
shares at the initial public offering price. The offering of
common stock will be made only by means of a prospectus. When
available, a copy of the preliminary prospectus relating to this
offering may be obtained from:
Goldman, Sachs & Co.
Attn: Prospectus Department
85 Broad Street
New York, NY 10004
Fax (212) 902-9316
Lehman Brothers Inc.
c/o ADP Financial Services Integrated Distribution Services
1155 Long Island Avenue
Edgewood, NY 11717
Telephone (631) 254-7106
Merrill Lynch & Co.
4 World Financial Center
New York, NY 10080
Telephone (212) 449-1000
About Hertz Corp.
Headquartered in Park Ridge, New Jersey, The Hertz Corporation --
http://www.hertz.com/-- is a vehicle renting company that offers
a wide variety of current-model cars on a short-term rental basis
-- daily, weekly or monthly -- at airports, in downtown and
suburban business centers, and in residential areas and resort
locales.
* * *
As reported in the Troubled Company Reporter on July 12, 2006,
Standard & Poor's Ratings Services held its ratings on Hertz
Corp., including the 'BB-' corporate credit rating, on CreditWatch
with negative implications, where they were placed on June 26,
2006.
INCO LTD: Increase Falconbridge Merger Offer By CDN$1 Per Share
---------------------------------------------------------------
Phelps Dodge Corp., Inco Ltd. and Falconbridge Ltd. took action to
improve the terms of their three-way combination. Phelps Dodge
increased the cash portion of the consideration to be paid to the
shareholders of Inco in the combination of Phelps Dodge and Inco
by CDN$2.75 per Inco share. Inco increased the cash portion of
its offer to purchase all outstanding common shares of
Falconbridge by CDN$1.00 per Falconbridge share, and the
Falconbridge board of directors has declared a special cash
dividend of CDN$0.75 per Falconbridge common share.
Improved Terms of 3-Way Combination
Under the improved terms, Phelps Dodge will acquire all
outstanding common shares of Inco for a combination of cash and
common shares of Phelps Dodge having a value of CDN$80.70 per Inco
share, based upon the closing price of Phelps Dodge stock and the
closing U.S./Canadian dollar exchange rate on Friday, July 14,
2006. Shareholders of Inco will receive 0.672 shares of Phelps
Dodge stock plus CDN$20.25 per share in cash for each share of
Inco stock. This represents a premium of 7.8% to Inco's market
price as of close of trading on July 14 and a premium of 23.7% to
Inco's market price as of the close of trading on June 23, the
last trading day before the announcement of the combination of
Phelps Dodge, Inco and Falconbridge.
Under its enhanced bid for Falconbridge, Inco is now offering
CDN$18.50 plus 0.55676 shares of Inco for each share of
Falconbridge, assuming full proration of the consideration. With
the completion of both transactions, Falconbridge shareholders
would receive an implied total consideration on a "look-through"
basis of CDN$63.43 per Falconbridge common share, consisting of:
(a) C$29.77 in cash; and
(b) 0.3741 of a Phelps Dodge Inco Corp. common share (based on
the closing price of the Phelps Dodge common shares on the
New York Stock Exchange and applicable U.S. Federal Reserve
U.S.-Canadian dollar exchange rates on July 14, 2006).
Falconbridge Special Dividend
In order to further increase the value received by Falconbridge
shareholders, the board of Falconbridge declared a special cash
dividend of CDN$0.75 per Falconbridge share payable on Aug. 10,
2006, to common shareholders of record at the close of business on
July 26, 2006. The Falconbridge board also unanimously determined
that Inco's amended offer for the shares of Falconbridge is
superior to the unsolicited offer by Xstrata and unanimously
recommends that Falconbridge shareholders accept the Inco offer.
Reduction in Minimum Tender Condition
In addition, Inco reduced the minimum condition in its offer for
Falconbridge from two thirds of the outstanding shares of
Falconbridge to 50.01% of outstanding shares on a fully diluted
basis. Phelps Dodge and Inco also amended their Combination
Agreement so that the combination of Phelps Dodge and Inco may be
consummated before the acquisition by Inco of 100% of
Falconbridge. Inco's amended offer for Falconbridge will expire
on July 27, 2006.
As part of the transaction, Phelps Dodge expects to repurchase up
to US$5 billion of its shares in the 12 months after closing.
"We strongly believe the combination of Phelps Dodge, Inco and
Falconbridge represents a unique value-creation opportunity for
the shareholders of all three companies," J. Steven Whisler,
chairman and chief executive officer of Phelps Dodge, said.
"There's no question that the value of the enhanced Inco offer for
Falconbridge is superior to the unsolicited offer by Xstrata. In
addition to the value inherent in the offer, the Falconbridge
shareholders will have the ability to participate in the upside
resulting from the three-way combination through their ownership
of almost 30% of the combined company, which includes a 30% share
in the $900 million of expected annual synergies, which in total
have a net present value of $5.8 billion."
"Today's actions demonstrate our shared commitment to create the
leading North American-based mining company and a global
powerhouse in copper and nickel," Scott Hand, chairman and chief
executive officer of Inco, said. "That's great news for our
shareholders, for our employees, for our communities and for
Canada."
"We are pleased with the actions taken today by Phelps Dodge and
Inco and by their affirmation of the value of Falconbridge," Derek
Pannell, chief executive officer of Falconbridge, said. "The
special dividend declared by our board today further enhances the
expected return to our shareholders. We are confident our
shareholders will see the value in the combination of these three
companies to create Phelps Dodge Inco."
All required regulatory approvals for Inco's acquisition of
Falconbridge have been received. Phelps Dodge's offer to acquire
Inco is expected to close in September, subject to Phelps Dodge
and Inco shareholder approval, regulatory approvals and customary
closing conditions.
About Phelps Dodge
Phelps Dodge Corp. -- http://www.phelpsdodge.com/-- produces
copper and molybdenum and is the largest producer of molybdenum-
based chemicals and continuous-cast copper rod. The company and
its two divisions, Phelps Dodge Mining Co. and Phelps Dodge
Industries, employ approximately 15,000 people worldwide.
About Falconbridge
Headquartered in Toronto, Ontario, Falconbridge Limited
(TSX:FAL.LV)(NYSE: FAL) -- http://www.falconbridge.com/-- is a
leading copper and nickel company with investments in fully
integrated zinc and aluminum assets. Its primary focus is the
identification and development of world-class copper and nickel
orebodies. It employs 14,500 people at its operations and
offices in 18 countries. The Company owns nickel mines in
Canada and the Dominican Republic and operates a refinery and
sulfuric acid plant in Norway. It is also a major producer of
copper (38% of sales) through its Kidd mine in Canada and its
stake in Chile's Collahuasi mine and Lomas Bayas mine. Its
other products include cobalt, platinum group metals, and zinc.
About Inco
Headquartered in Sudbury, Ontario, Inco Limited (TSX, NYSE:N) --
http://www.inco.com/-- is the world's #2 producer of nickel,
which is used primarily for manufacturing stainless steel and
batteries. Inco also mines and processes copper, gold, cobalt,
and platinum group metals. It makes nickel battery materials
and nickel foams, flakes, and powders for use in catalysts,
electronics, and paints. Sulphuric acid and liquid sulphur
dioxide are produced as byproducts. The company's primary
mining and processing operations are in Canada, Indonesia, and
the U.K.
* * *
Inco Limited's 3-1/2% Subordinated Convertible Debentures due
2052 carry Moody's Investors Service's Ba1 rating and Standard &
Poor's BB+ rating.
INTERVISUAL BOOKS: Educational Dev't to Provide DIP Financing
-------------------------------------------------------------
Educational Development Corporation entered into an agreement to
provide debtor-in-possession financing and to participate in a
Plan of Reorganization with Intervisual Books, Inc. Intervisual
is currently operating as a debtor-in-possession in a Chapter 11
bankruptcy case voluntarily filed on May 8, 2006. Upon approval
by the United States Bankruptcy Court for the Central District of
California, EDC will provide Intervisual with interim financing
intended to facilitate the acquisition by EDC of substantially all
of the assets of Intervisual, which would then become an operating
division of EDC.
There is no assurance this transaction will be finalized, as it is
subject to approval from the Court.
About Educational Development Corp.
Based in Tulsa, Oklahoma, Educational Development Corporation
(Nasdaq: EDUC) -- http://www.edcpub.com/-- a Delaware
corporation, is a U.S. distributor of a line of children's books
produced in the United Kingdom by Usborne Publishing Limited.
About Intervisual Books
Headquartered in Inglewood, California, Intervisual Books Inc. --
http://intervisualbooks.com/-- aka Piggy Toes Press is an
international publisher and packager of pop-up books, novelty and
educational children's books, and playsets. The Company filed for
chapter 11 protection on May 9, 2006 (Bankr. C.D. Calif. Case No.
06-11853). Ron Bender, Esq., at Levene, Neale, Bender, Rankin &
Brill LLP, in Los Angeles, represents the Debtor. When the Debtor
filed for protection from its creditors, it estimated assets and
debts between $1 million and $10 million.
ITEN CHEVROLET: Court Approves Buckley & Jensen as Bankr. Counsel
-----------------------------------------------------------------
Iten Chevrolet Company, Inc., obtained authority from the United
States Bankruptcy Court for the District of Minnesota to employ
Buckley & Jensen as its bankruptcy counsel.
Buckley & Jensen is expected to:
a) give the Debtor legal advice with respect to its powers and
duties as debtor-in-possession and the continued operation
of its business and management of its property;
b) represent the Debtor, as debtor-in-possession, in connection
with the use of its cash collateral covered by various
security interests and any new lendings required in the
ordinary course of business;
c) prepare, on behalf of the Debtor, necessary applications,
answers, orders, reports and other legal papers necessary in
the proceeding;
d) formulate a Plan, Disclosure Statement, and other matters
necessary for the Debtor to continue in business.
The Debtor discloses that Mary Jo A. Jensen-Carter, Esq., a member
at Buckley & Jensen, will be lead counsel for this engagement and
will be paid $250 per hour.
Ms. Jensen-Carter assures the Court that her firm is disinterested
as the term is defined in Section 101(14) of the Bankruptcy Code
and does not hold or represent any interest adverse to the
Debtor's estate.
About Iten Chevrolet
Based in Brooklyn Center, Minnesota, Iten Chevrolet Company, Inc.
-- http://www.gmbuypower.com/-- operates a General Motors
Corporation automobile dealerships in Minnesota. The Company
filed for chapter 11 protection on June 28, 2006 (Bankr. D. Minn.
Case No. 06-41259). Mary Jo A. Jensen-Carter, Esq., at Buckley
and Jensen, represents the Debtor. When the Debtor filed for
protection from its creditors, it listed assets of $16,083,417 and
debts of $17,703,249.
ITEN CHEVROLET: Court Approves Carson Clelland as Special Counsel
-----------------------------------------------------------------
Iten Chevrolet Company, Inc., obtained permission from the U.S.
Bankruptcy Court for the District of Minnesota to employ Carson,
Clelland & Schreder as its special counsel.
Carson Clelland is expected to represent the Debtor in negotiation
of a sale of its assets and assist the Debtor in dealing with
contractual issues related to its normal business operations and
special contractual matters related to the Chapter 11 case.
The Debtor discloses that William Clelland, Esq., a member at
Carson Clelland, will be the lead counsel for this engagement and
bills $225 per hour.
Mr. Clelland assures the Court that his firm is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code and does not hold or represent any interest
adverse to the Debtor's estates.
About Iten Chevrolet
Based in Brooklyn Center, Minnesota, Iten Chevrolet Company, Inc.
-- http://www.gmbuypower.com/-- operates a General Motors
Corporation automobile dealerships in Minnesota. The Company
filed for chapter 11 protection on June 28, 2006 (Bankr. D. Minn.
Case No. 06-41259). Mary Jo A. Jensen-Carter, Esq., at Buckley
and Jensen, represents the Debtor. When the Debtor filed for
protection from its creditors, it listed assets of $16,083,417 and
debts of $17,703,249.
KAISER ALUMINUM: Court Allows MAXXAM to Sell Up to 3.5 Mil. Shares
------------------------------------------------------------------
MAXXAM Inc. recently contacted Kaiser Aluminum Corporation and its
debtor-affiliates about selling up to 3,500,000 shares of Kaiser
Aluminum Corp. stock.
The Debtors have determined that the proposed disposition would
not adversely impact Kaiser Aluminum's tax attributes.
Accordingly, the Debtors and MAXXAM have reached an agreement to
modify their July 23, 2002 stipulation and agreed order to permit
MAXXAM's proposed disposition.
At the parties' behest, the U.S. Bankruptcy Court for the District
of Delaware authorizes MAXXAM to sell up to 3,500,000 shares of
its KAC stock.
Judge Fitzgerald clarifies that other than the proposed sale,
MAXXAM will continue to be prohibited from disposing of any of its
remaining KAC stock prior to a hearing pursuant to its agreement
with KAC.
About MAXXAM Inc
Headquartered in Houston, Texas, MAXXAM Inc. (AMEX: MXM)
operates businesses ranging from aluminum and timber products to
real estate and horse racing. MAXXAM's top revenue source is
Kaiser Aluminum, which has been in Chapter 11 bankruptcy since
2002. MAXXAM's timber subsidiary, Pacific Lumber, owns about
205,000 acres of old-growth redwood and Douglas fir timberlands in
Humboldt County, California. MAXXAM's real estate interests
include commercial and residential properties in Arizona,
California, Texas, and Puerto Rico. The Company also owns the Sam
Houston Race Park, a horseracing track near Houston. Chairman and
CEO Charles Hurwitz controls 77% of MAXXAM.
About Kaiser Aluminum
Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications. The Company filed for chapter 11 protection on Feb.
12, 2002 (Bankr. Del. Case No. 02-10429), and has sold off a
number of its commodity businesses during course of its cases.
Corinne Ball, Esq., at Jones Day, represents the Debtors in their
restructuring efforts. Lazard Freres & Co. serves as the Debtors'
financial advisor. Lisa G. Beckerman, Esq., H. Rey Stroube, III,
Esq., and Henry J. Kaim, Esq., at Akin, Gump, Strauss, Hauer &
Feld, LLP, and William P. Bowden, Esq., at Ashby & Geddes
represent the Debtors' Official Committee of Unsecured Creditors.
The Debtors' Chapter 11 Plan became effective on July 6, 2006. On
June 30, 2004, the Debtors listed $1.619 billion in assets and
$3.396 billion in debts. (Kaiser Bankruptcy News, Issue No. 100;
Bankruptcy Creditors' Service, Inc., 609/392-0900)
KAISER ALUMINUM: Wants Orricks Herrington's Payment Request Denied
------------------------------------------------------------------
Kaiser Aluminum Corporation and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Delaware to deny the payment
request of Orrick, Herrington & Sutcliffe LLP for fees and
expenses related to the Net Operating Losses Motion and Protocol.
Orrick Herrington on behalf of the Official Committee of Retired
Salaried Employees and Voluntary Employees' Beneficiary
Association Trust for Salaried Retirees, reached an agreement with
the Debtors regarding the latter's NOL Motion.
The agreed resolution was in the form of a Protocol for Pre-
Effective Date Sales, which permits the Salaried VEBA Trust to
sell a portion of its interest under the Debtors' Reorganization
Plan, Kimberly D. Newmarch, Esq., at Richards, Layton & Finger, in
Wilmington, Delaware relates.
For work purportedly done on behalf of the Retiree's Committee,
Orrick requested interim payment of $27,548 in fees and $1,052 in
expenses for March 2006 and $38,661 in fees and $500 in expenses
for the next month.
In the March Statement, $24,318 of the fees and at least $1,044 of
the expenses relate to work done in connection with the NOL Motion
and the Protocol. About $36,087 in fees and at least $334 in
expenses related to the same work were included in the April 2006
Statement.
The Debtors, however, contend that Orrick's NOL Motion and
Protocol-related fees and expenses should be borne by the Salaried
VEBA Trust.
Ms. Newmarch explains that the issues raised in the NOL Motion and
resolved by the Protocol affect only the Salaried VEBA Trust and
not the Retiree's Committee. She asserts that Orrick's allocation
of the fees at issue appears to be a misguided attempt to sidestep
the cap on the Salaried VEBA Trust's administrative costs.
The Debtors insist that they will only reimburse administrative
costs only to the extent provided in the Amended Retiree Medical
Agreement.
Retirees Committee Objects
Frederick D. Holden, Jr., Esq., at Orrick, Herrington & Sutcliffe
LLP, in San Francisco, California, asserts that the fees and
expenses contested by the Debtors were reasonably incurred by the
Official Committee of Retired Salaried Employees to preserve the
rights of the salaried retirees.
Mr. Holden notes that the Retirees Committee has been directed to
serve as the authorized representative of the salaried retirees in
the Debtors' Chapter 11 cases, until the Plan becomes effective.
All reasonable legal fees incurred by the Retirees Committee in
performing its duties through the effective date of the Plan
should be paid by the bankruptcy estate, Mr. Holden asserts.
The NOL Motion sought the Court's restriction of rights granted
under the Reorganizing Debtors' settlement agreement with the
Retirees Committee. The Retirees Committee was therefore a proper
objecting party, Mr. Holden asserts. He adds that Section 1114 of
the Bankruptcy Code make it the duty of the Retirees Committee to
oppose motions that would adversely impact retiree benefits.
Accordingly, Orrick's NOL Motion-related fees and expenses should
not be borne by the Salaried VEBA Trust, Mr. Holden asserts.
Mr. Holden assures the Court that all of Orrick's fees incurred in
connection with the modification of the Protocol have been billed
exclusively to the Salaried Retirees VEBA, since the group
requested the revisions.
The Reorganizing Debtors caused the subject expense, which should
not be borne by the salaried retirees, Mr. Holden maintains.
Mr. Holden notes that, in settlement negotiations with the
Retirees Committee in early 2004, the Debtors never requested any
restriction on sales of rights before the effective date of the
Plan. When the Debtors became aware of their desire for a
restriction, they directed the NOL Motion to the rights of the
salaried retirees, without raising the issue with the Retiree
Committee.
No one knows what might have been accomplished if negotiations had
preceded the filing of the NOL Motion, but the salaried retirees
should not have to pay for that tactical decision by the Debtors,
Mr. Holden says.
The Retirees Committee asks the Court to overrule the Debtors'
objection.
Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications. The Company filed for chapter 11 protection on Feb.
12, 2002 (Bankr. Del. Case No. 02-10429), and has sold off a
number of its commodity businesses during course of its cases.
Corinne Ball, Esq., at Jones Day, represents the Debtors in their
restructuring efforts. Lazard Freres & Co. serves as the Debtors'
financial advisor. Lisa G. Beckerman, Esq., H. Rey Stroube, III,
Esq., and Henry J. Kaim, Esq., at Akin, Gump, Strauss, Hauer &
Feld, LLP, and William P. Bowden, Esq., at Ashby & Geddes
represent the Debtors' Official Committee of Unsecured Creditors.
The Debtors' Chapter 11 Plan became effective on July 6, 2006. On
June 30, 2004, the Debtors listed $1.619 billion in assets and
$3.396 billion in debts. (Kaiser Bankruptcy News, Issue No. 100;
Bankruptcy Creditors' Service, Inc., 609/392-0900)
KEITH EICKERT: Escada Apparel Purchases Were Fraudulent Conveyance
------------------------------------------------------------------
The Honorable Jerry A. Funk of the U.S. Bankruptcy Court for the
Middle District of Florida ruled that apparel purchases from
Escada (USA), Inc., by Keith Eickert Power Products, LLC's owner
didn't benefit the estate, the transaction by the Debtor's
principal was a fraudulent conveyance, and the post-confirmation
estate may recover the transfer.
That $2,800 transfer was made by Juliana Sullivan, the Debtor's
owner or part-owner, to pay for women's designer fashion using the
Company's debit card. Ms. Sullivan bought the merchandise on Nov.
20, 2002, at Escada's store in Bal Harbor, Florida.
Judge Funk determined that Keith Eickert met its burden of proving
that the transfer was constructively fraudulent under Section 548
of the Bankruptcy Code by demonstrating that:
(1) there was transfer of an interest in the debtor's
property;
(2) the transfer occurred within one year prior to the
petition date;
(3) the Debtor received less than reasonably equivalent value
in exchange for the transfer; and
(4) the Debtor was insolvent on the date of the transfer.
To expedite the court's resolution of the Debtor's fraudulent
conveyance complaint, Keith Eickert and Escada stipulated to three
key facts:
(a) the Company had a property interest in its own bank
account funds;
(b) the Escada Purchase was within one year prior to the
Debtor's bankruptcy filing on May 21, 2003; and
(c) as of November 2002, the Company's liabilities exceeded
its assets by around $1.8 million.
The disputed issue was whether Keith Eickert received less than
reasonably equivalent value in exchange for transfer.
In a decision published at 2006 WL 1724376, the Court opined that
the clothes Ms. Sullivan purchased didn't benefit the marine
engine manufacturer. The Court agrees with the Debtor that the
exchange did not provide the Company with a reasonably equivalent
value in exchange for its funds. Judge Funk rejected Escada's
"inventive argument" that the Company received reasonably
equivalent value because Ms. Sullivan's haute couture purchases
bearing the Escada name should be valued based on the market price
of the merchandise determined objectively by the fashion-savvy
buyer. Escada's high-fashion clothing and accessories are
intrinsically useless to a marine specialty company, Judge Funk
says.
Judge Funk further ruled that the constructively fraudulent
transfer is recoverable from Escada under Section 550 of the
Bankruptcy Code, and Keith Eickert proved that Escada was the
initial transferee of the funds.
Using the Eleventh Circuit's test taught in Andreini & Co. v. Pony
Express Delivery Services, Judge Funk determined that Ms.
Sullivan's use of Company funds to purchase merchandise from
Escada because of her special position as owner or part-owner of
the Company did not confer on her initial transferee status. Ms.
Sullivan was a mere conduit in transferring funds from the Company
in exchange for the merchandise from Escada.
Gardner F. Davis, Esq., at Foley & Lardner LLP, represented
Escada, the international luxury fashion retailer with 500 stores
in 60 countries.
The Debtor has a separate adversary proceeding seeking recovery of
more than $1 million pending against Ms. Sullivan based on other
allegations that she dipped into company property for her own
personal use anmd disregarded the distinction between Company
property and her personal property.
Keith Eickert Power Products, LLC, a Delaware limited liability
company, manufacturers and sells marine engines and products. The
Company filed for chapter 11 protection on May 21, 2003 (Bankr.
M.D. Fla. Case No. 03-05234-3F1). Robert D. Wilcox, Esq., at the
Wilcox Law Firm in Jacksonville, Florida, represents the Debtor.
LIONEL LLC: Wants Open-Ended Extension of Exclusive Periods
-----------------------------------------------------------
Lionel L.L.C. and Liontech Company ask the Honorable Burton R.
Lifland of the U.S. Bankruptcy Court for the Southern District of
New York in Manhattan to extend their exclusive period to file a
plan of reorganization from July 31, 2006, through and including
the date that is 120 days after the date on which the Sixth
Circuit decision with respect to Lionel's Appeal on the United
States District Court for the Eastern District of Michigan's
decision on the Mike's Train House, Inc., litigation, is entered
on the docket.
The Debtors also want to extend their exclusive period to solicit
acceptances of that plan from Sept. 30, 2006, through and
including the date that is 180 days after the date on which the
Sixth Circuit decision in respect of the Appeal is entered on the
docket.
Mike's Train Litigation
One of Lionel's main competitors is Mike's Train House, Inc. In
2000, MTH sued Lionel in the United States District Court for the
Eastern District of Michigan, accusing Lionel, among other things,
of violating the Michigan Uniform Trade Secrets Act, Mich. Comp.
Laws Section 445.1901 et seq.
MTH's suit was based upon allegations that Korea Brass -- one of
Lionel's former Korean suppliers -- stole confidential design
drawings and scheduling information from MTH's Korean supplier,
Samhongsa, and then used that information to design and build
trains for Lionel.
MTH further alleged that Lionel knew or should have known that its
trade secrets were being incorporated into Lionel products, and
contended that it had experienced both lost sales and an erosion
of its overall profitability as a result of the misconduct.
Lionel strongly disputed all of MTH's allegations.
On June 9, 2004, the jury in the MTH Litigation returned a verdict
in favor of MTH and against Lionel in the amount of $38,608,305,
and on Nov. 3, 2004, the Michigan District Court entered judgment
in favor of MTH in the amount of the jury verdict. The Michigan
District Court also granted MTH certain injunctive relief against
Lionel.
Sixth Circuit Appeal
Lionel filed its appeal on Jan. 15, 2005, in the United States
Court of Appeals for the Sixth Circuit. The Sixth Circuit held
oral arguments on June 7, 2006. Lionel and MTH believe that a
decision of the Sixth Circuit should be rendered on or before
Dec. 31, 2006. However, there can be no assurance when that
decision will be available, or what the outcome of the Appeal will
be.
Reasons for Extension
The Debtors said they have made substantial progress in their
reorganization efforts. The Debtors said that they have increased
sales and hired new management.
The Debtors also entered into new license agreements:
-- to use certain trademarks and other proprietary property of
National Association for Stock Car Auto Racing, certain of
its drivers, and the Metropolitan Transportation Authority;
-- to perform under marketing, sale, and licensing agreements
with Sanda Kan Industrial (1981) Ltd. and NC Train
Acquisition LLC or another subsidiary or designee of Sanda
Kan, which details the Debtors' rights and obligations
relating to the use and commercial exploitation of the
assets of the Debtors' former competitor model train maker,
MDK, Inc., dba K-Line Electric Trains, which assets were
acquired by Newco. Under these agreements, Lionel has the
exclusive right to sell, market, and operate certain K-Line
Electric Train products and other brands formerly owned by
MDK, Inc.; and
-- to perform under a joint venture agreement with Creative
Trains Company. Pursuant to the joint venture agreement,
CTC agreed to provide the Debtors with the intellectual
property underlying the next generation of the TMCC
operating system.
The Debtors said that terminating the exclusive periods at this
juncture will unnecessarily invite additional litigation and
divert the Debtors' personnel and their professionals from
vigorously and carefully pursuing new business opportunities
without actually furthering the plan formulation process.
Extending the Debtors' exclusive periods will allow their
management to continue focusing on the growth of the business and
will be given an appropriate amount of time to formulate and
propose a confirmable plan of reorganization.
The Debtors said they are current on all post-petition obligations
and anticipate that they will be able to continue to pay their
bills as they come due.
Judge Lifland will convene a hearing at 10:00 a.m. on July 25,
2006, to consider the Debtors' request. Objections to the
Debtors' motion, if any, must be submitted by 5:00 p.m. on
July 21, 2006.
About Lionel LLC
Headquartered in Chesterfield, Michigan, Lionel LLC --
http://www.lionel.com/-- sells model train products,
including steam and die engines, rolling stock, operating and non-
operating accessories, track, transformers and electronic control
devices. The Company filed for chapter 11 protection on Nov. 15,
2004 (Bankr. S.D.N.Y. Case No. 04-17324). Adam Craig Harris,
Esq., and Adam L. Hirsch, Esq., at Schulte Roth & Zabel, LLP, and
Abbey Walsh Ehrlich, Esq., at O'Melveny & Myers, LLP, represent
the Debtors on their restructuring efforts. When the Company
filed for protection from its creditors, it estimated assets
between $10 million and $50 million and estimated debts more than
$50 million.
MAAX HOLDINGS: Posts $6.323 Million Net Loss in First Quarter 2006
------------------------------------------------------------------
MAAX Holdings Inc. reported earnings for the first quarter ended
May 31, 2006. Net sales for the first quarter of fiscal 2007
increased 3.9% to $144.4 million from net sales of $139 million
for the first quarter of fiscal year 2006. Operating income for
the fiscal 2007 first quarter decreased by $1.8 million, or 24%,
from $7.5 million in the first quarter of fiscal 2006 to
$5.7 million in the first quarter of fiscal 2007.
For the three months ended May 31, 2006, the Company reported a
net loss of $6,323,000 compared to a net income of $717,000 for
the three months ended May 31, 2005.
The Company discloses that for its Bathroom Sector, net sales
increased by $10.2 million, or 9%, compared with the first quarter
of fiscal 2006, to reach $123.5 million. The Company says that
there was good demand for its products despite slowing housing
construction activities due to the success in introducing new
products and signing new customers. Sales were also favorably
impacted by the stronger Canadian dollar. Operating income for
the Company's Bathroom Sector increased by $1.5 million, or 18%,
to $9.9 million for the first quarter of fiscal 2007, despite
higher raw material costs and freight costs when comparing with
the same period last year.
The good results from our Bathroom Sector have been partly offset
by the disappointing results from the Company's Cabinetry Sector
and Spa Sector which have both gone through important operational
transitions during the first quarter of the current fiscal year.
Free cash flow for the first quarter of fiscal 2007 was negative
$16.7 million compared with positive $3.3 million for the same
period last year. This reduction in cash flow results from lower
operating income, the non-recurring gains realized under currency
hedging contracts last year and the need to invest in working
capital in order to support sales growth and new product
introduction. Total net debt of $480.1 million at May 31, 2006
increased from February 28, 2006 levels of $457.1 million.
Long-term debt
On May 30, 2006, the Company obtained an amendment under its
senior secured credit facility to avoid a potential default of
certain financial covenants set forth in its senior secured credit
facility for the quarter ending May 31, 2006. This amendment
provides that, if certain of the Company's shareholders invest at
least $7 million in the Company by July 15, 2006, the lenders will
waive any such default. The Company says that its sponsors have
provided it with an equity commitment letter, pursuant to which
they have agreed to make such investment. The Company has agreed
that the aggregate outstanding amount of loans and letters of
credit under the revolving portion of its senior secured credit
facility will not exceed CDN$30 million until such investment is
made.
In addition, the amendment increased the applicable margin of the
term loan A to 2.75%, based on a grid pricing. The amendment also
incorporates a new provision that allows the Company in the
future, under certain conditions, to utilize certain cash
contributions to its equity to cure a failure to satisfy the
interest coverage ratio, fixed charge coverage ratio or leverage
ratio financial covenants set forth in our senior secured credit
facility, on a ratio of 1:1 to the adjusted EBITDA, as defined in
its senior secured credit facility, and the financial covenants
would then be recalculated using said increased adjusted EBITDA
amount.
About MAAX Holdings
MAAX Holdings, Inc. -- http://www.maax.com/-- manufactures
bathroom products, kitchen cabinets and spas for the residential
housing market. The corporation is committed to offering its
customers an enjoyable experience: distinctive, stylish and
innovative products and the best customer service practices in the
industry. MAAX offerings are available through plumbing
wholesalers, bath, kitchen and spa specialty boutiques and home
improvement centers. The corporation currently operates 26
manufacturing facilities and independent distribution centers
throughout North America and Europe. MAAX Corporation is a
subsidiary of Beauceland Corporation, itself a wholly owned
subsidiary of MAAX Holdings, Inc.
* * *
As reported in the Troubled Company Reporter on June 14, 2006,
Standard & Poor's Ratings Services lowered its long-term corporate
credit rating on Quebec-based bathroom fixtures manufacturer MAAX
Holdings Inc. to 'CCC+' from 'B-'. At the same time, Standard &
Poor's lowered its rating on the company's senior discount notes
to 'CCC-' from 'CCC'.
The long-term corporate credit rating on subsidiary MAAX Corp. was
also lowered to 'CCC+' from 'B-'. In addition, Standard & Poor's
lowered its ratings on the subsidiary's secured bank facilities to
'CCC+' from 'B-', with a recovery rating of '3', and on the
subsidiary's senior subordinated debt notes to 'CCC-' from 'CCC'.
The outlook is negative.
MARINER MOTEL: Bankruptcy Auction to be Held on August 15
---------------------------------------------------------
Tom C. Smith, Jr., Chapter 7 Trustee for Mariner Motel Inc.,
jointly retained Keen Realty, LLC and Zeb Barfield, Inc. to market
and sell the Mariner Motel, a 92-room hotel located in
Chincoteague, Virginia.
A public auction of the Debtor's real estate and personal property
will be held on Aug. 15, 2006 at 12:00 noon and will take place at
the Debtor's place of business, the Mariner Motel located at 6273
Maddox Boulevard in Chincoteague, Virginia.
A minimum bid will not be required at the time of the auction,
however the highest bidder at the auction must make a deposit at
the conclusion of the auction sale in the amount of $75,000 in
certified funds. Closing of the sale shall occur within 45 days
of the date of the auction.
"This is an excellent opportunity for developers, investors, and
hotel and motel users," states Matthew Bordwin, Executive Vice
President and Principal of Keen Realty. "All interested parties
must act immediately as we have an auction set for Aug. 15, 2006."
Keen Realty, LLC -- http://www.keenconsultants.com/-- is a real
estate consulting firm specializing in maximizing the value of its
clients' real estate assets nationwide. Zeb Barfield, Inc. --
http://www.zebsauctions.com/-- is a professional auctioneer who
is committed to effective and economical methods of marketing real
estate and personal property.
Contact:
Keen Realty, LLC
Telephone (516) 482-2700
Zeb Barfield, Inc.
Telephone (410) 957-9559
Based in Chincoteague, Virginia, Mariner Motel Inc. offers a
variety of housing including standard guest rooms, economy rooms,
deluxe rooms, and one or two bedroom suites. Amenities on site
include an outdoor pool, a sun deck, a beach area, a children's
play area, guest laundry facilities, a screened pavilion, and a
Chincoteague pony on the premises.
MAXXAM INC: Can Sell Up to 3.5 Million Kaiser Aluminum Shares
-------------------------------------------------------------
MAXXAM Inc. recently contacted Kaiser Aluminum Corporation and its
debtor-affiliates about selling up to 3,500,000 shares of Kaiser
Aluminum Corp. stock.
Kaiser Aluminum has determined that the proposed disposition would
not adversely impact its tax attributes.
Accordingly, Kaiser Aluminum and MAXXAM have reached an agreement
to modify their July 23, 2002 stipulation and agreed order to
permit MAXXAM's proposed disposition.
At the parties' behest, the U.S. Bankruptcy Court for the District
of Delaware authorizes MAXXAM to sell up to 3,500,000 shares of
its KAC stock.
Judge Fitzgerald clarifies that other than the proposed sale,
MAXXAM will continue to be prohibited from disposing of any of its
remaining KAC stock prior to a hearing pursuant to its agreement
with KAC.
About Kaiser Aluminum
Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications. The Company filed for chapter 11 protection on Feb.
12, 2002 (Bankr. Del. Case No. 02-10429), and has sold off a
number of its commodity businesses during course of its cases.
Corinne Ball, Esq., at Jones Day, represents the Debtors in their
restructuring efforts. Lazard Freres & Co. serves as the Debtors'
financial advisor. Lisa G. Beckerman, Esq., H. Rey Stroube, III,
Esq., and Henry J. Kaim, Esq., at Akin, Gump, Strauss, Hauer &
Feld, LLP, and William P. Bowden, Esq., at Ashby & Geddes
represent the Debtors' Official Committee of Unsecured Creditors.
The Debtors' Chapter 11 Plan became effective on July 6, 2006. On
June 30, 2004, the Debtors listed $1.619 billion in assets and
$3.396 billion in debts.
About MAXXAM Inc
Headquartered in Houston, Texas, MAXXAM Inc. (AMEX: MXM)
operates businesses ranging from aluminum and timber products to
real estate and horse racing. MAXXAM's top revenue source is
Kaiser Aluminum, which has been in Chapter 11 bankruptcy since
2002. MAXXAM's timber subsidiary, Pacific Lumber, owns about
205,000 acres of old-growth redwood and Douglas fir timberlands in
Humboldt County, California. MAXXAM's real estate interests
include commercial and residential properties in Arizona,
California, Texas, and Puerto Rico. The Company also owns the Sam
Houston Race Park, a horseracing track near Houston. Chairman and
CEO Charles Hurwitz controls 77% of MAXXAM.
* * *
Maxxam's balance sheet at March 31, 2006 showed a $671.3 million
total stockholders' deficit resulting from $1,013.1 million in
total assets and $1,684.4 million in total liabilities.
MESABA AIRLINES: Can Reject Contracts With Pilots & Mechanics
-------------------------------------------------------------
The Hon. Gregory Kishel of the U.S. Bankruptcy Court for Minnesota
granted Mesaba Aviation, Inc.'s motion for authority to reject its
contract with flight attendants, pilots and mechanics. This
ruling only authorizes Mesaba to make changes to its collective
bargaining agreements at a time that it determines to be
appropriate. The ruling does not mean changes are imposed
automatically.
The Court directed Mesaba to give the labor groups a 10-day notice
before rejecting the contracts and imposing new terms.
"For months, Mesaba's efforts have been focused on reaching
consensual agreements with its unions and that is where they
continue to be," said John Spanjers, Mesaba Airlines president and
COO. "We prefer consensual agreements and believe that they are
in the best interest of all involved - the company, its employees,
and our passengers. However, Northwest Airlines' bankruptcy and
its subsequent actions, along with the continuing distress
impacting the entire industry, require us to take sweeping
measures to secure Mesaba's future."
If no agreement is reached, the company is authorized to implement
the most recent proposals it presented to each group represented
by the Association of Flight Attendants, the Airline Pilots
Association and the Aircraft Mechanics Fraternal Association.
Mesaba has reached agreements on permanent wage and benefit
reductions with the Transport Workers Union. The ruling does not
impact Mesaba's operations or its obligations to Northwest or to
its passengers -- Mesaba intends to fly its full schedule.
About Mesaba Aviation
Headquartered in Eagan, Minnesota, Mesaba Aviation, Inc., dba
Mesaba Airlines -- http://www.mesaba.com/-- operates as a
Northwest Airlink affiliate under code-sharing agreements with
Northwest Airlines. The Company filed for chapter 11 protection
on Oct. 13, 2005 (Bankr. D. Minn. Case No. 05-39258). Michael L.
Meyer, Esq., at Ravich Meyer Kirkman McGrath & Nauman PA,
represents the Debtor in its restructuring efforts. Craig D.
Hansen, Esq., at Squire Sanders & Dempsey, L.L.P., represents the
Official Committee of Unsecured Creditors. When the Debtor filed
for protection from its creditors, it listed total assets of
$108,540,000 and total debts of $87,000,000.
MIRANT CORP: $1.2 Bil. Equity Buy Back Cues Moody's to Cut Ratings
------------------------------------------------------------------
Moody's Investors Service downgraded the ratings of Mirant
Corporation and its subsidiaries Mirant North America, LLC and
Mirant Americas Generation, LLC. The Ba2 rating for Mirant Mid-
Atlantic, LLC's secured pass through trust certificates was
affirmed. Additionally, Mirant's Speculative Grade Liquidity
rating was revised to SGL-2 from SGL-1. The rating outlook is
stable for Mirant, MNA, MAG, and MIRMA.
This rating action follows Mirant's announcement that it plans to
repurchase up to $1.25 billion of common stock, to pursue the sale
of its international businesses and to continue to return cash to
shareholders after it generates proceeds from the sale of the
international assets. The international assets contributed about
40% of consolidated year-to-date EBITDA.
"The downgrades reflect Moody's belief that key financial coverage
ratios will now be weaker than previously expected over the next
several years due to the sharp shift in management's financial
strategy towards increased shareholder rewards that reduce the
level of protection for debt holders" said Moody's Vice President
Scott Solomon.
These concerns are exacerbated by challenges confronting the
company to fund a capital expenditure program that could require
as much as $2 billion of capital over the next several years.
While Mirant expects to generate sufficient cash to meet all of
its capital requirements, the potential volatility of its cash
flow combined with very large cash payments to equity holders
causes concern that leverage may be increased. Moody's notes that
Mirant's financing documents provide considerable flexibility for
the incurrence of additional indebtedness.
Moody's previous ratings incorporated the expectation that Mirant
would generate consolidated cash flow of at least 10% of total
consolidated debt and that this ratio would gradually improve as
the company used excess cash flow to reduce debt. Given Mirant's
strategic direction however we now anticipate that this ratio will
be pressured and could trend downward in 2007 and 2008.
With the exception of MIRMA, the previous notching differential
between the ratings of the issuers are maintained and reflect
structural subordination and the relative benefit of the
collateral for each debt instrument.
The affirmation of MIRMA's rating considers its direct holding of
some of Mirant's most competitively positioned generating assets,
its significant hedged position through 2008 and the benefit of a
$75 million rent reserve.
The revision of the Speculative Grade Liquidity rating to SGL-2
reflects a reduction in financial flexibility and cash on hand
as the company will use a portion of its cash to achieve the
stock repurchase program. The initial repurchase of up to
$1.25 billion is expected to be completed in the third quarter and
to be funded with a combination of cash on hand and funds to be
contributed upstream from a term loan borrowing at Mirant's
Philippines business.
Expected available cash upon completion of the repurchase program
is $200 million at Mirant and $105 million at MNA. Additional
liquidity is expected to be available through MNA's $800 million
senior secured bank facility that was undrawn at March 31, 2006.
MNA also has access to $200 million of synthetic letters of credit
that is used to provide liquidity to its energy trading business.
Downgrades:
Issuer: Mirant Americas Generation, LLC.
* Senior Unsecured Regular Bond/Debenture, Downgraded to B3
from B2
Issuer: Mirant Corporation
* Corporate Family Rating, Downgraded to B2 from B1
* Speculative Grade Liquidity Rating, Downgraded to SGL-2 from
SGL-1
Issuer: Mirant North America, LLC
* Senior Secured Bank Credit Facility, Downgraded to B1 from
Ba3
* Senior Unsecured Regular Bond/Debenture, Downgraded to B2
from B1
Mirant Corporation is an independent power producer that owns or
leases a portfolio of electricity generating facilities totaling
17,600 megawatts. MAG, MNA and MIRMA are indirect wholly-owned
subsidiaries of Mirant Corporation. Mirant is headquartered in
Atlanta, Georgia.
O'SULLIVAN INDUSTRIES: Sells United Kingdom Business Operations
---------------------------------------------------------------
In a regulatory filing with the Securities and Exchange
Commission, Rick A. Walters, president and chief executive officer
of O'Sullivan Industries Holdings, Inc., reports that effective
June 30, 2006, the company conveyed substantially all of the
assets of its United Kingdom sales and distribution office to a
company formed by the former manager of the office. The
purchasing company assumed certain of the liabilities of the UK
sales and distribution office as consideration.
The purchasing company also entered into a distributorship
agreement with O'Sullivan Industries to provide for continued
sales and service in the United Kingdom, the remainder of Europe,
the Middle East and Africa.
Mr. Walters states that in connection with the sale of the UK
operations, O'Sullivan Industries expects to record a non-cash
charge of $1,600,000. The major components of the charge are
expected to be:
Accounts receivable $1,600,000
Inventory 300,000
Prepaid assets 700,000
Others 400,000
Liabilities assumed (1,400,000)
"We expect that this transaction will have an positive effect on
our earnings commencing with the first quarter of fiscal 2007,"
Mr. Walters relates.
Headquartered in Roswell, Georgia, O'Sullivan Industries Holdings,
Inc. -- http://www.osullivan.com/-- designs, manufactures, and
distributes ready-to-assemble furniture and related products,
including desks, computer work centers, bookcases, filing
cabinets, home entertainment centers, commercial furniture, garage
storage units, television, audio, and night stands, dressers, and
bedroom pieces. O'Sullivan sells its products primarily to large
retailers including OfficeMax, Lowe's, Wal-Mart, Staples, and
Office Depot. The Company and its subsidiaries filed for chapter
11 protection on Oct. 14, 2005 (Bankr. N.D. Ga. Case No. 05-
83049). Joel H. Levitin, Esq., at Dechert LLP, represents the
Debtors. Michael H. Goldstein, Esq., Eric D. Winston, Esq., and
Christine M. Pajak, Esq., at Stutman, Treister & Glatt, P.C.,
represent the Official Committee of Unsecured Creditors. On Sept.
30, 2005, the Debtor listed $161,335,000 in assets and
$254,178,000 in debts. (O'Sullivan Bankruptcy News, Issue No. 20;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
O'SULLIVAN INDUSTRIES: To Close Virginia Facility by Year-End 2006
------------------------------------------------------------------
O'Sullivan Industries Holdings, Inc., reports in a filing with the
Securities and Exchange Commission, that it has decided to close
the South Boston, Virginia manufacturing and distribution facility
owned by O'Sullivan Industries - Virginia, Inc., by the end of the
year.
"The closure is a result of the continued execution of our
strategy focused on improving utilization of production capacity
and productivity," Rick A. Walters, president and chief executive
officer of O'Sullivan Holdings says. "This decision stems from an
analysis of our activities as a whole and the implementation of
measures aimed primarily at continuing to improve our operational
efficiency."
According to Mr. Walters, the closure is a result of industry wide
excess capacity and is not a reflection on the workforce or
management team in the company's South Boston facility.
"In fact, the plant has demonstrated continuous operational
improvement and is consistently meeting customer quality and
delivery requirements," Mr. Walters recounts. "However, there is
an immediate need to improve our capacity utilization and optimize
overall company performance."
In connection with the closure of the South Boston facility, the
company expects to spend $6,200,000, of which approximately
$1,500,000 will be cash costs. The remainder will be an
impairment charge against our Virginia machinery and equipment,
Mr. Walters discloses.
The company expects to incur these charges:
Category Amount
-------- ------
Impairment charge against machinery & equipment $4,700,000
Severance and personnel 480,000
Relocation, recruitment and training 685,000
Facility preparation and shutdown 220,000
Others 90,000
"The South Boston facility employs 200 people. We plan to add up
to 150 jobs to our Lamar, Missouri facility over the next twelve
months as a result of the consolidation," Mr. Walters further
discloses.
The company expects to record an impairment charge of $4,700,000
against machinery and equipment located at the South Boston
facility.
"None of this charge will be cash," Mr. Walters reported. "This
charge is in addition to the $1,500,000 expense we expect to incur
in connection with the closing of our South Boston, Virginia
facility."
Headquartered in Roswell, Georgia, O'Sullivan Industries Holdings,
Inc. -- http://www.osullivan.com/-- designs, manufactures, and
distributes ready-to-assemble furniture and related products,
including desks, computer work centers, bookcases, filing
cabinets, home entertainment centers, commercial furniture, garage
storage units, television, audio, and night stands, dressers, and
bedroom pieces. O'Sullivan sells its products primarily to large
retailers including OfficeMax, Lowe's, Wal-Mart, Staples, and
Office Depot. The Company and its subsidiaries filed for chapter
11 protection on Oct. 14, 2005 (Bankr. N.D. Ga. Case No. 05-
83049). Joel H. Levitin, Esq., at Dechert LLP, represents the
Debtors. Michael H. Goldstein, Esq., Eric D. Winston, Esq., and
Christine M. Pajak, Esq., at Stutman, Treister & Glatt, P.C.,
represent the Official Committee of Unsecured Creditors. On Sept.
30, 2005, the Debtor listed $161,335,000 in assets and
$254,178,000 in debts. (O'Sullivan Bankruptcy News, Issue No. 20;
Bankruptcy Creditors' Service, Inc., 215/945-7000)
ONE TO ONE: U.S. Trustee Says Disclosure Statement is Inadequate
----------------------------------------------------------------
Pheobe Morse, the U.S. Trustee for Region 1 gave a limited
objection to the Disclosure Statement jointly submitted by One to
One Interactive, LLC, and its Official Committee of Unsecured
Creditors to the U.S. Bankruptcy Court for the District of
Massachusetts in Boston.
The U.S. Trustee said that the Disclosure Statement explaining the
Joint Plan of Liquidation failed to provide adequate information
regarding its proposed plan of reorganization.
The U.S. Trustee said that the Disclosure Statement and Plan
should be amended to:
(a) indicate the amount of any prepetition and postpetition
Federal and state tax obligations;
(b) remove language regarding cram-down where the plan provides
for voting by a single class of non-insider claimants
namely, the Class 3 general unsecured creditors; and
(c) discuss in detail the 5-part Master Mortgage test with
respect to the proposed third-party release set forth in
the plan.
The U.S. Trustee said that the Disclosure Statement and Plan
should be amended to include this paragraph:
The Debtor (or Liquidating Agent) will be responsible for
timely payment of fees incurred pursuant to Section 1930(a)(6)
of the Judiciary and Judicial Procedures. After confirmation,
the Debtors (or Liquidating Agent) will serve the U.S. Trustee
with a monthly financial report for each month, as the case
remains open. The monthly financial report will include:
(1) a statement of all disbursements made during the course of
the month, whether or not pursuant to the plan;
(2) a summary, by class, of amounts distributed or property
transferred to each recipient under the plan, and an
explanation of the failure to make any distributions or
transfers of property under the plan;
(3) Debtors' projections as to its continuing ability to comply
with the terms of the plan;
(4) a description of any other factors, which may materially
affect the Debtor's ability to consummate the plan; and
(5) an estimated date when an application for final decree will
be filed with the court (in the case of the final monthly
report, the date the decree was filed).
The U.S. Trustee said that the matters have been resolved and the
Debtor intends to file an amended disclosure statement and plan.
Summary of the Original Plan
The Plan does not contemplate the financial rehabilitation of the
Debtor or the continuation of its business. Substantially of the
Debtor's assets have been sold since the start of the Debtor's
bankruptcy case, and the Plan considers that the remaining
unliquidated assets -- primarily causes of action -- will be
liquidated either by the Debtor or, after the Effective Date of
the Plan, by the Liquidating Agent appointed pursuant to the plan,
to administer the estate.
The Plan provides for a Liquidating Agent to assume possession and
control of the Debtor's remaining assets -- including causes of
action under the Bankruptcy Code.
The Liquidating Agent will:
-- administer those assets for the benefit of the Debtor's
creditors,
-- object to claims that appear to be invalid or overstated,
-- prosecute objections to claims filed by the Debtor or the
Liquidating Agent prior to confirmation of the Plan, and
-- make distributions to creditors on account of their allowed
claims against the Debtor.
The Debtor has ceased all business operations and has liquidated
virtually all of its property. The Debtor's principal asset is
approximately $900,000 in cash as of April 30, 2006.
The Plan places all general unsecured claims as Class Three. The
Debtor and the Creditors Committee estimate that each holder of a
Class Three Claim will receive a distribution in the range of 30%
to 35% of its allowed claim. This estimate assumes that general
unsecured claims allowed by the Bankruptcy Court will not exceed
$2.4 million. The actual dividend will depend on the amount in
which claims are ultimately allowed and the extent to which the
bankruptcy estate is augmented through recoveries of avoidable
transfers.
The holders of the Debtor's stock will receive nothing on account
of their equity interests.
A full-text copy of the original Disclosure Statement is available
for a fee at:
http://www.researcharchives.com/bin/download?id=060715000631
About One to One Interactive
Headquartered in Boston, Massachusetts, One to One Interactive,
LLC -- http://www.onetooneinteractive.com/-- provides Internet
marketing services and offers marketing, creative and technology
services to companies in industries like financial services, life
sciences, media, telecommunications and technology. The Debtor
filed for chapter 11 protection on March 18, 2005 (Bankr. D. Mass.
Case No. 05-12083). A. Davis Whitesell, Esq., at Cohn &
Whitesell, LLP, represents the Debtor in its restructuring
process. When the Debtor filed for protection from its creditors,
it estimated assets and debts from $1 million to $10 million.
ONEIDA LTD: Okays Proposed $222 Mil. Buyout by Investment Firms
---------------------------------------------------------------
Oneida Ltd. signed a Letter of Intent to be acquired by an entity
to be formed by D. E. Shaw Laminar Portfolios, L.L.C. and Xerion
Capital Partners LLC, both current Oneida shareholders.
Under the terms of the proposed transaction, Laminar and Xerion
will pay at least $222.5 million, or an amount sufficient to pay
in full the company's secured bank claims plus, among other
things, the payment or assumption of all other general unsecured
claims. In addition, the Buyers will include an element of
consideration for the company's common equity holders in
connection with securing their approval of the proposed
transaction.
"The proposed agreement with Laminar and Xerion represents a very
favorable outcome for Oneida and its stakeholders, including
creditors, shareholders, employees, vendors and our valued
customers," said Christopher H. Smith, Chairman of Oneida Ltd.
"The possible investment by these two widely respected firms
acknowledges the substantial progress Oneida has made in
transforming its business, which began more than 18 months ago.
These firms have had an opportunity to see our operations first-
hand as shareholders, and we are pleased that they support
Oneida's plan of reorganization. Importantly, their investment
would bring stability and a long-term perspective to Oneida's
shareholder base."
"This transaction would set the table for Oneida's growth," said
James E. Joseph, President of Oneida. "As an 18-year veteran of
Oneida, I am proud of what our people have achieved over the past
18 months, and I am truly excited about our future. We are
prepared, as I believe few in our industry are, to meet our
challenges, strengthen our business and provide exceptional
service to customers."
It is currently anticipated that the proposed transaction would be
in the form of an offer to purchase 100% of the equity interest of
Oneida through a plan funding agreement. Execution of a
definitive agreement is subject to, among other things, confirming
due diligence by the Buyers, standard regulatory approvals and
other conditions, including confirmation of Oneida's plan of
reorganization by the Bankruptcy Court. Should Oneida and the
Buyers fail to reach a definitive agreement, Oneida would move
forward to complete its original recapitalization plan, which is
supported by its lenders, in a timely manner.
About Oneida
Headquartered in Oneida, New York, Oneida Ltd. (OTC: ONEI) --
http://www.oneida.com/-- manufactures stainless steel and
silverplated flatware for both the Consumer and Foodservice
industries, and supplies dinnerware to the foodservice industry.
Oneida also supplies a variety of crystal, glassware and metal
serveware for the tabletop industries. The Company and its 8
debtor-affiliates filed for Chapter 11 protection on March 19,
2006 (Bankr. S.D. N.Y. Case Nos. 06-10489 through 06-10496).
Douglas P. Bartner, Esq., at Shearman & Sterling LLP represents
the Debtors. Credit Suisse Securities (USA) LLC is the Debtors'
financial advisor. Scott L. Hazan, Esq., and Lorenzo Marinuzzi,
Esq., at Otterbourg, Steindler, Houston & Rosen, P.C., represent
the Official Committee of Unsecured Creditors. Robert J. Stark,
Esq., at Brown Rudnick Berlack Israels LLP represents the Official
Committee of Equity Security Holders. When the Debtors filed for
protection from their creditors, they listed $305,329,000 in total
assets and $332,227,000 in total debts. On May 12, 2006, Judge
Gropper approved the Debtors' disclosure statement.
ORIENTAL TRADING: S&P Junks Rating on $180 Million 2nd-Lien Loan
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on Omaha,
Nebraska-based Oriental Trading Co. Inc., including its corporate
credit rating to 'B' from 'B+'. The outlook is negative. All
ratings are removed from CreditWatch, where they were placed on
June 14, 2006, with negative implications.
At the same time, Standard & Poor's assigned bank loan and
recovery ratings to the company's $640 million bank financing,
comprised of:
* a $410 million seven-year first-lien term loan;
* a $50 million six-year first-lien revolving credit facility;
and
* a $180 million, 7-1/2-year second-lien term loan.
The first-lien loans are rated 'B', the same as the corporate
credit rating, with recovery ratings of '2', indicating the
expectation of substantial recovery of principal in the event of
default.
The second-lien term loan is rated 'CCC+', two notches below the
borrower's corporate credit rating, with a recovery rating of '5',
indicating the expectation of negligible recovery of principal in
the event of default.
The proceeds of the credit facilities, along with the proceeds of
a $70 million mezzanine loan from Oriental Holding Corp. and about
$355 million in equity contribution from The Carlyle Group,
Brentwood, and OTC's management will be used to fund the
acquisition of OTC by The Carlyle Group and the repayment of
existing indebtedness. On June 11, 2006, the Carlyle Group
entered into a definitive agreement to acquire OTC from Brentwood
Associates.
"The downgrade reflects a significant increase in debt leverage
due to the largely debt-funded acquisition and an aggressive
financial policy," said Standard & Poor's credit analyst Ana Lai.
Debt leverage is expected to increase substantially, with pro
forma total debt to EBITDA increasing to about 7x for the 12
months ended April 1, 2006, from 4.5x.
The ratings on OTC reflect its highly leveraged capital structure,
thin cash flow protection measures, as well as the company's
participation in the highly competitive and fragmented toys,
novelties, party supplies, and home decor retailing industry, and
its modest size.
OWENS-BROCKWAY: Completes Partial Tender Offer for 8-7/8% Notes
---------------------------------------------------------------
Owens-Brockway Glass Container Inc. successfully completed its
partial tender offer for its 8-7/8 % Senior Secured Notes due
2009.
As of 5:00 p.m., New York City time, on July 11, 2006, holders of
Notes had tendered $827,474,000 in aggregate principal amount of
the Notes. Owens-Brockway Glass Container Inc. purchased
$100,000,000 principal amount of the Notes, or 12.1% of the
aggregate principal amount of Notes tendered, for a total price of
$103,998,110, including $3,998,110 of premiums, subject to the
terms and conditions of the tender offer. Owens-Brockway Glass
has also paid accrued and unpaid interest on all Notes accepted
for purchase up to, but not including, July 12, 2006, the
settlement date.
Banc of America Securities LLC served as the exclusive dealer
manager in connection with the tender offer.
Owens-Brockway Glass Container Inc. (NYSE: OI), an indirect wholly
owned subsidiary of Owens-Illinois, Inc. Based in Toledo, Ohio,
Owens-Illinois, Inc. -- http://o-i.com/-- manufactures glass
containers and plastic packaging products. For the year ended
Dec. 31, 2005, O-I had revenue of $7.2 billion.
* * *
As reported in the Troubled Company Reporter on May 11, 2006,
Moody's Investors Service assigned a B1 rating to the proposed
$1.5 billion senior secured first lien credit facilities of Owens-
Brockway Glass Container, the principal U.S. operating subsidiary
of Owens-Illinois, Inc. Moody's also affirmed Owens-Illinois' B2
corporate family rating and ratings on Owens-Illinois' senior
unsecured notes and preferred stock, rated B3 and Caa1, as well as
Owens-Brockway's secured and unsecured notes, rated B1 and B2.
Standard & Poor's Ratings Services assigned its 'BB-' rating and
its recovery rating of '2' to Owens-Illinois Inc.'s proposed
$1.5 billion senior secured credit facilities, based on
preliminary terms and conditions. The rating on the proposed
credit facilities is the same as the corporate credit rating; this
and the recovery rating of '2' indicate that lenders can expect
substantial recovery of principal in the event of a payment
default. Proceeds from the new credit facilities will be used to
repay the outstanding amount under the existing credit facilities.
Standard & Poor's also assigned its recovery rating of '2' to
Owens-Brockway Glass Container Inc.'s (a wholly owned subsidiary
of Owens-Illinois Inc.) existing $2.08 billion senior secured
notes. The senior secured notes are rated 'BB-'.
OWENS CORNING: Court Allows Shintech to Hold $7-Mil. Unsec. Claim
-----------------------------------------------------------------
The Honorable Judith K. Fitzgerald approves the settlement
agreement among Owens Corning and its debtor-affiliates and
Shintech Incorporated.
As previously reported, the Debtors obtained Court authority to
reject a resin supply contract with Shintech Incorporated.
In August 2001, Shintech sought allowance and payment of an
administrative expense claim for $10,591,530, which Shintech
later reduced to $3,666,329.
After discovery and arm's-length discussion, the parties entered
into a stipulation dismissing the Administrative Expense Claim
Motion, without prejudice.
Shintech also filed Claim No. 12105, a general unsecured, non-
priority claim against the Debtors, for $38,942,063. The Claim
is comprised of:
-- prepetition accounts receivable claim for $5,298,751; and
-- a claim based on failure to accept contract volume for
$33,643,312.
The Debtors objected to the Claim. In response, Shintech revised
the Claim amount to $14,061,447.
In February 2006, The Court permitted the Debtors to conduct
partial discovery from Shintech. Consequently, Shintech reduced
the Claim Amount to $4,488,430.
After engaging in negotiations, the Debtors and Shintech agreed
to enter into a settlement agreement to resolve their disputes.
The key terms of the Settlement are:
a. Claim No. 12105 will be allowed against Exterior Systems,
Inc., for $7,000,000 as a general unsecured, non-priority
claim, in full and final satisfaction of all claims,
liabilities or demands relating to the Supply Contract.
b. The Settlement Agreement provides for mutual releases from
all claims, liabilities and demands relating to the
Contract, including those that arose postpetition.
Owens Corning (OTC: OWENQ.OB) -- http://www.owenscorning.com/--
manufactures fiberglass insulation, roofing materials, vinyl
windows and siding, patio doors, rain gutters and downspouts.
Headquartered in Toledo, Ohio, the Company filed for chapter 11
protection on Oct. 5, 2000 (Bankr. Del. Case. No. 00-03837).
Norman L. Pernick, Esq., at Saul Ewing LLP, represents the
Debtors. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered,
represents the Official Committee of Asbestos Creditors. James J.
McMonagle serves as the Legal Representative for Future Claimants
and is represented by Edmund M. Emrich, Esq., at Kaye Scholer LLP.
(Owens Corning Bankruptcy News, Issue No. 135; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
OWENS CORNING: Wickes Wants Admin. Priority on Preference Claim
---------------------------------------------------------------
Wickes, Inc., asks the U.S. Bankruptcy Court for the District of
Delaware grant it an administrative priority in:
1. whatever amount of preference liability is determined in
the Preference Adversary Proceeding; and
2. the difference between the rebate to which it is entitled
and the amount it owes Owens Corning for postpetition
shipments.
Owens Corning sold goods on credit postpetition to Wickes. Wickes
is also a debtor under Chapter 11 protection. It filed for
bankruptcy on January 20, 2004, in the U.S. Bankruptcy Court for
the Northern District of Illinois.
Within 90 days before Wickes filed for bankruptcy, it paid Owens
Corning $3,658,311 for goods it bought. Wickes has brought suit
in its Bankruptcy Case to recover these preferential payments.
Steven K. Kortanek, Esq., at Klehr, Harrison, Harvey, Branzburg &
Ellers, LLP, in Wilmington, Delaware, points out that Wickes'
payments to Owens Corning was beneficial to Owens in the
operation of its business. Thus, the preference liability
associated with the payments is entitled to administrative
priority, Mr. Kortanek says.
Rebates
In Wickes' bankruptcy, Owens Corning has filed an Application for
Payment of Administrative Expense asserting that Wickes owes
Owens Corning $207,268 for shipments made after the Wickes filed
for bankruptcy. Wickes responded that it is entitled to a rebate
of over $825,000 based on its purchases from Owens Corning.
Wickes purchased goods from Owens Corning in 2004 and those
purchases were subject to a rebate program.
Mr. Kortanek asserts that Wickes is also entitled to an
administrative expense for the difference between the rebate to
which it is entitled to and the amount it owes Owens Corning for
postpetition shipments -- a sum greater than $617,000.
About Owens Corning
Owens Corning (OTC: OWENQ.OB) -- http://www.owenscorning.com/--
manufactures fiberglass insulation, roofing materials, vinyl
windows and siding, patio doors, rain gutters and downspouts.
Headquartered in Toledo, Ohio, the Company filed for chapter 11
protection on Oct. 5, 2000 (Bankr. Del. Case. No. 00-03837).
Norman L. Pernick, Esq., at Saul Ewing LLP, represents the
Debtors. Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered,
represents the Official Committee of Asbestos Creditors. James J.
McMonagle serves as the Legal Representative for Future Claimants
and is represented by Edmund M. Emrich, Esq., at Kaye Scholer LLP.
(Owens Corning Bankruptcy News, Issue No. 135; Bankruptcy
Creditors' Service, Inc., 215/945-7000)
PENHALL INTERNATIONAL: S&P Rates Proposed $175 Mil. Notes at CCC+
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to Penhall International Corp.
At the same time, Standard & Poor's assigned its 'CCC+' rating
and a recovery rating of '5' to Penhall's proposed $175 million
second-lien senior secured notes due 2014, indicating negligible
recovery of principal in the event of a default after full
recovery of the unrated senior ABL revolving credit facility.
The outlook is stable.
Anaheim, California-based Penhall is a construction service firm
specializing in construction and demolition contracting and other
road building services, which had about $215 million in sales in
fiscal 2006.
The ratings on Penhall reflect the company's modest positions in
small and fragmented niche construction services and related
equipment rental markets, and its highly leveraged profile.
Penhall provides highly specialized construction and demolition
contracting services. About 50% of its sales come from projects
in California, with the majority of work linked to publicly
financed, highway-related projects or to commercial construction.
In the past, spending in California for highway renovation and
commercial construction had been weak. Currently, nonresidential
construction spending has shown improvement, especially in
California. Fiscal conditions in California are healthier, while
higher appropriations in new federal highway legislation and
better industry conditions bode well for the company.
PETCO ANIMAL: Sells Assets to Investment Firms for $1.8 Billion
---------------------------------------------------------------
PETCO Animal Supplies, Inc. entered into a definitive agreement to
be acquired by two private equity investment firms, Leonard Green
& Partners, L.P. and Texas Pacific Group, for $29 per share in
cash. The total value of the transaction, including assumed debt,
is $1.8 billion.
The Board of Directors of PETCO, on the recommendation of an
Independent Committee of Directors, approved the merger agreement
and recommends that PETCO's stockholders adopt the agreement. The
transaction, which is expected to close by the fourth quarter of
2006, is subject to approval by PETCO's stockholders, as well as
other customary closing conditions, including the receipt of
regulatory approvals.
"Consistent with its fiduciary obligations, and in consultation
with its independent financial and legal advisors, PETCO's Board
of Directors formed an Independent Committee of Directors to
carefully review an expression of interest in acquiring PETCO, and
to determine what course of action would be in the best interest
of our stockholders," David B. Appel, the Chairman of the
Independent Committee of Directors, said. "After extensive
negotiations and careful consideration in conjunction with our
independent advisors, the Independent Committee of PETCO's Board
unanimously concluded that the agreement being announced today was
in the best interest of all of our constituencies, and, most
importantly, our stockholders."
In accordance with the merger agreement, the Company will conduct
a market test for 20 business days concluding Aug. 10, 2006.
"This proposed transaction provides PETCO stockholders with an
immediate cash premium for their investment in the company, based
on the trading range of PETCO shares over the past several
months," James M. Myers, Chief Executive Officer, said. "Upon
completion of the transaction, PETCO will be a private company
that will have greater flexibility to accomplish its long-term
plans, which, we believe, will be favorable for the company's
associates and suppliers and the customers we serve through more
than 800 stores nationwide. Texas Pacific Group and Leonard Green
& Partners have deep experience investing in the retail sector and
we look forward to working closely with them as our partners as we
continue to advance PETCO's position as a leading specialty
retailer of premium pet food, supplies and services."
UBS is acting as financial advisor to PETCO in connection with the
merger transaction and has rendered a fairness opinion to the
Independent Committee of PETCO's Board of Directors. Pillsbury
Winthrop Shaw Pittman LLP is serving as its legal counsel. Credit
Suisse, Bank of America, N.A., Wells Fargo Bank, N.A. and
mezzanine funds managed by Goldman, Sachs & Co. have provided
commitments for the debt portion of the financing for the
transaction, which are subject to customary conditions.
A full-text copy of the Merger Agreement is available for free at:
http://ResearchArchives.com/t/s?dcd
About Leonard Green & Partners
Leonard Green & Partners -- http://www.leonardgreen.com/-- is a
Los Angeles-based private equity firm specializing in organizing,
structuring and sponsoring management buy-outs, going-private
transactions and recapitalizations of established public and
private companies.
About Texas Pacific Group
Headquartered in Fort Worth, Texas, Texas Pacific Group --
http://www.texaspacificgroup.com/-- is a private investment firm
with more than $30 billion of assets under management. TPG
invests in world-class franchises across a range of industries and
has extensive experience with public and private investments
executed through leveraged buyouts, recapitalizations, take
private transactions, spinouts, joint ventures, and
restructurings.
About PETCO Animal
Based in San Diego, California, PETCO Animal Supplies, Inc.
(Nasdaq: PETC) -- http://www.petco.com/-- is a specialty retailer
of premium pet food, supplies and services. The Company operates
more than 800 stores in 49 states and the District of Columbia.
* * *
As reported in the Troubled Company Reporter on June 27, 2006,
Standard & Poor's Ratings Services revised its outlook on
San Diego, California-based PETCO Animal Supplies Inc.
(BB/Negative/--) to negative from stable.
The ratings on PETCO reflect the vulnerability of its customers to
changes in disposable income; the company's aggressive growth
strategy; and substantial debt leverage.
PHIBRO ANIMAL: Moody's Rates Proposed $240 Mil. Sr. Notes at B3
---------------------------------------------------------------
Moody's Investors Service assigned a B3 rating to the proposed new
senior unsecured note offering of Phibro Animal Health
Corporation. At the same time, Moody's affirmed the existing
ratings of Phibro, including the B2 corporate family rating.
The rating outlook is stable.
The B3 rating for the senior notes is being assigned in
conjunction with a complete refinancing of Phibro's capital
structure. The senior notes will be sold in a privately
negotiated transaction without registration rights under the
Securities Act of 1933 under circumstances reasonably designed to
preclude a distribution thereof in violation of the Act. This
issuance has been designed to permit resale under rule 144A.
At the close of the transaction, Moody's anticipates withdrawing
the ratings on Phibro's existing debt, including senior notes due
2007 and subordinated notes due 2008.
As one of the three largest players in the animal health and
nutritional industry, Phibro's B2 rating reflects many of the key
factors outlined in Moody's Global Pharmaceutical Rating
Methodology. Key rating factors include Phibro's somewhat modest
size and scale, and its high leverage and limited cash flow
relative to debt.
Moody's understands that Phibro's pro forma capital structure will
be comprised primarily of:
(1) a $65 million senior secured revolving credit facility
expected to be undrawn at close;
(2) $240 million of new senior unsecured notes due 2013; and
(3) various international credit facilities totaling
approximately $10 million in the aggregate, expected to
be drawn approximately $2 million at close.
We understand that borrowers under the revolving credit facility
include the parent and domestic subsidiaries, and that guarantors
include these same entities. The credit facility benefits from
security consisting of a first priority perfected lien on property
and assets of borrowers and guarantors. We understand that the
senior unsecured notes will be guaranteed by the same entities
guaranteeing the bank facility. The B3 rating on the senior
unsecured notes reflects the unsecured position in the capital
structure.
The rating outlook is stable. Although Phibro's leverage has
increased somewhat with the refinancing, the stable outlook
reflects Moody's assumption that cash flow from operations to debt
will exceed 5%, that free cash flow will be positive, and that
large revolver borrowings are unlikely. The stable outlook also
reflects Moody's assumption that Phibro's new facility in
Guarulhos, Brazil will receive FDA approval for the production of
virginiamycin.
If Phibro's free cash flow relative to debt improves and appears
comfortably sustainable in excess of 5%, then positive rating
action could be considered. Positive rating pressure would likely
depend on a fully successful transition of virginiamycin
manufacturing from Belgium to Brazil, including winding down all
special costs related to the Belgian operation.
Conversely, a delay in the FDA approval of Phibro's plant in
Brazil could have negative rating implications because of the
importance of this product to Phibro's cash flow. Other factors
that could create rating pressure include the inability to sustain
Debt of at least 5% or to generate positive free cash flow, in
which case reliance on the $65 million revolver would increase.
Rating assigned:
* B3 senior unsecured notes of $240 million due 2013
Rating affirmed:
* B2 corporate family rating
Ratings affirmed and expected to be withdrawn at the completion of
the refinancing:
* B2 senior secured notes due 2007
* Caa2 senior subordinated notes due 2008
Headquartered in Ridgefield Park, New Jersey, Phibro Animal Health
Corporation is a diversified manufacturer of a broad range of
animal health and nutritional products. For the twelve month
period ended March 31, 2006 Phibro reported net sales of
approximately $388 million.
PLATINUM EQUITY: Moody's Junks Rating on Proposed $190 Mil. Notes
-----------------------------------------------------------------
Moody's Investors Service assigned first time ratings to Textron
Fastening Systems in connection with its pending acquisition by an
affiliate of Platinum Equity Advisors, LLC.
Moody's assigned the following ratings to the proposed debt
financing:
(i) B2 to TFS' proposed $325 million senior secured term loan,
due 2013; and
(ii) Caa1 to its proposed $190 million senior secured notes,
due 2016.
Moody's assigned a SGL-3 liquidity rating, reflecting adequate
liquidity and expected covenant compliance. The ratings outlook
is stable. The ratings are subject to confirmation of the final
financing documentation.
These first time ratings were assigned:
* B2 for the corporate family rating;
* B2 for the $325 million senior secured term loan, due 2013;
* Caa1 for the $190 million senior secured notes, due 2016; and
* Speculative Grade Liquidity rating of SGL-3.
The rating outlook is stable.
TFS is a former subsidiary of Textron Inc. In June 2006,
Platinum entered into an agreement to purchase TFS from Textron
for total cash consideration of approximately $630 million plus
the assumption of certain liabilities, excluding fees and
expenses. The acquisition is expected to be financed with
approximately $550 million of newly issued funded debt and a
$160 million cash equity investment from Platinum.
The ratings reflect:
(1) TFS' high adjusted leverage and Moody's expectation of
modest free cash flow generation and de-leveraging over
the near-term;
(2) the Company's fixed cost structure, which should benefit
the Company in the periods of high production levels and
strong demand, but could have a material negative impact
on earnings and cash flow should demand decline;
(3) TFS' high customer concentration and significant end-
market exposure to the automotive and heavy truck
industries, which combined represent close to two-thirds
of fiscal 2005 revenues, and
(4) Moody's concern that as a stand-alone company with a
highly leveraged capital structure, TFS' significantly
increased interest expense obligations may adversely
restrict its flexibility in responding to unanticipated
competitive or other pressures.
The primary factors supporting TFS' ratings are:
(1) TFS' strong competitive position as a proven supplier with
both a global footprint and with sufficient scale to
provide cost-efficient solutions to its long-standing
customers in the mechanical fastener sector;
(2) the anticipated benefits of the Company's now completed
restructuring efforts in which the Company has invested
over $160 million in restructuring and other non-recurring
costs from fiscal 2003 through fiscal 2005; and
(3) the Company's broad geographic diversification which
could reduce the impact of regional demand volatility.
The proposed $325 million senior secured term loan will be secured
by:
(1) a first priority lien on the Company's PP&E and
substantially all other tangible and intangible assets
and
(2) a second priority lien on the North American accounts
receivable and inventories.
The B2 rating on the facility reflects:
(1) its junior position relative to the ABL with respect to
the most liquid collateral and
(2) the term loan's size relative to Moody's assessment of
the potential value of the remaining collateral in a
distressed scenario.
The proposed $190 million of senior secured notes due 2016 will be
secured by:
(1) a second priority lien on the Company's PP&E and
substantially all other tangible and intangible assets
and
(2) a third priority lien on the North American accounts
receivable and inventories.
The Caa1 rating on the facility reflects:
(1) its effective subordination to the revolving credit
facility and term loan and
(2) Moody's view of an increased liklihood of financial loss
in the event of default.
Moody's assigned an SGL-3 rating to TFS reflecting adequate
near-term liquidity as the Company should have approximately
$95 million of availability at closing under the borrowing base of
its proposed $175 million asset-based revolving credit facility
and approximately $15 million in cash.
Textron Fastening Systems, headquartered in Troy, Michigan, is
a global provider of integrated fastening solutions and offers
a broad range of fastening technologies, including fasteners,
engineered assemblies and automation equipment. Revenues for the
year ended December 31, 2005 totaled approximately $1.8 billion.
PLUSFUNDS MANAGER: Winding-Up Hearing Is Scheduled for July 28
--------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Plusfunds Manager Access
Funds, SPC Ltd.
The founder shareholder of Sphinx Strategy placed the company into
voluntary liquidation on June 30, 2006, under Section 150 of the
Companies Law (2004 revision) of the Cayman Islands. Kenneth M.
Krys and Christopher Stride of RSM Cayman Islands were appointed
as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Plusfunds Manager.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Plusfunds Manager's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Plusfunds Manager's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
PREMIUM PAPERS: Committee Hires Traxi LLC as Financial Advisor
--------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in Premium
Papers Holdco, LLC and its debtor-affiliates' chapter 11 cases
obtained permission from the U.S. Bankruptcy Court for the
District of Delaware to employ Traxi LLC, as its financial
advisor.
Traxi LLC is expected to:
a. review all financial information prepared by the Debtor or
its consultants as requested by the Committee, including a
review of the Debtors' financial statements as of the
petition date, showing in detail all assets and liabilities
and priority and secured creditors;
b. monitor the Debtors' activities regarding cash
expenditures, receivable collections, asset sales and
projected cash requirements;
c. attend meetings with the Committee, the Debtors,
creditors, their attorneys and consultants, Federal and
state authorities, if required;
d. review the Debtors' periodic operating and cash flow
statements;
e. review the Debtors' books and records for related party
transactions, potential preferences, fraudulent conveyances
and other potential prepetition investigations;
f. conduct any investigation with respect to prepetition acts,
conduct, property liabilities and financial condition of
the Debtor, its management and financial condition of the
Debtor, its management, creditors including the operation
of its businesses, and as appropriate, avoidance actions;
g. review any business plans prepared by the Debtor or their
consultants;
h. review and analyze proposed transactions for which the
Debtor seeks Court approval;
i. assist in a sale process of the Debtor collectively or in
segments, parts or other delineations, if any;
j. assist the Committee in developing, evaluation, structuring
and negotiating the terms and conditions of all potential
plans of liquidation;
k. provide expert testimony on the results of the findings;
l. analyze potential divestitures of the Debtors'
operations;
m. assist the Committee in developing alternative plans
including contacting potential plan sponsors if
appropriate; and
n. provide the Committee with other and further financial
advisory services with respect to the Debtors, including
valuation, and advice with respect to financial, business
and economic issues, as may arise during the course of the
restructuring as requested by the Committee.
Perry M. Mandarino, a senior managing director and unit holder at
Traxi, told the Court that the Firm's professionals bill:
Professional Hourly Rate
------------ -----------
Partners/Managing Directors $450 - $525
Managers/Directors $275 - $425
Associates/Analysts $125 - $275
Mr. Mandarino assured the Court that the Firm is "disinterested"
as that term is defined in Section 101(14) of the Bankruptcy Code.
About Premium Papers
Headquartered in Hamilton, Ohio, Premium Papers Holdco, LLC --
http://www.smartpapers.com-- manufactures and markets a wide
variety of premium coated and uncoated printing papers, such as
Kromekote, Knightkote, and Carnival. The Company and two of its
affiliates filed for chapter 11 protection on March 21, 2006
(Bankr. D. Del. Case No. 06-10269). Ian S. Fredericks, Esq., at
Young, Conaway, Stargatt & Taylor, LLP, represents the Debtors in
their restructuring efforts. The Official Committee of Unsecured
Creditors has retained Mary E. Seymour, Esq., at Lowenstein
Sandler PC, as its counsel. When the Debtors filed for protection
from their creditors, they did not disclose their total assets but
estimated debts between $10 million and $50 million.
PROCARE AUTOMOTIVE: Hires David Gole as Real Estate Consultant
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Ohio
allowed ProCare Automotive Service Solutions, LLC, to employ David
G. Cole as its commercial real estate consultant.
The Debtor, owner of two gas stations located in Marion and
Fairfield, plans to sell those real properties as part of winding
down its estate. The Debtor needs Mr. Gole, a licensed commercial
real estate leasing agent, to provide consulting services.
Mr. Gole will:
a) advise with respect to valuation and marketing of the
Debtor's properties;
b) assist with the Debtor's sale process, including and not
limited to, facilitation of the overall process, assistance
in negotiations with buyers, review and consultation
regarding the Properties and facilitation of potential
purchaser's due diligence;
c) provide testimony at a deposition, hearing, or other similar
forum, where appropriate; and
d) advise and consult with respect to any other activity
concerning the Properties as deemed necessary by the Debtor
or the Debtor's professionals.
Mr. Cole will charge the Debtor $100 per hour for his analysis of
the properties plus $100 for expenses. In addition, a 5%
commission of 5% of the sale price properties will be charged to
the Debtor if the properties are not sold to the lessee, sublessee
or any party operating the properties.
If the existing tenants will buy the properties, only the $1,500
appraisal fee will be due but if either of the properties are sold
to a third party, the $1,500 appraisal fee will be waived, Alan R.
Lepene, Esq., at Thompson Hine LLP, tells the Court.
The Debtor assures the Court that Mr. Cole does not hold nor
represent any interest adverse to the Debtors or to their estates.
Based in Independence, Ohio, ProCare Automotive Service Solutions,
LLC -- http://www.procareauto.com/-- offers maintenance and
repair services to all makes and models of foreign, domestic,
light truck, and commercial-fleet vehicles. ProCare operates 82
retail locations in eight metropolitan areas throughout three
states. The Debtor filed for chapter 11 protection on March 5,
2006 (Bankr. N.D. Ohio Case No. 06-10605). Alan R. Lepene, Esq.,
Jeremy M. Campana, Esq., and Sean A. Gordon, Esq., at Thompson
Hine LLP, represent the Debtor. Scott N. Opincar, Esq., at
McDonald Hopkins Co., LPA, represents the Official Committee of
Unsecured Creditors. Joseph M. Geraghty at Conway MacKenzie &
Dunleavy gives financial advisory services to the Committee. When
the Debtor filed for protection from its creditors, it estimated
assets and debts between $10 million and $50 million.
PULL'R HOLDINGS: Committee Taps Weinstein Weiss as Counsel
----------------------------------------------------------
The Official Committee of Unsecured Creditors in Pull'R Holdings
LLC and its debtor-affiliates asks the U.S. Bankruptcy Court for
the Central District of California for permission to employ
Weinstein, Weiss & Ordubegian LLP, as its general bankruptcy
counsel.
Weinstein Weiss will:
a) represent the Committee's interests with respect to the
reorganization or liquidation of the Debtors' businesses;
b) investigate and analyze the scope and validity of claims,
secured or otherwise, asserted by various parties;
c) investigate and analyze potential claims against insiders
and third parties; and
d) take other action and perform other services as the
Committee may require relating to the Debtor' chapter 11
cases.
Aram Ordubegian, Esq., a Weinstein Weiss partner, bills $335 per
hour for his services. Mr. Ordubegian discloses that the firm's
professionals bill:
Professional Hourly Rate
------------ -----------
David R. Weinstein, Esq. $510
Sharon Z. Weiss, Esq. $375
Jacquelyn H. Choi, Esq. $275
Gil Hopenstand, Esq. $240
Mr. Ordubegian assures the Court that his firm is disinterested as
that term is defined in Section 101(14) of the Bankruptcy Code.
Headquartered in Santa Fe Springs, California, Pull'R Holdings LLC
-- http://www.pullr.com/-- sell contractors' equipment and
tools. They are known for brands such as Bucket Boss, Dead On
Tools, and the Maasdam Pow'R-Pull line. The Company and its
affiliate, Maasdam Pow'r Pull Inc., filed for bankruptcy
protection on April 27, 2006 (Bankr. C.D. Calif. Case No.
06-11669). Lawrence Diamant, Esq., at Robinson, Diamant &
Wolkowitz, APC, represent the Debtors in their restructuring
efforts. When the Debtors filed for bankruptcy, they
reported $1 million to $10 million in total assets and $10 million
to $50 million in total debts.
PULL'R HOLDINGS: Wants Until Feb. 21 to File Chapter 11 Plan
------------------------------------------------------------
Pull'R Holdings LLC and its debtor-affiliates asks the U.S.
Bankruptcy Court for the Central District of California to extend
until Feb. 21, 2007, the period within which they have the
exclusive right to file a chapter 11 plan. The Debtors also want
their period to solicit acceptances of that plan extended to
April 22, 2007.
Ric Calder, the Debtors' CFO, says that the Debtors have been in
the process of determining the Debtors' reorganization. Mr.
Calder notes that the Debtors will reorganize either through:
* a sale of all or part of their stock; or
* a sale of their assets as going concerns.
The Debtors have not yet started the marketing process since they
have focused their time on obtaining the DIP financing necessary
to fund their marketing efforts and reorganization, Mr. Calder
adds. The Debtors expect that its request for DIP financing with
Merrill Lynch Business Financial Services, Inc., will be heard
within the next sixty days.
Mr. Calder believes that the extension will give the Debtors
enough time to complete negotiations and formulate the terms of
their plan.
Headquartered in Santa Fe Springs, California, Pull'R Holdings LLC
-- http://www.pullr.com/-- sell contractors' equipment and
tools. They are known for brands such as Bucket Boss, Dead On
Tools, and the Maasdam Pow'R-Pull line. The Company and its
affiliate, Maasdam Pow'r Pull Inc., filed for bankruptcy
protection on April 27, 2006 (Bankr. C.D. Calif. Case No.
06-11669). Lawrence Diamant, Esq., at Robinson, Diamant &
Wolkowitz, APC, represent the Debtors in their restructuring
efforts. When the Debtors filed for bankruptcy, they reported $1
million to $10 million in total assets and $10 million to
$50 million in total debts.
QUAKER FABRIC: Posts $4.1 Mil. Net Loss in Quarter Ended March 31
-----------------------------------------------------------------
Quaker Fabric Corp. filed its financial statements for the quarter
ended March 31, 2006, with the Securities and Exchange Commission.
The Company reported a $4,135,000 net loss on $46,280,000 of net
sales for the three months ended March 31, 2006, versus a
$3,090,000 net loss on $59,215,000 of net sales for the three
months ended March 31, 2005.
At March 31, 2006, the Company's balance sheet showed $213,810,000
in total assets and $76,561,000 in total liabilities resulting in
a stockholders' equity of $137,249,000.
Full-text copies of the Company's financial statements for the
quarter ended March 31, 2006, are available for free at:
http://ResearchArchives.com/t/s?db8
Going Concern Doubt
As reported in the Troubled Company Reporter on April 12, 2006,
Auditors at PricewaterhouseCoopers LLP in Seattle, Washington,
raised substantial doubt about Quaker Fabric Corporation's ability
to continue as a going concern after auditing the company's Dec.
31, 2005 and Jan. 1, 2005 consolidated financial statements and
its internal control over financial reporting as of Dec. 31, 2005.
PwC pointed to the Company's recurring losses from operations,
certain debt covenant defaults, and operating performance decline.
About Quaker Fabric
Based in Fall River, Massachusetts, Quaker Fabric Corporation
(NASDAQ: QFAB) -- http://www.quakerfabric.com/-- manufactures
woven upholstery fabrics for furniture markets in the United
States and abroad, and produces Jacquard upholstery fabric.
REFCO INC: Six Creditors Withdraw Nine Proofs of Claim
------------------------------------------------------
Six creditors withdraw nine proofs of claim filed against Refco
Inc., and its debtor-affiliates on the basis that the Claims have
been satisfied:
The Claimants are:
Creditor Claim No./s Amount Debtor
-------- ----------- ------ ------
AT&T Corp. 46 $215,054 Refco, Inc.
Henning & Carey Trading Co. - 77,708 Refco, LLC
Massachusetts Department - 10,000 Refco Capital,
of Revenue LLC
Kent Consulting Engineers 52 - Refco, Inc.
51 - Refco, LLC
Alps Construction, Inc. 53 - Refco, Inc.
50 - Refco, LLC
Griswold, Heckel & Kelly 74 - Refco, Inc.
Associates, Inc. 52 - Refco, LLC
About Refco Inc.
Based in New York, Refco Inc. -- http://www.refco.com/-- is a
diversified financial services organization with operations in
14 countries and an extensive global institutional and retail
client base. Refco's worldwide subsidiaries are members of
principal U.S. and international exchanges, and are among the most
active members of futures exchanges in Chicago, New York, London
and Singapore. In addition to its futures brokerage activities,
Refco is a major broker of cash market products, including foreign
exchange, foreign exchange options, government securities,
domestic and international equities, emerging market debt, and OTC
financial and commodity products. Refco is one of the largest
global clearing firms for derivatives.
The Company and 23 of its affiliates filed for chapter 11
protection on Oct. 17, 2005 (Bankr. S.D.N.Y. Case No. 05-60006).
J. Gregory Milmoe, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, represent the Debtors in their restructuring efforts. Luc A.
Despins, Esq., at Milbank, Tweed, Hadley & McCloy LLP, represents
the Official Committee of Unsecured Creditors. Refco reported
$16.5 billion in assets and $16.8 billion in debts to the
Bankruptcy Court on the first day of its chapter 11 cases.
Refco LLC, an affiliate, filed for chapter 7 protection on
Nov. 25, 2005 (Bankr. S.D.N.Y. Case No. 05-60134). Refco, LLC, is
a regulated commodity futures company that has businesses in the
United States, London, Asia and Canada. Refco, LLC, filed for
bankruptcy protection in order to consummate the sale of
substantially all of its assets to Man Financial Inc., a wholly
owned subsidiary of Man Group plc. Albert Togut, the chapter 7
trustee, is represented by Togut, Segal & Segal LLP.
On April 13, 2006, the Court appointed Marc S. Kirschner as Refco
Capital Markets Ltd.'s chapter 11 trustee. Mr. Kirschner is
represented by Bingham McCutchen LLP. RCM is Refco's operating
subsidiary based in Bermuda.
Three more affiliates of Refco, Westminster-Refco Management LLC,
Refco Managed Futures LLC, and Lind-Waldock Securities LLC, filed
for chapter 11 protection on June 6, 2006 (Bankr. S.D.N.Y. Case
Nos. 06-11260 through 06-11262). (Refco Bankruptcy News, Issue
No. 33; Bankruptcy Creditors' Service, Inc., 215/945-7000).
RIM SEMICONDUCTOR: Files Four Amended Financial Statements
----------------------------------------------------------
Rim Semiconductor Company filed with the Securities and Exchange
Commission on July 11, 2006, its amended financial statements for:
-- the third quarter ended July 31, 2005;
-- the year ended Oct. 31, 2005;
-- the first quarter ended Jan. 31, 2006; and
-- the second quarter ended April 30, 2006.
The Company's Statement of Operations showed:
For the period ended
----------------------------------------------
Quarter Year Quarter Quarter
07/31/05 10/31/05 01/31/06 04/30/06
---------- ---------- --------- -----------
Revenue $10,360 $39,866 $40,176 $58,874
Net (Loss) ($897,920) ($4,690,382) ($1,297,876) ($10,974,722)
The Company's Balance Sheet showed:
For the period ended
----------------------------------------------
Quarter Year Quarter Quarter
07/31/05 10/31/05 01/31/06 04/30/06
---------- ---------- --------- -----------
Current Assets $1,088,126 $407,512 $388,311 $4,051,342
Total Assets $7,667,447 $6,504,965 $6,218,400 $12,102,536
Current
Liabilities $6,234,207 $4,417,132 $3,366,786 $14,419,290
Total
Liabilities $6,969,775 $4,864,391 $3,481,964 $14,850,433
Total
Stockholders'
Equity (Deficit) $697,672 $1,640,574 $2,736,436 ($2,747,897)
Restatement
The Company's Board of Directors, after consultations by
management and the Audit Committee with the Company's independent
registered public accounting firm, concluded on July 6, 2006, that
the classification of warrants issued in connection with the 2005
and 2006 convertible debentures was not in accordance with
interpretations of Emerging Issues Task Force Issue No. 00-19
"Accounting for Derivative Financial Instruments Indexed To and
Potentially Settled In, a Company's Own Stock."
Accordingly, the consolidated financial statements included in the
Company's Annual Report on Form 10-KSB for the fiscal year ended
Oct. 31, 2005, and the condensed consolidated financial statements
included in the Company's Quarterly Reports on Form 10-QSB for the
periods ended July 31, 2005, Jan. 31, 2006, and April 30, 2006,
are being restated by the Company to correct the accounting for
the warrants as derivative liabilities.
Full-text copies of the company's financial statements are
available for free at:
third quarter ended
July 31, 2005 http://ResearchArchives.com/t/s?da9
the year ended
Oct. 31, 2005 http://ResearchArchives.com/t/s?daa
first quarter ended
Jan. 31, 2006 http://ResearchArchives.com/t/s?dab
second quarter ended
April 30, 2006 http://ResearchArchives.com/t/s?dac
Going Concern Doubt
As reported in the Troubled Company Reporter on Feb. 2, 2006,
Marcum & Kliegman LLP expressed substantial doubt about Rim
Semiconductor's ability to continue as a going concern after it
audited the Company's financial statements for the fiscal years
ended Oct. 31, 2005, and 2004. The auditing firm pointed to the
Company's $3,145,391 working capital deficiency at Oct. 31, 2005.
The Company's October 31 balance sheet showed strained liquidity
with $407,512 in current assets available to pay $3,552,903 of
current liabilities coming due within the next 12 months.
About Rim Semiconductor
Headquartered in Portland, Oregon, Rim Semiconductor Company fka
New Visual Corporation -- http://www.rimsemi.com/-- is an
emerging fabless communications semiconductor company. It has
made available an advanced technology that allows data to be
transmitted at greater speed and across extended distances over
existing copper wire.
SAINT VINCENTS: Wants to Walk Away from Bayer Contracts
-------------------------------------------------------
Saint Vincents Catholic Medical Centers of New York and its
debtor-affiliates ask the U.S. Bankruptcy Court for the Southern
District of New York for authority to reject certain contracts
with Bayer Corporation.
SVMC operated seven hospitals including Saint Mary's Hospital in
Brooklyn, which was closed on September 20, 2005, as of July 5,
2005. Prior to its bankruptcy filing, SVCMC also operated Saint
Joseph's Hospital in Queens, which was closed on August 27, 2004.
St. Mary's and St. Joseph's, each leased equipment from Bayer
Corporation pursuant to two Cost Management Plan Contracts.
The equipment leased by St. Joseph's was returned to Bayer on
April 1, 2005, for storage. The Debtors have never used or
possessed the equipment since the Petition Date but continued to
make payments under the St. Joseph's Equipment Lease.
Since the closure of the lab that utilized the equipment leased
to St. Mary's, the Debtors never used that equipment but
continued to make payments under the St. Mary's Equipment Lease.
The Debtors want to reject:
(i) the St. Joseph's Equipment Lease effective as of
July 5, 2005; and
(ii) the St. Mary's Equipment Lease effective as of
September 30, 2005 -- the date the lab was closed.
Andrew M. Troop, Esq., at Weil, Gotshal & Manges LLP, in New
York, informs the Court that the Debtors are current on their
obligations under the Equipment Leases and have made:
* postpetition payments under the St. Joseph's Equipment Lease
totaling $18,378; and
* post-Closure Date payments under the St. Mary's Equipment
Lease totaling $23,959.
Mr. Troop says the retroactive application of the Court's
approval of the rejection is fair, equitable, and consistent with
recent court decisions because:
-- the Equipment Leases are burdensome liabilities with no
corresponding benefit to the Debtors and their estates;
-- the rejection eliminates any claim Bayer may have to
further administrative payments under the Equipment Leases
and provides the Debtors with the opportunity to recoup
administrative payments that have been made;
-- Bayer will not be prejudiced by a retroactive rejection of
the Equipment Leases because, had the rejection occurred
earlier, Bayer would not have been able to re-lease the
equipment or obtain any significant value from the
equipment;
-- Bayer has been on notice that the Debtors were not
benefiting from the Equipment Leases or using the
equipment.
Headquartered in New York, New York, Saint Vincents Catholic
Medical Centers of New York -- http://www.svcmc.org/-- the
largest Catholic healthcare providers in New York State, operate
hospitals, health centers, nursing homes and a home health agency.
The hospital group consists of seven hospitals located throughout
Brooklyn, Queens, Manhattan, and Staten Island, along with four
nursing homes and a home health care agency. The Company and six
of its affiliates filed for chapter 11 protection on July 5, 2005
(Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951). Gary
Ravert, Esq., and Stephen B. Selbst, Esq., at McDermott Will &
Emery, LLP, filed the Debtors' chapter 11 cases. On Sept. 12,
2005, John J. Rapisardi, Esq., at Weil, Gotshal & Manges LLP took
over representing the Debtors in their restructuring efforts.
Martin G. Bunin, Esq., at Thelen Reid & Priest LLP, represents the
Official Committee of Unsecured Creditors. As of Apr. 30, 2005,
the Debtors listed $972 million in total assets and $1 billion in
total debts. (Saint Vincent Bankruptcy News, Issue No. 28
Bankruptcy Creditors' Service, Inc., 215/945-7000)
SEALY CORP: May 28 Balance Sheet Upside-Down by $212 Million
------------------------------------------------------------
Sealy Corporation reported results for its second quarter of
fiscal 2006. Net sales for the fiscal quarter ended May 28, 2006
increased 5.9% to $376.7 million from $355.9 million for the
comparable period a year earlier. Domestic net sales increased
2.5% to $291.5 million as average unit selling price improved 9.0%
and unit volume declined 5.9%. International net sales increased
$13.6 million or 19.0% (17.4% on a constant currency basis) to
$85.2 million on unit volume increases of 12.2% and average unit
selling price improvement of 6.0%.
Second quarter gross profit was $168.6 million, or 44.7% of sales,
versus $157.1 million, or 44.1% of sales, for the comparable
period a year earlier. This increase was due primarily to
improvements in Sealy's international operations, domestic
manufacturing efficiency and sales mix, as its luxury products,
which retail above $1,000, continued to outpace sales of other
products. Adjusted EBITDA for the quarter increased to
$56.9 million versus $56.0 million for the comparable period a
year earlier.
Net income was $100,000 versus $6.4 million for the comparable
period a year ago. Second quarter 2006 operating results included
pretax costs of $34.2 million, or $21.0 million after tax related
to the Company's initial public offering and related debt
repayment. Second quarter results also include $6.4 million of
incremental cost related to the launch of Sealy's new products and
$1.5 million of incremental expense for stock options versus the
comparable prior year period.
As previously disclosed, these incremental costs are expected to
total approximately $15 million to $20 million in 2006. Second
quarter 2005 operating results included pretax costs of $6.2
million, or $3.7 million after tax, related to debt refinancing.
"We are pleased with our results for the quarter and the progress
we have made on our new product introductions. The Stearns &
Foster roll-out is complete and approximately half of the new
Posturepedic product has been rolled out," said David J.
McIlquham, Sealy's Chairman and Chief Executive Officer. "As we
have previously communicated, product upgrade cycles typically
impact unit volumes in the short term as our retail partners
transition the beds on their selling floors. Over the long term,
such new product innovation is an important driver of our growth.
This process is expected to last until the beginning of the fourth
quarter domestically and is already complete in some of our
international businesses that introduced major new lines in the
first quarter of 2006."
Mr. McIlquham continued, "Along with ongoing strong demand in our
international markets, we are focused on driving domestic unit
volume through new product introductions and targeted promotions
during the key summer months. We firmly believe that the strength
of our brands, our position as the market share leader in the
industry, combined with continued operating improvements, position
Sealy to increase its annual cash flow and profitability
consistently over the long term."
Net sales for the six months ended May 28, 2006 increased 8.0% to
$772.4 million from $714.9 million for the comparable period a
year earlier. Gross profit was $345.3 million, or 44.7% of sales,
versus $316.2 million, or 44.2% of sales, for the comparable
period a year earlier. Adjusted EBITDA was $120.9 million versus
$115.7 million for the comparable period a year earlier. Net
income was $23.1 million, versus net income of $27.1 million for
the comparable period a year ago. Six month results include $14.9
million of incremental cost related to the launch of Sealy's new
products and $1.8 million of incremental expense for stock options
versus the comparable prior year.
As of May 28, 2006, Sealy's cash and cash equivalent balance was
$24.2 million versus $25.0 million at the comparable time last
year. The Company had total debt of $818.0 million at May 28,
2006, compared to total debt of $1,033.8 million as of May 29,
2005.
As previously announced, the Company's Board of Directors has
authorized a quarterly cash dividend of $0.075 per common share.
The dividend is payable on August 1, 2006, to common stockholders
of record on July 14, 2006.
About Sealy Corp
Sealy Corporation (NYSE: ZZ) -- http://www.sealy.com/-- is the
largest bedding manufacturer in the world with sales of nearly
$1.5 billion in 2005. The company manufactures and markets a
broad range of mattresses and foundations under the Sealy(R),
Sealy Posturepedic(R), Stearns & Foster(R), and Bassett(R) brands.
Sealy has the largest market share and highest consumer awareness
of any bedding brand in North America. Domestically, Sealy has 20
plants and sells its products to 2,900 customers with more than
7,000 retail outlets. Sealy is also a leading supplier to the
hospitality industry.
At May 28, 2006, the Sealy Corp.'s balance sheet showed a
$212,389,000 stockholders' deficit compared to a $412,223,000
stockholders' deficit at November 27, 2005.
SECUNDA INTERNATIONAL: Gets Consent from 100% of Noteholders
------------------------------------------------------------
Secunda International Limited disclosed the results to date of its
previously announced cash tender offer and consent solicitation
for any and all of its outstanding $125,000,000 aggregate
principal amount of Senior Secured Floating Rate Notes due 2012
(CUSIP No. 81370FAB4). As of 5:00 p.m., New York City time, on
July 12, 2006, which was the deadline for holders to tender their
Notes in order to receive the consent payment in connection with
the tender offer, tenders and consents had been received from
holders of $125.0 million in aggregate principal amount of the
Notes, representing 100.0% of the outstanding Notes.
Accordingly, the requisite consents to adopt the proposed
amendments to the indenture governing the Notes have been
received, and a supplemental indenture to effect the proposed
amendments will be executed shortly. The proposed amendments to
be effected by the supplemental indenture, among other things,
eliminate substantially all of the restrictive covenants and
certain events of default in the indenture governing the Notes.
The supplemental indenture will not become operative until the
Initial Settlement Date, which will be after the Consent Time but
no earlier than July 20, 2006, as specified by the Company, and is
subject to the conditions. Adoption of the proposed amendments
required the consent of holders of at least a majority of the
aggregate principal amount of the outstanding Notes. Notes
tendered prior to the Consent Time may no longer be withdrawn and
consents delivered prior to the Consent Time may no longer be
revoked, except in the limited circumstances described in the
Offer to Purchase.
The tender offer and consent solicitation are subject to the
satisfaction of certain conditions, including the receipt of
tenders from holders of a majority in principal amount of the
outstanding Notes, entering into a new credit facility or another
financing vehicle that provides the Company with sufficient cash
to fund the tender offer and consent solicitation, the successful
pricing (as determined in the Company's sole discretion) of the
initial public offering of the Company's common shares in Canada,
and satisfaction of customary conditions.
Holders of the Notes who validly tendered their Notes by the
Consent Time and consented to the proposed amendments will receive
the total consideration as described in the Offer to Purchase per
$1,000 principal amount of Notes accepted for purchase. Holders
who validly tender their Notes after the Consent Time, but on or
prior to the expiration date of the tender offer, will receive the
total consideration per $1,000 principal amount of Notes accepted
for purchase, less the consent payment of $30.00 per $1,000
principal amount of Notes. The total consideration is expected to
be determined as of 2:00 p.m., New York City time, on July 14,
2006. Acceptance of and payment for Notes validly tendered before
the Consent Time will be on the Initial Settlement Date. The
tender offer is scheduled to expire at 5:00 p.m., New York City
time, on July 28, 2006, unless extended or earlier terminated.
The complete terms and conditions of the tender offer and consent
solicitation are described in the Offer to Purchase and Consent
Solicitation Statement of the Company dated June 27, 2006, copies
of which may be obtained by contacting D.F. King and Co., Inc.,
the information agent for the tender offer, at (212) 269-5550
(collect) or (800) 758-5378 (U.S. toll-free). Banc of America
Securities LLC is the exclusive dealer manager and solicitation
agent for the tender offer and consent solicitation. Additional
information concerning the tender offer and consent solicitation
may be obtained by contacting Banc of America Securities LLC, High
Yield Special Products, at (212) 847-5836 (collect) or (888) 292-
0070 (U.S. toll-free)
About Secunda International
Secunda International Limited provides supply and support services
to the offshore oil and gas industry internationally. The Company
currently owns and operates a fleet of 14 harsh weather,
multifunctional marine vessels that provide supply, support and
safety services to offshore exploration, development, production
and subsea construction projects. The Company primarily serves
the North Sea, West Africa and the Gulf of Mexico and have a
leading position in the east coast of Canada. The combination of
its experienced and highly skilled workforce and its
multifunctional, harsh weather fleet allows the Company to operate
in virtually any part of the world, including deepwater areas.
* * *
As reported in the Troubled Company Reporter - Latin America on
June 30, 2006, Standard & Poor's Ratings Services held its 'B-'
long-term corporate credit and senior secured debt ratings on
offshore support vessel provider Secunda International Inc. on
CreditWatch with positive implications, where they were placed
Sept. 29, 2005.
SERVICE CORP: Moody's Holds Ba3 Rating on $1.1 Bil. Senior Notes
----------------------------------------------------------------
Moody's Investors Service confirmed the credit ratings of Service
Corporation International, concluding a review for potential
downgrade initiated on April 3, 2006. The ratings outlook is
stable.
On April 3, 2006, SCI announced that it entered into a definitive
agreement to acquire all of the outstanding shares of Alderwoods
Group, Inc. for $20.00 per share in cash. Alderwoods operated 584
funeral homes, 73 cemeteries and 60 combination funeral home and
cemetery locations in North America as of March 25, 2006. The
transaction was approved by Alderwoods' shareholders on May 31,
2006.
The transaction is valued at approximately $1.2 billion, which
includes approximately $364 million of Alderwoods debt. SCI
expects to fund the transaction with at least $400 million of cash
on hand and a combination of term loans and bonds. SCI received a
commitment letter from JPMorgan for an $850 million bridge
facility that can be used to fund the transaction. The
transaction is not subject to any financing conditions but is
subject to antitrust clearance. SCI anticipates that the
acquisition will be completed by the end of 2006.
SCI has not announced the details of its proposed financing
package for the Alderwoods acquisition. If SCI increases the
amount of debt that is secured or guaranteed by its operating
subsidiaries, the ratings on the non-guaranteed senior notes may
be notched below the corporate family rating.
Moody's views the combination of SCI and Alderwoods favorably,
since it provides increased scale, potential for rapid debt
reduction with the proceeds from asset sales and significant cost
saving opportunities. The confirmation of SCI's ratings reflects
Moody's expectation that SCI will be able to improve credit
metrics to more appropriate levels for the rating category within
18 months following the closing of the Alderwoods acquisition,
through a combination of asset sales and realization of cost
synergies.
The ratings reflect the large revenue and EBIT base of the
combined company, broad geographic diversification within North
America, significant value in owned real estate and a stable
revenue stream supported by a large backlog of preneed funeral and
cemetery contracts. The ratings are constrained by integration
risks and challenging deathcare industry trends.
These ratings of SCI were confirmed:
* $300 million 7% senior unsecured notes due 2017, Ba3
* $250 million 6.75% senior unsecured notes due 2016, Ba3
* $56 million 7.875% senior unsecured debentures due 2013, Ba3
* $342 million 7.7% senior unsecured notes due 2009, Ba3
* $195 million 6.5% senior unsecured notes due 2008, Ba3
* Senior unsecured shelf registration, (P)Ba3
* Senior subordinated and junior subordinated shelf
registrations, (P)B2
* Corporate family rating, Ba3
Moody's affirmed the SGL-2 rating of SCI reflecting its good
liquidity profile, without giving effect to the proposed
acquisition of Alderwoods. Moody's will determine whether the SGL
rating should be revised when there is more certainty regarding
the post-acquisition capital structure.
The stable ratings outlook anticipates significant debt reduction
with the proceeds from asset sales and realization of meaningful
cost reductions within 18 months after the closing of the
Alderwoods acquisition. Moody's anticipates that at the end of
this period, Debt to EBITDA and free cash flow to debt will
stabilize at about 4 times and 10%, respectively.
The ratings could be pressured if:
(1) the integration proves more difficult than expected and
anticipated merger synergies are not achieved;
(2) expected asset sales and related debt reductions are not
completed;
(3) a material payment is required to settle outstanding
litigation; or
(3) SCI adopts more aggressive financial policies than
expected.
If any of these actions result in sustainable Debt to EBITDA
increasing to about 5 times and free cash flow to debt declining
to under 7%, a ratings downgrade is likely.
Given the risks related to the merger and the extended time frame
for the realization of cost synergies, an upward change in the
ratings or outlook is not likely in the near term. However, the
ratings outlook could be changed to positive if greater than
expected cost synergies or debt reduction results in sustainable
Debt to EBITDA and free cash flow to debt approaching 3.5 times
and 12%, respectively.
Service Corp, headquartered in Houston, Texas, is the leading
provider of funeral and cemetery services in the world. Revenue
for the year ended December 31, 2005 was about $1.7 billion.
SHAW GROUP: Incurs $16.7 Million Net Loss in Third Quarter 2006
---------------------------------------------------------------
The Shaw Group Inc. filed its financial results for the third
quarter ended March 31, 2006, to the Securities and Exchange
Commission on July 10, 2006.
For the three months ended March 31, 2006, the Company incurred a
$16.7 million net loss on $1.2 billion of net revenues, compared
to a $21.7 million net loss on $891 million of net revenues in
2005.
As of May 31, 2006, the Company had cash and cash equivalents of
$137.3 million, which included $19.7 million of restricted and
escrowed cash, and $155.5 million of availability under our $750.0
million Credit Facility to fund operations.
A full-text copy of the Company's Quarterly Report is available
for free at http://researcharchives.com/t/s?db4
The Shaw Group Inc. -- http://www.shawgrp.com/-- is a leading
global provider of technology, engineering, procurement,
construction, maintenance, fabrication, manufacturing, consulting,
remediation, and facilities management services for government and
private sector clients in the energy, chemical, environmental,
infrastructure and emergency response markets. Headquartered in
Baton Rouge, Louisiana, with over $3 billion in annual revenues,
Shaw employs approximately 20,000 people at its offices and
operations in North America, South America, Europe, the Middle
East and the Asia-Pacific region.
The company's credit rating carries Standard & Poor's BB rating.
That rating was assigned July 27, 2005.
SILICON GRAPHICS: Five Shareholders Want Interests in New SGI
-------------------------------------------------------------
Five holders of Silicon Graphics, Inc., common stock ask the
U.S. Bankruptcy Court for the Southern District of New York to
compel the Debtors to grant them interests in the future of SGI.
The shareholders are:
Shareholder Shares Held
----------- -----------
Fred A. Stupp undisclosed
Katharine Alexander 200,000
Kozo Yamada 150,000
Malinda Sutcliffe 10,000
Theodore M. Raichel 50,000
The Shareholders assert that they were intentionally and publicly
misled, and not treated as owners of the Company, evidenced by the
way they were left out in the proposed remedies and reorganization
plan, and by the lack of communication with them for the past few
months.
"To bypass us, to avoid us, to mislead us is wrong and may have
been illegal," Mr. Raichel asserts.
Headquartered in Mountain View, California, Silicon Graphics, Inc.
(OTC: SGID) -- http://www.sgi.com/-- offers high-performance
computing. SGI helps customers solve their computing challenges,
whether it's sharing images to aid in brain surgery, finding oil
more efficiently, studying global climate, providing technologies
for homeland security and defense, enabling the transition from
analog to digital broadcasting, or helping enterprises manage
large data. The Debtor and 13 of its affiliates filed for chapter
11 protection on May 8, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10977
through 06-10990). Gary Holtzer, Esq., and Shai Y. Waisman, Esq.,
at Weil Gotshal & Manges LLP, represent the Debtors in their
restructuring efforts. When the Debtors filed for protection from
their creditors, they listed total assets of $369,416,815 and
total debts of $664,268,602. (Silicon Graphics Bankruptcy News,
Issue No. 9; Bankruptcy Creditors' Service, Inc., 215/945-7000)
SILICON GRAPHICS: Wants Merrill Lynch Directed to Turn Over Assets
------------------------------------------------------------------
Silicon Graphics, Inc., asks the U.S. Bankruptcy Court for the
Southern District of New York to direct Merrill Lynch Trust
Company of California to turn over certain assets of a trust to
the Debtors' bankruptcy estate, and to account for the value of
the assets.
In July 1994, Silicon Graphics established a non-qualified
deferred compensation plan for the benefit of:
* certain management or highly compensated employees; and
* non-employee members of its board of directors.
On August 18, 1994, Silicon Graphics and Merrill Lynch entered
into an agreement under which Silicon Graphics agreed to
contribute assets to be held in a trust by Merrill Lynch.
Merrill Lynch agreed to disburse funds from the Trust to fund
payments by Silicon Graphics to Plan participants.
Gary T. Holtzer, Esq., at Weil, Gotshal & Manges LLP, in New
York, relates that pursuant to the Trust Agreement, the Trust is a
"grantor trust, of which [Silicon Graphics] is the grantor."
Mr. Holtzer says the assets of the Trust are property of the
Debtors' estate. Under the Trust Agreement, the assets are
subject to the claims of Silicon Graphics' general creditors under
federal and state bankruptcy law.
Merrill Lynch holds the assets of the Trust, including principal
contributed by Silicon Graphics, and income. As of June 19, 2006,
the value of the Assets was $1,648,000.
Section 542(a) of the Bankruptcy Code provides that any party in
possession of property of the estate must deliver to the trustee
the property or its value, Mr. Holtzer reminds the Court.
Accordingly, turn over of the assets is warranted for the reason
that Merrill Lynch is in possession of property of the bankruptcy
estate, Mr. Holtzer explains.
Headquartered in Mountain View, California, Silicon Graphics, Inc.
(OTC: SGID) -- http://www.sgi.com/-- offers high-performance
computing. SGI helps customers solve their computing challenges,
whether it's sharing images to aid in brain surgery, finding oil
more efficiently, studying global climate, providing technologies
for homeland security and defense, enabling the transition from
analog to digital broadcasting, or helping enterprises manage
large data. The Debtor and 13 of its affiliates filed for chapter
11 protection on May 8, 2006 (Bankr. S.D.N.Y. Case Nos. 06-10977
through 06-10990). Gary Holtzer, Esq., and Shai Y. Waisman, Esq.,
at Weil Gotshal & Manges LLP, represent the Debtors in their
restructuring efforts. When the Debtors filed for protection from
their creditors, they listed total assets of $369,416,815 and
total debts of $664,268,602. (Silicon Graphics Bankruptcy News,
Issue No. 9; Bankruptcy Creditors' Service, Inc., 215/945-7000)
SOLO CUP: Susan H. Marks Resigns as Chief Financial Officer
-----------------------------------------------------------
Solo Cup Company disclosed that Executive Vice President and Chief
Financial Officer Susan H. Marks decided to leave the company,
effective on July 11, 2006, to pursue other interests.
The Company disclosed that it has engaged Heidrick & Struggles
International, Inc., an executive search firm, to undertake a
nationwide search for Ms. Marks' successor. Robert Korzenski,
president and chief operating officer said "On an interim basis,
we are fortunate to have an experienced and capable accounting and
finance department within the company to facilitate a smooth
transition upon the appointment of a new CFO".
Headquartered in Highland Park, Illinois, Solo Cup Company --
http://www.solocup.com/-- manufactures disposable foodservice
products for the consumer and retail, foodservice, packaging, and
international markets. Solo Cup has broad expertise in plastic,
paper, and foam disposables and creates brand name products under
the Solo, Sweetheart, Fonda, and Hoffmaster names. The Company
was established in 1936 and has a global presence with facilities
in Asia, Canada, Europe, Mexico, Panama and the United States.
* * *
As reported in the Troubled Company Reporter on Apr. 4, 2006,
Moody's Investors Service assigned ratings on Solo Cup Company's
$80 million senior secured second lien term loan due 2012 at B3;
$150 million senior secured revolving credit facility maturing
Feb. 27, 2010, at B2; $638 million senior secured term loan B due
Feb. 27, 2011, at B2; $325 million 8.5% senior subordinated notes
due Feb. 15, 2014, at Caa1; and Corporate Family Rating at B2.
SPHINX CONVERTIBLE: Court Sets Winding-Up Hearing on July 28
------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Convertible
Arbitrage Ltd.
The founder shareholder of Sphinx Convertible placed the company
into voluntary liquidation on June 30, 2006, under Section 150 of
the Companies Law (2004 revision) of the Cayman Islands. Kenneth
M. Krys and Christopher Stride of RSM Cayman Islands were
appointed as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Convertible.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx
Convertible's liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
E-mail: Kenneth.Krys@rsmi.com
Chris.Stride@rsmi.com
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Convertible's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX CONVERTIBLE (FUND): Winding-Up Hearing Set for July 28
-------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Convertible
Arbitrage Fund SPC.
The founder shareholder of Sphinx Convertible placed the company
into voluntary liquidation on June 30, 2006, under Section 150 of
the Companies Law (2004 revision) of the Cayman Islands. Kenneth
M. Krys and Christopher Stride of RSM Cayman Islands were
appointed as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Convertible.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx
Convertible's liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Convertible's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX DISTRESSED: Court Schedules Winding-Up Hearing on July 28
----------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Convertible
Distressed Ltd.
The founder shareholder of Sphinx Distressed placed the company
into voluntary liquidation on June 30, 2006, under Section 150 of
the Companies Law (2004 revision) of the Cayman Islands. Kenneth
M. Krys and Christopher Stride of RSM Cayman Islands were
appointed as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Convertible.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Distressed's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Distressed's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX DISTRESSED FUND: Court Sets Winding-Up Hearing on July 28
----------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Convertible
Distressed Fund SPC.
The founder shareholder of Sphinx Distressed placed the company
into voluntary liquidation on June 30, 2006, under Section 150 of
the Companies Law (2004 revision) of the Cayman Islands. Kenneth
M. Krys and Christopher Stride of RSM Cayman Islands were
appointed as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Convertible.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Distressed's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
E-mail: Kenneth.Krys@rsmi.com
Chris.Stride@rsmi.com
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Distressed's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX EQUITY: Court Hears Winding-Up Petition on July 28
---------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Equity Market
Neutral Ltd.
The founder shareholder of Sphinx Equity placed the company into
voluntary liquidation on June 30, 2006, under Section 150 of the
Companies Law (2004 revision) of the Cayman Islands. Kenneth M.
Krys and Christopher Stride of RSM Cayman Islands were appointed
as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Equity.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Distressed's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Equity's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX EQUITY (FUND): Court Hears Winding-Up Petition on July 28
----------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Equity Market
Neutral Fund SPC.
The founder shareholder of Sphinx Equity placed the company into
voluntary liquidation on June 30, 2006, under Section 150 of the
Companies Law (2004 revision) of the Cayman Islands. Kenneth M.
Krys and Christopher Stride of RSM Cayman Islands were appointed
as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Equity.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Distressed's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Equity's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX FIXED: Winding-Up Hearing Is Scheduled for July 28
---------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Fixed Income
Arbitrage Ltd.
The founder shareholder of Sphinx Fixed placed the company into
voluntary liquidation on June 30, 2006, under Section 150 of the
Companies Law (2004 revision) of the Cayman Islands. Kenneth M.
Krys and Christopher Stride of RSM Cayman Islands were appointed
as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Fixed.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Fixed's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Fixed's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX FIXED (FUND): Court Sets Winding-Up Hearing on July 28
-------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Fixed Income
Arbirage Fund SPC.
The founder shareholder of Sphinx Fixed placed the company into
voluntary liquidation on June 30, 2006, under Section 150 of the
Companies Law (2004 revision) of the Cayman Islands. Kenneth M.
Krys and Christopher Stride of RSM Cayman Islands were appointed
as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Fixed.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Fixed's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
E-mail: Kenneth.Krys@rsmi.com
Chris.Stride@rsmi.com
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Fixed's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
E-mail: cbridges@rc.com.ky
ahporter@rc.com.ky
SPHINX LONG/SHORT: Court Hears Winding-Up Petition on July 28
-------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Long/Short Equity
Ltd.
The founder shareholder of Sphinx Long/Short placed the company
into voluntary liquidation on June 30, 2006, under Section 150 of
the Companies Law (2004 revision) of the Cayman Islands. Kenneth
M. Krys and Christopher Stride of RSM Cayman Islands were
appointed as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Fixed.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Long/Short's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Long/Short's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX LONG/SHORT (FUND): Winding-Up Hearing Is Set for July 28
---------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Long/Short Equity
Ltd.
The founder shareholder of Sphinx Long/Short placed the company
into voluntary liquidation on June 30, 2006, under Section 150 of
the Companies Law (2004 revision) of the Cayman Islands. Kenneth
M. Krys and Christopher Stride of RSM Cayman Islands were
appointed as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Long/Short.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Long/Short's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Long/Short's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX LTD: Court Schedules Winding-Up Hearing for July 28
----------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Ltd.
The founder shareholder of Sphinx Ltd. placed the company into
voluntary liquidation on June 30, 2006, under Section 150 of the
Companies Law (2004 revision) of the Cayman Islands. Kenneth M.
Krys and Christopher Stride of RSM Cayman Islands were appointed
as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Ltd.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Ltd's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Ltd.'s counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX MACRO: Court Schedules July 28 for Winding-Up Hearing
------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Macro Ltd.
The founder shareholder of Sphinx Macro placed the company into
voluntary liquidation on June 30, 2006, under Section 150 of the
Companies Law (2004 revision) of the Cayman Islands. Kenneth M.
Krys and Christopher Stride of RSM Cayman Islands were appointed
as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Macro.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Macro's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Macro's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX MACRO FUND: Court Sets Winding-Up Hearing for July 28
------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Macro Fund SPC.
The founder shareholder of Sphinx Managed placed the company into
voluntary liquidation on June 30, 2006, under Section 150 of the
Companies Law (2004 revision) of the Cayman Islands. Kenneth M.
Krys and Christopher Stride of RSM Cayman Islands were appointed
as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Macro.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Macro's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Macro's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX MANAGED: Court Schedules Winding-Up Hearing for July 28
--------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Managed Futures Ltd.
The founder shareholder of Sphinx Managed placed the company into
voluntary liquidation on June 30, 2006, under Section 150 of the
Companies Law (2004 revision) of the Cayman Islands. Kenneth M.
Krys and Christopher Stride of RSM Cayman Islands were appointed
as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Managed.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Managed's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Managed's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX MERGER: Winding-Up Hearing Is Scheduled for July 28
----------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Merger Arbitrage
Ltd.
The founder shareholder of Sphinx Merger placed the company into
voluntary liquidation on June 30, 2006, under Section 150 of the
Companies Law (2004 revision) of the Cayman Islands. Kenneth M.
Krys and Christopher Stride of RSM Cayman Islands were appointed
as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Merger.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Merger's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Merger's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX MERGER (FUND): Court Hears Winding-Up Petition on July 28
----------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Merger Arbitrage
Fund SPC.
The founder shareholder of Sphinx Merger placed the company into
voluntary liquidation on June 30, 2006, under Section 150 of the
Companies Law (2004 revision) of the Cayman Islands. Kenneth M.
Krys and Christopher Stride of RSM Cayman Islands were appointed
as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Merger.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Merger's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Merger's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX PLUS: Court Schedules Winding-Up Hearing on July 28
----------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Plus SPC Ltd.
The founder shareholder of Sphinx Plus placed the company into
voluntary liquidation on June 30, 2006, under Section 150 of the
Companies Law (2004 revision) of the Cayman Islands. Kenneth M.
Krys and Christopher Stride of RSM Cayman Islands were appointed
as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Plus.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Plus'
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Plus' counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX SPECIAL: Court Schedules Winding-Up Hearing for July 28
--------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Special Situations
Ltd.
The founder shareholder of Sphinx Situations placed the company
into voluntary liquidation on June 30, 2006, under Section 150 of
the Companies Law (2004 revision) of the Cayman Islands. Kenneth
M. Krys and Christopher Stride of RSM Cayman Islands were
appointed as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Situations.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Situation's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Situation's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX SPECIAL (FUND): Winding-Up Hearing Is Set for July 28
------------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Special Situations
Fubd SPC.
The founder shareholder of Sphinx Situations placed the company
into voluntary liquidation on June 30, 2006, under Section 150 of
the Companies Law (2004 revision) of the Cayman Islands. Kenneth
M. Krys and Christopher Stride of RSM Cayman Islands were
appointed as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Situations.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Situation's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Situation's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SPHINX STRATEGY: Court Sets Winding-Up Hearing for July 28
----------------------------------------------------------
The Grand Court of the Cayman Islands will hear on July 28, 2006,
at 10:00 a.m., the petition to wind-up Sphinx Strategy Fund.
The founder shareholder of Sphinx Strategy placed the company into
voluntary liquidation on June 30, 2006, under Section 150 of the
Companies Law (2004 revision) of the Cayman Islands. Kenneth M.
Krys and Christopher Stride of RSM Cayman Islands were appointed
as joint voluntary liquidators.
On July 4, 2006, the liquidators presented in court the petitions
for the winding-up of Sphinx Strategy.
Parties-in-interests who want to attend the hearing must inform
of their intention to appear on the hearing to Sphinx Strategy's
liquidators at:
Kenneth M. Krys
Christopher Stride
RSM Cayman Islands
P.O. Box 1370 GT, 2nd Floor Commerce House
7 Dr. Roy's Drive, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7100
Fax: (345) 949-7120
Under Rule 4.16 of the Insolvency Rules 1986 of the Cayman
Islands, those who intend to appear on the hearing must serve
notice not later than 4:00 p.m. on July 27, 2006.
Sphinx Strategy's counsel can be reached at:
Cherry Bridges
Alex Horsbrugh-Porter
Ritch & Conolly
P.O. Box 1994GT, 4th Floor Queensgate House
113 South Church Street, George Town
Grand Cayman, Cayman Islands
Tel: (345) 949-7366
Fax: (345) 949-8652
SURFSIDE RESORT: Ct. Says Paid Insurance Policy Not Executory Pact
------------------------------------------------------------------
The Honorable Jerry A. Funk of the U.S. Bankruptcy Court for the
Middle District of Florida in Jacksonville refused to revoke
confirmation of Surfside Resort and Suites, Inc.'s Plan. Finding
that the supplemental insurance policy issued by Westchester
Surplus Lines Insurance Company had already been paid before
Surfside Resort filed for bankruptcy, Judge Funk said the
insurance policy is not "executory contract".
Surfside Resort has a supplemental insurance policy numbered
D3589844A001, which was issued by Westchester. This insurance is
part of the Hotel Risk Management Association Layered Property
Program Property Coverage and covered the period from Feb. 1,
2004, through Feb. 1, 2005.
The primary policy is issued by Hartford Fire Insurance Company,
which offered $10,000,000 in coverage. The Westchester policy
covered Debtor's property, for physical loss or damage in excess
of the $10 million coverage provided by Hartford.
The Debtor entered into an insurance premium finance agreement
with Imperial Premium Finance, Inc. Imperial paid Westchester's
annual insurance premium in full, and the Debtor agreed to repay
Imperial in monthly installments with interest.
Sometime in August and September 2004, Surfside Resort's hotel
sustained property damage as a result of Hurricanes Charley and
Frances.
The Debtor filed for bankruptcy on Sept. 17, 2004, and the
Bankruptcy Court approved its First Amended Plan of Reorganization
on May 10, 2005.
Bray & Gillespie IX, LLC, owned and held the first and second
mortgage liens of the Debtor's hotel. Under the Plan, B&G will
purchase the hotel, the Debtor's main asset. B&G acquired the
right to collect the proceeds from the insurance claims asserted
by the Debtor pursuant to the sale.
Westchester argued that B&G and Surfside Resort conspired to
intentionally deprive to give notice of Surfside Resort's
bankruptcy filing. Westchester said that because of B&G's and
Surfside Resort's fraudulent conduct, it is not bound by the terms
of Surfside Resort's Plan.
Westchester reasoned that it was entitled to notice of Surfside
Resort's bankruptcy filing since it was a creditor, or in the
alternative, a party-in-interest. Westchester added Surfside
Resort assumed and assigned the supplemental insurance policy in
violation of the specified anti-assignment clause.
Surfside Resort replied that the supplemental insurance policy was
no longer "executory contract" when the bankruptcy petition was
filed because all premiums were already paid in full to
Westchester.
Judge Funk said that the Debtor's plan confirmation won't be
revoked based on its alleged fraud in failing to provide notice
because Westchester had no claim on the Estate and was not
creditor nor party-in-interest.
Judge Funk also said that although the policy contained anti-
assignment clause, the clause did not affect Debtor's right to
assign its right to post-loss insurance proceeds. Under Florida
law, policyholders may freely assign post-loss insurance claims,
even if policy contains anti-assignment clause.
In a decision published at 2006 WL 1689316, Judge Funk held that:
(a) the supplemental property insurance policy purchased by
Surfside Resort on its hotel property was no longer
"executory contract" when bankruptcy petition was filed;
(b) Westchester, whose obligation to indemnify Surfside Resort
for hurricane damage to Debtor's hotel had already attached
prior to commencement of Chapter 11 case, and whose
obligations could not be affected by debtor's bankruptcy
case, was not "party-in-interest," so as not to be entitled
to notice of time set for filing objections to disclosure
statement and proposed plan;
(c) the confirmation order would not be revoked based upon
Debtor's alleged fraud; and
(d) the Debtor could assign its right to proceeds, despite
anti-assignment clause in the insurance policy.
Walter J. Snell, Esq., at Snell & Snell, P.A., in Daytona Beach,
Fla., and John B. Macdonald, Esq., and Patrick P. Patangan, Esq.,
at Akerman Senterfitt, in Jacksonville, Fla., represented the
Debtor in this litigation.
Gary M. Freedman, Esq., and Joel L. Tabas, Esq., at Tabas,
Freedman, Soloff & Miller, P.A., in Miami, Fla., represented
Westchester Surplus Lines Insurance Company.
Headquartered in Ormond Beach, Fla., Surfside Resort and Suites,
Inc. -- http://www.daytonasurfsideandsuites.com/-- operates a
vacation resort, restaurant and lounge. The Debtor filed for
chapter 11 protection on Sept. 17, 2004 (Bankr. M.D. Fla. Case No.
04-05948). Walter J. Snell, Esq. at Snell & Snell, P.A.,
represents the Debtor. When the Debtor filed for protection from
its creditors, it listed $19,598,145 in total assets and
$9,289,843 in total liabilities. The Debtor's First Amended Plan
of Reorganization was approved by the Bankruptcy Court on May 10,
2005.
TOTAL TIME: Case Summary & 18 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Total Time Solutions LLC
P.O. Box 12008
Hauppauge, New York 11788-0815
Bankruptcy Case No.: 06-71631
Chapter 11 Petition Date: July 14, 2006
Court: Eastern District of New York (Central Islip)
Debtor's Counsel: Andrew M. Thaler, Esq.
Thaler & Gertler, LLP
900 Merchants Concourse, Suite 414
Westbury, New York 11590
Tel: (516) 228-3553
Fax: (516) 228-3396
Total Assets: $111,523
Total Debts: $7,153,682
Debtor's 18 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
JII Inc. Unpaid Client Taxes $561,009
2605 Camino del Rio South
4th Floor
San Diego, CA 92108
Ingentra HR Services, Inc. Intercompany Loans $439,047
425 Oser Avenue
Hauppauge, NY 11787-0815
Dover Corporation Unpaid Client Taxes $287,051
280 Park Avenue, Suite 34 West
New York, NY 10017
Malibu Textiles, Inc. Unpaid Client Taxes $153,609
49 West 37th Street
New York, NY 10018
Ideal Window Mfg. Inc. Unpaid Client Taxes $149,253
100 West 7th Street
Bayonne, NJ 07002
Spear Wilderman Borish Unpaid Client Taxes $128,531
Endy SP
Epic Mechanical Contractors LLC Unpaid Client Taxes $108,033
Retina Associates of NJ PA Unpaid Client Taxes $89,477
Ladas & Parry Unpaid Client Taxes $88,386
Integrative Nutrition Inc. Unpaid Client Taxes $86,469
Grand Sport Auto Inc. Unpaid Client Taxes $78,641
Malibu Textiles Inc. Unpaid Client Taxes $72,010
The Goodman Corporation Unpaid Client Taxes $67,250
Schuylkill Valley Sporting Unpaid Client Taxes $64,548
Goods, Inc.
GW Hoffman Inc. Unpaid Client Taxes $62,508
Sterling Sanitary Supply Corp. Unpaid Client Taxes $61,562
Big O LLC Unpaid Client Taxes $59,187
G Boys Excavating Inc. Unpaid Client Taxes $58,546
USG CORP: Court Denies Consortium's Move for $12.5M Admin. Claim
----------------------------------------------------------------
The U.S. Bankruptcy Court denies the Consortium of Investors'
request for payment of a fee for competing against Berkshire
Hathaway's equity backstop commitment agreement.
The Consortium is comprised of investment funds managed by eight
fund groups including:
* Deephaven Capital Management LLC,
* Fidelity Management & Research Company,
* Silver Point Capital, L.P.,
* D.E. Shaw & Co., L.P.,
* Abrams Capital Partners,
* Redwood Capital Management, LLC,
* Citadel Limited Partnership, and
* Caspian Capital Advisors LLC.
USG and the Official Committee of Equity Security Holders believed
that the Consortium's involvement in the process of securing an
equity backstop commitment was critical to generating up to
$46,300,000 and at least $33,000,000, depending on the rights
offering completion date, in savings for USG and its stakeholders.
Accordingly, the Consortium asked the Court to allow it a
$12,500,000 administrative expense priority claim for its
substantial contribution to USG's estate, and direct the Debtors
to pay the claim.
The Court, however, directs the Debtors to pay as administrative
expenses of their estates $134,005 to the Consortium's counsel,
Kirkland & Ellis, LLP and Pachulski Stang Ziehl Young Jones &
Weintraub LLP.
The fee consists of $127,494 for the reasonable and necessary
professional services rendered by and $6,511 for the actual and
necessary costs and expenses of the Consortium's counsel.
Kirkland and Pachulski initially sought payment of $149,737 in
fees and reimbursement of $6,511 in expenses for their services
to the Consortium.
The Debtors found the fees excessive. While they support the
reimbursement of the Consortium's reasonable attorney's fees, the
Debtors declined to foot $22,243 of the fees incurred by the
Consortium's counsel in connection with preparing and arguing
before the Court the Consortium's request for the Unsuccessful
Bidder Fee. The Objectionable Fees should be treated the same as
the Unsuccessful Bidder Fee, the Debtors argued.
As previously reported, the Consortium of Investors delivered an
alternative equity backstop proposal for the Debtors' rights
offering. The competing bid was virtually identical to the terms
of the Court-approved Equity Commitment Agreement with Berkshire
Hathaway, Inc.
The Debtors emerged from Chapter 11 protection on June 20, 2006,
following confirmation and effectiveness of their First Amended
Joint Plan of Reorganization.
Headquartered in Chicago, Illinois, USG Corporation --
http://www.usg.com/-- through its subsidiaries, is a leading
manufacturer and distributor of building materials producing a
wide range of products for use in new residential, new
nonresidential and repair and remodel construction, as well as
products used in certain industrial processes.
The Company filed for chapter 11 protection on June 25, 2001
(Bankr. Del. Case No. 01-02094). David G. Heiman, Esq., Gus
Kallergis, Esq., Brad B. Erens, Esq., Michelle M. Harner, Esq.,
Mark A. Cody, Esq., and Daniel B. Prieto, Esq., at Jones Day
represent the Debtors in their restructuring efforts.
Lewis Kruger, Esq., Kenneth Pasquale, Esq., and Denise Wildes,
Esq., represent the Official Committee of Unsecured Creditors.
Elihu Inselbuch, Esq., and peter Van N. Lockwood, Esq., at Caplin
& Drysdale, Chartered, represent the Official Committee of
Asbestos Personal Injury Claimants. Martin J. Bienenstock, Esq.,
Judy G. Z. Liu, Esq., Ralph I. Miller, Esq., and David A.
Hickerson, Esq., at Weil Gotshal & Manges LLP represent the
Statutory Committee of Equity Security Holders. Dean M. Trafelet
is the Future Claimants Representative. Michael J. Crames, Esq.,
and Andrew A. Kress, Esq., at Kaye Scholer, LLP, represent the
Future Claimants Representative. Scott Baena, Esq., and Jay
Sakalo, Esq., at Bilzen Sumberg Baena Price & Axelrod LLP,
represent the Asbestos Property Damage Claimants Committee.
When the Debtors filed for protection from their creditors, they
listed $3,252,000,000 in assets and $2,739,000,000 in debts. The
Debtors emerged from bankruptcy protection on June 20, 2006. (USG
Bankruptcy News, Issue No. 116; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
USG CORP: Objects to Three Asbestos Personal Injury Claims
----------------------------------------------------------
Before USG Corporation and its debtor-affiliates filed for
bankruptcy, Debtor United States Gypsum Company and certain
claimants were members of the Center for Claims Resolution, which
was formed in 1988 to mitigate burdens of resolving asbestos
personal injury claims against the member companies.
Pursuant to a Producer Agreement dated September 28, 1988, the
CCR acted as agent for each member in administering, defending,
evaluating, settling and paying asbestos personal injury claims
against the member companies. Paul N. Heath, Esq., at Richards,
Layton & Finger, P.A., in Wilmington, Delaware, says that
liability for settlements of asbestos personal injury claims made
by the CCR on its members' behalf was apportioned among the member
companies pursuant to certain formulas.
On June 16, 2006, the U.S. Bankruptcy and District Courts
confirmed the Debtors' First Amended Plan of Reorganization,
which establishes, among other things, a trust under Section
524(g) of the Bankruptcy Code to which all asbestos personal
injury claims are channeled. The Plan became effective
on June 20, 2006.
Under the Plan, the definition of Asbestos Personal Injury Claim
includes "Asbestos Personal Injury Indirect Claims," which
consist of claims brought by the CCR Claimants.
The Plan also provides that an "Asbestos Personal Injury Indirect
Claim" includes claims or demands against any Debtor by the CCR
or its members relating to Asbestos Personal Injury Claims and
claims by any entity, including the CCR or its current or former
members, with respect to any surety bond, letter of credit or
other financial assurance issued by any entity on account of
Asbestos Personal Injury Claims.
An Asbestos Property Damage Indirect Claim will not constitute an
Asbestos Personal Injury Indirect Claim.
In this connection, the CCR Claimants subsequently filed proofs
of claim seeking reimbursement for amounts that have been or may
in the future be allegedly required to pay to asbestos personal
injury claimants for U.S. Gypsum's allocated share of settlements
made by the CCR.
The CCR Claimants and the Claims at issue are:
Claimant Claim No.
-------- ---------
C.E. Thurston & Sons, Inc. 6414
Quigley Company, Inc. 6542
Pfizer, Inc. 6543
The Debtors argue that the Claims fall directly within the
definition of an Asbestos Personal Injury Indirect Claim that is
channeled to the Asbestos Personal Injury Trust.
Accordingly, the Debtors ask Judge Fitzgerald to disallow the
Claims since their estates no longer have any liability for the
Claims.
Mr. Heath asserts that the Claims are now liabilities of the
Asbestos Personal Injury Trust and are entitled to receive a
consideration as provided in the distribution procedures
established by the Plan.
The Debtors' request is without prejudice to the Claimants'
rights to assert each Claim or any other claim against the
Asbestos Personal Injury Trust.
Headquartered in Chicago, Illinois, USG Corporation --
http://www.usg.com/-- through its subsidiaries, is a leading
manufacturer and distributor of building materials producing a
wide range of products for use in new residential, new
nonresidential and repair and remodel construction, as well as
products used in certain industrial processes.
The Company filed for chapter 11 protection on June 25, 2001
(Bankr. Del. Case No. 01-02094). David G. Heiman, Esq., Gus
Kallergis, Esq., Brad B. Erens, Esq., Michelle M. Harner, Esq.,
Mark A. Cody, Esq., and Daniel B. Prieto, Esq., at Jones Day
represent the Debtors in their restructuring efforts.
Lewis Kruger, Esq., Kenneth Pasquale, Esq., and Denise Wildes,
Esq., represent the Official Committee of Unsecured Creditors.
Elihu Inselbuch, Esq., and peter Van N. Lockwood, Esq., at Caplin
& Drysdale, Chartered, represent the Official Committee of
Asbestos Personal Injury Claimants. Martin J. Bienenstock, Esq.,
Judy G. Z. Liu, Esq., Ralph I. Miller, Esq., and David A.
Hickerson, Esq., at Weil Gotshal & Manges LLP represent the
Statutory Committee of Equity Security Holders. Dean M. Trafelet
is the Future Claimants Representative. Michael J. Crames, Esq.,
and Andrew A. Kress, Esq., at Kaye Scholer, LLP, represent the
Future Claimants Representative. Scott Baena, Esq., and Jay
Sakalo, Esq., at Bilzen Sumberg Baena Price & Axelrod LLP,
represent the Asbestos Property Damage Claimants Committee.
When the Debtors filed for protection from their creditors, they
listed $3,252,000,000 in assets and $2,739,000,000 in debts. The
Debtors emerged from bankruptcy protection on June 20, 2006. (USG
Bankruptcy News, Issue No. 116; Bankruptcy Creditors'
Service, Inc., 215/945-7000)
VALENTINE PAPER: Court Confirms Amended Plan of Liquidation
-----------------------------------------------------------
The Honorable Jerry A. Brown of the U.S. Bankruptcy Court for the
Eastern District of Louisiana in New Orleans confirmed the Amended
Plan of Reorganization of Valentine Paper, Inc., nka VPI
Liquidation Corporation on July 3, 2006.
Judge Brown determined that the Plan complies with the 13
standards imposed by Section 1129(a) of the Bankruptcy Code.
Overview of the Plan
As reported in the Troubled Company Reporter on May 5, 2006, the
Debtor told the Court that pursuant to the Plan and a Liquidating
Trust Agreement, a trust will be created for the purposes of
liquidating their assets and satisfying claims against the them.
Treatment of Claims
Under the Plan, Administrative Claims and Priority Tax Claims will
be paid in full.
Holders of the Note Acquisition Residual Claim will be entitled to
funds remaining in the Escrow Account. The Debtor tells the Court
that, as agreed between the Debtor, the Official Committee of
Unsecured Creditors and the Noteholder, there will be no
deficiency claim.
Priority Non-Tax Claims will receive their pro-rate share of the
cash distribution from cash held by the Liquidating Trustee after
payment of priority claims.
Holders of Unsecured Claims will receive their pro-rate share of
the cash distribution from cash held by the Liquidating Trustee
after payment of all other claims.
Holders of Equity Interests in the Debtor will receive nothing
under plan and those interests will be extinguished.
Headquartered in Lockport, Louisiana, Valentine Paper, Inc. --
http://www.valentinepaper.com/-- produces technical and specialty
papers. The Company filed for chapter 11 protection on June 6,
2005 (Bankr. E.D. La. Case No. 05-14659). David F. Waguespack,
Esq., at Lemle & Kelleher, L.L.P., represents the Debtor in its
restructuring efforts. C. Davin Boldissar, Esq., at Locke,
Liddell & Sapp LLP, represents the Official Committee of Unsecured
Creditors. When the Debtor filed for protection from its
creditors, it estimated assets between $1 million and $10 million
and debts between $10 million and $50 million.
W.R. GRACE: Court Closes Asbestos Panels' Complaint v. Sealed Air
-----------------------------------------------------------------
The Honorable Judith K. Fitzgerald holding court in Philadelphia,
Pennsylvania, has closed the adversary proceeding between the
Official Committee of Asbestos personal Injury Claimants and
Sealed Air Corp., without prejudice to Sealed Air and Cryovac,
Inc.'s rights to reopen the Adversary Proceeding at a later date
and renew, in their sole discretion, Sealed Air's request to
vacate Judge Wolin's July 29, 2002, In Limine standards opinion
and order.
Closure of the Adversary proceeding is without prejudice to the
refiling and hearing by the U.S. Bankruptcy Court for the District
of Delaware in W.R. Grace & Co.'s Chapter 11 cases of fee
applications currently pending in the Adversary Proceeding.
The Court approved in June 2005 a $950,000,000 settlement
agreement among Sealed Air and the Asbestos Committees in the
Debtors' Chapter 11 cases. Sealed Air agreed to pay $512,500,000
in cash and deliver 9,000,000 shares of its common stock to a
Section 524(g) Trust to be created under the Debtors' ultimate
Chapter 11 plan. In exchange, Sealed Air and its co-defendants
obtain a complete release from all asbestos-related obligations.
The agreement is expected to become effective upon the Debtors'
emergence from bankruptcy with a plan of reorganization that is
consistent with the terms of the agreement, which includes the
establishment of one or more trusts under Section 524(g) of the
Bankruptcy Code.
About W.R. Grace
Headquartered in Columbia, Maryland, W.R. Grace & Co. --
http://www.grace.com/-- supplies catalysts and silica products,
especially construction chemicals and building materials, and
container products globally. The Company and its debtor-
affiliates filed for chapter 11 protection on April 2, 2001
(Bankr. D. Del. Case No. 01-01139). James H.M. Sprayregen, Esq.,
at Kirkland & Ellis, and Laura Davis Jones, Esq., at Pachulski,
Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the
Debtors in their restructuring efforts. The Debtors hired
Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan LLP represent the Official Committee of
Unsecured Creditors. The Creditors Committee tapped Capstone
Corporate Recovery LLC for financial advice. David T. Austern,
the legal representative of future asbestos personal injury
claimants, is represented by Orrick Herrington & Sutcliffe LLP and
Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., and
Nathan D. Finch, Esq., at Caplin & Drysdale represent the
Official Committee of Asbestos Personal Injury Claimants.
The Asbestos Committee of Property Damage Claimants tapped
Scott L. Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin
Sumberg Baena Price & Axelrod LLP to represent it. Lexecon,
LLP, provided asbestos claims consulting services to the Official
Committee of Equity Security Holders.
W.R. GRACE: U.S. Trustee Amends Creditors Committee Membership
--------------------------------------------------------------
Kelly Beaudin Stapleton, the United States Trustee for Region 3,
amends the membership of the Official Committee of Unsecured
Creditors in the chapter 11 cases of W.R. Grace & Co., and its
debtor-affiliates, effective July 10, 2006.
The Committee is now composed of:
1. J.P. Morgan Chase & Co.
Attn: Thomas F. Maher
380 Madison Avenue
New York, New York 10017
(212) 622-3671
2. Wachovia Bank
Attn: Jill W. Akre
1339 Chestnut Street
Philadelphia, Pennsylvania 19107
(215) 786-4135
3. Sealed Air Corporation
Attn: Mary A. Coventry
Park 80 East
Saddle Brook, NJ 07663
(201) 703-7600
David M. Klauder, Esq., is the attorney assigned to monitor and
represent the U.S. Trustee's interests in W.R. Grace & Co.'s
Chapter 11 cases.
About W.R. Grace
Headquartered in Columbia, Maryland, W.R. Grace & Co. --
http://www.grace.com/-- supplies catalysts and silica products,
especially construction chemicals and building materials, and
container products globally. The Company and its debtor-
affiliates filed for chapter 11 protection on April 2, 2001
(Bankr. D. Del. Case No. 01-01139). James H.M. Sprayregen, Esq.,
at Kirkland & Ellis, and Laura Davis Jones, Esq., at Pachulski,
Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the
Debtors in their restructuring efforts. The Debtors hired
Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan LLP represent the Official Committee of
Unsecured Creditors. The Creditors Committee tapped Capstone
Corporate Recovery LLC for financial advice. David T. Austern,
the legal representative of future asbestos personal injury
claimants, is represented by Orrick Herrington & Sutcliffe LLP and
Phillips Goldman & Spence, PA. Elihu Inselbuch, Esq., and
Nathan D. Finch, Esq., at Caplin & Drysdale represent the
Official Committee of Asbestos Personal Injury Claimants.
The Asbestos Committee of Property Damage Claimants tapped
Scott L. Baena, Esq., and Jay M. Sakalo, Esq., at Bilzin
Sumberg Baena Price & Axelrod LLP to represent it. Lexecon,
LLP, provided asbestos claims consulting services to the Official
Committee of Equity Security Holders.
WERNER HOLDINGS: Chap. 11 Filing Cues Moody's to Withdraw Ratings
-----------------------------------------------------------------
Moody's Investors Service withdrawn the ratings of Werner Holdings
Co., Inc. due to the company's voluntary filing of Chapter 11 of
the United States Bankruptcy Code. Please refer to Moody's
Guidelines for the Withdrawal of Ratings on moodys.com.
These ratings were withdrawn:
* $50 million revolver due 2008 previously rated Caa2;
* $90 million guaranteed senior secured term loan previously
rated Caa2;
* $134 million senior subordinated notes due 2007 previously
rated C;
* $100 million second lien due 2009 previously rated Ca.
Headquartered in Greenville, PA, Werner Holding Co., Inc. is the
nation's largest manufacturer and marketer of ladders and other
climbing equipment. Total adjusted debt as of September 30, 2005
was approximately $405 million.
WORLD HEART: Posts $3 Million Net Loss in Quarter Ended March 31
----------------------------------------------------------------
World Heart Corp. filed its financial statements for the quarter
ended March 31, 2006, with the Securities and Exchange Commission.
The Company reported a $3,441,591 net loss on $3,284,816 of
revenues for the three months ended March 31, 2006, versus a
$3,942,396 net loss on $3,416,988 of revenues for the three months
ended March 31, 2005.
At March 31, 2006, the Company's balance sheet showed $22,071,674
in total assets and $4,769,192 in total liabilities resulting in a
stockholders' equity of 17,302,482.
A full-text copy of the Company's financial statement for the
quarter ended March 31, 2006, is available for free at:
http://ResearchArchives.com/t/s?db7
Going Concern Doubt
As reported in the Troubled Company Reporter on May 12, 2006,
PricewaterhouseCoopers LLP, World Heart Corporation's auditor,
expressed substantial doubt about the Company's ability to
continue as a going concern after auditing the Company's financial
statements for the year ending Dec. 31, 2005. PwC pointed to the
Company's recurring losses.
About World Heart
Headquartered in Oakland, California, World Heart Corporation --
http://www.worldheart.com/-- develops, produces and sells
ventricular assist devices. VADs are mechanical assist devices
that supplement the circulatory function of the heart by re-
routing blood flow through a mechanical pump allowing for the
restoration of normal blood circulation.
WORLDCOM INC: Intercity Cable Agrees to Reduce Claim to $500,000
----------------------------------------------------------------
On August 18, 1993, Intercity Cable entered into a sales
representation agreement with ACS Enterprises under which it
would be paid a commission to solicit new customers for ACS'
cable services.
Intercity then asserted that its commissions were unpaid or
underpaid between August 19, 1993 and August 22, 1994.
In August 1997, Intercity filed a lawsuit against ACS and its
then corporate parent CAI Wireless Systems in the Court of Common
Pleas of Philadelphia County.
WorldCom, Inc., and its debtor-affiliates are the successors-in-
interest to ACS and CAI Wireless.
On January 22, 2003, Intercity filed Claim No. 19167 in the
Debtors' bankruptcy cases, seeking to collect the unpaid or
underpaid commissions.
The parties disputed about the commissions, the State Court
Action, the proof of claim, and the amount, extent, and type of
claim to which the Intercity is entitled.
The Parties wish to compromise, resolve, and settle the claims
and causes of action that were or could have been asserted by
Intercity in the State Court Action or the Proof of Claim.
Consequently, the Parties entered into a settlement agreement on
June 21, 2006.
Subsequently, in a stipulation approved by the U.S. Bankruptcy
Court for the District of New York, the Parties agree that Claim
No. 19167 is reduced and allowed as a Class 6 General Unsecured
Claim for $500,000. The payment of the Allowed Claim will be made
in accordance with the terms of the Debtors' Plan of
Reorganization.
About WorldCom
WorldCom, Inc., a Clinton, MS-based global communications company,
filed for chapter 11 protection on July 21, 2002 (Bankr. S.D.N.Y.
Case No. 02-13532). On March 31, 2002, WorldCom listed
$103,803,000,000 in assets and $45,897,000,000 in debts. The
Bankruptcy Court confirmed WorldCom's Plan on Oct. 31, 2003, and
on Apr. 20, 2004, the Company formally emerged from U.S. Chapter
11 protection as MCI, Inc. On Jan. 6, 2006, MCI merged with
Verizon Communications, Inc. MCI is now known as Verizon
Business, a unit of Verizon Communications. (WorldCom Bankruptcy
News, Issue No. 121; Bankruptcy Creditors' Service, Inc., 215/945-
7000)
* BOND PRICING: For the week of July 10 - July 14, 2006
-------------------------------------------------------
Issuer Coupon Maturity Price
------ ------ -------- -----
ABC Rail Product 10.500% 12/31/04 0
Adelphia Comm. 3.250% 05/01/21 1
Adelphia Comm. 6.000% 02/15/06 0
Adelphia Comm. 7.500% 01/15/04 55
Adelphia Comm. 7.750% 01/15/09 55
Adelphia Comm. 7.875% 05/01/09 54
Adelphia Comm. 8.125% 07/15/03 44
Adelphia Comm. 8.375% 02/01/08 55
Adelphia Comm. 9.250% 10/01/02 53
Adelphia Comm. 9.375% 11/15/09 57
Adelphia Comm. 9.500% 02/15/04 53
Adelphia Comm. 9.875% 03/01/05 51
Adelphia Comm. 9.875% 03/01/07 54
Adelphia Comm. 10.250% 06/15/11 60
Adelphia Comm. 10.250% 11/01/06 55
Adelphia Comm. 10.500% 07/15/04 52
Adelphia Comm. 10.875% 10/01/10 55
AHI-DFLT07/05 8.625% 10/01/07 73
Allegiance Tel. 11.750% 02/15/08 48
Allegiance Tel. 12.875% 05/15/08 45
Amer & Forgn Pwr 5.000% 03/01/30 68
Amer Color Graph 10.000% 06/15/10 73
Amer Plumbing 11.625% 10/15/08 18
Ames Dept. Stores 10.000% 04/15/06 0
Antigenics 5.250% 02/01/25 56
Anvil Knitwear 10.875% 03/15/07 57
Armstrong World 6.350% 08/15/03 72
Armstrong World 6.500% 08/15/05 72
Armstrong World 7.450% 05/15/29 72
Armstrong World 9.000% 06/15/04 72
At Home Corp. 0.525% 12/28/18 2
At Home Corp. 4.750% 12/15/06 1
ATA Holdings 12.125% 06/15/10 2
Autocam Corp. 10.875% 06/15/14 61
Banctec Inc 7.500% 06/01/08 74
Bank New England 8.750% 04/01/99 6
Bank New England 9.500% 02/15/96 0
Big V Supermarkets 11.000% 02/15/04 0
Burlington North 3.200% 01/01/45 54
CCH II/CCH II CP 10.250% 01/15/10 72
Cell Therapeutic 5.750% 06/15/08 58
Charter Comm Hld 10.000% 05/15/11 62
Charter Comm Hld 11.125% 01/15/11 66
Chic East Ill RR 5.000% 01/01/54 61
CIH 9.920% 04/01/14 62
CIH 10.000% 05/15/14 62
CIH 11.125% 01/15/14 64
Collins & Aikman 10.750% 12/31/11 28
Color Tile Inc 10.750% 12/15/01 1
CPNL-Dflt12/05 4.000% 12/26/06 25
CPNL-Dflt12/05 4.750% 11/15/23 46
CPNL-Dflt12/05 4.750% 11/15/23 47
CPNL-Dflt12/05 6.000% 09/30/14 38
CPNL-Dflt12/05 7.625% 04/15/06 72
CPNL-Dflt12/05 7.750% 04/15/09 71
CPNL-Dflt12/05 7.750% 06/01/15 37
CPNL-Dflt12/05 7.875% 04/01/08 71
CPNL-Dflt12/05 8.500% 02/15/11 49
CPNL-Dflt12/05 8.625% 08/15/10 48
CPNL-Dflt12/05 8.750% 07/15/07 70
CPNL-Dflt12/05 10.500% 05/15/06 72
Cray Research 6.125% 02/01/11 15
Curagen Corp 4.000% 02/15/11 73
Dal-Dflt09/05 9.000% 05/15/16 28
Delco Remy Intl 9.375% 04/15/12 55
Delco Remy Intl 11.000% 05/01/09 62
Delphi Trust II 6.197% 11/15/33 64
Delta Air Lines 2.875% 02/18/24 28
Delta Air Lines 7.541% 10/11/11 38
Delta Air Lines 7.700% 12/15/05 30
Delta Air Lines 7.900% 12/15/09 29
Delta Air Lines 8.000% 06/03/23 28
Delta Air Lines 8.187% 10/11/17 36
Delta Air Lines 8.300% 12/15/29 28
Delta Air Lines 8.540% 01/02/07 71
Delta Air Lines 8.950% 01/12/12 66
Delta Air Lines 9.200% 09/23/14 75
Delta Air Lines 9.250% 03/15/22 27
Delta Air Lines 9.320% 01/02/09 73
Delta Air Lines 9.375% 09/11/07 63
Delta Air Lines 9.480% 06/05/06 58
Delta Air Lines 9.750% 05/15/21 27
Delta Air Lines 9.875% 04/30/08 68
Delta Air Lines 9.950% 06/01/06 70
Delta Air Lines 9.950% 06/01/06 70
Delta Air Lines 10.000% 06/01/12 63
Delta Air Lines 10.000% 08/15/08 28
Delta Air Lines 10.060% 01/02/16 74
Delta Air Lines 10.125% 05/15/10 29
Delta Air Lines 10.375% 02/01/11 27
Delta Air Lines 10.375% 12/15/22 27
Delta Air Lines 10.500% 04/30/16 69
Deutsche Bank NY 8.500% 11/15/16 64
Dov Pharmaceutic 2.500% 01/15/25 49
Dura Operating 9.000% 05/01/09 53
Dura Operating 9.000% 05/01/09 55
Eagle-Picher Inc 9.750% 09/01/13 68
Epix Medical Inc. 3.000% 06/15/24 68
Exodus Comm. Inc. 11.625% 07/15/10 0
Falcon Products 11.375% 06/15/09 3
Federal-Mogul Co. 7.375% 01/15/06 60
Federal-Mogul Co. 7.500% 01/15/09 59
Federal-Mogul Co. 8.160% 03/06/03 59
Federal-Mogul Co. 8.250% 03/03/05 63
Federal-Mogul Co. 8.370% 11/15/01 58
Federal-Mogul Co. 8.370% 11/15/01 59
Federal-Mogul Co. 8.800% 04/15/07 61
Finova Group 7.500% 11/15/09 29
Ford Motor Co 6.500% 08/01/18 69
Ford Motor Co 6.625% 02/15/28 69
Ford Motor Co 7.125% 11/15/25 69
Ford Motor Co 7.400% 11/01/46 67
Ford Motor Co 7.500% 08/01/26 71
Ford Motor Co 7.700% 05/15/97 68
Ford Motor Co 7.750% 06/15/43 69
Ford Motor Cred 5.650% 01/21/14 73
Ford Motor Cred 5.750% 01/21/14 74
Ford Motor Cred 5.750% 02/20/14 74
Ford Motor Cred 5.750% 02/20/14 74
Ford Motor Cred 6.000% 01/20/15 73
Ford Motor Cred 6.000% 02/20/15 73
Ford Motor Cred 6.000% 03/20/14 74
Ford Motor Cred 6.000% 03/20/14 75
Ford Motor Cred 6.000% 11/20/14 74
Ford Motor Cred 6.000% 11/20/14 74
Ford Motor Cred 6.000% 11/20/14 74
Ford Motor Cred 6.050% 02/20/15 74
Ford Motor Cred 6.050% 12/22/14 72
Ford Motor Cred 6.050% 12/22/14 74
Ford Motor Cred 6.100% 02/20/15 74
Ford Motor Cred 6.150% 01/20/15 75
Ford Motor Cred 6.150% 12/22/14 75
Ford Motor Cred 6.200% 03/20/15 74
Ford Motor Cred 6.250% 01/20/15 75
Ford Motor Cred 6.250% 03/20/15 74
Ford Motor Cred 6.500% 03/20/15 75
Ford Motor Cred 7.500% 08/20/32 70
Gateway Inc. 2.000% 12/31/11 72
GB Property Fndg 11.000% 09/29/05 62
General Motors 7.400% 09/01/25 74
GMAC 5.900% 01/15/19 74
GMAC 6.150% 09/15/19 75
Golden Books Pub 10.750% 12/31/04 0
Graftech Intl 1.625% 01/15/24 68
Gulf Mobile Ohio 5.000% 12/01/56 73
Gulf States Stl 13.500% 04/15/03 0
Hertz Corp 7.000% 01/15/28 74
HNG Internorth 9.625% 03/15/06 33
Home Prod Intl 9.625% 05/15/08 67
Imperial Credit 9.875% 01/15/07 0
Inland Fiber 9.625% 11/15/07 60
Insight Health 9.875% 11/01/11 46
Iridium LLC/CAP 10.875% 07/15/05 29
Iridium LLC/CAP 11.250% 07/15/05 29
Iridium LLC/CAP 13.000% 07/15/05 27
Iridium LLC/CAP 14.000% 07/15/05 28
Isolagen Inc. 3.500% 11/01/24 73
Kaiser Aluminum & Chem. 9.875% 02/15/02 49
Kaiser Aluminum & Chem. 10.875% 10/15/06 58
Kaiser Aluminum & Chem. 12.750% 02/01/03 12
Kellstrom Inds 5.500% 06/15/03 0
Kmart Corp. 9.780% 01/05/20 10
Kmart Funding 9.440% 07/01/18 43
Liberty Media 3.250% 03/15/31 74
Liberty Media 3.750% 02/15/30 57
Liberty Media 4.000% 11/15/29 62
Lifecare Holding 9.250% 08/15/13 72
Macsaver Financl 7.400% 02/15/02 2
Macsaver Financl 7.600% 08/01/07 1
Merisant Co 9.500% 07/15/13 65
Merrill Lynch 10.000% 08/15/12 72
MSX Int'l Inc. 11.375% 01/15/08 66
Muzak LLC 9.875% 03/15/09 54
New Orl Grt N RR 5.000% 07/01/32 66
Northern Pacific RY 3.000% 01/01/47 54
Northern Pacific RY 3.000% 01/01/47 54
Northwest Airlines 6.625% 05/15/23 49
Northwest Airlines 7.248% 01/02/12 14
Northwest Airlines 7.625% 11/15/23 49
Northwest Airlines 7.875% 03/15/08 50
Northwest Airlines 8.700% 03/15/07 49
Northwest Airlines 8.875% 06/01/06 49
Northwest Airlines 9.179% 04/01/10 25
Northwest Airlines 9.875% 03/15/07 52
Northwest Airlines 10.000% 02/01/09 49
Northwest Stl&Wir 9.500% 06/15/01 0
NTK Holdings Inc 10.750% 03/01/14 72
Oscient Pharm 3.500% 04/15/11 68
Osu-Dflt10/05 13.375% 10/15/09 0
O'Sullivan Ind 10.630% 10/01/08 59
Outboard Marine 7.000% 07/01/02 0
Outboard Marine 10.750% 06/01/08 9
Overstock.com 3.750% 12/01/11 72
Owens-Corning Fiber 9.375% 06/01/12 75
PCA LLC/PCA Fin 11.875% 08/01/09 21
Pegasus Satellite 9.625% 10/15/49 11
Pegasus Satellite 12.375% 08/01/06 9
Pegasus Satellite 12.500% 08/01/07 12
Piedmont Aviat 10.350% 03/28/11 0
Pixelworks Inc. 1.750% 05/15/24 70
Pliant-DFLT/06 13.000% 06/01/10 38
Pliant-DFLT/06 13.000% 06/01/10 50
Polaroid Corp. 6.750% 01/15/02 0
Polaroid Corp. 7.250% 01/15/07 0
Polaroid Corp. 11.500% 02/15/06 0
Primus Telecom 3.750% 09/15/10 48
Primus Telecom 8.000% 01/15/14 65
PSINET Inc 10.500% 12/01/06 0
Radnor Holdings 11.000% 03/15/10 34
Railworks Corp 11.500% 04/15/09 1
Read-Rite Corp. 6.500% 09/01/04 18
Reliance Group Holdings 9.000% 11/15/00 20
RJ Tower Corp. 12.000% 06/01/13 68
Salton Inc 12.250% 04/15/08 73
Silicon Graphics 6.500% 06/01/09 73
Startec Global 12.000% 05/15/08 0
Tekni-Plex Inc. 12.750% 06/15/10 73
Tom's Foods Inc 10.500% 11/01/04 9
Toys R Us 7.375% 10/15/18 70
Transtexas Gas 15.000% 03/15/05 0
Tribune Co 2.000% 05/15/29 66
Triton Pcs Inc. 8.750% 11/15/11 72
Triton Pcs Inc. 9.375% 02/01/11 73
Twin Labs Inc. 10.250% 05/15/06 2
United Air Lines 7.270% 01/30/13 53
United Air Lines 7.870% 01/30/19 54
United Air Lines 9.020% 04/19/12 58
United Air Lines 9.350% 04/07/16 30
United Air Lines 9.560% 10/19/18 58
United Air Lines 10.020% 03/22/14 45
United Air Lines 10.125% 03/22/15 50
United Homes Inc 11.000% 03/15/05 0
US Air Inc. 10.250% 01/15/49 5
US Air Inc. 10.250% 01/15/49 11
US Air Inc. 10.300% 07/15/49 6
US Air Inc. 10.550% 01/15/49 45
US Air Inc. 10.680% 06/27/08 2
US Air Inc. 10.700% 01/01/49 20
US Air Inc. 10.700% 01/15/49 44
US Air Inc. 10.700% 01/15/49 45
US Air Inc. 10.700% 01/15/49 45
US Air Inc. 10.700% 01/15/49 45
US Air Inc. 11.200% 03/19/05 0
Venture Holdings 9.500% 07/01/05 1
Vesta Insurance Group 8.750% 07/15/25 34
Werner Holdings 10.000% 11/15/07 27
Westpoint Steven 7.875% 06/15/05 0
Westpoint Steven 7.875% 06/15/08 0
Wheeling-Pitt St 6.000% 08/01/10 69
Winsloew Furniture 12.750% 08/15/07 26
Winstar Comm 14.000% 10/15/05 0
Winstar Comm Inc 10.000% 03/15/08 0
World Access Inc. 13.250% 01/15/08 4
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
On Thursdays, the TCR delivers a list of recently filed chapter 11
cases involving less than $1,000,000 in assets and liabilities
delivered to nation's bankruptcy courts. The list includes links
to freely downloadable images of these small-dollar petitions in
Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
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 is a daily newsletter co-published
by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland,
USA. Marie Therese V. Profetana, Robert Max Victor M. Quiblat II,
Shimero R. Jainga, Joel Anthony G. Lopez, Emi Rose S.R. Parcon,
Rizande B. Delos Santos, Cherry A. Soriano-Baaclo, Christian Q.
Salta, Jason A. Nieva, Lucilo M. Pinili, Jr., Tara Marie A. Martin
and Peter A. Chapman, Editors.
Copyright 2006. All rights reserved. ISSN: 1520-9474.
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 subscription rate is $725 for 6 months 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
$25 each. For subscription information, contact Christopher Beard
at 240/629-3300.
*** End of Transmission ***